i don't like airlines traditionally, but we owned delta for a long time. we think united is going to be a bang-up christmas season. >> these stocks have gotten hurt lately. joe? >> i will see your interactive brokers and raise you a gartner. >> good weekend, everybody. "the exchange" starts now. ♪ ♪ and thank you very much, scott. welcome, everybody. i'm tyler mathisen in this afternoon for kelly evans. here's what's ahead. did today's job report just cement the end of rate hikes? we'll debate that and look at one job related trade. our market guest says it will pay off even until the labor market continues to cool from here. plus, one fast casual food stock having a good week. but earnings a mixed bag. the ceo will join us with what he is seeing from the american consumer. and from china to rates to jobs to energy, it's a three buys and

a bail edition. that's all ahead. but we begin with today's markets, and dom chu with if numbers. >> very bullish. it's been a bullish week for stocks. we are on pace for one of the best of the weeks for the stock market so far this year. the s&p 500, just to give you an idea, so far just this week alone, is up roughly 6% to 7%. again, just on a one-week basis. the s&p is up about 5 points. this is, by the way, just about session highs for stock market. at the highs, up roughly 51 points, up 17 points, even at the lows on the heels oh of that jobs number. so up nearly 1.25%. the dow, 34,148 the last trade there. the nasdaq composite pacing the events. that tech trade lending itself to a 1.5 point game in the composite. 13,487. interest rates moving lower has been a big part of that story.

the ten-year benchmark treasury yield is currently 4.535%. on an intraday basis on october 23rd, that level hit an intraday high of 5.02%, that's how far it's dropped so far this week. again, just a massive move lower. at one point today, it was 4.48%. so that interest rate story going lower, driving up valuations. that could be one of the story there is. if you take a look at it another way, the etf that tracks the long-term government bond market is up to $88.24. this low since the october 23rd level is up roughly 6% to 7% as well. so it's almost stock-like returns for a government bond focused etf. and the mega cap technology trade, apple has some concerns about earnings, so down about three quarters of a percent.

microsoft, alphabet, amazon, nvidia, all posting solid gains on that move today. so it appears as though, tyler, for now, the risk aversion trade has been set aside and people are more comfortable going long stocks with interest rates on the move lower. >> dom, thank you very much. let's start, folks, with the jobs report from this morning. non-farm payrolls increased by 150,000, just under 170,000 numbers economists expected. so what does this weaker data mean for the broader economy? richmond fed president thomas barken says it's a pleasant surprise. >> what i've been hearing is normalizing. the labor market and better balance supply has been getting better, demand is coming off, particularly in places like professionals. it's still hot in skilled trades. but i wasn't surprised. frankly, i was welcomed to see

the gradually lessening we have been expecting is continuing. >> but one of our next guests says the more overall conditions ease, the more the fed may have to raise rates again in 2024. joining us now, diane swank, kmpg chief economist along with steve liesman. folks, welcome. diane, i'm curious why does the easing of financial conditions, if that's what we are witnessing here, mean that it's more likely that the fed will raise rates in 2024? the markets seem to not be saying that. >> well, i think there's a key issue here, that is the fed included financial conditions in their assessment of why they could pause. i don't think they want to raise rates again in december. i do think they want to have this be the end in rate hikes, but they were looking to financial market conditions actually doing some of that heavy lifting for them. now, we may get lucky, and the economy may continue to normalize as barkin said.

