little bit higher, perhaps in relation to the backlogs in the suez canal or other things that are going on, but happily that ship, the ever given, has been freed in the suez canal and bottlenecks will start to abate we should hope frank. >> thank you for watching "power lunch. "closing bell" starts right now. >> it certainly sdchlt welcome to "the closing bell." i'm wilfred frost along with morgan brennan in for sara stocks are off to a cautious start to the week as details emerge of a margin call episode. credit suisse is getting slammed while the major averages are mixed with the russell seeing the biggest declines let's look at what's driving the action yields moving higher with the 10-year back above 1.7%. shares of boeing are leading the dow after southwest agreed to

buy 100 737 max jets and there are fresh concerns about the rise in covid cases across america president biden saying moments ago that he's asking governors, mayors and local leaders to reinstate mask mandates. we have 57 minutes left of trade and we are just lower on the other averages. >> marge enmadness i see what you did there, wilf coming up on today's show, that ship has sailed. it's going to come all day today. quarter mile long container ship that had been blocking traffic in the suez canal is now unstuck but will there be longer lasting impacts from that backup we'll discuss that with jeff currie plus harvey pitt will be here to talk about the margin call incident and whether it will lead to regulatory backlash. let's begin with that. leslie picker has the details on what happened last week and

wilfred has a closer look on the banks themselves but, leslie, let's set the scene with you. >> hey, morgan, that's right the postmortem is still being written. there's a lot of unanswered questions but it all started back on friday morning when goldman sachs in a note to clients offering black trades and several chinese internet names at steep discounts but throughout the day, the stock sales kept coming from across wall street discovery, farfetched, gxs, viacom, all offered at steep discounts. quickly traders scrambled to figure out what exactly was going on ultimately signs pointed to a little known firm called arcegos capital management the firm faced a forced liquidation on several overlevered positions. archegos did not respond to our request seeking comments but

some of his trading was done given swaps giving him the capacity to be more levered without the need to disclose what he holds. he worked with at least six prime brokers, none of whom had a full picture of his exposure we're told the ft citing sources familiar said a number of the banks were loaning at a ratio of 8 to 1 in some trades. that ratio got as high as 20-1 that is multiples higher than many of the riskiest hedge funds are out there. it's virtually unheard of on wall street, wilf. >> it's a fascinating read, that latest ft article. i just wonder, are we talking just a simple call option and whether that could maybe make some of those numbers seem a bit bigger than they are, but either day there's no doubt about some extraordinary leverage in this story. let's cover a bit of the angle from the bank side of things

late last week various prime brokerage departments started working with archegos capital to help them out but it didn't last very long as quite quickly one of the prime brokerage units started making margin calls and the others were forced to follow fairly quickly goldman sachs and morgan stanley said while they had large exposure, they managed to offload those positions without any serious losses a source at goldman sachs explaining this was due to having very high collateral requirements with this particular client and good risk management overall the same would presumably apply to morgan stanley given that both had high exposures overall. meanwhile deutsche bank on the record told me, quote, we have significantly derisked our exposure without incurring any losses we are managing down the immaterial remaining client positions on which we do not expect to incur any loss,

unquote. this means the bulk of the losses appear to be following an credit suisse and amora who have both warned on the record about the situation. the size of the loss is still to be confirmed it is expected to be in the billions and it comes at a tough time for credit suisse share prices for the group kind of highlighting that expected level of exposure. credit suisse is down a lot. the others not down so much. also, i think, importantly off their lows as all of us and our peers have been reporting these sorts of stories the thing i'd just end with, guys, it's quite the level of risk that has been taken on the hedge fund side we are talking a stock, for example, if we focus on viacom cbs that was up 9x. up at least double since the crazy gameshop madness so you wonder why not start to

take some profits and not be squeezed as they were once the company did a second relisting which is probably one of the triggers that started causing problems for this last week. on the prime brokerage side and probably more focused on the credit suisses of this world, what exactly are you taking that much risk for? an annual fee at best for a hedge funds of this style is going to be in the tens of millions of dollars, it's not hundreds and you're taking risks to the downside at many multiples of that it seems very, very imbalanced leslie, as we were discussing there, it's a story that's captivated all throughout the day. >> yeah, based on what you laid out right there, it defies the typical logic that those who have been watching wall street for decades now have come to appreciate you know, there's just so many more questions than answers at this stage a lot of that has to do with the risk appetite of the various parties involved

you know, i think that's one of those things that we're going to have to unpack the exact motives in the days and potentially weeks ahead. the s.e.c. said it was closely monitoring the situation so i think there will be more news that comes out of this. this is not going away today but you bring up a good point, wilf. the risk appetite across several parties involved here is quite surprising and is really what has people, you know, captivated by this story. >> yeah, it's also, leslie, i know we talked about it this morning as well but i think it's worth revisiting, the fact that whether there will be spillover to other family offices or other funds that might have also been involved in this trade to some extent and also just highlighting in general how much leverage is basically out there within pockets of the market right now. the s.e.c. has taken a look. we know that based on some reports. but you also have to wonder what an entity like the fed is going to be doing to approach this

situation at least from the banking side as well. >> yeah, it's a great question and it's one that i've been asking around about all day. at this point in time it does seem to be largely idiosyncratic to archegos at this time there are other funds that have faced declines for similar exposure but we're not seeing unwinding, large margin calls, nothing to the size and scale with regard to what has taken place with archegos at the time. the story is not over so we'll see what this brings obviously it's created some huge moves in some pretty significant names so we'll probably see within the next several days which hedge funds have felt that with regard to a dent in their returns. but archegos seems to be the one fund that's been caught up in all of this. >> and at other things i'd add to finish, clearly we haven't seen major infection of the rest of the markets today, essentially the russell is down

a bit but the other indices aren't and that's an encouraging sign the other thing i'd say in terms of who's taking so much risk, if we're talking deutsche bank and goldman sachs have presumably earned fees from this hedge fund relationship in the past, they haven't taken too much risk. they have managed it right and got the right checks and balances we need all of that to be confirmed in the weeks and months ahead but that is worth noting it is also perhaps worth pointing out that if you do take big losses, if there's anything untoward done by the client, and the client had way bigger exposure than they were letting on and multiple exposures through different prime brokerages and perhaps they misled those investment banks about it, there's some level of repercussion in that sense there might have been outright wrongdoing by a client maybe your risk management should have been able to catch that sort of thing nonetheless, i think there's a lot of things to be turned over

to explain this. finally until terms of the scale of this event, i get the feelin this is a once in a decade unwinding and there might be some other funds that get a little hurt. but the conversations i've had is they don't expect the once in a decade scale of this to be repeated in the weeks ahead. again, touch wood on that. but that seems to be the case at the moment. >> touch wood? i say knock on wood. >> you guys say knock on wood. >> that's one of the phrases that's different but we all get exactly what we mean. >> i see what you meant. i am curious, though, wilf, i know we have to move on but i'm curious how this reflects back on credit suisse everything that's happening in general with their asset management, i feel like there's going to be more to that conversation. >> yeah, it reflects badly this camera has gone haywire a little bit but the bad time in the short term but bad timing in the last couple of years.

