earlier, it is now back below 50,000 as the market is now solidly in the red in terms of the nasdaq down triple digits there's bitcoin, the ten-year, as we just pointed out, over 1.4% it seems like it's related, guys, interest rates are back, back interesting again we'll see you tomorrow andrew, becky, make sure you join us. "squawk on the street" is next good morning, welcome back to "squawk on the street" i'm carl quintanilla with david faber and jim cramer powell is on the hill, day two, as rates are on the rise, ten-year, 1.4 is the high for the year, the 30-year at 2 1/4 a road map that begins with vaccine optimism though. the fda staff endorsing j&j's single shot for emergency use

and that clears the way for a third vaccine in this country. and stock futures are dipping into the red particularly the nasdaq. this of coursefollows yesterday's rally after we were down sharply tesla and bitcoin both climbing. >> and the travel sector looks for a post-covid recovery, the marriott will join us later in the hour >> so much to unpack about yesterday, not to mention portnoy and tenev but cathie wood, ark i saw on twitter what stock will she save today >> it is a little bit of a pull, a little bit of a parler game. she's buying every stock that should be crushed by the interest rate move these are classic long dated assets that she's buying and that's what you're supposed be selling but the idea on ganging up on cathie wood, when you gang up on cathie wood, you're not ganging up on melvin capital, i

just want you to know that. >> important point here. and you're right there's no leverage. no leverage. etf is not leverage. so now, she did have a lot of outflows though, yesterday, jim. >> what can i say. >> by the way, a number so big, it is probably larger than her entire fund was only a handful of years ago. >> but david, she stopped tesla right in its track on the decline. >> yes >> so i mean today, it's cathie wood it's david portnoy it's vlad. it's pretty much everybody who matters. >> kind of a new world, isn't it >> tiger woods. >> she sells the spunk every day. everyone who wants to understand what cathie wood does, she puts out, 651 yesterday, she puts out what she did and there was a time, david, you know this, when there were people who would say, all right, she's got big outflows, let's go against unity software, let's break cathie wood, but you can't, because she's not levered so instead you see outflows and you say okay, which one is she going to stop? is she going to stop square

today? square did not have a great conference call. and maybe she stops the decline in square. this has become the ultimate parler game, carl. we look at these things, instead of investing and instead of trying to figure out the right thing to do, do you buy j&j, we're looking and saying holy cow, she is making a statement right now with aero environment, selling, and how did this happen how did this person become what we do for a living honestly carl, i don't know >> that is remarkable. she's been coming on for years but her influence has grown, as you said, more recently, jim i know you were watching this report out of cfra, talking about ripple effects, potentially out of ark, but they say we think they can manage their cash flow and use the liquidity in some of the large cap positions to mitigate any impact from those flows. >> cathie wood, close your fund. listen listen to what the late jeff bogle would say. close it concentrate on performance and not trying to deploy capital it's okay.

it's no sin. it's what the great ones do. peter lynch did it you just close it you don't keep taking in money and see what stock is down a lot and i'm going to do a call, tesla, 620, i'm done tesla goes higher. that's kind of ubris dave, help me here. >> what do you want me to tell you? i don't know i mean listen, i think back to 25 years ago when we knew nothing about what any fund manager, forget 25 years ago, we knew nothing about anything back then and it was impossible to get a hold of information other than to pick up your actual phone, and i think we had push button, it wasn't rotary and you pick your phone up and try to find things up and now we get sent every single trade that she made in the morning. it is amazing. some of transparency is helpful. it's interesting and you know, this is, as you say, something we go through, remember it's not just one fund, it's arkk, and arkg and i keep

saying, second morning in a row, discover ji is right at the top there, but she was selling square, david. >> it has been an incredible mo momentum stock the last eight years. >> and you want to look at the stocks when the ten year rates are rising and i don't want to own dated assets, i want to ownon deere, and these are the kinds of stocks that should go down but the people who are following her, many do not understand the int cracies between long-dated assets and the rise in interest rates, so this could be one of the situations, where the whole portfolio could fall, because of interest rates and carl, that's no sin, it's just when you keep taking money in and you keep deploying, i find sometimes what you really are doing is trying to keep up with your own inflows over the transom instead of trying to figure out performance and what's the right stock and that's where i think she is right now. i know i'm going to take a lot of heat for that and i really love that, because

i am, in the end, jimmy chill. >> yes, you are. >> you are, you wear a suit on the outside, jim, you're not a suit on the inside. >> no. >> as you said on twitter. >> and then there's portnoy and tenev, last night, talking about robinhood, in a way that perhaps financial media is just now getting up to speed. take a listen. >> the firm that's supposed to have our back is essentially the one who put us in this mess. >> look, i mean we, again, i'll just say, the last thing i want to do is create this problem for our customers where they want to buy something and they can't, right? so i'm going to do everything i can to make sure we don't see this happen again. we believe people should be able to trade what they want and that's the whole reason we exist, it's the whole reason we brought zero commissions to this market with no account minimums, so i raised $3.4 billion with

the team in 72 hours, which i don't know if it's been done before >> a couple of stories here, jim. one is just the, the scrutiny of the robinhood model. the other is the role of portnoy, part interrogator, part advocate. >> i thought it was rather amazing, and sitting there watching it, riveted lake many other people, because i, if you remember, at that very beginning, it looked like vlad wasn't on the show and one of these empty chair pile-ones and portnoy was going to destroy him without him being there and vlad comes in, wearing the taco tuesday hat and a much better haircut than he had in front of congress and he handles himself so well, that i thought he almost disarmed dave until the end when dave said listen, i'm not going to wish you good luck and i think your company is basically going to fail but i thought found it was riveting because this is, and david, you know this, this was the so-called betrayal of the little guy for the big guy. and i didn't feel that happen after i listened to what vlad said. >> why didn't you feel that?

>> i think it was a betrayal of the regulators who really screwed vlad because they changed, there was like a constant different amount that he had to up, okay, he shouldn't have been so proud to say i raised money. >> do you think they had a fundamental misunderstanding of the risk of their business the same way perhaps gabe bloplotki had in shorting so much gamestop, i think they, did and i don't think there is any doubt they ran out of money. >> you're absolutely right i'm sorry. i'm saying there was a clear liquidity issue. he dodged it >> i know. he had to dodge it, because as you said that, once you admit you have a liquidity problem, you're done. >> he totally screwed up he shouldn't have taken money without a gun to his head, i would like to see the p&l he showed, but there was an agreement that was mercurial to regulators but he totally screwed up and he didn't say he didn't and there was a dispute who sold out gamestop that week and cnbc put out some numbers

that retailer was seller, and in the end who is the winner here square >> how damaged did robinhood's business model, which prior to this certainly seemed poised to potentially go public, pretty soon. >> yes >> and at quite a valuation. i think their owners have learned the hard way what that business really is >> right i mean would you not - >> with a lot of capital. >> when dan schulman came on, paypal, one of the biggest asset 4,,000 people compliance, i don't know how few people they had in compliance, but the difference here, david, robinhood is an app, okay? it's an app. other things are companies e-trade, morgan stanley, companies. okay compliance regulators understand cash. now, to vlad's credit here, you know, the dtc just came down, you saw that, they just came out with what he wants which is faster clearing. but david, you're right. it was a complete and utter

screw-up and trying to take credit for being able to raise money with a gun to your head, i would not be proud of that that's nothing to be proud of it. >> they made it through. they have a much better understanding of their business at robinhood. >> he did come on. >> he's willing,i'm not sure, perhaps it's ill-advised. >> it was not common. >> with portnoy who was quite combative. >> carl, it was a moment where he said basically, yeah, i mean, we had a liquidity problem now jpmorgan, the great late jpmorgan would say if you ever had to admit that you had that, then you're done but he doesn't seem very done. and again, it was kind of out of body, because he was in front of congress, and then he's in front of the great inquisitor, dave portnoy. >> and in some ways, dave got more out of him than congressional members. it's very true, jim. >> sure did. >> we'll pay more attention to that and of course later on in the morning. j&j the other big story moving a bit higher this morning on the