that said, i look at this jobs report and say well, we have 96,000 people in this report that were affected by strikes. that's beginning to already unwind with some of the tentative deals that we have on the table. i think that's important to remember, because you add 96,000 back on to that 150,000, and all of a sudden you're well over 200,000 again. that's very important to remember. we know that strikes took a toll on hours worked and on wages during the months. so some of the normalization is a bit of a head fake and transtoir, dare i say it, due to strikes, and we could see wages pick up again by the end oh of the year. so this is something the fed has to watch carefully. they included financial conditions in their statement. the question is whether they will be able to sort of rely on that, or is that going to be something they regret in 2024? >> steve, if i'm understanding diane correctly, you know, the ten-year bond has dropped about

half percent in the last ten days, from a little over 5% to 4.54% as we begin this hour. so that's an easing of financial conditions. diane says the fed was probably looking for the markets to do some of its work for it. it was doing that maybe at 5%. but it's doing less of that at 4.5%. >> you know, tyler i don't feel on a friday like looking for something new to worry about. >> okay. >> i was worried about rates being too high. they have eased off. i'm not going to worry about rates being too low. not especially if i take a chart of the ten-year, which is me speaking to the control room. and i look at the ten-year from may, from may. what i see is that -- i'm sorry, april low of 326 basis point, 3.26. there you go. and i see the financial conditions are quite a bit still restrictive from where they were, and so the fact that

they're not 5% and they're 4.5%, is not going to give me trouble to think that the market -- that financial conditions are easing to the point that the fed would be back in play. and i will say this, because i always disagree with diane advisedly, i'll say the market is with me on this. maybe they're over their skis. but if you look at the probabilities this morning, the rate cut is out of the pricing entirely almost. >> the rate cut? >> rate hikes, sorry. rate hikes are in. i'll walk you through two charts -- >> no, cuts are in. >> hikes are out, cuts are in. thank you. did i mess that up? i'm sorry. >> yes, you did. >> 5% coming for december right now, and i can't read -- where is it? 11% for january. 10% for march. more interesting is what's happened now to -- those are the heights. and now look at the cuts is the next chart. what you see is something like a

55% probability of a cut. now in may, that wasn't even in play before. now it's in play. so i think the market is, like, what's going on? what's going on is, the reason why this is down, why yields are down is because three things that caused them to be higher have now resolved themselves. the fed, less hawkish. it was the fed's hawkishness in september that caused yields to rise. the treasury issuance was a problem in august, they took some of that away. and the third thing is the, umm, the issuance and then just the growth story easing back. >> diane, react? >> so i don't entirely disagree with steve. and we always are quite in full disagreement or full agreement, i think. but i think my perspective is, if we keep going on this financial market rally, if we see bond yields come down even further, that's when we start to

get in, does it undo some of the progress we have made on inflation? and the fed already expects the move down, the dissent on inflation to be bumpy. if it gets more sticky, that becomes a problem. the stunning growth that we had over the summer was great. and you really saw chairman powell lean into that in his press report. and you did not see a fed, even though i think steve, you asked a great question at the presser about, is the bias to tighten still? he said yeah, kind of. but there was no signal that the fed was going to tighten again in november. and i agree with that. that's where i'm at, as well. and i don't have an additional tightening. we do have the fed peaking where they're at. however, if financial conditions continue to ease, you do up the ante that the fed has to go back in and you get stickier inflation. it is something that is an inissue when they put it in a statement.

>> one, the jobs report today was softer. you had the revisions downward, that's one. i got two isms this week, both of which ended up being weaker than expected. it tells me the service sector may be easing back. the manufacturing sector went down further. i think we may have been through this -- >> manufacturing was -- that was the uaw stuff, steve. that really is sort of a circular story. we lost 44,700 workers due to strikes this month. 96,000, the highest since 1997, when u.p.s. went on strike in august of 1997, affected by strikes, as well. that raised ton employment rate, and we saw it and can trace it in information in the sector hit by the actors and the writers strike. the writers strike started to unwind during the month. but the actor's strike was still out there. we saw nit the wages and that helped suppress that. so i say listen, you have to add those numbers back in, and it's