all sorts of issues. the quick final point i'd also make is who was the investment bank, the only thing i've been able to confirm according to sources that it wasn't goldman sachs that started the margin call because there's definitely a process that whoever starts to act first will probably suffer the least losses also what factors in is good risk management and collateral in the first place and possibly also your level of exposure in the first place. all of those things, i think, tilted badly to credit suisse and nomura we're going to continue this conversation and bring in cassandra torien from bell rock capital. thanks for being with us. >> sure, happy to be here. >> given the fact that we are seeing financials take it on the chin more broadly today, one of the worst performing sectors in the s&p and some weakness in some of these names that had exposure but maybe de minimus in

terms of the impact. do you see buying opportunities here >> oh, gosh, absolutely. i'd probably leave nomura and cs out of saying that, but for the rest of the group,.you've got some tremendous valuations there's a real value play still here in a lot of these stocks and a lot of -- jp m ppmorganjp of america, goldman, all of them i think you all are right that some of these companies have really good risk management teams and they did their job, and that's what it's moved by them saying this is going to be fairly de minimus to us. so as a result, i think this little blip is a buying opportunity, but also keep in mind that this also kind of backs up the fed's policy of saying that maybe by the end of june that a lot of these stocks

are going to be -- these companies are going to be able to start their stock buybacks and reinstate dividends, so that's just another reason why to take advantage of this. i mean when you can buy some of these below book value, that's a tremendous opportunity which we haven't seen in a couple of years. >> interesting that jpmorgan's note today on this question whether credit suisse's buyback announcement of late last year will be under threat given the scale of exposure they have. that scedoesn't apply to some of the u.s. names clearly the banks might be exposed to this. there's just a huge amount of leverage to the upside that perhaps we're not all pricing in and we're not saying that we're going to see everything collapse in half like discovery and cbs have, but it's kind of odd to see those happen to traditional value names we know well we're not talking about spacs,

or teslas or recent ipos. >> absolutely. but in looking at the list of media companies, specifically named in the news regarding what they really have taken a hit in, i'm not sure i would couch them simply as value plays. i think they may have been playing more the momentum. if you look at cbs or viacom cbs in the last couple of weeks, i mean it's been strongly to the upside until last week sometime. so i just wonder if momentum playing was really what was going on here. i'm not sure if that's the right approach for a family office, but it's none of my business but certainly the names that were mentioned i think are so far really, i think, are sector

specific i look at my screen and i'm not seeing what i would consider the buy and hold value names right now doing very badly, procter & gamble, campbell's soup, things like that. those are the kind of true value names that aren't getting hit so that tells me more about the composition of the portfolio. >> cassandra, thanks for joining us good to see you. >> take care. after the break, whatever floats your boat the suez saga coming to an end as the massive ever given ship is finally free. we'll discuss the potential ripple effects on the day. jeff currie joins us from goldman sachs. that's a good one. yours was better, though you're watching "closing bell. we're back in a couple gohealth has blossomed from an idea in a chicago apartment

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causing further damage to an already struggling global supply chain. but now traffic which conducts about 12% of global trade can resume let's bring in jeff currie from goldman sachs. thanks for joining us. >> thanks for having me. >> were you a little surprised we didn't see more upward pressure on commodities generally but oil in particular the last week because of this or is it to be expected that the impact was small in the short term >> well, let's put it in the context of the demand shock that we entered over the course of the last week. you had lockdowns announced in the eu, bans on international flights. so you had a significant demand shock coming out of europe so this was an offsetting force against that so when we go back, the last time they announced all of these lockdowns, going back into november, it was a similar situation. we had a weather shock that offset some of it and again in january. this is one of those lucky

offsetting events against those lockdowns in the eu. but nonetheless part of the reason why the markets are struggling right now is this demand shock is much larger than this potential supply shock. the other issue too is mostly resolved right now what i want to emphasize, it really sits at the core of one of our tenets of our structural bull market thesis which is the need to resiliency in supply chains this just underscores how exposed supply chains are globally, whether you're talking oil, metals or commodities more broadly. >> when you talk of oil and industrial metals, jeff, do you think some of these potential demand threats because of semi lockdowns in the short term in europe are a big potential hit to the prices or are they short term, temporary and as particularly the uk and u.s. continue their vaccination paths that hopefully things will rally later in the year? >> i think we're still positive on the rally later this year which is why we call these a

speed bump the question is how big of a speed bump are they. we're not going to completely dismiss them because there is a new variant that is concerning that is on the continent in the u.s., east coast but our base case is we're going to get through this. if opec this week announces it's going to roll forward its production cuts, then you easily accommodated them and we're sticking with our $80 a barrel target for the third quarter on oil and $10,500 on copper. and actually in latin america, there's a 20% drop in chilean copper exports, which is also impacting the supply side. >> you just touched on it, jeff, the opec plus meeting that's going to be happening later this week, what are your expectations is there any room for a surprise there? >> you know, there was a surprise last month and i think the consensus view is they're going to roll over again this

month. why do we think they're going to roll over? we still haven't seen a supply response let's go back to january when saudi arabia did the unilateral production cut they took their production down 11% and prices are up 40%. not a bad trade-off and we've still not seen a supply response globally by the way, it's not just oil we haven't seen a supply response, it's the same thing on the metals what i was telling you is supply i is bare capacity in the near term. >> just over the weekend you have this, quote unquote, comprehensive strategic partnership signed between china and iran iran is going to be supplying more oil to china. you can't talk about the crude market and not talk about g geopolitics. are things shifting on the world stage and what does that mean for u.s. products and u.s. crude? >> i think one of the key reasons, going back to the whole idea of resiliency and supply chains is the escalating trade war between the u.s. and china

call it a cold war or whatever you want to call it, but what this is going to introduce is the need to self-reliance. so we talk about the resilienc in supply changes. it's building strategic reserves, whether it's grains, copper, oil, because think about it, the u.s. is a large exporter of grains as well as oil so that's one of the key responses. but even in the u.s. alone, you have made in america, focused on creating independent chains in the united states. so i think this is going to be a feature of the market going forward and going to create more lengthy supply chains, create more demand for commodities. i'd like to emphasize, when did the americans and europeans build all their strategic reserves in the 1970s in the cold war with the soviets so i think we're going back to a period very similar to that where you have a lot of inefficiencies introduced into the system. >> jeff, i want to finish

quickly on gold. i know you have a $2,000 price target so some upside from where we are now but a more broad, long-term question, do you think gold will continue over the next decade to be one of if not the primary hedge against risk and protection against monetary debasement or is its role in that sense a thing of the past now? >> no, i think -- can bitcoin and gold coexist absolutely actually now we're watching the trading patterns of bitcoin. it's acting very differently than gold. gold is your traditional defensive asset. bitcoin is acting more like a risk on inflation type hedge, more tied to what's going on in the economic cycle so it may be defensive assets but they're trading very differently which means there's room for both to coexist in terms of putting that pool together of defensive assets, you've got roughly $2.5 trillion in gold, $2 trillion in bitcoin

and digital currencies that's roughly $4.5 trillion if you go back to the maximum amount of defensive assets, total aun, it was in 1979, 1980. in today's dollars that would be about $5 trillion. if we look at the digital currencies and gold, lump them all together about 4.5, max historically is 5. so as a group as a whole are we going to take this higher? is this situation more serious than 1979, 1980? that's a question we'll have to answer. >> yeah. just the fact that you're invoking the 1970s right now, by wish we could dig into this a little bit more, but jeff, come back i have a feeling we're going to be talking about it even more. jeff currie, thank you. >> thanks for having me. we have 35 minutes to go before the closing bell. you can see the session is pretty mixed for the major averages the dow is up about half a percent, the s&p is just about flat and the nasdaq is under

pressure after the break the head of the cdc is raising a red flag about rising covid cases in america. we'll bring you up to speed on the latest in the fight against had pandemic, including what president biden just said about vaccines and as we head to break, check out some of today's top searched tickers on cnbc.com the 10-year yield on top followed by viacomcontribution, tesla, apple and boeing. we'll be right back. no one likes to choose between safe or sporty. modern or reliable.