fda endorsing the company's one dose covid vaccine, for emergency use, and meg terrel has more on that good morning, meg. >> good morning, carl, the briefing documents out from the fda are the first time we've seen the agency's take on these data the first vaccine that would just require a single dose, to provide efficacy and that's what they have filed for, the fda's go-ahead for, one shot and we've seen in these document, they've broken down the efficacy by region, we saw these in the original lin cal trials in the u.s., 72% efficacy south africa where they had more of the variant, 64%. and 68% in brazil. now, interestingly, when we look to see whether there were any variants included in the u.s. part of the trial that affected efficacy and there weren't, and mostly that old strain, the original strain of the virus, but we didn't see any cases of the variant associated with the u.k. now, interestingly, they also talked about potential efficacy against asymptomatic infection,

about four weeks after you get the shot now they said the numbers are still small so it's hard to draw real conclusions here but it would suggest the potential effect on the ability to cut down on transition and early days there importantly, a lot of results here on hospitalizations, and deaths, showing that after four weeks, nobody on the vaccine group was hospitalized, and after two weeks, two were, which is 29 in the placebo group, nobody who took the vaccine died from covid, versus seven in the placebo group, guys. check out this graph, which shows over time, the protection kicking in from the single shot of the j&j vaccine and you can see it kicks in, and the blue line the people who got the vaccine and the red line is people on glass bow and after two week, you really start to see the lines separate and that protection is kicking in from the vaccine. now, some more details we've got in these documents, also about sort of the reactions you might feel, after you get this shot.

pretty common reactions, like injection site pain, headache, fatigue, muscle pain, no concerns that would preclude emergency use authorization and did note a couple of rare events, hives that might have been related to the vaccine in very few cases and one hyper sensitivity that was not anaphylaxis out of 40,000 people in the trial and overall picture, safe effective vaccine and we will see the fda committee talk about all of this on friday, and if they vote positively this vaccine could get cleared over the weekend guys >> yes, meg, so you put it all together, and you've got the data, 20 million doses waiting in the wings over the next month perhaps, expectations that the pfizer vaccine may be cleared for more standard refrigeration. and it's all good news, isn't it >> yeah, the vaccine front has been really good news, i mean the concern of course is that variant, which does impact, it appears to im pact the efficacy

of the vaccines. we haven't seen clinical trial data on the pfizer and moderna vaccines and the j&j shows lower efficacy against that variant, but you know, the supply is going up, it's doubling, of the mrna vaccines and it looks like we will have a lot more vaccine over the coming months and these data today suggest a third one is coming. >> why is it that we find out, well, first, it has to be minus 90 and turns out it doesn't have to be, and more vaccines than we thought within the particular vaccine, maybe j&j has more, but why is it that it's so fungible? i thought you have a vaccine and it's one and done. but the fungibility of these, it shocks me because suddenly we have a lot more out of these same vials >> i'm not sure that the companies would say it is such a surprise, it is just the manufacturing sort of ramps up over time, and as they bring on more capacity, you really start to see the output increase and in terms of the ability to store the vaccine at not such arctic temperatures, that's a

function of the fact that these vaccines were developed at such speeds during the pandemic, normally all of this would get worked out, before a vaccine would come to market, and in a multi-years long process, if not decades to figure out the perfect storage, all of the manufacturing, but because we did this during a pandemic, they've got to figure it out in realtime and getting it out to people as quickly as they, could so we're going to see these iterations continue. >> meg, so much to watch, so much easier with your help thank you for bringing us up to speed on j&j this morning. thanks. futures are week at the open with the 10-year yielding above 1.4. and the 30-year close to 2.28. we'll get to square of course and bitcoin and the president and the white house looking at supply chain issues today. we're back in a minute

♪♪ hey you, yeah you. i opened a sofi money account and it was the first time that i realized i could be earning interest back on my money. i just discovered sofi, and i'm an investor with a diversified portfolio. who am i?! i refinanced my student loans with sofi because of their low interest rates. thanks sofi for helping us get our money right. ♪♪

white house is going to hold a meeting with lawmakers this afternoon to talk about the global chip shortage and the impact on u.s. business. it comes in the advance of a new executive order from the president that will kick off a review of the supply chain that supports manufacturing including autos, pharma, clean energy, they're going to fold some rare earths in there as well. >> nxp all right? you want the villain you want to know who's the big backlog? where it is? who doesn't have the chips

the companies that relied on nxp. and i'm just putting it out there. the other companies, qualcomm, the stock has been down 40 straight points because their fab, the fabless light, the fab-e, i don't care, it's nxp. so nxp, come on right now, and explain why you're costing american automakers billions of dollars and maybe you're not and maybe you will say there is nothing you can do and i remember coming on and saying nxp, they're the greatest, i love auto, and they are the auto semi and i'm sure there is a great reason they have not been able to come up with chips and i will feel much better when i hear the reason. >> we have made the invitation it's just done 127.50 is what i remember, the purchase price that qualcomm had before the chinese regulators sat on it and eventually time ran out for qualcomm and abandoned the deal >> and a brilliant company. >> to the larger issue here, and an executive order, we know

about some of these chip shortages but the larger issue is domestic production of chips broadly speaking and intel the national champion of that, the only big producer in the united states, jim, and whether it is the business school, and aided by the actions of u.s. i don't think they will be pumping money into the company directly but there are things they can do. >> to separate ourselves from taiwan semi, and you may think about it is all about taiwan, the prc has its tentacles into taiwan semi. >> really? >> now you're starting that? lear we go >> well, it's all -- >> the other guy, the other guy said that -- >> the chinese are coming. >> the other guy said that you >> may be right. i don't know but that's quite a thing all right, taiwan semi on -- can we ask them if they're a puppet of prc. >> i didn't say they were a puppet. >> i'm your puppet good song. >> anyway -- >> we're not done talking about

china, that's for sure >> jim, we'll take a break here, we will talk about travel and the pandemic and including with marriott's new ceo tony capuano, coming up later this hour. stay with us and i'd like your best new smartphone deal. oh do ya? actually it's for both new and existing customers. i feel silly. but i do want the fastest 5g network. oh i want the fastest 5g network. are we actually doing this again? it's not complicated. only at&t gives everyone the same great deal. like the samsung galaxy s21 5g for free when you trade in. this is how you become the best! [music: “you're the best” by joe esposito] [music: “you're the best” by joe esposito]

[triumphantly yells] [ding] don't get mad. get e*trade and take charge of your finances today. [announcer] durán catches leonard with a big left. ♪♪ you can spend your life in boxing or any other business, but one day, you're gonna take a hit you didn't see coming. and it won't matter what hit you. what matters is you're down. and there's nothing down there with you but the choice that will define you. do you stay down? or. do you find, somewhere deep inside of you, the resilience to get up. ♪♪ [announcer] and this fight is a long way from over, leonard is coming back. ♪♪

♪♪ ♪♪ take a look at futures for now, weakness once again in the nasdaq, not a coincidence that the ten-year is hitting new highs for the year so far. close to 1.41. the debate's going to continue about the impact of higher rates as we get powell on the hill for a second day on the house side back in a minute

♪ snap your fingers. >> by the way, i am glad i didn't know that song. >> opening bell in three and a half minutes. >> what you got? >> lowe's. >> home depot did not do that, 24 so people will like what marvin ellison did more than home depot, and home depot had a decent call but they were not as effusive as marvin ellison is today, i think marv will have an unbelievable spring, because this is the year that i think that they're going to be able to really put the wood to home depot. >> do you? >> when it comes to plants plants >> well, to plants, okay >> the outdoor - >> you've been talking about some of the retailers that will benefit from the, we're out of here, we're back into the world, and clearly, lowe's and home depot are not amongst that group, given their comparisons will be pretty tough. >> they will be very hard, but i

think lowe's had, marvin inherited a company that didn't really even have e-commerce and he is putting a few things in e-commerce to make it so the comparisons will be better, their e-commerce site was quite war weak, and christmas time, it was gardening, very popular, and you're right, is this as good as, i don't know, aero-postale, and some have done quite well but i think lowe's versus home depot, you go it lowe's. >> you go with lowe's versus home depot if you want to continue to be invested in those companies. >> exactly right. >> got it. >> and i think that lowe's, ellison has done a remarkable job but the company was very far off its game versus home depot, it's playing catchup, but he's going to catch it. >> really? >> i really do think so. >> wow. >> the stores look great by the way. >> i haven't heard you say that. >> the stores look great the web site is getting better it still has some availability

issues but i do think that what marv's doing is basically saying okay, look, we know that the contractors are going to go to home depot, they will come to us, too, but lowe's is back having what i regard as a place, and this is my wife, so it is anecdotal, women like to shop for garden at lowe's, again like they used to >> before home depot really came on. >> and by the way, home depot, enough of the scott's miracle grow plants. get me some better flats, will you? the flats are weak at home depot. you know what a flat is, david >> no. >> oh, my -- >> i will plant some trees >> you don't know what a flat is >> i don't garden. carl, i don't know, do you garden at all? >> no. no >> my 33rd year. >> none of us garden >> my 33rd year. >> compared to jim. >> those tomatoes. but once again, i get nothing. i don't get the canned tomatoes. i get nothing. no olive oil no tomatoes. no tomato sauce.

