>> with the economist. can you hear me? >> yes. >> great. obviously, inflation is someways away from target. on employment, though, if you look at the projection for the full year of 4.0% in february. we were already at 3.9%. quite close to the projection. are you concerned at all that notwithstanding the very strong jobs growth that this factor may be some cracks appearing in the employment market. talk about the labor market being a condition for easy rate. what would constitute that in your eyes? >> we monitor one of the goal variables is the labor market. we monitor very carefully. we follow all the possible stories that are out there about there being cracks. but the overall picture really is strong labor market. the next game in balance is that we saw in the early part of that pandemic. recovery had mostly been

resolved. you are seeing high job growth. we are seeing big increases in supply. we are seeing strong wage growth him about which growth is gradually moderating down to more sustainable levels. in many, many respect. the things are returning more to their state in 2019, which we can think of is normal for this purpose. that's job openings, quits, surveys of workers and businesses are always interesting. how easy it is to find a job, how easy it is to find a worker. those have both come down. the labor market in good shape. you now. you do see things like the low hiring rate people have made the argument that if layoffs were to increase, that that would mean that the net would be fairly quick increases in unemployment. that something we are watching. but we are not seeing it.

initial claims are very, very low. if anything, drag down a little bit. so they don't see it. i used the term unexpected weakening in the labor market. we do expect the unemployment rate. the forecast would move up closer to what we would see as a long-run sustainable level. that's just people's individual forecasts. that's where i will leave it, though. >> steve matthews with bloomberg pretty mentioned at the beginning of the press conference that the committee thought it might be appropriate to slow the pace of asset runoff very soon. when you say very soon, does that mean the committee would meet about this again in may? a decision could be reached that soon? i was wondering if you can also

just described the scope of what the committee is discussing here at $95 billion of caps right now. would that be cut about in half or something of that nature? thank you. >> that's what we are discussing essentially. we are not discussing all the many other balance sheet issues. we will discuss those in due course. what we are really looking at is slowing the pace of runoff. there is not much runoff right now but there is treasuries. we will talk about going at a lower pace. i don't want to give you a specific number because we have not had an agreement or a decision. but that the idea. and that's what we are looking at. in terms of the timing, fairly soon, i wouldn't want to be more specific than that, you get the idea. the idea is this is in our

longer -- longer run plans. we may be able to get to a lower level because we would avoid the kind of friction that can happen. liquidity is not evenly distributed in the system and there can be times when in the aggregate, reserves are ample or even abundant, but not in every part. and those parts that are not ample, there can be stress which causes you to prematurely stop the process to avoid the stress and then it would be very hard to restart i think. if something like that happened in '19, perhaps. that's what we are doing. looking at what would be a good time and a good structure fairly soon. words that we used to mean fairly soon. >> will it be a discussion about returning to an all treasuries balance sheet at some point? >> so that -- our longer run goal is to return to a balance sheet that is mostly treasuries. i do expect that once we are through this, we will come back

to the other issues about the composition and the maturity and revisit those issues. but it's not urgent right now. we want to get this decision made first and then we can when the time is right come back to the other issues. >> hi, victoria with politico. also on the balance sheet, can you talk a little bit about the outlook for the banking sector and how it might impact your balance sheet lands? do you worry that as deposits start to shrink, we could see more tarpaulins? >> we will be watching carefully. one of the reasons why we are slowing down, we will soon enough -- fairly soon, i should say. we want to avoid any kind of turbulence. i was not thinking that particularly but the banking sector turbulence. and we had some indicators the

last time. this is our second time doing this and i think we are going to be paying a lot of attention to the things that darted to happen and foreshadowed what eventually happened at the end of that timing cycle where we wound up being in a short reserve situation and we don't want to do that again. i think now we have a better sense of what are the indicators? it wasn't so much in the banking system as it was around, for example, where federal funds is trading relative to the administrative rates and where our secured rates are. those sorts of things. >> we will always be watching the banking system for similar signs. >> is it because you're not sure exactly how the reserve supply will react once the facility drops? >> i think we broadly think that once the overnight repo stabilizes either a zero or close to zero, that as the balance sheet shrinks, we should expect that reserves

will decline pretty close to a dollar for dollar with that. >> hi, chair powell. jean young with him and i market news. i wanted to ask about the balance sheet. you said that starting the taper sooner could get you to a smaller balance sheet size. does that mean you do not have to make a decision on when to end qt at this point and will you be setting up the process for deciding that sooner or will you wait until we are closed tonight? >> it's sort of ironic that the going slower, you can get further but that is the idea. the idea is that with a smoother transition, you want to live this you will run much less risk of liquidity problems which can grow into shocks and cause you to stop the process prematurely. so that's where it interests.