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welcome back to "closing bell." president biden speaking out about covid vaccinations last hour just after the head of the cdc issued a warning about rising cases in america. meg tirrell has the latest. >> dr. rochelle walensky, the cdc director, saying he feels a sense of impending doom when she looks at the case trajectories saying she's scared about what she's saying about an 11% increase in the numbers of new daily cases we are seeing in a few states, more pronounced than others, michigan seeing a big uptick, new york and new jersey as well seeing cases rising higher, guys. then we heard from president biden talking about progress with vaccines and vaccinations, but reiterating that he's concerned as well. here's what he said. >> variants are spreading and sadly some of the reckless behavior we've seen on television over the past few weeks means that more new cases are to come in the weeks ahead

with vaccines, there's hope. which is a very good thing, to state the obvious. but people are letting up on precautions, which is a very bad thing. >> now, biden saying by april 19th, 90% of adults in the u.s. will be eligible for a vaccine here is what we're looking at in terms of expected supply from companies by the end of may, expected to be enough for 300 million people here in the united states. the administration saying they're doubling the number of federal pharmacies that will be able to do vaccinations as well and so we will see this increase, guys but the president, given what we're seeing with case numbers, calling on governors to reinstate or maintain their mask mandates he was asked as he was leaving this press conference does he think that some states should pause their reopenings based on these trends he said yes. wilf >> to your point on the vaccine front, new york announcing today

that over 30s from tomorrow can get their vaccine. very exciting news indeed. time for a cnbc news update with rahel solomon. the opening statement at the trial of derek chauvin, his attorney argued that the former minneapolis police officer was just doing what he had been trained to do with a suspect resisting arrest despite all of the attention of how long chauvin's knee was on george floyd's neck, he asserts that floyd was not asphyxiated. >> evidence will show that mr. floyd died of a cardiac arrhythmia that occurred as a result of hypertension, coronary disease, the ingestion of methamphetamine and fentanyl and the adrenaline flowing through his body, all of which acted to further compromise an already compromised heart. >> and new york is now the latest state planning to make all adults eligible for a shot we know that wilf is very

excited about this one that starts on april 6th with those 30 and over becoming eligible tomorrow. now to a vaccination setback in canada. an advisory panel advising against giving the astrazeneca to people under 50 on the news with dr. shepard smith, hear what dr. anthony fauci is saying about the increase in cases that has dr. rochelle walensky talking about her impending sense of doom. that's the cnbc news update. i could say for the record i'm also very excited. >> i was going to say, it's a bit of an understatement i haven't got my appointment yet, but honestly, once we get vaccinated, it's just a game-changing moment. >> i thought it was funny was the two thumbs up. it was like the boris johnson photo. >> his was more like this. we should move on. still to come, tourists

upgrading twitter saying it has the most exciting road map we've ever seen in the company and former harvey pitt says the archegos margin call has eerie similarities to the 2007-2008 meltdown he'll join us to explain that. bond yields moving higher today. the 10-year currently 1.72 we're back in a couple of minutes.

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we've got, what, 24 minutes left in the session. here's where we stabnd up 154 points near the dow right near the session high, it was 60 s&p is also higher, the nasdaq lagging down 4.0%. so russell still down the most, down 2%. straight ahead twitter getting an upgrade

it's the most exciting road map ever is being rolled out we'll get the word on the street and the call, next

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welcome back shares of twitter up nearly 150% over the past year, but down 20% from the high. the company getting an upgrade today from truist. it wrote that it has the most exciting product road map we've ever seen of the company joining us now is the analyst behind that call yusef, good to see you. >> hey, morgan. >> so you upgraded to buy. you had a hold rating since 2018 why now? what's so impressive >> well, what's impressive is really just the roster of what they have rolled out in the last three, four months and especially what they have in store for the next nine to 12 months so sometime back last year they rolled out topics, which allowed

meme to now follow topics instead of following people. that immediately draws user engagement and stories is also showing some traction. they're launching subscription, they're launching an equivalent to clubhouse, et cetera on the advertisers side, it was really hard for advertisers to advertise against this 200 plus million users. it has become a lot easier they have revamped their new ad server, and their new map products which focuses on mobile app promotion, et cetera so we think that finally the stars are aligning where they have the right advertiser or the right products for advertisers while at the same time growing users and user engagement, so we're pretty excited about it. >> is this more an engagement growth story

i mean, look, relative to a facebook, this is a very, very, very, very small platform. 200 million, they're finally starting to get the scale to get a lot of advertisers relative to facebook, this is maybe one-tenth the monetization of facebook. they need to increasingly show to advertisers, whether they're direct response advertisers or smes which typically don't advertise on this platform, it's really their job to try to convince as much or as many of these advertisers to come onto the platform but the book has already been written. we saw snap do this a couple of years ago and they have done a good job at it we saw facebook do it eight or nine years ago so it's really

more of an execution story as far as getting more advertisers on board right now. >> what about the regulatory risk we saw jack dorsey and other tech ceos testifying again in front of a new congressional composition last week. we've got lena khan coming in at the ftc. could there be a regulatory crackdown? >> absolutely. to their credit, this is not a twitter risk, it's a risk to the entire social platform environment, whether it's facebook or google or snap or these guys so our view is the regulatory framework is going to keep evolving section 230 is probably going to be rewritten the question is how and to what extent these platforms will still be protected under section 230. but we think that's already baked honestly into a lot of

these valuations we like facebook, we like google and we like twitter. and relative to other smaller cap names, these are some of the more -- some of the cheapest names in our space, whether you adjust it for growth or not. >> all right your upgrade is sending shares of twitter higher today, up about 3% thanks for joining us. >> thank you. why citadel's ken griffin says we could see another retail trading boom and boeing gets another big order for its 737 max. those stories and morehewe enter the market zone. to save. really? yeah. very proud of that. with smartride® from nationwide, they can get discounts for safe driving. does she get one? mrs. carmichael? safest driver in peytonville. takes a lot of work and effort to be the safest driver in peytonville. what about this guy? with nationwide smartmiles®, the less he drives, the less he pays. the list of inspiring stories goes on and on. i bet. i've never seen anyone do more with their retirement... ♪♪

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love that music! >> what you guys are missing are the market zone dance there as well anyway, we have 12 minutes left in the trading day we're now in the closing bell market zone, commercial-free of all the action going into the close. let's kick things off with the broader markets. we are on record close watch, somewhat remarkably given the volatility on the dow. the s&p 500 is essentially flat where we stand, though anything positive for the s&p would be a record close nasdaq down half a percent, the russell down 2.3%. michael, russell close, anything to worry about >> there are two markets right now. there's what you see on the screen, all-time highs the s&p 500 on friday hit it