nothing. i've seen the pictures that's all. >> the olive oil just came in, it is unbelievable, you want virgin olive oil, that's my and all of the other stuff is adulterated. they're clapping, for my virgin olive oil. >> you keep asking. >> that's all for jim's oil. [ bell ringing ]. >> there's the opening bell and the nysc and nasdaq. >> and american eagle upgraded up to 31 macy's up to $16 although they keep the market perform. and macy's had some interesting comments yesterday, jim, where they said, long-term in general, the mall is going to continue to see low single digit declines on comps, after they recover from this pandemic. >> i think that jeff did a very good job on the call, i thought it was a good quarter, the quarter was down at one point 80 cents, rallied, simon property group, spg, has been the bellwether here, the biggest

shopping mall company, they brought tal -- this stock is up 34%. because people want to go back to the stores. something better than having the big stack of boxes when you get home. >> people want to get out. and in some states, they're already out. many of them. >> right >> but there are others where they're not. certainly in the northeast it's just this time of the year as well. well, obviously they're indoors but getting around with all of the snow and everything else, but once things get back to some level of normal and given the j&j news, and i don't know when that will be but it seems like closer than you would expect and i wonder how much is reflected in the 31% move in the stock price. >> two terms below where it historically has been so i think it has more. >> do you. >> yes i was walking with a cane and you see people in the mall, and

that guy is walking the mall, i was one of those people and carl, i got to tell you, i had to swallow my pride to play that game. >> and the decline of the mall now for many, many years, it was not though that was continuing prior, that was a trend well prior to the virus >> yes, but there are companies in the mall, including jcpenney which david simon is trying to reinvent and don't forget kohl's, david >> yup >> i won't >> no, i won't forget kohl's but after 9%, nine board seats >> what do you think happens here >> i have no idea. i have not reported on that. list tonight interview that scott walker did with the gentleman in question. it's interesting. >> i will be on scott's show today. >> are you really? >> yes i am. >> what is it that you think you will be discussing today. >> square, we have not discussed square, square was one of those calls they talked about bitcoin 4,500 times.

hello. you can buy bitcoin and people can buy fractions but it's actually the speed with which people were buying bitcoin this quarter was disappointing and they did not talk about that, but i just did, but look, it is a cathie wood stock, so i guess she waits until it is where she has them where she wants them and then she buys it, right? david? right? >> earlier, you can't even close an etf, i'm not sure what you were referring to. >> she has to do something this is ridiculous. >> what's ridiculous >> you can't just keep taking money in and i'm going to go buy cash equivalent and go by some, i don't know -- >> why not >> listen, her fund has a 769% return over the last five years. >> so she's allowed to have a couple hundred percent and no one will care? >> i heard this point yesterday, too and i said it many times, so large now, the question will be does she lose more money than she ever made for people, but if you were lucky enough to be in that fund over the last few years, you were extraordinarily

happy and one would might expect you would be somewhat loyal. >> paypal and spotify. and she is dumping roku, david, and splunk, she must have a splunk shredder. she just destroyed splunk. holy cow >> guys, we have, you know, not much on spacs, a lot of spacs being priced, don't get me wrong, but not too much to share. and carl, i think you have reed hoffman on later, but the spac, flying cars, i like to call it flying cars, really flying taxis, electrically powered flying taxis, the symbol here is rtp, that's at least the spac in question, and the deal is for a company called joby, going to be competing against the likes of archer, acic, and the spac that went public and this is about a $6.6 billion deal, overall, and i always like to, there's reid, coming up for you guys later, carl, sort of their projections,

2025 seems to be the key year here for them where they anticipate having gross profit of $417 million, and a profit margin of about 58%, and then more than doubling the 1.183 billion by 2026, but they, jim, they're going to have these things flying around, they say by 2024. and they're really quiet, by the way. really quiet just so you know much quieter than like a helicopter they're as quiet as a conversation >> david, is it possible, that one day, the s.e.c. says you know what, i'm tired of company spacs that they will do $5 billion in sales of 2026. >> 2026 by the way is an incredible year for all of these companies, a year they all focus on, and lucid, 2025, every week, we have two or three where i focus on that year, because that's the year, and it was for archer as well, they're basing their multiples off of 2026, i

don't know, you think we will be sitting here talking about the incredible profit machine that is flying cars maybe. i don't know i hope so. it would be great. >> look, look at door dash 18 months ago, i thought door dash may not make it and now door dash is one of the biggest companies on earth. >> yes. >> so anything's possible. but i just find when i look at these spacs, look at this spac, in terms of that page, which says that this is, in 2026, you will not believe what we do, and then you look at a prospectus and you're not even allowed to talk about 2026. the s.e.c.'s got to do something about this, but they don't know what to do what what was that face you were making >> i was saying hello, and saying yes to chip, our producer. >> it's all about me. >> i wasn't listening to you >> it's all about me. >> i thought you were going to go on talking about door dash for a while. >> carl -- >> is that what you do, david? you wait for him to start talking and then check with the booth. >> exactly don't do you that, come on of course you do

>> he's awesome. >> i mean -- >> flats have plants >> carl is still fighting with his toes, it is incredible, you know that. >> what he can do, while he's talking, he can tweet. >> actually, to be honest, i was actually thinking about where to lead jim after the spac discussion jim, i'm curious to know your thoughts on just dividend hikes, and i've been keeping track, the last few days wendy's, 28%, thermal fisher, depot, we know, allstate, danaher i mean they're trying to keep up with the joneses, right >> home depot, $6 dividend that's fantastic people should be looking at these. i had conagra on last night. look a steady eddie company, frozen food dominant 80% of their ads online and yield 3% not everything has to be schrodinger, life science, signified health, it is okay to own a company that has a good yield and interest rates moving up, you will still get a good

number so i like dividend stocks, david, i really do. >> speaking of dividend stock, ge is not one of them and i want to come back to the interviewdy a few days ago of former chairman and ceo of ge, and he has a book out and promoting in it in a number of places and it may be the only opportunity to sit down with him, and it is not clear we will, and the book as immelt points out, he criticizes himself a good deal in terms of his leadership and praises many of the people he worked with and i noticed and other readers will, that a handful of people did not receive that same level of praise. take a listen. >> ken, you don't spare criticism, despite his deep financial expertise, he had approved awful disastrous insurance acquisitions made by my predecessor >> i think ken is a great entrepreneur who built a great company at home depot and i will leave it at that. >> john flannery, i worried that he could not make a decision >> john's a good man, he did his best for the company, i

supported him, and if truth be told, the most difficult person to write about in the book is john, because i left problems for him, i didn't mean, to and it certainly hurt him and his ability to take over the company. >> you do say lorenzyocho, would have been the best choice for ge, why? >> i saw him lead hughes now, in a very difficult cycle, and you could see him shine and the fact is, david, you don't know anything about somebody until the worst day, and you never see them and know much about them on their best day and i've had the chance to see lorenzo on some really bad days and he is a spectacular executive. >> bob wright. i was done with him. bob wright had done a lot for ge but it was time for a change >> yeah, i think that sums it up i think bob was spectacular at nbc, it was time to have a

transition, and i'm a big supporter and fan of jeff zucker, and i think he did a great job at cnn, and he was, he did a, he put a lot of things in place that nbc benefitted for, for a long time. >> dennis naiden who ran ge capital had crossed the line, he needed to go >> there's nobody that did more for the company in the '90s than dennis, but time's had changed, and you know, again, i think one of the hardest parts of telling the story for the ge community is times change. and people have to change. and situations have to change. and that's what it reflected >> jeff immelt, again, talking about his book and going over some of those names. carl, over to you. >> all right, guys. not huge swings this morning in the indices, but we do have travel and leisure leading, home builders lagging, let's get to rick santelli. hey, rick. >> good morning, carl. interesting to say the least as we see everything has gone

hot in the treasury complex. you know, we could pick a number of reasons why interest rates are doing what they're doing but i think let's make it easy, the strength from home world is opening up and treasurys seem to be the window into that as of late look at intra-day 10s. 1.41, 1.42, as high as 1.43, intra-day 1.30 a whisker under 2.10 excuse me, 2.27. and it has been as high as 2.29. boom deals boon deals boon deals under minus 30 guns hot as well and it doesn't stop there. look at the sovereign paperwork across the globe look at what is going on in ten-year guilds hovering around 80 basis points. and by the way, ten years here are a little over, right around a one-year high-ish, february, we're going to january, but we comped even further back for 30, and eight-month yields, and tens minus twos, now the steepest in