still very solid jobs report, and it's still a little more tight than the fed would like. >> i'll give diane that round. i give you that round, diane. >> but wasn't this -- >> okay, well -- >> wasn't this effectively -- i'll throw it up for both of you -- precisely the jobs report the fed might like to see? >> i'll take it. i think so. i think diane is right, and i did do the addition live onset at 8:30 maybe not quite as well i could have, the idea of the 150 adding back 30,000, 40,000 of striking workers. and it means -- >> 96,000 affected. >> right, right, fair enough. so it may be a little stronger, but it's still easing down from the 336, and the downward revisions not affected by the strikes, at least not as much. so to me is that. and you had the wage number being at 0.2%. i look at not absolute levels. i'm trying to gauge this issue

that i call pressure. how much pressure is the labor mask going to exert on the economy through inflation potentially? when i look at lower wages, and then lower payroll growth, i see less pressure on inflation. >> last word, diane. we talked a lot about the fed and rates and the jobs report. if you sweat away, you take away all of the manufacturing issues related to the strike, how healthy is manufacturing in america right now? >> many veteran sectors holding up much better than we expected. a lot of sectors are holding up much better. this is a nod to steve, it's important in terms of how the labor market has changed. let's take this to the point and end it on this point. that is, 90% of job gains, the acceleration in job growth we saw over the summer was due to three sectors, leisure, hospitality, health care, public education. that even was stronger in this

jobs report. that's very important, because those receptors are your interest rate sectors. the most sensitive sectors are no longer driving job gains. and job gains are much more concentrated than they once were. and that's where i'm a little more worried and don't have that extra hype out there. i'm just worried if the market keeps going, the fed may need to put it in there. but there is a normalization occurring. >> i want to add one thing, diane. the thing that powell might have done a jig about this week was the decline in labor cost. it was negative, 0.8%. productivity numbers were strong. he's probably more excited about unit labor costs. >> love to see the jig. diane, thank you very much. and steve, as always, great to have you. next guest, betting on america's workforce or the companies that will help make it

more productive, and there are three names in particular she likes. joining us now is kim forest. can you pronounce that for me, kim? >> foboca. >> like the florida term. >> it's a photography term. but we won't get into that. >> kim, thank you. let's take what was just said there by diane and steve and bring it across the finish line into what kinds of investments should i be looking at right now, particularly in the equity market? >> sure. well, i think this week really hack given us a sigh of relief, we're not going towards the word that everybody dreads -- staglation. and i think because of that, and because of the earnings season we're just coming out of, we're get ak picture of how businesses are spending. and productivity says holy cow,

businesses have spent, and somehow they have made their employees more productive. so i don't think productivity ever goes out of style for business. and i think that going into them the next three to five years, investors really have to understand that the labor market isn't necessarily growing, and companies are going to have to spend to make the people that they have more productive. and that's why we like the names that we like. >> so let's get to those names that you like. they're not necessarily the sexy plays in artificial intelligence. they're more sort of bricks and mortar plays. >> sure. well, they're untouched by ai, we'll say that, opposed to that being the driver of their recent success. and yes, nvidia, i'm talking to you that you have really benefitted from ai. i think both amd and they had a strong report this week, but it's more exciting that they are

going to have $2 billion in ai chips being sold next year in 2024, for at least that's the target. and i think that's very, very exciting. and i think intel still has a shot at recovering some of their more high-tech business. and that, too, will go into some sort of ai. >> and a third name is micron. >> right. because what people don't -- i don't think you can ever underestimate the amount of data that ai needs. that data has to live somewhere, and micron, half of their products goes towards memory storage. so i think that's really exciting. and i think the growth of storage and the prices that they can get for storage is holding up micron right now and will drive it in the future. >> you know, so much of the markets gain, such as they are or such as they remain this year, have been driven by those

magnificent seven stocks. where are you on those babies? >> well, you know, i think if chatgbt doesn't take over the world, nvidia investors might be disappointed. and i never like to say that technology is going to roll out on investor's timeline. that's something that you can count on, it's always going to take longer. it's not going to be the magic that you think in the short term. but it's going to surprise in the long-term. that's just about how every new technology has ever rolled out. and that's kind of why i don't like the magnificent seven, because so much of it is banking on a short timeline for ai. and the sexy ai's success. >> kim, thank you very much. appreciate your time, always. kim forrest. coming up, a read on the consumer from the ceo of the fast casual chain for -- f

tortillos. and later on in our program, a special edition of "three buys and a bail," looking at the big themes dominating the markets this week, including the fed decision and this name our treasurer calls a buy in the rate sensitive category. we will reveal it later on in the program. "the exchange" is back after this.