15th high for 2020 alone but there are two very different markets. there's what you see on the market level and there's what you see inside of it and when you look inside of it, you see a violent rotation from the high growth, high multiple names to some of the reopen plays. so i would say that even though it's not the leaders that we've been accustomed to over the last few years, the amazons and apples of the world which it's good to have that, 93% of s&p 500 stocks are above their 200-day moving average, which is by far the highest level going back to 2013 so we are seeing broad participation. it's just not quite as exciting when you're being led by names such as csx, alcoa, that's not the exciting type of market, but things look pretty good from here. >> i don't know. i think the industrial part of the economy is pretty exciting, but maybe that's just me jim lecamp, i am curious, though, we are seeing not only

the nasdaq under pressure but also small caps again which are down 2% and certainly lagging the broader market what happened to this rotation trade we've been talking about for recent weeks >> it turned hotter and faster than it normally does. why? we've got stimulus on steroids, we've got liquidity, we've got leverage and it puts everything in launch mode, especially when you have consumers that have a very high savings rate and pent-up demand so you see consumers ready to go you have tons of liquidity, tons of leverage and we think it puts this into launch mode in terms of how these stocks are going to cycle out. so our early stage economic recovery stocks, which include small caps, are going to get hurt by some of the internals that are already happening, including higher input costs and higher cost metrics across the board. so what really rallied off the

lows were low quality stocks and small cap stocks, and that's what's getting hurt today. we're rotating out of those names already into the middle stage economic recovery type plays, which should continue to include industrials, materials, financials i really like energy in here and i think these plays that have really ramp ud up ed up fre l lows are going to take a backstage because the market is already moving past mentally the early stage recovery plays into the mid-stage recovery plays and it might mean that the averages have trouble continuing to hit new highs as we continue to rotate and i think we rotate into higher quality names, but only at reasonable prices so they're going to avoid the high pe stocks and they're going to avoid the low quality stocks all at the same time it's going to make a stock picker's market, not necessarily a market for the averages.

>> citadel's ken griffin warning today that the rise in retail investors may indirectly threaten the bull market we've seen in the stock market in an interview with the ft, he said given the incredible amoamount of stimulus that has been released, we could see a real surge in inflation there's a chance it could become permanent and structural, more of a chance of that happening than at any other time other the past 12 years. michael, i'll go to you on this first. we've been having this debate for weeks, if not months now about inflation. we've had a number of companies come out in their earnings, for example, in recent days and talk about higher input costs and talk about the fact that they're going to realize higher prices on consumers as well but i guess the bigger question is, is it temporary, is it t transitory or could it take root and become a runaway situation >> that's the multi trillion question

right now everybody seems to be worried about inflation. there's not an investor that you speak to that isn't asking whether this is temporary or structur structural i would point out when is the last time everybody, everybody saw the big risk coming? usually risk comes from things we're not paying attention to. this morning i went down to feed my dog for breakfast and she told me to go to chewy and start hoarding extra bags before prices rose. now, just because we're talking about, doesn't mean that it's not going to arrive, but the market seems to be gekt tting aa of that. you see the commodity stocks at multi-year highs or getting there. so point taken, the $1,400 stimulus checks, the reopening, i get it i give the market more credit for that and think that it's not going to be shocked when we do get the economic reports and do see the producer prices and consumer prices rising i would expect the market

expectation to be rather muted. >> jim, to that point, traditionally one could happily argue that more inflation means higher exposure to equities. >> you could, because certainly higher inflation isn't going to be the friends of the bond market certainly higher inflation gives corporations pricing power what you don't want to have is inflation that runs too hot, runs too fast and does what we did with the 10-year treasury last month which pushes way higher faster than anybody expected and that rattled the market so, yes, if you have a measured increase in the rate of inflation that is seemingly manageable, then the market will accept that and it will accept higher interest rates. if that runs a lot hotter than anybody expects, then you have a market issue this government has never given so much money directly to consumers as it has now. they haven't spent it yet because a lot of them don't have jobs so they're saving that money. but once we get back to work, it's going to be a real question to see whether those prices will

be contained or not. i think they will. i agree with my other advisor here on the fact that nobody has a history -- no market has a history of predicting runaway inflation well in advance of things so i do think it will be contained. we have some structural issues in the economy, we have some demographic issues in the economy, we have problems in the labor force. i don't think it will be sustainable. but i do think it is something that will be impacting the market from time to time >> southwest airlines announcing today that it agreed 100 firm orders for the boeing 737 max to add that to its fleet, 30 of which to be delivered in 2022. that's the largest order since ryanair announced 75 jets in december and united ordered 25 earlier this month shares of southwest are trading lower today, but boeing up more than 2% on the news. let's bring in airline reporter leslie joseph. leslie, how surprised are we by this announcement?

>> i think it would be more surprising if they wepnt with airbus in a totally different direction. if southwest had made that move, it would pretty much be breaking with a tradition they have had for five decades so one thing to note is that southwest was shopping around. southwest was doing price comparisons and looking at this airbus a-220, another plane similar size, looking at fuel burn and things like that. but ultimately they said there were issues with that and there would be pilot costs, maintenance costs that complicates things for an airline like southwest that's so focused on cost altogether. >> and i also think about something like fuel efficiency obviously we have a new administration in place that's putting a lot of focus on climate change and combatting that, this idea of things like carbon pricing that's getting bandied about with the support of some of the biggest players

in the energy industry i wonder how much of that is participating with this momentum that we're seeing gathering for a re-emerging order book for this particular aircraft >> of course the 737 max has been down for a long time, and for the last 20 months through november it wasn't even allowed to fly, right? so the faa lifted that grougroundin in november and we saw new orders from united airlines, alaska airlines and now this big order from southwest fuel efficiency, any airline that deals with cost, which is every airline, they care about that of course there is more momentum around the environment, but looking where they can save money has been a story for years. >> all right leslie josephs, thank you. shares of boeing are up 2.5% right now. visa is diving further into the world of crypto becoming the first major payment company allowing users to use u.s. d coin, a digital coin that is

pegged to the u.s. dollar, and uses blockchain. shares of visa are higher while mastercard and american express are both down more than 1% on the session. bitcoin jumping today as well. that is up more than 3%. mike, i just want to get your response to this we are seeing more and more, i guess, use cases or at least companies making moves to adopt or take on more crypto possibilities. >> yeah, so visa supports 160 currencies around the globe. so i think this makes a lot of sense that they're getting into crypto among the other institutional names that we've seen doing this. if you have consumers that have these coins in their wallet, rather than converting it into dollars, it makes the transaction process so much more seamless so ike think this is a natural fit. >> we have 90 seconds left and we have slimmed over the course of the last 20 minutes or so we are now down by 10 basis points on the s&p so not on

track for a record close the dow, though, should still make one, it's up about a third of 1%, 90 points, but that's about half of its gains it's given up in the last 30 minutes or so. it was up 180 points the nasdaq is down 0.6, the russell 2000 is down 2.7%. let's have a look at some of those margin call-related stocks today, discovery and cbs which are down significantly as we speak. not compared to their friday declines, viacom is down 7%, discovery is down about 14%. both of them have halved or thereabouts over the last week or so. the banks tied up in this, goldman sachs down half a percent, morgan stanley down 2.6%, largely off its lows and both of those banks well higher compared to the likes of nomura and credit suisse, both which were down double digits.