130 basis points, and christmas of 2016. carl, jim, david, back to you. >> thanks. and powell at the top of the hour and when we come back, the new ceo of marriott tony capuano don't go anywhere.

- [narrator] grubhub perks give you deals on all the food that makes you boogie. (upbeat music) get the food you love with perks from- - [crowd] grubhub. before we talk about tax-smart investing, what's new? -well, audrey's expecting... -twins! grandparents! we want to put money aside for them, so...change in plans. alright, let's see what we can adjust. ♪♪ we'd be closer to the twins. change in plans. okay. mom, are you painting again? you could sell these. lemme guess, change in plans? at fidelity, a change in plans is always part of the plan.

there's new leadership at marriott after the death of arnie sorenson, we have more with the company's new ceo, tony c capuano. >> tony, thank you for joining us today i know it's been an emotional and challenges people for you and the marriott team, following the unexpected passing of arnie, how are you doing, where is your head at, as you now inherit this new role as ceo? >> well, good morning, nice to speak with you again it's a profoundly emotional and

sad week as we say goodbye to our friend and leader. and for me personally, it's a humbling week, to follow such a generational leader. but the teams are energized. and as we talk to our associates and our customers and our owners, franchisees around the world, they want us lalaser foc to do everything we can, to pull every lev we're can to try to help build demand volume. >> as cross 1.4 million hotel room, the largest hotel operator, as you sort of craft your game plan, what is top of mind i mean this is an industry that is betting on a recovery, but is also still reeling from the effect of the pandemic, with thousands of jobs lost, across the hospitality sector. >> no question and i think as the forefront of our thinking is pulling, is taking every action we can take, to try and make our guests comfortable and feel safe when

they travel and doing everything we can to support our owners and franchisees, who have obviously born the brunt of the financial pressure created by the pandemic. >> of course, we will have more on arnie who was a believer in the business being the biggest force for social change, remarkable man in the last couple of years, we've seen a company, airbnb, which gets to $100 billion your company is a billion. i would say with the great hotelier of the world and i'm trying to rationalize the two. is it possible that, if you wanted to, you could be in the airbnb business? your brand is so fantastic is that something you should do or is that just chasing market cap? >> it's a great question, jim, as you probably recall, in early 2019, we actually entered the space, by launching marriott homes and villas, it was a fairly soft step-in, i think we had about 2,000 full homes when

we started, and we're now at about 25,000 full home rental opportunities on every continent. and it's an interesting business i don't ever anticipate us being anywhere close to the scale of airbnb we've really gone for the top end of that market, focusing purely on whole home rentals we've tried to make the value proposition on the foundation of safety, service, and tie-up with the bonvoy loyalty program, and for us, i think really the focus that we hear from our customer, that for system very specific trip types, they want a whole home rent and being able to offer that through the bonvoy platform really allows us to keep them within that marriott ecosystem. >> in 2019, as we look at the home, at the end of the day,

marriott does rely on the business traveler, in 2019, 60% of room nights went to business travelers but now as more companies are saying that their companies are going to go virtual, are you confident you can get back to that number by next year? >> there are lots of opinions out there. some well-informed opinions suggesting there is a tectonic plate shift as it relates to business travel, and it will never come back. that's not what we hear from our customers. certainly, leisure transient demand is leading the recovery but we do have lots of optimism that over the passage of time, as the vaccine is more widely distributed, as the pandemic starts to recede, that our customers are anxious toget ou there and be face to face with their business partner, and their customers. >> that, tony, evercore upgraded the stock earlier in the week, and one of their larger points was they didn't see peak rev par until 2024-2025, and in their

words it is said that it is hard to backfill monday to thursday nights in seattle at $400 a night without a large contribution from business travel is there something you can do from a marketing standpoint, to help spur that sort of nascent demand >> well, i think, as i said earlier, we're said earlier, we are pulling all the refers we can right at the start of the pandemic. we radically changed our operating and cleaning protocols for the benefits of our associates and customers we want them to be safe on the road and we are trying to inspire confidence in those travelers. but it's really murky as we peer into the future. we can look to markets like china, where there has been terrific containment of the virus and you see occupancy levels returning almost pre-pandemic levels. the challenge as we look around the world, occasionally, we'll see a spike in infection rates

and it has a significant chilling impact on demand. but again as the vaccine gets widely distributed, we see pretty strong and steady prospects for demand flow. >> the outlook looks uncertain as you alluded to. what remains sense, your portfolio, tony, laser-focused as you said on the earnings call last week, a global pipeline of nearly 500,000 rooms you added 63,000 rooms last year does that suggest that this rebound in hotel occupancy, you are expecting it to happen in 20 one or is it the 2022 story that the industry is setting on >> well, i think for our owners and franchisees, they are long-term investors and they have long-term confidence in the strength of the travel industry. these hotels take multiple years to get entitled, developed and opened and so they are betting on the long-term future for the

travel industry. >> are you concerned - >> if we've seen any dynamic,ory. >> i was concerned, are you concerned being too aggressive given where occupancy levels are and so many consumers shifting to homes over hotels >> well, what we hear from our commerce loud and clear. they want breath of choice they have very distinctive trip type and depending on that trip type, they may want an economy option, a luxury option, urban they may want a resort so when we look around the world, we think we still have a very long runway to continue to grow our footprint >> understood. we look forward to continuing to track this recovery in the hospitality industry and the role that marriott is playing. tony, thank you for joining us today. we appreciate it tony capuano of marriott. >> thank you all >> thanks to you we'll take a break here. once again, dallas seeing

relative outperformance losses s&p financials record high we're back in a minute i'm searching for info on options trading, and look, it feels like i'm just wasting time. that's why td ameritrade designed a first-of-its-kind, personalized education center. oh. their award-winning content is tailored to fit your investing goals and interests. and it learns with you, so as you become smarter, so do its recommendations. so it's like my streaming service. well except now you're binge learning. see how you can become a smarter investor with a personalized education from td ameritrade. visit tdameritrade.com/learn ♪

tonight at 8:00 eastern

time, we got a good one for you. the cnbc report, this path forward, focusing on small business and how businesses are hoping for and preparing for a potential boom in activity this spring and summer. that tig'sonht 8:00 a.m. eve we're back in a minute

it's time for jim to stop trading. >> first kathy woods has to stop paypal, it's down to three that's enough. so, matel, matel is recommended by citi. they have done a fantastic job turning it around. it is still a very expensive stock. it will do well during an opening because this man engineered the first big turn. we seen matel go down, now it's going higher i like it. >> yeah, jim, there is the stay@home game thing and the film and production thing. it's no longer a one-note story. >> elon hasn't done that plus barbie is in so many different kind i saw that one and it just crushed me >> nobody else did, jim. >> we're coming to the end of the show, you don't need to look