and when it ends, we will be looking at money market conditions and asking what they're telling us about reserves. right now, we would characterize them as abundant. what we are aiming for is ample. a little bit less than abundant. there is not a dollar amount or a percent of gdp or anything like that where we think we have a clear understanding of that. we will be looking at what is happening in money markets in particular. there's a bunch of different indicators including the ones i mentioned to tell us when we're getting close. he stopped along the balance sheet to runoff. and then the period in which non-reserve liabilities grow

organically. you have a slower pace of runoff which we will have fairly soon. then there is another time where you effectively hold the balance sheet constant and not allow them to expand. that ultimately brings you ideally into a nice easy landing. at a level that is above what we think the lowest possible ample number would be. we are not trying for that. we want to have a cushion or a buffer. we will not find ourselves in situations where there are not reserves have to turn around and put us at back into the banking system the way we did in 2019 and '20. >> hi, nancy marshall kinzer. you said you are waiting to

become more confident with inflation getting to the 2% goal before you cut rates. can you somewhat more specifically the data you are looking at that will give you the confidence? >> most importantly, looking at the income inflation data, the contents of it and what they are telling us. that would be various components. obviously, more confidence coming down sustainably towards 2%. of course, we are also looking at all the other things that happen in the economy. looking at totality in the data in getting everything essentially. as we make that assessment. the most important thing will be the inflation data. >> are they giving more weight to things like wages? >> wages is one thing. our target is not wages. it is really inflation. we would look to the fact that wages are still coming in very

strong, but they have been wage increases. that's to say wage increases have been quite strong but they are gradually coming down to levels that are more sustainable over time. and that's what we want. we don't think that the inflation was not originally caused. i think, i don't think mostly by wages. that wasn't really the story. to get inflation back down to 2% sustainably, would like to see gradual movements of wave increases back into high levels that are more sustainable over time. >> thank you. chair powell, could you say at this meeting whether there ere more officials who wanted to be careful and go slower about rates than at the last meeting? was there that sense of maybe

it is smart to wait? thanks. >> i guess let's put it this way. if you look at the incoming inflation data that we've had for january and february, i think very broadly that suggest that you were right to wait until we are more confident. we didn't hear anyone dismissing that has not information we could look at her anything. i think generally going in the direction of, yes, it's appropriate for us to be careful as we approach this question. >> brandon peterson with fungible news. i wanted to ask you about central-bank digital currency stuff. we have been hearing a lot from

republicans in congress about what the fed is or isn't doing in a digital dollar. i know you've said to congress that you are going to wait for approval before the fed does or launches anything. but folks with tom emmer have said that they are actively researching or hiring personnel to study this. can you give us any more clarity on what the fed is doing right now on this? >> sure. i think we have been very transparent with this. i will try harder. so we are not getting ready. we have not proposed or come to a conclusion that we should oppose or anything like that that congress considers legislation to authorize a digital dollar. it would take legislation signed by the president to give us the bility to do this which

is with the public. we are just a long way from that. what we are doing and what i think every central-bank is doing in the frontiers of finance. many areas. applications in wholesale finance, and then payment system. to serve the public, these issues have become very front burner in the last five or six years. we need to be knowledgeable about all that. we actually do have people trying to understand things. it's wrong to say that we are working on this one we secretly have a lab here where we've got one and we just want to spring it on congress at the right moment. i have not at all and my owned -- in my own mind decided that this is something the u.s. should be doing. we do have people who are keeping up with that.

as part of the broader payments landscape. that's how i would characterize it. >> thank you. mark with bank rate. april 13th marks the anniversary since the council started holding regular news conferences. how important is the transparency with you as part of the central-bank and also accomplishing your mission nd is there more that you and your colleagues can do on the transparency front and what might that look like? >> i generally think this movement actually started, you know, 30 years ago. when some academics posited that a more transparent control bank if the public understand your reaction function, the markets will do your work for you. they will react to the data. there has been a march towards

greater and greater transparency. what chair greenspan did, what chair yelling dead. we went from four press conferences per year to now age. every meeting really is live now. that's a good innovation. wouldn't want to turn it back. we've also done a bunch of other things. we have an annual supervision report, financial stability report. there's a long list of things that we've done. nothing comes to mind is really desperately in need of doing at this moment. we are very transparent. no shortage of participants speaking to the public for the media. so that channel is full, i would say. i think it's generally broadly help and made things better, but not every day in every way. >> i will follow up. has there ever been a day when