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your kohler® walk-in bath. and take advantage of our low monthly payment financing. shares of the fast casual change portillos up nearly 9%, reporting earnings in line with expectations yesterday, while revenues were a touch light. at least with expectations. management saying traffic trends remain about the same, but waving a yellow flag about the lasting impacts of commodity and wage inflation on that earnings call. joining us now to discuss is the ceo. if i were from chicago, i would have known absolutely that it is portillos and you serve chicago hot dogs with all the works. i apologize for that. but i often look at, when i'm looking at restaurants, i look at overall sales.

your sales were up very strongly. your same-store sales were up 4%. that is a good sign. i guess my question is -- how much of that increase in sales is related to price increases, and how much of it can be attributed to actually stronger traffic, more people coming in and visiting your outlets? >> well, first, nice to see you, tyler. thank you for that. we'll send you chocolate cake so we will be indelibly imprinted on your brain. >> i love that. >> we were the beneficiaries of a little bit of pricing in q3, and our traffic was down a little bit. but we're excited about the trends going into the fourth quarter. we're optimistic about where our business is. q3 felt a lot more typical of a precovid world, like 2019. there tends to be an ebb and flow in the restaurant industry. q3 tends to be sluggish with back-to-school, et cetera. so i feel really good about where our business is right now.

i feel good about the underlying performance of our business. and i feel great about the margins that we generated in q3. so i'm very bullish on portillos. >> so tell us how rising prices, both for labor and inputs, which would be food and materials, how are those affecting business? how are they running? >> well, look, it's -- i don't want to be overly optimistic, but it's getting better. every week it's getting a little better. our labor inflation in the quarter was up 1.9%. it's 4.8% for the year. but that's on the back of almost 30% increases in labor wage rates over the prior two years. so that's definitely mitigating. commodities have started to taper off, and we're still guiding towards mid single digits for the year. but the third quarter was better than the second, which was better than the first. so the trends are all in the right direction for us when it

comes to those cost pressures. >> how do you manage over the past several years, when you just mentioned the really high became inflation that you had there for the past couple of years, how do you keep your margins up in the face of that? what do you do? >> yeah, it's a tough -- it is really tough. it's undeniably tough. it's been an incredibly, i don't know, what's the word, volatile, uncertain experience for restauranteurs for the last couple of years. pricing has to play a role in that, and we have all felt that pinch in the wallet. the good news is, we have not taken any pricing in the back half of this year. i think that's coming down. and then there's a lot of pick and shovel work, right? so on one hand, commodities have gotten better, but our teams have done great work in sourcing our beef from alternate sources, buying from australia, going through different kinds of smart moves. we got really good at labor

optimization. we're building kitchens that are more friendly for our team members. there's less conveyance. it's like walking back and forth in the kitchen is wasted effort. so we have where a team member can grab the french fries and dutch them into the friar, minimizing the steps. so we got smart about wasted effort in our kitchens, being creative and thoughtful on the supply chain. all of that has made us a better operator. >> talk us through your plans for store expansion, store growth, and regional expansion. your outlets are largely concentrated i would say in the upper midwest, florida, california, texas as well. tell us about how many stores you might add and might you spread out a little bit regionally? >> yeah. it's probably the central tenant of our growth strategies. and we're growing along the sun belt.