over here, what can i tell you >> okay. i will >> jim, what's tonight at 6:00 really quick >> okay. i have a company upwork. it's climbing. then james litinski. it's real earth materials. it's a spac. it is the zeitgeist of the moment david. rare earth material. >> c'mon >> flying cars >> flying rare earth materials >> we'll see you tonight, jim, "mad money" 6:00 p.m. eastern time >> good morning, i'm carl, morgan brennan has the morning off. some loses to start with we're watching for powell in a bit. we'll take you there live as soon as we get way way beginning. first, though, rick santelli new home sales >> yes, good morning january new home sales maybe one of the hottest sectors that was

least affected, actually enhanced in many ways by covid, well, up over 4% to 923,000 seasonally adjusted annualized units. that is better-than-expected and sees a very nice positive revision, from 842,000 originally, december final jumps up to 885 thousand j you to give folks an idea. this is the one sector pre covid the numbers were smaller we're 774,000 in january of '20. we reached a million in september revised lower. all that is treasury yields because they keep zoom, zoom, zooming to the upside >> look at that, endorsing j&j for emergency ruse mech terrell has a lot of

details. most of them are good, meg >> they are, sure. the briefing documents released ahead of a meeting of outside advisers scheduled for friday reemphasizing the efficacy after the single shot of the j&j vaccine. show out this graph that shows the comparison between the vaccine and placebo group. the cases are leveling off, really after two weeks you see that protection start to kick in compared with the orange line which is the sorry, those are switched the blue line should be switched you can see the vaccine provides protection importantly also providing strong protection against hospitalizations and deaths, after four weeks of getting the shot nobody was hospitalized who received the vaccine the faa saying no concerns that would preclude emergency ruse, the common reaction inject site

teams, headache, fatigue, muscle pain there were air events of hives and one hypersensitivity reaction the next steps are the next outside group of advisers, they vote at the end of the day if that is positive, we could potentially see emergency use authorization over the weekend the cdc will meet sunday and monday to discuss this vaccine, whether they make specific recommendations on how best it can be used. we know that once this vaccine starts to roll out, there will be a few million dose available ramping up to 20 million by the end of march 100 million by the end of june because this is a single shot, it's enough for 100 million people >> coupled with moderna and pfizer could get us close. >> absolutely. we know we ordered enough for 300 million americans from moderna and pfizer with delivery

by the end of july and another doses from j&j there are only 330 million of us so we will have an excess. >> we cannot wait for that day, meg. we will talk to you as we continue to work through j.&j materials. watching the markets rates are a big part of the story today as the ten-year yield hits above 1, 4. we await jerry powell's testimony. global chief investment strategist le la richardson is the adp chief economist. thank you so much for the time it's great to see you both >> thanks for being here >> stephen, i talk about the rain picture there is a story crossing the wire now j.p. morgan is cutting market effects to market weight because of the rising yield story in the u.s. is the picture changing air play book at all? >> well, look, the u.s. is borrowing a lot and having a

higher inflation target, which chair powell downplayed somewhat and luckily he is aware of these things in his testimony yesterday. all of this will probably weaken the u.s. dollar in time. but we've got a tremendous amount of consensus positioning that's underweight the u.s. dollar and the fact that we're seeing, for example, europe push back on sovereignty yields rising the ecb likely to do more. i haven't heard the federal reserve talking about stepping up the qe from 120 billion a month while the biden administration pushes through a record large stimulus. so it's very possible we are in a countertrend rebound in the dollar, which causes a bit of trouble for some of those dollar sensitive assets of course, the rise we have in yields that comes with this, creates some problems for a very intrasensitive growth assets, which is the big story we have been covering the last two days. >> are you having to walk some

people off the ledge in terms of worrying about a rate shock or a rate ska ir? either now or later in the year? >> at adp, we're look tact labor market, the federal reserve is looking in the middle between wall street and main street and their concern is the labor market, making that recovery in the labor mark, which is going to be a clawback 10 million people still out of work that's the concern of the fed and the process of doing it, the biproducts are these super low interest rates, which fueled the stockmarket. so it's really for us all about jobs and that's what it is for the feds right now i think the fed is actually ahead of the curve i know the marks like to think the federal reserve is behind the curve. on this the fed is thinking about two things about the economy. one is lower growth positions are more permanent so below 3% growth is probably

likely in the future after we get these short-term births. two, the economy can sustain a much lower rate in unemployment than previously thought and still not generate inflation the markets haven't caught up to those two things, the feds have totally reoriented its policy around. >> stephen against this rising interest rate backdrop, do you think there should be more of a focus on where the government is putting its money as debt has the potential to become more expensive? >> look again what you just heard, 10 million job losses in the u.s. is real 1 million joining the labor force as we grow these are absolutely right but the most stimulus is the vaccine you talked about we're going to be stimulating more we're going to have a larger fiscal easing in 2021 with a

vaccine in an open economy than we did in 2020 if you think about you heard obviously larry summers talk about the priority of improving economic growth with structural improvements right, with infrastructure as one of those possibilities, you got to say how much room is there for all of this? i think we can get ourselves a little too upset the direct income supports to the economy, checks for 85% of the public this is about 2% of gdp. a lot of this borrowing will go to fixed balance sheets. 500 billion for state and local governments will not be instantly spent on the economy it may stop tax increases from happening, for example so a lot of moving parts here. i think the real question for concerns built in the markets is what does the federal reserve do what does the government do after we are fully recovered how much will this be business

as usual the thing for us to do, right now we know fiscal policy is still counteracting swaps. >> when does that full recovery take place i seen estimates of the 2022, perhaps, by the time as fauci would say we may not be wearing masks. we could see a rate increase around that time frame are you looking at >> we are inching closer to that time period. i would say the second half of the year, we are starting to see gdp growth aksel race and we're starting to see it going back to pre pandemic levels. it's going to take that little bit longer to get from pre boycotted levels to the levels of the trajectory of growth before the pandemic. but the story for the labor market is very different i have to circle back to homebase here for main street, which is jobs. jobs are not likely to recover for several years more that's what the fed is looking at and the game changer here is

stimulus we talked a lot of the relief aspect of government spending. as your previous guest just mentioned, there is so much more with stimulus and infrastructure spending that could change the trajectory over the long term instead of giving us a short burst of quarterly enthusiasm in growth because of consumer demand pent up but the question you ask is a great one. it's a layered question, though. we will see a recovery in gdp far sooner than we see in the labor market >> finally, leave, yesterday, we had a bit of a betting game on twitter too whether or not powell would reiterate the phrase, thinking about raising rates. i didn't hear it, myself, i wonder if he might use it again today. when that moment comes, will the market see it as pivotal or we have been waiting for this and there it is? >> i don't know if that will solve everybody's fears pushing

up long-term rates right now the fact that we are negative in real terms ought to be disincentive in getting large position and safer fixed income right now. i think the fact that powell said we will not repeat the mistakes of the 1970s has got to be comforting. then again, we're not looking to do more than restore the economy and get our labor markets back i'll tell you, when you think about, i'm sorry to disagree about restoring full employment, we have lost in april of last year half of the hospitality workers in the country the vaccine can reopen this economy. it can get people back out at shopping strernts and restaurants. that's what will restore full employment again if we give people money to get through this, to bridge over this period of time when the economy is suffering from this health pandemic, that's fine. what we can't do is make that a rer pitch wal habit going

forward. >> definitely have small business, it's a real concern. it's not just lost workers that's affecting the legion hospitality. >> neil, steven, we'll see what powell says on day two i appreciate that setup. thanks. as we head to break. watching shares of tesla trying to avoid a fifth straight day of decline. our kathy woods says she is spying on the dip. we are of course awaiting the start of way way with that hearing with fed chair powell. we will take you there live as soon as it begins. don't go away. we've been online for more than 25 years and have helped thousands of students reach their goals. as a nonprofit university, we believe access to high quality education should be available to everyone. that's why we offer some of the lowest tuition rates in the nation, and haven't raised tuition

in nearly a decade. so no matter where you want to go, snhu can help you get there. visit snhu.edu today.

it's moving day. and while her friends are doing the heavy lifting, jess is busy moving her xfinity internet and tv services. it only takes about a minute. wait, a minute? but what have you been doing for the last two hours? delegating? oh, good one. move your xfinity services without breaking a sweat. now that's simple, easy, awesome. xfinity makes moving easy. go online to transfer your services in about a minute. get started today.