you wanted to put the genie back in the bottle someone? >> of course not. >> let's go to jennifer for the last question. >> thank you. jennifer jon berger. not too hard too much on this but you said earlier in the press conference that the reason inflation data has not raised confidence. he testified before the senate a couple weeks ago and told lawmakers that you are, quote, not far from receiving the confidence needed on inflation for cutting rates and are you still of that belief or not? what are we to take by those words? >> my main message in those two days of hearings was really that the committee needs to see more evidence to build more confidence that inflation is moving down sustainably to our 2% goal. we don't expect that it will be appropriate to begin to reduce rates until we are more confident than that.

said that any number of times. kind of the main part of the message. we repeated that today. to the language that you mentioned, i pointed out that we've made significant progress over the past year. when we are looking for is confirmation that that progress will continue. we had a series of inflation readings from the second half of last year that were much lower. did not overreact as i mentioned, but that's what i had in mind. >> given that you set the pce for february at 2.8% and that we have seen it coming down by 10% every month, wouldn't you be at about 2.4% this summer? june, july, to a point where you could cut them? >> well, we will just have to see how the data will come in. we would of course love to get more data. we have good data on the second part of last year.

we did not overreact to it. reset it would be bumpy. now we have january and february. a couple of times. we are looking for more good data. we would certainly welcome it. thank you. welcome to closing bell. i'm accidentally in fort scott walker. given listening to federal reserve chair foul -- powell on interest rates, changes to the market. embracing the status quo. the s&p 500 lifting to renew a high above 5200. the prior high around 51 or 89. and you closing high. the nasdaq up. outperforming 1.6%. treasury yields relaxing a bit lower. mostly on the short end as we sort of get a little more confidence that the fed

anticipates three quarter-point rate cuts by the end of this year. you see a little bit every steepening of the curve. maybe this suggests that more tolerance for someone my inflation but i would say in general, chair powell talks about the balance of risks between employment and inflation roughly equal. but he is not concerned about any of them. so let's get you to josh brown. ceo of management. so five investment strategies. just to break this down a little bit, the market seemed to take the absence of any surprise as a positive. we were in a strong market before. unconcerned seemingly about the uptake and inflation in their or kind of gaining. >> my understanding is that they will slow the pace down and run off. which i guess i found to be something unique. >> they're talking about it they have not decided it yet

and it's definitely not the case. >> slowing the pace. it reminds me of when they were posting all this stuff and said are you going to sell your stocks then? she said going to stop investing. all right. we got it. that was one thing. here's the others. the risk is decided if we use too much. if we use too little, we could risk the economy. thanks. for those people who have not been paying attention to what the balancing act is, there it is. but frankly, nothing seems to have changed to the point another set of the balancing act to push the fed and really, i think we are and during higher tenure rates fairly well in the quarter market. which is certainly not the purview of the fed, what the tenure does. we know dang attention. consider this. you got seven basis points in the last week. 41 base points here today. it's a fairly substantial movement. stocks are weathering that really well.

today did not give me anything new on that front and i think the balancing act is to continue. >> it is true. first of all we listened to you throughout the little bit of the disclaimer that a lot of these rip one way, than the other way. right now it does not seem like there's a lot of room for interpretation here. if you look at the summary of economic projections which came out along with it, they keep the median of three anticipated quarter-point cut by the end f this year. some of the highs and lows changed in there. there is fewer deep dives and not as much in the middle. i guess what i would say is it also comes with a higher than anticipated gdp for the year and a slightly higher core pce inflation. powell says that's just kind of marking the market. what we know for the first two months here. it's not projecting ahead. but i guess it's understandable that a market would take that

as a net positive. >> i think a dungeon -- it is understandable that the market takes it as a positive. and the math of being concerned earlier in the year, projecting 1.4% gdp growth and we were somehow supposed to generate double digit earnings growth and it did not make sense. their projection to bring gdp growth up as a positive. obviously inflation is higher. not much of a positive but not quite as concerning if people think the labor market will be strong. people can absorb the inflation if they are employed and confident in their wages staying steady. the thing that is interesting, they did lower the expected number of cuts in 2025. now we are pushing at the worry into the future even further. we came into the your thinking we were going to get six cuts. the market completely weathered the storm, brought it down to three and quite resilient throughout but lowered what we think might appen in '25. >> wage sensitive stocks are moving. i found this interesting.