the 10-yield up a little bit, 1.71 the vix up above 20, 20.8. ole is up 1%, gold and silver down a percent or so the u.s. dollar up 0.2 of 1% at the close, s&p 500 down a fraction the dow enough for a record closing high once again with a quarter of a percent of gains or 79 points, off the high of 186 points the nasdaq down 0.7% the russell 2000 down 2.8% welcome to "closing bell." i'm morgan brennan in for sara eisen along with wilfred frost as you can see as the markets begin to settle here on the heels of that closing bell, we've basically finished near the lows of the session, i think, for most of the major averages save the dow. we did get a record close for the dow, up 0.3 of a percent or 99 points. that is well off the high, you just heard wilf say that the s&p did close slightly

negative, 3971 is your level there. the nasdaq underperforming, down about 0.6 of 1%. and the russell 2000, the small caps, snapping a two-day win streak as well, down nearly three% 2.8% there coming up, former chairman harvey pitt on whether new regulations are needed to ensure this won't happen again. jim lecamp and michael batnick are still with us. joyce chang from jpmorgan joins the conversation as well joyce, i'll go to you first. i just want to get your take on where we are at in the markets as we are poised in the next couple of days to not only end the month but ending the quarter. >> well, we're ending the first quarter without the taper. i'm thinking that the worst is probably behind us right now in the second quarter we're going to have very strong growth numbers. we do think some of this inflation overshoot will materialize as well, but a lot of this price movement has

already occurred you have fixed income markets in negative territory right now i am thinking there are some opportunities outside of the u.s. you have tripled the vaccines that are going to be delivered in europe in the second quarter of the year and you've had this weakness in asia where we think some of the worst could actually be behind us. >> mike, are you worried about some of the big outperformers of last year? we could all them the arc complex, which was down 2.4% today. is there more downside to come for some of those names? >> it sure looks like it the market is at a all-time high, but proctor and gamble is looking like a momentum stop i just want to point out it's so easy to get lost in the day-to-day gyrations of the market but if we take a step back and think about what drives the economy, which is consumer spending 70% of our gdp is consumer

spending if we and everybody is expecting an economic boom to materialize, then it's hard to get too bearish on the stock market. and if this is just a pause where the high flyers, the apples and amazons, which have done nothing, especially amazon and netflix for seven months, if they could come out of their bases and join the rally and participation, that could set us up for the next high absent that, i think you're putting a lot of weight on the materials and industrials to continue to carry the rally. >> i just want to riff off what joyce just said about this taperless tantrum. do you see it the same way what is your expectation for the 10-year treasury yields through the rest of this year? is the worst or at least that fast pace of increases that we saw that was so violent and quick, is that type of movement behind us now? >> i think largely it is you had all these concerns last month about the supplemental liquidity ratio ending on march

31st and the questions about whether the banks were going to have to sell treasuries and maybe they did sell treasuries throughout the month i know most of the sale in treasuries came through the japanese session and their quarter is over now. i don't think we're going to see that much pressure on yields moving up from here, at least not at that rate what does that mean? it probably means less excitement for the financials, although we do like financials they probably are going to be a little less robust and i think we're going to see a lot of rotation. i think michael is right, though if you look at what's happened with the nasdaq and the intraday trading of the nasdaq, it's been closing on a pretty consistent basis. the semi conductor index was leading the market all of last year now it's real choppy unless we can get some direction out of the nasdaq, out of the semi conductors that were our leading growth areas, it may be harder to push these other areas much further because the industrials, the materials and

the financials have all had big runs and so that's why i'm saying we may see a little bit of trouble for the averages, but we will have markets of stocks inside those averages there will be rotations, there will be stock pickers and their ability to make money above what the indexes are doing. so i don't think we'll fall out of bed here. i just think it's going to be a lot harder moving forward and a lot more selective better than i like that. >> joyce, what will rise faster in the next six to 12 months, yields or earnings >> well, we have yields rising to 1.95 for the 10-year by the end of the year. but i don't think that level of rates is really problematic for the equity market. so i think a lot of this momentum trade has already unwound. we still like value more here, but i would think that momentum here could perform in line some of this energy sell-off we've seen over the last few weeks seems that it is not

fundamentally driven so some of the energy equities still look attractive as well so there's going to be a rise in yields but i do think we've seen a lot of the big move behind us and i don't see a level of rates that's overall problematic for the equity markets when we look out six to 12 months. >> you mentioned that you might be looking internationally for more opportunities there where specifically, and i guess what does that imply in terms of the trajectory of the u.s. dollar as well >> well, you've had europe really lagged here because they had a second wave, a third wave in some cases, but we have news now that the vaccine deliveries are set to triple. so you could see europe really go through a double-digit rebound in the coming quarter. and that region could look much less fragile by the summertime we've also had weakness in the asian equity markets as well and we could be nearing the end of that as well so reopenings that we're seeing

in the developed markets really could see momentum coming into the summer months. let's now get to leslie picker for another update on the latest details of the margin call at archegos capital. >> bill wong was almost an unknown entity up until this weekend. now his reckless risk tolerance has caught the ire of regulators, counterparties and may be partially responsible in billions of dollars of losses at several banks. he is the face behind archegos capital. it has taken an kbexorbitant amount of leverage he faced margin calls causing the banks to sell his assets, including viacom cbs, discovery and a group of chinese technology companies, guys. stick around for the conversation

michael, my broad first question is what level of concern all of this gives you that there's just a lot of leverage out there across all stocks to the upside that we could see this play out in a sort of viacom and discovery type set of stocks and see them collapse as quickly as they have from their recent highs? >> yeah, it's never good to see a company of that size fall with that magnitude so quickly. but i would say if there were other shoes to drop, if there was a domino-like effect, i think we probably would have seen it already. the story was they were using these equity swaps to be honest, these cfds, that were contract for difference, i never even heard of that before so this is esoteric stuff. i think we'll finding out in the coming days and weeks what's really going on. >> jim, when you look at this, and i realize these are very different situations when you look at the runup in a handful of stocks, that whole reddit trade, gamestop, et

cetera, you look at these different instances where we've had stock charts go parabolic for different reasons and we've seen unwinds, do you step back from this and say there's distortions in this market in general right now, maybe perhaps given all the liquidity we see in it, or is this generally healthy and these are basically the outliers >> that's a good question. i think it's generally healthy in terms of millenials entering the market and starting to buy stocks and learning the hard way that this isn't easy and maybe these brutal lessons that some investors are being taught are going to be healthy for them in terms of this fund, the archegos funds, i don't think it's healthy i think you're right that we have this combination of a recovering economy, tons of liquidity, and interest rates that are just coming off of all-time lows. that is a perfect recipe to take on leverage.