welcome back cbre the largest real estate firm posting a record eps. the stock already up more than 20% year-to-date hovering a flat line today for more on the quarter of the company's move to dallas and even their own spac, we are joined by cbre ceo and i want to apologize in advance, we are awaiting that interview from chair powell. we may have to cut this short. let's talk about officer it has been a struggle throughout the pandemic. it represents less than half of your leasing revenue during the fourth quarter compared to nearly two-thirds last year. what are the conversations like right now with corporations about their return-to-work plan. do you expect the full snapback

after this vaccine kind of rolls its way through? >> a lot of uncertainty of what will happen when companies around the world return to the office but here's what we think today and what they're telling us. something like 85% of weighted average base of office employees will come back of course, as i said, uncertain. they'll take more space per person they will be more intense service offerings and so forth but there is going to be more remote working, more hybrid working. some people working from home full time. the really important thing to know about our company as it relates to that is offices in pre business for us, but so are data centers and warehouses and some space type, prototypes have really thrived that's what allowed us to post those strong results in q4. >> i want to circle back to what you just said, 85% will come back they will take up more space when they do are those 85% of people

currently working from home or 85% of the overall economy, including those currently in the officer and so forth >> you know, that 85% is a benchmark against pre covid and it's based on surveys we've done, lots of talk with our tenant clients but i will say, there is a lot of uncertainty how they will feel about this once we do get back they do feel, though, like things like collaboration, culture, are really bend and also understand some of the benefits we seen by using technology while we are working from home. >> bob, one would imagine the outset of the pandemic, given your leasing efforts in cities like new york, london, san francisco, that you'd be hurt. but you mention these often overlooked industry opportunities. you mentioned data centres what else allows you to make up for the lack of business you saw in one of your key areas >> well, i mentioned data centers, distribution centers

really big any kind of medical space did well also, geographically, we are spread around the world, so yes, new york, san francisco, london were hurt. we have a sizable business in asia that held up well second tier markets in asia held up well. part of europe held up well. so we're in a product type, geography and some of those clients and some of those geographies and prototypes did exceptionally well that's what you saw come through in our results in the fourth quarter. >> when it comes to some of those enormous market offices, london, new york, san francisco went to a lesser but significant extent do you think companies are ever going to increase their footprints so many seem to be walking away from their leases as opposed to thinking about renewing or expanding? >> very few of the big clients that we interface with, we interface with most of them, are saying that they're going to

abandon their office space most had a few that they will go back to the office in a significant way. but also have a hybrid work format, where some of their people are at home some are in part of the time, out part of the time some of their people use this remote necks space we just invested in disastrous flex space company that we got a great profile. so it's going to be a mixed back but there is going to be a sophisticate return to the officer. almost every large client is telling us that. yes, there will be some hybrid space circumstances as well. >> it's fascinating that you say that, bob. goldman ceo david solomon is on the tape this morning presenting a credit suisse. he says a work at home is not new for us it's an aber aberations with wi correct as soon as possible. is is that what you heard? smr it's not a lot firmer than

others, they are saying a real concern about culture how people solve problems, about collaboration, about the mental health of people working from hem endlessly, that's in the - >> yeah, i'm sorry my apologies i appreciate the answer. powell is beginning way way. let's get to the hill. sn♪ >> on that same day, you gave a speech that warned against the start of a top line assessment of employment, noting that, quote, employment in january of this year was nearly 10 million below its february 2020 level, a greater shortfall than the worst of the great recessions after that quote/unquote. chair powell, do you believe our economy is in ahealthier position less now than it was in 2014, several years into the recovery from the great

recession? >> i am reluctant to make that comparison without thinking about it further i will just, though, echo that we have 120 m0 million fewer pee on payroll jobs than we had one year ago today and that the unemployment rate, the reported rate is 6.3% if you include people who were in the labor force and, indeed, working in february and a couple other adjustments you get to almost a 10% unemployment rate so, there is a lot of slack in the labor market and a long way to go to maximum employment. >> thank you in that same february 10th speech, you mentioned that and i quote, formally recognizing the benefits of a strong labor market will take continued support from both chair powell and run investments, quote/unquote. certainly, it will take a longer-run investment to achieve

a true quote economy that lifts workers' wages and finally closes the racial gap. has congress considered the rescue plan? many of my colleagues said we should quote wait and see unquote before spending more chair powell, does the economy need additional fiscalsupport from congress right now? also, how critical is it for congress to make longer-run investments if we want to terminate the racial wealth gap? >> what i was really saying, madam chair, with that was that we have shown that we can over the course of a long substantial we can get to long low levels of employment and the benefits to society, particularly to lower moderate income people are very substantial. we've shown we can do that but, it's not really a great strategy to wait until the 8th or ninth year of expansion to

get those benefits to really improve through the cycle what i was saying in that set of remarks was that it will take private sector and investments from the public sector in, you know, frankly in the work force, education, training, policies that support work force participation. things like that that's what i was really getting at there >> and with that, i'm going to yield back my time and i'm going to call on the gentleman from north carolina, mr. machenry, who is the rank member of the committee. are you now recognized for five minutes. >> well, thank you, madam chair. and, in fact, i think your work force speech was your labor market speech was a very important one for all of us to take note of and this recovery is different than the recovery from the

financial crisis it took much longer for us to get to this rate of unemployment than it did post-financial crisis and as i've mentioned in my statement, that the chairman of the committee was kind enough to quote from is that the labor market now is better than it was in president obama's first term of office, so, these recoveries are different. now, also, you had a broad-base recovery that took decade, almost a decade to come about with post-financial crisis but right now, have you segments of the economy like you mentioned in your statement, chair powell, about hospitality, that that is lagging because of state shutdowns. but in your testimony, you mentioned the fed exit strategy is contingent on meeting the fed's goals for economic

recovery so, how close is the economy to meeting the fed's goals and what does that look like? >> so, what we've said is that we would be purchasing assets at least at the current pace until we see substantial further progress toward our goals so that's actual progress that's not forecast progress so we would want to see, it is what it sounds like, we would like to see incoming actual data that shows us moving closer to our goals, both for inflation and employment that's what it will take i agree, there is an element of judgment, we will be indicating as clearly as possible, as far advanced as possible how we perceive the path of progress towards those goals. >> is it consistent with your mandate? consistent with the mandate? what does the labor market look like when the fed has achieved

this goal? what does the labor market look like >> so i this i it's easier to say with liftoff we have been very specific with liftoff. we said in liftoff, we need to see labor market conditions that are consistent with maximum employment, inflation at 2% and inflation expected to move laterally above 2% for some time those are theen cans that are quite specific we haven't tried to be specific about, you know, the pace of asset purchases and we just said substantial further progress is what we said >> chair powell, yesterday, you also spoke about the digital dollar being a high priority for the fed. i think this is a national security issue and economic security issue for sure. you said you are committed to transparencys, you are looking at the digital dollar. it's important for our system of government i think it's an important thing for an open society. let's get into a few specifics,

if we can. what can the public expect in terms of learning the details of this project going forward and are some more details, are you able to share with us today what we can expect from the fed in this year over the course of this year with the digital dollar project >> yes so this is going to be an important year this is going to be the year in which we engage with the public pretty actively, including with public events we are working, which i'm not going to allowance today. but there are things we are working. and the decision we made, what do you guys think? it's going to be these are the tradeoffs. there are both policy questions and technical questions that inner relate between those two they're very challenging questions. so we're going to want to have a public dialogue with all of the interesting constituencies and that is the idea what we are doing. in the meantime, we are working

on the technical challenges and also collaborating with and sharing with central banks around the world doing this we will need depending on what we do, we could well need legislative authorization for such a thing that isn't clear until we see which way we're going. so we will be engaging significantly with you and your colleagues on capitol hill as well >> i think the project's vital for xhern competitiveness. but -- for american competitiveness. but to kill private sector innovation and our banking system, implementing monitored policy, modern monetary theory, for example vis-a-vis said accounts what do you say to folks hoping to exploit the digital project in that way? >> one thing we need to be very mindful about is that we have a functioning financial system and