new york atf up 7%. regional banks up 2%. these jumped out at me. and then if you look at the russell 2000, you are up 2%. if you finish the day where we are right now it is the second best day of the year for that index. those things were interesting. also should not be glossed over while chair powell was speaking. we printed a new all-time record high in the s&p 500 above 5200. >> doing that with its biggest holding. super microcomputer. down 3.4%. there was also in those projections a slight rise in the long term projected neutral interest rates. this is a theoretical thing. 2.5%. now 2.6. what this suggests is that maybe the economic potential growth rate is better than we thought or maybe we have a little more tendency towards inflation than we thought. there is slightly rests -- less

room between there and the neutral rate or the have a lot to cut before they get less restrictive. this is all on paper. this is happening in the lab so to speak. previously, powell had said we really know the neutral rate by its works. nonetheless, it fits in with this idea that we have to at least acknowledge the economy has been performing better than a lot of the models would have suggested by now. >> one of the points that he made, i do not know the exact quote. something along the lines of yeah, the neutral rate is higher than what we initially acted. what we are used to pre- pandemic was abnormally low. almost an admission that this was maybe a mistake. getting used to what would be more normal for the healthy economy. frankly, the higher for longer argument isn't new. we've been talking about that for a long time. their data, the projections is just showing us that they

expected to be higher for longer. is it too high for the economy to be able to refinance the corporate maturity that will start heating up in '25 in '26? is it too high for the cost of funds? when will the yield curve get back to normal? as much as i wanted to be dramatic so we have more to say, wasn't that dramatic. >> dialing ahead by three months with what they said in december. going to get them this year. steve leishman just stepping out of chair powell's news conference. i know you asked him about the interplay between the expectation for potential is your policy and the projections for inflation and growth, as well. >> yeah. let me tell you about the question i asked which is they raised the inflation forecast, the growth forecast, lowering the unemployment forecast. it did not do much change this year to the outlook for the

funds. right. we could come to a bunch of conclusions on that. one conclusion i asked about was maybe something you're more tolerant with higher inflation. less willing to clamp down on the economy. do not think it's worth it to really slow the economy more than you are going to get the inflation results that you want? he kind of slammed the door on that and said no that not the case. here's what he said. >> we are strongly committed to bringing inflation down to 2% over time. that's our goal. we will achieve that goal. the markets believe we will achieve that goal and they should believe that because that's what will happen over time. >> so the whole debate might not matter. if we do resume this structure of inflation, then the fed will be in a good place. the question becomes in a couple months, if these lousy inflation numbers continue, then what does the fed do? does it decide you know what, we cannot tolerate higher growth the way we have been tolerating it? we need to make faster

progress. it's not a question for now. it's one possible inference you could take from the data ut it is not definitive. >> right. we do want to mention we are continuing to make further highs in the s&p 500 as the dow rises 1% now, as well. and steve, it is sort of interesting because powell sort of declined a couple of opportunities to declare a little bit of a harder line on inflation. he conveyed a fair amount of tolerance of what the january and february inflation numbers have indicated. maybe some confidence. emphasizing the progress made over the course of the past year. >> i think you are hearing exactly what i heard. there were several opportunities for them to come in. those would have been opportunities for him to bolster the inflation fighting credibility or his oncern with it and he did say hey, if it keeps up, we may stay higher

for longer. by the way, this discussion also tells you that the fed chair believes there is quite a bit of restraint in the current rate. you look at the fact that they did raise by 2.6. what does that mean? they are still quite above the 540 or so. they believe there is plenty of restraint in the system which i guess suggests they feel there is some upward bound they could go for higher inflation and still feel like they are addressing it with the restrictive funds. >> right. stay here. let's bring josh and liz back into the conversation. in some respects, i've been saying this for a while, this has not been a fetid driven market. it's a market that wants the fed to be in this predictable spot somewhat out-of-the-way. >> here is what is different. the first half of 2024 versus the first half of 2023.