we all like necessary weather, but it's because where america is moving to. when you look at the three fastest growing states, texas, florida, arizona. the vast majority of our new restaurant growth is in those three states. we opened our first restaurant in dallas, texas, in january of this year. by january of '24, we'll end up with five restaurants in the dallas metropolitan area. so we're excited by that. we're building in dallas and in arizona, we're building in florida. and i think that's a wonderful balance for us between our strong core in chicagoland, but also fantastic growth markets. >> people in dallas are feeling good right now. the cowboys are winning. they just won the world series. you've got reason to be happy about texas. michael. thank you very much. appreciate it. >> thank you, tyler. let's turn to another indicator of consumer health, credit scores. new data show that rising debt levels aren't necessarily

putting a debt in people's scores. hi, sharon. >> hi, tyler. a new report shows that credit scores have held up, even as they have taken on more debt. this is from vantage score. i spoke with the ceo of vantage score about the health of the consumer. this is what he told me in our exclusive interview. >> the reality is, the consumer is actually quite healthy. the consumer is not maxed out. they're reducing their overall credit and managing credit pretty well. >> vantage score finds the average score is now a healthy 701. the lowest possible score is 300, below 660 is considered subprime. and 850 is a perfect score. low unemployment and strong equity are helping consumers, but dlelinquency rates are

climbing. >> we are looking to see if a low-income recession is developing. we haven't really seen that happening, but we're watching it, particularly in the case of late payments, we're already starting to see those lower income, younger consumers having a tougher time keeping up with their payments. >> on-time payments are the biggest boost to credit scores. also a key factor is how much credit you're using compared to your credit limit. lepp dors use these scores to assess the ability to repay, and knowing those key factors and keeping them in line is key to boosting and keeping your score. >> what is the difference between a vantage score and fico score? >> fico has been around for decades, but they both have that range between 300 and 850. but they may use a couple different factors to really gauge your credit score. with fico score, you need to have at least six months track

record with some credit line, whether it's a credit card or a personal loan. with the vantage score, you don't need to have a credit card for them to come one a score for you. they may use rental payments or student loan payments. so a lot of people fall into that group. >> sharon, thanks. good as always to see you. join us next thursday to find out more ways to maximize your finances at the cnbc "your money" virtual event at noon eastern on november 9th. register using the qr code on your screen right there, or at cnbcevents.com. lots of crunching information that we will be dispensing on that day, november 9th. coming up, apple disappointing wall street, implying revenue growth is going to be flat this holiday compared to last year. we'll tell us what tim cook is blaming for the miss, with the stock riding its longest monthly losing streak in more than a

year. check out shares of overstock.com, the hedge fund jat capital urging it to replace the ceo jonathan johnson. blaming him for poor financial p performance. they called on overstock to consider selling assets. overstock ar u4%shesp . "the exchange" back after this. (birds chirping) go. and go and go and go. ( ♪ ♪ ) but what if you... stop? you work hard, it's time for a bank that'll work hard for you. everbank brings security and a guarantee that you'll earn a yield in the top 5% of competitive accounts. going, that's what got you where you want to be. we're the partners for your next move. everbank. advantage, you.

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the u.s. is flying unmanned drones over gaza to search for hostages. the drones are assisting with hostage location efforts. there are still ten americans unaccounted for who officials believe are among more than 200 people taken hostage by hamas and brought into gaza october 7th. > sam bankman fried is still in jail. he was charged and faces 115 years in prison. his sentencing is scheduled for march 20th through the 24th. and the actor's strike is causing yet another delay, this time with "yellow stone." the final installment was scheduled to return this month, but not anymore. paramount rushed it back to november 2024, two years after the first half of the fifth season aired. so a little disappointing news

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welcome back, everybody. if it's friday, it's "three buys and a bail" and we're going to trade some of the themes dominating the headlines today.