a banking system and capital markets which intermediatiate between savers and borrowers they're the best markets and i would say the strongest banks in the world. we need to be careful with the design of the digital dollar that we don't create something that will undermine that very healthy market-based function. that's one thing for sure. >> okay. now, final question here you mentioned the labor market we talked about the labor markets. as far as the fiscal side of the house, what are the things we should be doing? what are the biggest challenges to gettingpeople back to work? >> well the single biggest as you well know, unemployment and low activity is demonstrated in that sector of the economy and the service sector, where people gather closely together, travel and entertainment, at leisure, holes, those sorts of things the single-most important policy to

getting those sectors reopened and getting people back to work, of course, is bringing the pandemic to a decisive end as soon as possible and we are on the path to that but we haven't done it yet so i think it's important that we quite decisively. >> thank you thank you, chair powell, thanks for your leadership. >> the last guest for small business is now recognized for five minutes >> thank you, chair, chair woman. chairman powell, i hear you speak about the changes in the fomc's monetary policy framework in your opening statement. it is clear that the pandemic has had an outside impact on women, minorities, women and workers. how will the changes in the fomc's monetary policy framework benefit workers in these areas >> so what we've learned in the

course of the last expansion was we could have unemployment at historically low levels without seeing troubling inflation arise. so we took that on board in creating our new framework and as i mentioned in my remarks, that means we won't say monetary policy just because of a strong labor market we want to see either inflation moving up in a troubling way or other risks to achieving our goals. that puts us in a place where we can have low levels of unemployment again western we get to those low levels, we see that they do benefit low and moderate income communities and minorities more than others who tend to benefit earlier in expansion so that plus what we said about maximum employment being a broad and inclusive goal >> thank you chairman powell. in may, 2020, the occ finalized

a rule substantially revising the community reinvestment which the fed and the fdic may not sign on to in september 2020, the fed proposed its own update to cras. with a changed administration, do you expect to reengage with the occ and the fdic on cfcra rule 19? and do you thinkthere is an opportunity for a harmonized rule amongst all three agencys >> i think there is an opportunity for a harmonized rule amongst agencies. we are engaged, partly engaged and continue to be engaged with the updated occ and we are working on that very thing >> do you have a time line >> i think we are just getting started. there will be a new comptroller. nonetheless, we are working on it by the way, it will be one that has broad support among the

community. which was always the fed's test and my test for what it would take for the fed to support and perform a cra. >> especially at this time when under served communities, minority and female business and all that have been impacted by this pandemic and cra is a way to lift up the community of color particularly chairman powell, lastly, governor boehner gave a speech on the role of financial institutions in tackling the climate challenge. in her speech, she stated and i quote, climate change is already boasting substantial economic costs and to have a profound effect on the economy at home and abroad would you agree with the statement and can you give some examples of how you see that to be true?

>> but i think climate change is a very important issue and if you will allow me, i will start by saying that the nation's policy on climate change really need to be set in the first instance by you, elected representative in the house and senate and then by the administration through the agencies congress has created. our role is that of assuring we are using our powers to carry out our mandate in supervising financial institutions including that of -- >> and can you, plain the steps the fed will be taking over the next 18-to-4 months to ensure the until system can deal with the future financial and economic risks posed by climate change >> yes so we're doing right now a great deal of outreach and research and consultation and, by the way, the larger and medium-size

banks are doing the same thing it is really time to have this, to do this work and to try to understand climate change is a longer-run issue to deal with and you will see that the financial institutions, so they're very focused on understanding how it will over time affect their business model. we're looking at doing the same thing from a standpoint of supervisors, so, researching basic work to layout a framework, which will take some time, but it is time for us to do that. >> thank you i yield back >> thank you just a moment. -- recognized for five minutes. >> thank you, madam chair woman and chairman powell again thanks for being here today thank you for all that you have done during this unprecedented pandemic under the fed's average ingalatian targeting, you are

looking for inflation to be and i quote moderately above 2% for some time to make up for under shooting inflation in the past what does moderately above 2% for some time mean, specifically, and why do we believe this is achievable if the fomc's three-area projections are quite some time now have been forecasting inflation that of 2% or less >> so, on the first part, what does moderately mean we don't have a formula, we're not going to have a formula. the sense of it, though, is that we want inflation to average 2% over time. the reason we want that is we want inflation expectations anchored at 2% which is a part of the case now. that's really how we are looking at it. in terms of ka we get there?

i am confident that we can and will and we are committed to using our tools to achieving that the three-year time frame is arbitrary chosen by us we're just being honest about the challenge. we live in a time where there is significant disinflationary pressures around the world are essentially all majored a vantsd economy, central banks struggled to get above 2%. we believe we can do it. it may take more than three years. we will update at every quarter, we update that assessment we will see how that goes. >> thank you, chairman powell. i know you were asked a number of times by my colleagues in the senate yesterday, whether the fed intends to extend the exclusion of low rick assets such as treasuries and reserve balances from the supplementary

leverage ratio i strongly support it, the agencies decision nearly a year ago to make this exclusion in recognition i think of the fact that banks are receiving just an unprecedented amount of new deposits, largely ads as a result of the ed's actions, that continue, continue to put pressure on leverage ratios. you indicated, sir, yesterday, that the fed is still considering, considering whether or not to provide an extension do you agree that the exclusion proved to be an important tool to preserve liquidity in the treasury market? >> yes, i do agree we are now, we're looking at this i don't really have anything for you on that decision i didn't have anything yesterday i should have pointed out. so we're looking at that and we know when the deadline isn't we're working on that and we

will come forth with something relatively soon. >> well, i hope it's relatively soon, mr. chairman , in that we are considering other accommodations to continue economic recovery. i am concerned and i am wondering if you are concerned about that arbitrarily removing the exclusion on march 31 could put additional pressure on the treasury mark, making sure that the slr is extended i think is very, very important as we continue this recovery and as i said, as further stimulus actions are considered and put

into law >> march 31 is nearly upon us, mr. chairman. >> yes, it is. >> oh, c'mon, surely you can tell us a little bit more about how important that was over the past year in terms of our banking industry and to keep liquidity in the market given the large number of deposits that were extended to our union. >> i'm just going to say they're having discussion on it right now internally i really don't want to go any further than that, i'm sorry we're making a decision. we're considering it when we have a decision, we'll come forward i'm sorry. >> i respect that and i look forward to your decision and madam chairman, i yield back thank you. >> thank you >> the -- from california, mr. sherman was also the chair of the subcommittee

entrepreneurialship and capital market is now recognized for five minutes. >> thank you mr. chairman, it's good to hear about your fed listens events. i assure you your best fed listens event is right here today. you will not find 50 people and more representative of the 320 million americans. i have grown old serving on this committee and i've seen your predecessors, come here and republicans attack them for what they regarded as a monetary policy, whether the expansionary system be the traditional or the relatively new fangled quantitative easing. it's good for me to live long enough to see many of the republicans are moving in our direction, towards the need for a somewhat more expansionary monetary policy. i would hope you would be looking at 2 and a quarter

percent rather than 2% as your target i also commend you for the quantitative easing. it halls allowed you to remit to the federal government 50 to $100 billion in each of the last several years and so those who criticize your big balance sheet as unwilling to identify which taxes they would raise in order to make up for that lost revenue. also your quantitative easing big balance sheet approach is the only tool you have to influence long-term interest rates, which i think are much more important to our economy, in that you have to borrow long-term to build back critical business i prefer mon they're policy to expansionary fiscal policy because all of your tools reduce the federal deficit and all of our tools increase the long-term federalle debt i want to focus your attention

on libor it now appears as if the libor index will be produced until 2023 it's almost disappointing to get a reprieve and it will solve this problem but it does give us more time. and there is, of course, the alternative reference rates committee. arc. we have legislation to facilitate how to deal with what will be $2 trillion of contracts that don't have back-up language i weekender if you can confirm for me, in your view, is it necessary to have federal legislation to have a smooth transition after june 2023 when libor is no longer -- >> yes, we think it will be. as you know, many libor contracts will run off before then, they'll be a hard tail as we say we think federal legislation is the best answer.