the first half of '23, we had serious acute issues with the banks right around now and we also had a scenario where and nation without facing wage gains. that was a very ugly place for a lot of people to feel comfortable. this is the opposite. yes, it is true. inflation is somewhat picky. what is also true, the cause of the inflation, the fact that people are doing really well right now and actually wage gains have started to outpace the growth in price gains throughout the economy. people don't feel it yet or hear a lot of optimism, but it's the reality on the ground. the fed understands this. as a result, they are not in a situation where they have an emergency and other side of what they are doing. last year, again, remember, inflation, way too high, plus the risk of if you kept taking rates, you might blow up the banking system. both of those threats seem to have been neutralized. to your point, we are in this place where it's a little bit

of a box but no emergency on the left, no emergency on the right. everybody has the benefit to move more slowly and make decisions at a lesser pace. >> yeah. and of course, history says if there's going to be an easing cycle, a slow one is usually better for stocks. so there is no emergency. for all of this, we do have a market that's been rolling for a while right now. doesn't seem like it's been in need of help from the fed or anything else. it's one of those situations where it seems like the market keeps with the same news everyday or some version of it. it is hard for evaluations to really start to bite even if they are high. if the fed is going to be accommodative. if earnings are going higher. but i guess, how would you think about the overall market position at this point? >> i think the market is queuing off of some good things and some momentum and a lot of

risk appetite that people really want things to continue moving upwards. that's where you see this big rotation. maybe out of the stuff that was very obviously overvalued and obviously crowded traits. into some of the things that are still risk assets but more cyclical, more attractive. we can sleep at night paying that much for that particular part of the market. i think that is healthy risk appetite in this part of the cycle. i still think there is a pretty strong debate between whether or not we are late or midcycle. and if the fed does not land this plane or does not stick the landing, we could accelerate into late cycle pretty quickly, overheat again and that is the big question but so far it's working. and today especially the broadening out is alive and well. >> if you never get the first rate cut, it remains this thing that's on the fishing line out in front of us. and we continue to move along and wait for it and it really never even happens. >> i would say indefinite if not never. where do we now think we will start to look towards?

some more fed speak. i guess we will have the february pce report at the end of this month or so? >> i want to expand on what josh said, which i think was really interesting. if you listen to the press conference, there was not something that folks were able to hammer powell over the head with to say, how could you possibly not be cutting rates given that this thing is happening? josh was right. we have moved away from the banking crisis of last year, which was an obvious thing. i cannot point to something and say, you idiot. why aren't you cutting rates? that question, the pretext does not exist now. we could be missing something here. it could be the cre thing. something going on in the banking system. but right now i'm looking to see mike answer your question. does consumer spending holdup, to the delinquencies that we

saw stabilize at the end of last year remain stable? are there systemic issues to worry about after going to forward the balance sheet, reducing it by too much. and does the cumulative effect of higher rates have an impact that was just delayed and it's coming? but i think that what josh said should be expanded. there's nothing out there that you say to powell, how could you be missing this and why aren't you cutting right now? >> that's very clear. that's well said. on the other hand, you would almost imagine a scenario where you could hound him and say how could you not be taking a protective rate cut out? we have these higher-than- expected numbers. >> that was my question. that was my question. >> exactly. so what he was asking, you're still anticipating shelter inflation to kind of revert lower and he is like i think there's a lot of expectation it's going to happen.

>> i think his answers are okay there. shows hey, we are very restrictive. we have a lot of restraint in their and we have not taken a way out and we have not promised you are taking it away. which leads to the thing i think john was just getting out on a kind of interrupted him. sorry about that. if the rate cuts do not happen, are you cool with that? is that a cell signal for stocks? >> i don't sell solar roof panels. i'm not a mortgage banker. i might feel differently if i owned a hotel chain. seriously. by the way, for the people screaming they need to cut rates to support the economy because younger millennial's need to buy a house. what do you think will happen to the home price when ortgage rates comes down 100 basis points? you think that will work in your favor? are you crazy? >> i think one has a firm idea of what happens to the tenure rate which mortgages are based on if we start to cut. we focus on the curve. tens aren't moving.

30s and moving much at all. i'm not saying this is the way it is. >> that's a debate we have not had which is this whole scenario sets up higher for longer on the 10 year, which sets up for higher rates or more competition for stocks down the road. that's the interesting debate to have a think. >> that's right. the other thing about that is that the tenure is also going to follow what inflation expectations to and these have not moved much. so that's been working in the fed's favor. expectations reasonably anchored except at the two-year portion but over the long run which gives them the flexibility to still say we can wait. we have the strength in the economy, we've got the time. if expectations look more threatening, you will see the tenure rate move quickly. >> that's one of the things we have to turn to and watch in the next few weeks. thank you very much. see you in a little bit in the market zone. the s&p 500 crossing about 5200