so you're seeing leverage attached to real estate. you're seeing leverage attached to the stock market. a lot of people, a lot of wealthy people are going to make a lot of money with that leverage that being said, there's going to be many bubbles that pop up here and there and shoot up and explode and we're going to be seeing these all over the place, now, the gamestop, the reddit crowd was a small part of the market, 2.9% this hedge fund isn't big enough to really be too systemic of a failure or anything like that. it's not a lehman brothers or bear stearns or anything like that but we are going to be hearing more and more of that. i think if you start to see anything that has a vertical chart like some of these names did, then you can bet that there's a lot of leverage and momentum investors playing those names and you better be careful. if that chart is going up more than a 45-degree angle, you better be careful with something like that and you better know that there's a lot of people that are really pressing that bet. if you're the last one with the

musical chair, there's no chair for you, you're going to get hurt really badly. >> leslie, the other quick final points i was going to bring up is i wonder whether this is a good advertisement for the traditional long only investor who doesn't take on risk, doesn't have that risk and maybe held cbs for a long time and started selling it as it rose so aggressively, if that indeed has happened a few examples we've heard about on this show in recent weeks but also you get an interesting little case study comparison of what's happening in 2021 between gamestop and viacomcbs everyone is thinking how terrible it is, the shares of halved, but they have got a second place rating at 84, 85. it's way above where it was a year ago, $10 a share or wherever i wonder whether there's a lesson and gamestop missed that opportunity or perhaps didn't seize it in the same sort of perfect way that it seems cbs

has. >> it's interesting because you bring up the secondary sale as a comparison i was also thinking they're classic cases of short squeezes. what's interesting is this is a classic case of a short squeeze because you have a professional investor who is theoretically targeting some of these names that have had significant short interest and some that have had public shorts that were saying especially with gsx, for example, saying there's no real value at the levels that it had been trading you know, archegos capital was, well, i'm going to take a bunch of leverage, run up the names and benefit from squeezingthe shorts on the upside at well so we've seen kind of parallels on that front as well this year. >> guys, we'll leave it all there. thank you very much. jim lecamp, michael batnick, our leslie picker. also sam deliar, i did not get

that one, arch no no 99% outstanding. up next, tony dwyer on his recent downgrade on financials and why he thinks excess liquidity is keeping the market afloat plus harvey pitt on the archegos margin call miss and the similarities to the 2007-2008 financial crisis we are back in 90 seconds.

the dow posting a positive

close. the russell down nearly 3% tony dwyer joins us. tony, great to see you as always your headline point is you remain constructive overall but we're going to continue to see these sorts of fallbacks. >> yeah. it's a rotation that's taken hold rather than have the s&p 500 go down 5% to 10%, it's grinding sideways to higher in early march you had a greater than 10% drop in the nasdaq and the semis. as of last wednesday you had less than 10% of the russell 2000 above the 10-day moving average and the banks index from intraday peak-to-trough was down almost 10% from the prior week so we're getting this rolling rotation and this interest rate uncertainty that's probably going to continue a little while. >> you made a decent call on the banks, tony, and suggested people should take some profits there. are you still of that mindset or

do you think it's a buying opportunity? >> i think they should be equal weight i don't make these changes easily, because people make a move i'm not a trader, i'm the worst trader what i'm pretty good at is risk/reward. the rise in the 10-year note yield on the 10-week rate of change have gotten so extreme, the most extreme in history. when that's happened in the past, it's led to a period of lower relative performance not a crushing, not that banks get blasted, not a bear market, just that they have lesser relative outperformance. if you remember last summertime when i was hoping we'd be back on set by then but we talked about the banks and tanks or banks and industrials in late may. that's the best performing sector since then are the financials and industrials and just given that rise in the 10-year, i think history suggests that you just want to take a little bit off the table for now. >> so the fact that, tony, we're

expecting president biden to unveil this multi trillion infrastructure package later this week and then next month another spending package in the trillions potentially as well, what does this do to this entire discussion to continue to see more stimulus in some form or fashion potentially poised to go out into the market? >> it's a great question, morgan there's three levels of stimulus there's monetary with the fed, the fiscal stimulus, these packages we're talking about, but they don't talk about the interest rate stimulus the interest rate stimulus is the lower yield on corporate debt and household debt allows for increased spending but here's a -- this blew me away today there was a chart that showed that the u.s. is 25% fiscal stimulus to gdp is lagging behind germany, france and especially japan we're just catching up to what those three countries are doing

by increasing the stimulus when it's all said and done, what happens -- where you want to be really negative and bearish is when you have a need for money to grow and limited or no access to it. even with the higher rates, we have a historic level of access liquidity. you get these gyrations. every year it was 2004 after the 2003 recovery. the first half of 2010 after the 2009 recovery. you get this choppiness around interest rates you don't have to make a trade on the next ten minutes, especially given some of the stuff in the background over the last couple of days. >> overall, tony, what about positioning? what about things like the vix are you keeping an eye on those? do they suggest being cautious in the short term or bullish >> i'm going to break the cardinal rule here, wilfred. i have no idea everything that i have tactically is basically neutral. i like to attack the market when you're in a fundamentally strong

backdrop like i described earlier and you get oversold in an uptrend so there's a real conviction in my core fundamental thesis the vix at 20ish, the percentage of stocks above their moving average, the national association of active independent managers, neutral exposure, and their exposure index. there's 2340g that is really compelling i'd rather wait, especially in an environment where liquidity is all over the place, i'd rather attack it when i have a better pitch i just don't see that pitch right now. but it's coming. again, you don't want to be historically negative. even if it's a 10% drop. you want to buy weakness when you have money availability and excess liquidity and an economic recovery that's in front of us. >> so just to dig in a little bit more, tony i realize sometimes the toughest action is inaction, but what would change you to actually take that action what are you looking for >> we did a couple of weeks ago

when we downgraded the financials and took a little bit of profit there. we did about six weeks ago when the industrials relative to the s&p were as oversold as they get. it's those kind of moves listen, if you're looking out 6 to 12 to 24 months, i don't see any issue. we are in the beginning of a synchronized global recovery it's going to be choppy, there's going to be periods where interest rates make it feel weird, currency gyrations, all the funny stuff we love to write and talk about and drone on about. at the end of the day, do you have money if you have money, you can grow. that means the market correlates to the direction of earnings and that should remain positive for a while. >> tony dwyer, always great to get your thoughts. thanks for joining us. >> thank you, morgan. up next, former s.e.c. chairman harvey pitt on whether more regulation is necessary to prevent another margin call incident like the one hitting wall street. plus the countdown is on for

tomorrow's launch of kathy woods' space etf find out which stocks will be in that portfolio later on "closing bell." you run it by an expert, you talk about the risk and potential profit and loss. could've used that before i hired my interior decorator. voila! maybe a couple throw pillows would help. get a strategy gut check from our trade desk. ♪♪

the margin call incident at archegos capital could result in

a push for transparency at family offices robert frank has the details robert. >> hey, morgan there are now more than 5,000 family offices managing $6 trillion around the world. some of them bigger than hedge funds, but they don't have nearly the same oversight. that's because as part of the d dodd-frank legislation, family offices won a special carve-out from congress that allows them to avoid any s.e.c. registration as long as they serve a single family and don't give investment advice family offices made the case to congress at the time that they only make conservative investments to preserve family wealth and they don't try to beat the markets now, archegos did not make a single filing with the s.e.c. throughout its entire history, despite placing those billions of dollars in bets now, some family offices are required to disclose their share filings through 13-f to the s.e.c. but that is only if they own more than $100 million in

stocks attorneys tell me that rule is not always either understood or followed, which, wilf, would be a generous explanation for awhy archegos made these huge bets without anyone knowing about it. >> i would also say while i totally agree with the gift of what you're saying and it seems like their behavior was as aggressive as it could come and was only meant to be long-term preservation of wealth, the other key point is that as long as it's family's own money and they're not giving investment advice, those are two more powerful and important factors which do apply here and do explain why it could be understandable why they should face lower levels of regulation than a financial advisor or a typical hedge fund. >> true. but if you look at how family offices have grown up both in terms of size and sophistication, if part of the role of the s.e.c. and the government is to understand