the jobs data, the second fed pause in a row, solar stocks sinking on a big warning from solar edge, and weaker chinese demand. new street advisers delano sa poro has a trade, but let's take a look at the state of the consumer in china, with cnbc's eunice yun. >> reporter: this suit shop was relied on by financiers and real estate executives. but not this year, with business down 30%. the biggest reason people don't want to spend is the uncertainty about the future, he says. that's hitting brands such as apple, canada goose, estee lauder and kfc. so much is weighing on consumer minds, like all the income lost during the pandemic. retail sales are up 5.5% for september, but that compares poorly to 8.2% for the same period in 2019 before the

pandemic. instead, household deposits in the first half were up 9.8%, the biggest increase in a decade. families feel poorer because of the real estate slump. new home prices are down 0.3% in september, the steepest fall in almost a year. unemployment is high, especially among young people at 21.3% last recording. >> translator: everyone feels unsafe, this doctor told us. she cut her budget from $150 to zero. "all my friends are worried" this interior designer says. "i don't see any hope." tailor lee says customers are spending less. before the pandemic, they would buy suits for $3,000. now they choose $700 options. "i count consumption comes back even next year," he says.

before we get to your china pick, i want to tell you a quick story. once when i was in hong kong, i went to a suit shop to have a suit made. i walked in, it was chinese new year, and the traditional greeting in chinese is -- which means, i wish you good fortune. but the guy said it, and i thought he said, come here, fat boy. that was my welcome to the suit shop. let's take your china pick. it is qualcomm. why? >> thank you for having me, tyler. there's a few reasons why. you mentioned all the struggles we're seeing for consumers, obviously in china. qualcomm are doing things that are better for the company. they have new competitors emerging with huawei starting back up. but they're still estimating that their 35% increase in sales to smart phone companies. some of that softness is easing

off a bit. they renewed their contract with apple, as well. that broader move as we move over into the holiday season, will ease a little of that softness for consumers, especially when they think about electronics, which are a heavy gift around the holidays. >> the second category, what's going on in race. this was our mystery chart and you can pick here is? >> charles schwab. for a couple reasons. the t.d. acquisition, they're finishing the integration and will have another $1.3 trillion in assets. the big thing when you think about the banks, they had a tough time. but i was looking at the earnings. one thing that stuck out to me, they're looking at the cash sorting, so the move from their interest bearing accounts, to these higher yield with funds or different cash yield funds, they're seeing that slowdown ease off a bit. i looked at the valuation for sh one, they're trading favorably

here, so with the rigorous expense control, they do historically -- i think it's a good move to look at schwab. >> solar has been on the news this week. how can i be a high roller in solar? >> i like fslr here. when you think of a solar company, this is a growth company and relatively stable comparatively, when you look at the market caps of the other solar companies. 2024, they're looking at earnings going up 65% roughly. so if you look at their forward pe at ten times, it's an undervalue play. so last quarter compared to one of the biggest competitors, their revenue and margins expanded. so also looking at their balance sheet, a solid sheet for growth, not a lot of debt, and $1.3 billion in cash.

that's a really strong play potentially for investors. >> let's move on to the bail. that comes out of sort of the labor market. it could come out of a lot of different sort of categories, consumer, retail and so forth. the bail is target. >> yeah. this someone i've been holding. some of the positions i let go with gains, some i break even, some had losses. when you look at target and all the discretionary names, some are adding a lot of trouble. target, they mentioned that, obviously the high inflation. also mentioned the student loan moratorium that's going away. overall, the weaker consumer. when you look at the jobs data, we move to 3.9% unemployment this morning. a lot of that discretionary spending flows from target to discount stores like walmart who is having a strong year compared to target as far as the stock performance. i think the competitor stands to gain here as a consumer gets in more tough position.

target is not at the bottom yet, but that will come, just not yet. >> thank you very much. appreciate your time today. thank you. >> thank you for having me. all right. coming up, while apple doesn't issue official guidance, management signaling its fourth quarter could be a repeat of the third. where the weakness is and why it may not be such a hot holiday for the giant in technology. "the excng wl rht ck.ae"ilbeig when you think of investment risk, do you consider climate risk? changing weather patterns are impacting the way we live and the value of businesses large and small. this can mean disruption to supply chains, changing demand for products and shifting regulation. what does this mean for your business, your clients, and your investments? ice offers data and markets that can provide critical insight. manage your climate risk with ice. ♪ tourists tourists that turn into scientists.