for the first time. holding above that level. joining us now is sarah malik, chief investment officer. great to see you. so we do have more of the same in terms of the message. the same three anticipated rate cuts. the market seems fine with the fed sort of stepping aside. what are the key things you would pull to observe? >> great to see you. i think there's three outcomes at the market with this meeting. the economic upgrades and objections. it did not change and he has been incrementally hawkish on inflation. let's look at this spot that's teetering on the brink of moving to just to rate cuts this year. i think that's where we could likely end up. also with powell sticking to his 2% target, the question is when will we reach that? it could be years rather than months before we get to the 2% target. the second is where does the market go from here? there's a lot of fear of missing out. lots of cash on the sideline

looking to get back into the market. and second, continuing to move higher than 5200, we need the rally to continue to broaden. that's where i'm more skeptical. look at the earnings growth for 2024. by itself, already expected to be about 28%. the rest, about percent earnings growth and this translates to the rest to boost the earnings growth. i think that is how the market will stay sustainable from here. >> when you said you're skeptical that is going to kick in right away does that suggest a risk reward at this point in the market is not that great? >> i think it will be tough to find the catalyst to have markets move higher. if you look at the non-tech portions of the s&p 500, they're dealing with sticky inflation, wage inflation impacting their margins. also on the revenue growth so they just don't have the ai and demand to increase productivity that's benefiting tech

companies. the rest doesn't have that. you see in the materials sector, energy sector and healthcare sectors under pressure in terms of earnings growth. >> you mentioned certainly there are trillions of dollars in cash. a fair portion of that is retail investors. if you are involved at all in the equity markets, hasn't the market itself kind of kept you involved and raise your exposure and kind of allowed you to have both at once and have the cash cushion and a little bit of income and be able to support whatever equity risk you want to take. >> we are hearing from our client that many of them are rebalancing somewhat out of equities because of the huge run from to be disciplined in terms of diversification. a lot of that cash when it comes back into the market. what it should be looking at is fixed income. high-yield fixed income. high single digits. sometimes in the double digits. it should be a little bit more resilient because we do expect

2 to 3 rate cuts this year. that's an area where we can get out of cash and out earn what you could get with cash. >> i guess, you know, it raises a question about the rest of the world. there has been global confirmation of this bull market. some strong markets seen elsewhere. there's a lot of catching up to be done. if you think that we need, so to speak, the market to broaden away from u.s. tax year, this would also suggest the rest of the market in the world would be less disadvantaged. >> first, looking at europe, i think they are disadvantaged. they have a similar inflation problem but do not have the economic growth that the u.s. has because the u.s. is a optional when it comes to technology and its leadership. china, of course with property issues and other issues in terms of china getting back to its historical growth rate japan looks promising. japan's gdp growth, i think japan is an area that investors

can look at. thinking about this on a global basis this year, something else to consider since it is already march is that we will have 77 elections this year. 60% of gdp. normally that causes more volatility for the market. i think it's going to be a little bit more than noise this year. the less predictable the election outcomes are, the more volatile the markets are. that will be with misinformation with artificial intelligence. as we sit at 5200 on the s&p. >> i know the historical patterns in election years absolutely say that is the case during or after the summer. we should expect a little bit of turbulence. but for now, the market seems pretty undisturbed by any of that. within the u.s. market then, are there spots that you would be able to pick outside of tech where you feel as if they are underappreciated or is the market pretty well picked over? >> within tech, first of all, you need to be selective. there are promising technology

companies that are continuing to thrive in this kind of market. amazon just invested heavily in its logistics. i think they will continue to do well. looking at other sectors. an underperforming sector this year as we go from seven expected rate cuts to two. all of the real estate issues. if you look at rates historically, they tend to outperform in periods of rate causes or cuts. that's what we're looking at her and healthcare tends to be under performative in an election year. and the consumer i worry about after seeing two months of not great retail sales. we've seen his with earnings that have been mixed. the concern, will they be able to keep high single digit revenue growth target going forward? and sumer discretion is an area that i think we need to be much more selective on. >> most of it is lying today but we will see how it idles out. good to talk to you. thank you so much. >> is for having me. >> let's get a quick and check on the s&p 500 tracking for a

record close. any market today now 40, 52, 16. >> no rate cut rate >> anticipation is enough for now. up next, continue down to the reddit ipo pricing. and a rundown on the key earnings that you need to be watching over time. and don't miss this sitdown with pat. you can check out the interview at 4:00 p.m. eastern time on overtime. market zone is next.