systemic risk, if we have now $6 trillion that is effectively a shadow hedge fund system we used to talk about the shadow banking system then maybe there could be some broad disclosure when you reach, let's say, a billion dollars or some threshold which is technically required but not always followed, just, again, to better prepare the landscape for what could be some systemic risk, because of their size. >> sure, size and to your initial point the types of trading they're doing. is it tracking the market or trying to beat single day moves in massive stocks. robert, thank you so much. for more on what archegos' drama could mean, let's bring in former s.e.c. chairman, harvey pitt, who joins us in a closing bell exclusive great to see you, harvey thanks for joining us. >> my pleasure >> to what extent has something outright gone wrong here versus this being quite a risky part of the market and some parties have taken on too much risk and are

suffering today because of it and others manage to escape with less losses because their risk management worked? >> eveningi think there's a fain that's gone wrong here first of all, you have somebody who's pled guilty to insider trading and is somehow still operating. now, it's a family office, butt question is why were people on wall street so willing to deal with somebody with this kind of record for a long time they weren't, but then suddenly when they realized how much money there was available, they started doing business with him. so that's one problem. the second problem is that his use of swaps enabled him to both mask his identity and also mask the fact that he was actually

getting payments or funding from multiple banks for the same transactions that enabled him to incredibly overleverage, and there was no disclosure of this and the banks were not aware that they were actually participating in a plan in which other banks were funding the exact same trades. those are serious flaws, i think, in the way the regulations have operated, and there will be a need to revisit this and determine whether there's something better to be done when you have somebody in this kind of situation >> and then on the flip side, harvey, are there some positives to take that clearly we've seen some massive moves, two, three-day moves in certain stocks but we haven't seen it in the broader market, so far at least? >> yeah, i think what you're

seeing here is somebody who was, as it turns out, making very poorly timed bets, but his transactions were actually propping up the market for the securities in which he was investing. and one individual, and certainly one individual in a family office, should not have that kind of ability to affect the markets to these securities. >> so, harvey, we were just talking about this with robert frank. can the argument be made, and i realize this could be a one-off situation, but can the argument be made that there is essentially this shadow hedge fund system operating out there, family offices, i realize, not necessarily hedge funds, that not only needs closer scrutiny, but potentially could create or

could lead to other situations, risky situations that are out there in the market given the conversations we're having about low interest rates and all the liquidity, et cetera >> i understand the argument, but i always think there's a risk of trying to conclude too much from what is a very specific fact pattern. at the moment we have somebody who should not have even been classified as a family office, in my opinion, because he started out in a very different situation from those that the family office rules were intended to protect. as a result, it seems to me, the first step is to deal with the kinds of circumstances we're facing here as opposed to sort of throwing out the entire system of family office exemptions >> harvey, you kind of alluded

in your first response that the banks shouldn't have been so greedy to rush for the fees that were available from this particular client. is that across all of the banks that accusation that dealt with this client, or if it does end up being the case, as some of our reporting at cnbc has suggested, that two or three of these investment banks didn't really make any losses, that they were only dealing in a way that the risk/reward was legitimate and balanced and that maybe a couple of these investment banks, who have come out publicly, credit suisse and nomura, to say they are facing big losses, are the only ones that criticism should apply to or should they apply to all of these given this client's past and as an insider trader. >> i think that's a good question and it focuses in on what the banks understood and what they thought they were doing. but you have a situation here in which the banks had basically

refused to deal with them. and all of a sudden, as they're watching the transactions, that position tends to lighten up as soon as one or two banks started dealing with them, then more banks started dealing with them for fear of losing out on the business it strikes me that when you have somebody with this kind of a track record, the first thing you need to do is assure yourself that you have all the information conceivable to prevent these kinds of problems from arising, and that never seemed to have happened here >> one very quick final thought, harvey is it bad form, or is it breaking rules when one bank starts to call in the margin loans all of a sudden and the others don't know about that is that just part and parcel of this type of business? >> i don't think it's bad, per

se i think that there has to be a more structured way of doing things the fact that one bank can do this immediately and set off a $20 billion market drop is very, very troublesome there ought to be some mechanism by which the banks that are involved cooperate together with regulators so that the market isn't disrupted this way >> harvey, thanks for joining us much appreciated >> my pleasure still ahead, the u.s. chairman of pwc on the percentage of companies expecting revenue to increase over the next year as the economy continues to reopen. we're back in a couple

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time for a cnbc news update with rahel solomon. >> even as he points to 330 million vaccine doses being made available, president biden is also concerned about the recent increase in covid cases. >> i'm reiterating my call for every governor, mayor and local leader to maintain and reinstate the mask mandate please, this is not politics reinstate the mandate if you let it down. and businesses should require masks as well. the failure to take this virus seriously, precisely what caught us in this mess in this first place. and this was the sweet scene as 26-year-old jacob was

reunited for the first time with the firefighter who pulled him out of a burning home when he was just 3 years old william porter is now retired and said he's happy to have closure because he always wondered how the boy he rescued is doing for the boy's part he said he doesn't remember much about that night but he kept a teddy bear that porter gave him so really sweet. >> i love that it makes me -- >> i'm not crying, you're crying it's very sweet. >> my heart has been filled with joy. rahel solomon, thank you. so our hybrid work schedule is here to stay. we'll speak with the chairman of pwc on how businesses are veinto allow employees to work remotely after the pandemic stay with us ♪ i wish that i knew what i know now ♪ ♪ when i was younger ♪ you need a financial plan that fits the way you want to live in retirement. a plan that can help grow and protect your money.

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welcome back the cdc extending the national ban on evictions through the end of june but the rental market is still starting to show some cracks with landlords coming under increasing pressure. diana olick is here with more. >> reporter: small landlords own just over half of the nation's rental homes while the last two stimulus

bills together have earmarked $50 billion in rental relief, much of it is not getting to them because the process must start with the tenants >> in a situation, which that is happening around the country because people are so disillusioned, if the resident does not apply for these dollars, then there is really no recourse for the landlord. this is a critical time to get information out to people who are in rental housing to understand that they have the ability to apply for these monies >> 40% of rental owners who are owed back rent say they have not received the necessary paperwork from tenants to file for it, according to the national rental home council 11% said that they have already been forced to sell at least one of their properties. the trouble with landlords selling is that in today's incredibly tight housing market, buyers will likely be the occupants, reducing the stock of desperately needed affordable rental housing back to you guys. up next, pwc out with a new

survey that shows some surprising data on how executives are envisioning office life in a post-covid world. we'll discuss with pwc's tim ryan after the break at emerson, our automation software is empowering pharmaceutical companies to accelerate their production of critical vaccinations for the world. emerson. consider it solved. you can try to predict the future or you can create it. of critical vaccinations for the world. we're driving it. everywhere. we emit optimism, not exhaust. we plug in our vehicles as naturally as we charge our phones. we. we are generation e. we want smart. clean. and safe. to also be fun, easy and powerful! ultium! a battery that charges fast. runs long. it fits everyone. nobody will be left out. and that, changes everything. ♪ ♪ dana-farber cancer institute discovered the pd-l1 pathway. pd-l1. they changed how the world fights cancer.