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have you met them yet? [ gasp ] [ screams ] welcome back to "the exchange," everybody. shares of apple lower today, snapping a five-day win streak after the company beat estimates. but reported its fourth straight quarterly revenue drop after the bell yesterday. things aren't necessarily looking better for its key fourth quarter. steve joins us with more. what did you learn? >> it was the guidance for the current holiday quarter that sent shares lower last night, but easing off those lows today.

the street was expected 5% revenue growth for the current quarter, but expect sales to be about flat compared to the year ago quarter. so the question now is, what happened? it was an excuse-a-thon in the earnings call, apple blaming foreign exchange, and some new air pods and ipads didn't get new updates this year. on top of that, we're still getting signals that iphone demand isn't strong enough in the u.s. and china. i asked the ceo tim cook about that, and specifically about renewed competition in china from huawei which started making phones again after taking a hiatus over the last couple of years. he didn't address huawei directly but said the iphone 15 pro models are supply constrained due to strong demand but will have to see how the current quarter shakes out. and still some right spots in this apple report, especially for services, which grew 16% to

22.3 billion dollars, that's some reaccelerating growth there. and why are apple shares not down more after that disappointing outlook? i'll point to morgan stanley's note, reacting to those earnings, pointing out what they call "growth in the right places." that means iphone and services remain relatively strong, which they say is a good sign for apple in the longer term, tyler. >> so my question, is when you ask him about demand for iphone and he says something like, we're supply constrained, that feels like a very artful answer to say -- to not answer the question of whether the sales are where he expects them or needs them to be. >> right. he did say we'll see how the rest of the quarter shakes out, but the supply constraint is the good kind, meaning so many people want them, they just can't make enough phones right now to get them in the hands of

everyone who wants them. that's going to get easier as this quarter chugs along, because remember, it was around that week of thanksgiving a year ago that they had to shut down production in china for the iphone pro models that really damaged their quarter, caused them to miss. it's also going to make compares for the iphone business this year look a lot better and easier, because they're coming off that smaller base, tyler. >> steve, thank you very much. all right. customers at a number of anks, including bank of america, chase, and wells fargo are experiencing deposit delays today. the federal reserve confirmed the issue, which is related to the automated clearinghouse, ach, a network for processing bank transactions. businesses use this system for things like direct deposits and customers use it for direct payments of things like utility bills and mortgages. but clearing house says it's working with the impacted

institutions to resolve the issue. cnbc reached out to several banks about that, and we will update you with any responses. my wife is incidentally got word of this earlier today from a friend who was questioning whether there had been any issues and whether she had heard anything and whether i had. and now and now indeed confirm confirmed. direct deposit issues in the banking system. and up next, to the land of lincoln. opportunities in muni bonds as in-flowing turn positive first week in eight. "the exchange" will be right back. unibond picking, next. ♪ ♪ ♪ be ready for any market with a liquid etf. get in and out with dia.