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we are now n the closing bell market zone. josh brown is back with us. he never went anywhere. he will break in these crucial moments of the trading day. two moments we're watching in overtime today. leslie pick her on the highly anticipated reddit ipo. three big events. nvidia's revival meeting and >> so far, so good. >> bank of japan, the market absorbs it and then the fed. no change, which basically means, we are cool with -- we think inflation is going the right way. we will allow the economy to be as strong as it can be. what is next? what can we feed on from here? >> what is interesting right now is you don't have the catalyst ahead of you. you've got earnings in the past. just we could start worrying about next quarter. but you've already got more

economic data. one of the things people are nervous about is the job market being too good. the response to the new york times just now. strong jobs in and of that -- itself does not stall the need for rate cuts. i think the markets like hearing that because it is likely that we are not going to see any kind of about-face with the data. it's nowhere. >> we actually highlighted kind of a virtuous cycle with labor supply from domestic and getting jobs, spending money for the sort of self-sustaining job market. that's the best case scenario. you do wonder if you are getting to it. we did an omen here. at the s&p above a record 5200. still waiting for people to really get giddy about things. >> it's not a giddiness but it's also not waking up every day with regard up. you and i have been around for a long time.

remember long stretches of time where it wasn't oh, the next meeting is ake or break. i think we are in one of those stretches. to just appreciate that. it doesn't mean things can't go wrong. doesn't mean we wont have a 12 fixed forever. we shouldn't be too hard on ourselves. we've been through a lot over the last four or five years and it's okay to have an economy with no emergency that needs to be addressed. >> that's not the norm. boring is bullish as i would say. by the way, i've been around longer than you. >> not much. >> what should we expect. >> ai demand is driving memory chip rises higher. nvidia is boosting micron's profile was shout outs on stage in the recent developers conference. questions arise about mike rohn's ability to balance ai growth with cyclical business. in lockstep with nvidia over the last years and it

considered the high-bandwidth memory if you're going to get technical. this is xpected soon. this particular memory is used in ai systems. the revenue is still expected to be modest in the first half of the year with much of the real contribution in order for or later. micron is still exposed to cyclical businesses like pcs, smartphones, enterprise cloud server markets. all of these trying to improve. they posted underwhelming outlooks just two weeks ago and saw their shares selling off when investors decided they were not near-term ai plays because they were hit by the cyclical business. for all the ai confidence to remain, micron investors will have to see that ai memory is a growing percentage of total revenue and a boost to gross markets. >> this is reminiscent of even in past cycles before the ai obsession where mike rohn kept trying to liberate itself from the commodity memory chip, i

guess, profile, that they have had forever. >> almost every single chipmaker out there in management loves to deny the cyclical nature of their business and with ai right now, it is changing the narrative a little bit but not really because we are still seeing it with analog makers, and the auto sector, still seeing it with the enterprise market being hit. the cloud, less so. it's just a matter of admitting that there is a cyclical nature to this business. even with ai at play. >> thanks very much. we will see what the numbers give us. certainly homebuilders among the groups rallying on this sort of perceived dovish fed. >> this is a tricky quarter because mortgage rates came down, went back up again. they're focused on the entry- level buyer. maybe a product that tries to stay budget friendly. when you look at the mortgage rates and movements, they are particularly sensitive. that said, all the builders have been buying these rates to

get buyers in. the question is how much is this heading margins and how aggressive do they have to get? we saw their fairly aggressive in the earnings report last week and more of a move up builder. the luxury does much less of that. so we will be on the other side of that. we also saw the housing starts bumping up ignificantly in february. likely's lower home deliveries in the past quarter, but improved new orders looking ahead. and of course, we will be watching for any commentary on current demand because we are going into this. we are actually in it already. >> thank you. this group has been riding on that demographic and supply constraints for a while. unclear if anything is going to kind of disturbed that in the short term. although you have to believe existing home inventory will start to pick up. >> yes. my friend logan had been telling me since 2021, the thing about housing is that

borrowing costs will not overcome the fact that there just aren't enough houses. few things in the financial world that the said can't influence if it tries. cannot get homebuilders to do this when there aren't enough houses. the phenomenon remains with us. i don't see a change anytime soon. the housing market does not move on a dime. it does not change course very often. that's the situation that we're in, i think we are just going to continue to see the stickiness of inflation the in this shelter component. and it won't necessarily be up all the time or every month. but it's also not going away anytime soon. it's just the conditions in which we all exist and we have to get accustomed to. >> i guess from a macro perspective, you've seen housing activity in general. it's now a net contributor again. had that recession.