>> and there are those who think that we can -- that the private sector can just invent a synthetic libor and that would solve the problem. is that as good a solution as federal legislation? >> no, the federal legislation would creating path for a packup would be the best solution, we think. >> thank you >> now, i want to move to something that we talked about before and that it's regarded as a small issue. and that is the system for avoiding wire fraud. when we talked about this earlier this month, where usually somebody trying to buy a home, the first ever, ten, 20, 30, $50,000 from the pay it's their life savings. they are tripped into wiring in the money. they lose it forever you are using the fed now system

and your bureaucrats have told us that they don't want to eng fear that system to avoid this tragedy that occurred as i said affecting the $150 million last year that they don't want to do the really simple thing of saying when you remit money, not only the account number, but the name of the person you are sending it to and i know your bureaucrats will tell you, they don't want to do it i wonder whether you will go back to your agency and get personally involved and push them to avoid this tragedy i don't think your successor should have to treat people at the next session maybe ten years from now can you xh it to getting personally involved in having a system that will hopefully protect homeowners or home buyers >> so, i think as you know,

we've looked carefully at this and concluded that it's not the best way to do it and there are problems in the u.s. system. i will be happy to go back >> if there is another way, let me know what it is your staff tells me. -- >> your time has expired mr. lucas is now recognized for five minutes >> thank you, madam chair. and chairman powell, you know i have a tendency to focus on those things that affect my people back home up and down main street and across the third district of oklahoma so let's discuss for a moment when you were last before the committee in june. you noticed the banking system has been a source of strength during the pandemic. the monetary released february 19h reaffirmed this point stating that institutions are the core of the financial system remain resilient you continue to believe that banks are a source of strength

and elaborate both on what that means to the economy and for bank's abilities to lend, yes, absorb losses potentially too and provide liquidity in distressed markets >> yes so, we've, we know we spent and the bank spent ten years in a strengthening process, higher capital, better risk capital, higher liquidity, all those things and we received a historical size shock in the form of a pandemic and i think you know essentially close to a year into it, almost exactly a year into it we see so far what we see is that our banks have held up quite well and their capitol, the big bank's capitol increased over the course of the last year, while they've also

taken 100 billion plus of preserves against losses so they are able to keep blending they're not a source of weakness at the beginning of the pandemic, they were very important because they did absorb that huge flow of deposits, made all of those loans as companies pulled down their lines of credit. those were paid back early on. at the very beginning when it mattered a lot, they were a source of strength so i think all of that is right. we continue to be vigilant but history is that the banks are strong and i would say the same for small and medium size banks as well have generally held up, there will be issues. as we come out of this, there will be lossess, but it's quite different a very, very different situation than the global crisis >> absolute lit. and, mr. chairman, let's discuss for a moment a topic important not only to me but my friends on

the majority services committee. the national rate has been falling steadily for the past decade, since last cam calculated sets it at about 5.4% still this represents more than 7 million u.s. households without a checkings or savings account. unfortunately the covid-19 pandemic is likely to increase in on bank households. chair, what would you suggest to reduce the adverse impact on the unbank and under banked in the aftermath of the pandemic to ensure no one is left out of the economic recovery? >> you know, i think those are a serious problem to address you know, we tend to address it through our community affairs and efforts to make sure that fair lending policies and things like that. i also think there was more that congress can do, i'm sure to assure that people have, you

know, education around financial matters. and the other piece of it is, they're people at the lower end of the income spectrum living hand to mouth. we need a strong recovery. we need continued support for monetary policy and we'll be th. >> one last question, chairman, and it impacts the ability of every main street to function. according to the fda the united states administered more than 63 million doses of covid vaccine, covid-19 vaccine chairman powell, can you expand how important to the economic recovery or how dependent the recovery is in ramping up that manufacturing and distribution >> yes the weakness we see in our economy now is unusually concentrated in a set of industries that involve people getting really close together. hotels, restaurants, travel, entertainment, all of those places

and that's millions of people who aren't working and businesses that may have been in business for generations and the way to get after that is by successfully decisively bringing the pandemic to an end. that's the single best growth and economic and prosperity creating measure any of us can undertake. that is the vaccination continuing to absorb social distancing and wearing masks and hopefully we're on the road. if we are, we're going to see -- there's grounds for optimism in the second half of the year. >> the gentleman's time has expired. the gentleman from texas who is also the chair of the subcommittee on oversight and investigations is now recognized for five minutes >> i thank you very much, madam chair, and i thank the witness

for appearing. i'm always honored to have him before the committee my question has to do with the state's small business credit initiative this is that initiative that was on a republican administration it has served us exceedingly well and the chairwoman with her insight and foresight has expanded this program to make sure that it covers women and people of color to a greater extent we are talking about having this initiative funded with $10 million and this is in the covid package and this can drive up to $100 billion of private sector investments in these small businesses states would be required to submit a plan as well as our jurisdictions on how expeditiously these funds can be delivered to help small businesses respond to and recover from the pandemic. a plan to encourage

participation of mdis, minority depository institutions, as well as community development financial institutions would be a part of this my question to you is simply this how important is it that small businesses receive these capital investments? they sometimes find it difficult to acquire funds of this type, in this package. how important is it these funds during this pandemic get to these small businesses >> well, small businesses are under a lot of pressure. more so than the larger business that is had resources to get through this mdfi, mdis and cdfis are very important channels for reaching them it's not appropriate for me to take a position on this particular provision and its

inclusion in the legislation i would just say that it is important for small businesses and you mentioned the mdis and cdfis. we work very closely with those organizations and think highly of the contribution to our economy. >> yes, sir. i concur about working closely with them. i happen to be aware of some of the good works the community banks, as you know, i'm very much concerned about them and some of them are on the margins and this type of assistance to some of these smaller banks can be a great help to them i don't want to you comment on a specific bank or specific banks in general but i am concerned about the need to maintain these institutions that have a niche they have a clientele that somehow and sometimes will not

be met their needs won't be met if they don't have these institutions that are in the communities. have you found it's good to have these institutions and these communities where the need is not always met >> yes we think community banks are very important part of the fabric of our community, and we see them under longer term secular pressures. they've been declining and we don't want to add to that through regulatory burden. we have a community banker on the board of governors and we try to do everything we can to not be part of the problem. people are leaving small towns and moving to cities and things like that and that is putting pressure on rural community banks. overall they know their communities and we want them to operate safely and soundfully and successfully >> thank you very much i have very little time left what i would like to do is

simply acknowledge the chairwoman for helping us to get this $10 billion into the covid package. this helped us to modify it along with one of my republican colleagues so the very small businesses will get some help. there are small businesses and then very small businesses we don't want to leave any of them behind. madam chair, i thank you for the opportunity to ask these questions. i yield back >> thank you very much and i appreciate your comments i will now recognize the gentleman from florida, mr. posey, for five minutes. >> well, thank you very much, madam chairwoman i'm pleased that we have this opportunity to hear chairman powell's semiannual report on the state of monetary policy we've all shared quite a year since february 2020 hearing -- >> chair powell addressing a broader range of topics than

yesterday, the dollar and climate range. reiterating comments from yesterday about employment add that go it might be possible that they don't reach their inflation expectations for the next three years by the way, the dow has gone green. i think we have exceeded the all-time high. boeing up 5% year to date high. disney has hit $200. that's an all-time high. quk le srt "sawaly"tas in a minute it's not “pretty good or nothing.” it's not “acceptable or nothing.” and it's definitely not “close enough or nothing.” mercedes-benz suvs were engineered with only one mission in mind. to be the best. in the category, in the industry... in the world. lease the gla 250 suv for just $399 a month at your local mercedes-benz dealer.

mercedes-benz. the best or nothing. this is decision tech. find a stock based on your interests or what's trending. get real-time insights in your customized view of the market. it's smarter trading technology for smarter trading decisions. fidelity. we see temperature control software giving everyone a shot at vital vaccines. at emerson, our software is shepherding medicines through every step of the cold chain, helping track conditions to keep each dose safe and effective. emerson. consider it solved.

new projects means new project managers. to keep each dose safe and effective. you need to hire. i need indeed. indeed you do. the moment you sponsor a job on indeed you get a short list of quality candidates from our resume database. claim your seventy five dollar credit, when you post your first job at indeed.com/home.

good morning it is 8:00 a.m. at square headquarters in san francisco. 11:00 a.m. on wall street. "squawk alley" is live ♪ ♪ ♪ ♪ happy wednesday. welcome to "squawk alley." i'm jon fortt along with carl quintanilla. the sfo of square as