♪(romantic music)♪ (♪♪) (♪♪) (♪♪) (♪♪) (♪♪) (fisher investments) it's easy to think that all money managers are pretty much the same, (♪♪) but at fisher investments we're clearly different. (other money manager) different how? you sell high commission investment products, right? (fisher investments) nope. fisher avoids them. (other money manager) well, you must earn commissions on trades. (fisher investments) never at fisher. (other money manager) ok, then you probably sneak in some hidden and layered fees. (fisher investments) no. we structure our fees so we do better when our clients do better. that might be why most of our clients come from other money managers.

at fisher investments, we're clearly different. nice footwork. man, you're lucky, watching live sports never used to be this easy. now you can stream all your games like it's nothing. yes! [ cheers ] yeah! woho! running up and down that field looks tough. it's a pitch. get way more into what you're into (car engine revs) when you stream on the xfinity 10g network. (engine accelerating) (texting clicks)

(tires squeal) (glass shattering) (loose gravel clanking) well, signs of a slowdown ramp up ever so slightly fixed income inflows hit a near eight-month high weekend november 1 climbing 64% from the previous week and muni bonds particularly slow. closing first best close of the year. investors totaled $100 billion so far. the next guest still sees buying opportunities here.

senior portfolio manager. good to have you with us. surprising to me. is what's happening a recognition that people think rates are beginning to peak and this is a, a good time to lock in, maybe, to go after those higher yields? >> yeah. i think that's exactly what's happening. ho honestly, i think people are come around to realize there's good value in the bond market broadly speaking and certainly the municipal bond market. high quality tax securities earn roughly 6% up from two, three years ago significantly. look at municipal market, the tax adjusted yields there are in the range today of 7.5% to 8.5% depending on your tax bracket. the compelling value really is beginning to come through. people recognize that you buy bonds primarily for income and safety. but if you can earn somewhere in the range of 7% to 8%, now

you're butting yourself in a competitive game, if you will, against other asset classes including equity. the other point is just that while you can get something like, equity-like returns today in the muni bond market without taking a lot of risk, the volatility is probably a quarter of what it is typically in your s&p 500. >> lucky enough to live in a state like new jersey i think tax equivalent yield might be even higher. >> it is. we've seen 9%, 10% if you're in new york, new jersey, california. these are just really, really compelling values, and i think the other thing is that unlike the treasury market, which obviously a big concern the last several weeks has been the abundance of issuance and supply. the muni market has been stagnant. >> pretty stable. >> about 15 years. yeah. about $4 trillion of outstanding municipal debt exactly where we were after the financial crisis

of '08. i would say people perhaps underappreciate the checks and balances that the state and local government have. if your local school district wants to borough and build a new school typically there is to come to market, come to the voters and get their approval. you can imagine how challenging that would be at the federal level. particularly when we deal with the debt ceiling periodically, but most states have limits on theability of debt that can be issued. so, you know, we'd love to see more supply. i think we'll get more over the next few years hopefully. >> most states have to run a balanced budget. you point out, my township just went through last year a big school bond issuance and it was hard-fought. $180 million to do capital improvements postponed. at any rate it carried and taxes went up reflectively. different pieces of the muni market. if i'm looking at individual -- should i look at revenue bonds?

g.o.s? what? >> start first of all with our view is that you don't have to step down in credit quality now. in fact, we're focusing more on the higher-rated issues. the aa even aaa. one interesting little statistic is you can get 80% of the yield you would receive in a triple b bond in a triple a bond today. getting well paid to stay up in quality, and a little acronym we've come up with is the bonds we like today what we call r.o.b.s. remember large old bonds. think of the muni market, g.o. bonds, school district bonds, water, sewer, central service revenues. really strong credits out there. final point i would make on that is just these are domestic-based revenues. this is a u.s. centric market obviously and a way to kind of escape all the uncertainty and

global turmoil we're seeing around the world. >> right. great to talk with you. i don't want to get myself too giddy here but fun to talk about bonds again. appreciate it. thank you. >> thanks. before we go, there's still time to nominate a leader for cnbc's changemaker list of women transforming business. deadline is two weeks from today on november 17th. submit your nomination going to cnbc.com/changemakers or scanning that qr code on the screen. folks, that does it for "the exchange" and there is morgan getting ready. i'll join her on the other side of a quick break. there she is! hey, morgan. be right over.

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