powell got into the press conference about still waiting for home prices to come down. that not -- you cannot use that leverage. it does not exist. >> if you talk to financial advisors, you talk to people in mel -- wealth management which is where i live. people right now are helping the next generation bear the burden of these higher shelter costs. they are literally making the down payments for their adult children. it's not that they want to do that. it's that this is the environment we are in. in some of these cities, some of these 20 major metropolitan areas, you just literally cannot live in them if you're not getting some kind of help to buy the first home. starter homes don't exist. they're not available. again it comes back to is the money available? yes there is. that's what supporting the housing market. the housing market is not reliance, fortunately, on current mortgage rates coming

down. >> tons of cash buyers. >> all over the place. it's the reality of the situation we are in. >> wesley looking ahead to the reddit pricing. totally different. huge debut. up 69% after pricing last night. >> hopefully, that doesn't hurt. if you have some of this but feels good about what happened with this technology ipo today, does not bode well for reddit? it does not hurt. reddit ending to present the higher end of the arket. nothing is official until the final pricing call after the bell. if so, that implies a fully valued valuation. pricing is always more of an art than a science, but this one may have a few competing interests that the company and its advisors need to balance. on the sell side, shares are held by employees and

executives, which comprises about 30% of the amount sold in the offering. that group would like to see the deal priced higher, of course. then 8% of the offering reserved for eligible users and moderators on the platform in certain directors, friends and families of employees. you would not want to go to high and risk a day one flop to upset that group heard definitely an interesting balance. >> always tricky. you also have the uphill battle. of course, this is not a young company. has not been profitable as you've been pointing out. and anything that's in social media ad supported that is not meta-, google, amazon. it's been a tough sell for the stock market. >> and the upset of revenue is similar to that for the big tech giants. however, they are operating in

this space. social media in general. it comes with regulatory concerns. there's also just the overall monetization backlash that we saw last year. that has some investors kind of wondering how they strike that balance with regard to aping users while making sure they also generate money as a public company. it will be interesting to see kind of what happens. this is kind of the first social media ipo that we can send wendy 19. pre-pandemic. it's been a big change since then. >> 20 has happened. thanks a lot. >> kind of a deal in some ways. >> this is going to be a fun one. this is where we are all going to know there is going to be drama. what sticks out to me is the fact that the ipo calendar is back to the point where we can do reddit. whether you like it or not and 25 ipos here today. 14% ahead of where we were a year ago. probably lost money for 20

years. accumulated 771 million or so. got a ceo who paid himself 193 million last year. of course, most of that is stock. if the stock is a flop on the ipo, won't exactly be that number. but it's going to be controversial in their risk factors. actually state wall street bets which is probably their most visible community is one of their biggest risk factors. normally, you wouldn't expect to see a company say their own users or customers are a big risk to them. that is the nature of this thing and i cannot wait to see when it comes out how it is received. >> you want to advertise how to interact with all the flow on reddit. that's a bigger picture. >> it reminds me more of twitter than met up because they don't know their customers the way twitter didn't really know the customers. is that a great product? can we compare to instagram? i would say no. >> this market's willingness to believe right now seems pretty

intact. it did seem like we were tensed up going to the fed but we still had a little bit of tension release. >> yeah, but you know what, this is one of those things that we had to get through to your earlier point and we did read and quite frankly, nothing has changed, but that's a good because again, we are in a trending market, it is broadening, you see a lot of positivity away from the traditional leadership and new leaders emerging and if that's the situation you are in, you probably don't want any news, frankly. >> thanks a lot, josh. we'll talk to you again soon. we are going to be on pace for a new record high in the s&p 500. 52 .22. nasdaq up 1.2. the rustle up almost 2%. it's been underperforming a little bit. also about 80% of volume to the upside on the new york stock exchange. it is a broad rally.

the market taking the relative the business versus expectations of the fed. as a plus, we see this coming in after the last two weeks. 0.08 to 4.62. that's basically right where the fed is projecting. down to about 4.27. that does it for closing bell. a triple record close as the dow, s&p 500 and nasdaq are all in uncharted territory. that's the corecard on wall street on this fed day. the actions are just getting started. welcome to closing bell overtime. i'm morgan brennan. stocks rallying after reaffirming plans to lower interest rate three times this year. former boston fed president eric rosengren on when he thinks the first rate cut could happen. and we are moments