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welcome back to "closing bell." work from home, returning to the office or a hybrid of both pwc out with a new survey showing a majority of c-suite executives have already invested or plan to invest in tech to support remote work post-covid

and half say they will implement additional options like hybrid and permanent remote schedules joining us to discuss those findings is chair and senior partner tim ryan great to have you on. >> great to be here, morgan, thank you very much. >> so this kind of surprised me a little bit i was -- i was expecting more companies, more executives to sort of sound off and say they were going to start calling employees back, or at least calling employees back more so than perhaps these findings suggest. how does this speak to not only a post-pandemic new normal but also what workers want >> yeah, morgan, it's a great question i think in isolation ceos very much want to get people back but also recognize they're in a war for talent and they know in order to get that talent it takes a hybrid approach and different employees want different things so what we're seeing in this survey is a recognition that in order to get the best talent you need to balance their safety, which is coming first, but they want new ways of working, which

we're also seeing very much. the reality is as we survey our employees, they're asking for many different things. companies are adapting and they're adapting fast learning off the lessons they learned over the last year. >> some of the other findings from this survey jumped out at me for example, esg, something we talk about so much on this network and a shift from an investing standpoint how are ceos and the like thinking about that and approaching it right now >> what's been so interesting the last year and a half, we've seen esg move to the upper right-hand side of the quadrant in terms of risk and opportunity so we're seeing more and more companies talk about what is the strategy around all three elements of esg, environmental social governance and they're looking at different ways to drive differentiation. what is really important to point out is that esg is a hot topic and not only from a risk but opportunity standpoint so companies that are in each other's supply chains are looking for ways to differentiate of how can i win

more opportunities, mitigate the risk of being squeezed out of the supply chain because i'm maybe not doing the right things from an esg perspective. so it is an investor-driven topic but even as each company looks to get better and better, it's an opportunity to differentiate, whether it be transparency, different practices and the like. >> what about overall economic outlook, tim were the ceos and management executives you surveyed bullish, bearish, somewhere in between? >> good question overall high degree of optimism, the $1.9 trillion package helps but companies have really adapted. they are getting really good at managing their costs, driving productivity and seeing increasing revenue over 80% of the executives we surveyed see increased revenues this year over last year as they feel the recovery coming so a good degree of optimism out there. clearly a lot of things executives can't control but when you look at their ability to drive business improvement and increase

revenues, really good momentum and optimism that we're seeing out there. >> finally, tim, just to shift gears a little bit, a lot of talk about a higher corporate tax rate coming to fund trillions of dollars of spending what are the conversations you're having with customers how realistic is it to think we could get something like that before the year is out >> over 50% of the executives we surveyed, morgan, expect to see some type of tax activity in the planning levels up significantly. so companies are analyzing cash flow, investment earnings powers, and it's not just based on what may happen here in the u.s. it is important to point out governments across the world have done different types of stimulus packages and there is a sense that companies will be paying some type of more taxes going forward. we're seeing that already in the increase in planning happening we're also seeing controversy in different parts of the world increase as well, so it's very much a topic companies are planning for right now. >> tim, thanks so much for joining us. >> thanks for having me. take care, wilf. up next, double charged.

it looks like tesla charged some customers not once, but twice for their new cars taking tens of thousands of dollars from their bank accounts without authorization. we're back with that story, next

we have some news on tesla this hour. cnbc laura breaking a story that tesla double charged some customers for their cars she joins us now this is fascinating. talk us through what you found and has it led potentially to an artificial inflation of earnings reports or is it a side issue from that? >> well, over the weekend, i connected with customers who purchased new teslas they're very excited about using ach debit which immediately takes the funds out of your bank account and pays tesla. the problem came when tesla charged them twice for one vehicle and it was instantaneous and it is not like a credit card charge where you could just have them put a stop payment on it or something like that. so the customers have been left without tens of thousands of dollars there some cases accounts over drawn and facing over draft fees and tesla is not able to give them a confirmation on what timing it will take to get their money back there is a question as to how

this could effect tesla's end of quarter production and vehicle delivery report which was out last year on april 2nd >> yeah, just to dig into that more laura, we know that tesla has just said they're going to start accepting payment in bitcoin, to your point it is the end of the quarter as well there tends to be a big rush for the company in terms of deliveries and meeting some of those estimates at the end of the quarter. is this something that could be a technical glitch, is it tied to a change in infrastructure when you start implementing for payments and things like crypto? >> you raise a good point. they just significantly changed their e-commerce app and website to accept bitcoin payments which that comes with its own set of taxes and other complications. but one wonders if it is wise to do that toward the end of a quarter where they are know they're trying to process a lot of sales to hit their goal. >> just to be clear, this is something that has arisen for the first time this past weekend or last couple of weeks as opp

opposed something that might have dated back and happened for a longer and deeper problem. >> i'm a tesla historian and i've never heard of this issue happening in this pervasive manner one of my source that's i interviewed heard at the burbank store and service center that this was an issue befalling a number of customers and another owner heard from his customer service department at the bank that he wasn't the only one to call to try to resolve it. so it sounds significant enough. >> interesting we know you'll keep an eye on it and continue to report that out for us thanks for joining us. and for more on this story check out her article on cnbc.com. up next, there is no such thing -- oh, boy, there is no such thing as a free launch. get it kathy woods new space etf making d e rpsit tomorrow anthsuring names in that fund and they are surprising, when "closing bell" comes back

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welcome back, tomorrow kathy beck is launching the newest fund, the arc space exploration and innovation etf it will trade under the ticker arkx it will invest 80% in stocks that are engaged in the

investment theme of space exploration and innovation so this moves comes after seven spaces have announced spag deals over the last six months all of which have yet to close. more are expected to potentially go public as this year unfolds fon of the names are in this etf. that said here is what is in the arc x etf. rather the top ten holdings include aerospace and defense like lockheed martin and boeing and defense and tech company tremble, which is the largest hold heing and the second largest ark's 3-d printing, an etf. >> the title, space exploration and innovation is that meant to mean space exploration or just broadly innovation because things like netflix. >> netflix is in there you have some of the chinese internet stocks in there interestingly, virgin galactic, which you might be a top ten

holding because it is a space names i think is number 20 on the list and other names like northrop grumman aren't on here at all sam chore is who covered space at ark is joining me on "power lunch" tomorrow. also tomorrow, since tuesday is for space, we have an interview with the ceo of virgin galactic, michael colglazer as they unveil the new spaceship. >> is he disappointed for not being in the top ten holdings or the orange flag is holding a companies etf as well as part of the holdings at least you might be looking at it as this is a sign of a market top perhaps or some kind of overlap in these stocks. anyway, we look forward to the launch of that and your interview as well tomorrow on that front and some final thoughts on market what a crazy day vaio come, cbs down small,

discovery down 14. the banks are fellows which i think is the key takeaway from the u.s. banks, where they ended up today. >> absolutely. and it is a holiday week we still have big news-making events including the jobs report on friday, opec plus and biden infrastructure on wednesday. >> jobs report on friday even though mark markets will be closed but they'll be open tomorrow and more discussion about tomorrow coming up now on "fast money." >> i'm melissa lee and this is "fast money. tonight's trader lineup. tonight on "fast," a tiger cub gets de clawed and taking down shares some of the biggest chinese stocks what is behind the selling could it be over done. plus two social media stocks taking flight. we'll dig into the big moves on facebook and twitter and later music's new frontier, why an opportunity for nft we start o