is giving a lift to those tech names. also consumer discretionary names, tyler, and some of those reopening names getting a big bounce, whether it's the retailers, vegas tocasinos, crus lines. >> great as always being with you, morgan. >> back at you. >> thank you for watching "power lunch," everybody. "closing bell" starts right now. >> thank you, morgan and tyler welcome, everyone, to "closing bell." i'm sara eisen along with wilfred frost. another mixed session for stocks but the s&p 500 did hit a fresh record intraday high during the session an we are higher right now. the nasdaq leading the gains up about a percent as we head into this final hour of trade let's look at what's driving the action fed chair jay powell addressing inflation in a panel i hosted earlier for the imf saying in the most likely case, this period will show temporarily higher prices but not persistent inflation. we'll have much more of his dovish assurances from that panel later.

weekly jobless claims did come in at 734,000. the previous week was revised higher as well. technology is outperforming as bond yields inch lower. the faang stocks largely lower 59 minutes left to go in the session. >> right at session highs as we speak. coming up on today's show, european equities hitting all-time highs we'll speak with mark mobius about where he's finding opportunities across the globe. plus the chamber of commerce tweeting support for the biden's proposal on infrastructure but its opposition to tax hikes to pay for it first of all, let's focus in on the big stories mike santoli is tracking the market action and steve covac joins us to talk about apple and some new concerns about the global chip shortage on a week

when apple is bouncing back fairly strongly. mike, first to you and the markets. >> the market is in this low gear climb 4100 on the s&p 500. we talked about that last week as a level people were saying that's where a lot of the upside targets got you to basically it was going to stretch the limits of this particular little uptrend. so we are pretty much there. you can point to a lot of things that say it's a little bit overbought in the short term you can counter that by saying this isn't exactly a headlong rush higher. it seems orderly and contained you say orderly breadth but this growth in mega cap growth stocks you can also say we might be building up to some sort of an overshoot on the upside. take a look at the equal weighted russell 1000. basically your average large cap stock compared to the s&p 500. this is year to date and you see

both higher but this equal weighted measure, the typical stock in the market has tilted lower, below its highs, as the s&p driven by those big nasdaq names mostly has basically outperformed in the past several weeks. that's what people are complaining about or celebrating, depending on your point of view, as to whether it's uneven kind of on and off type of a rally where it's either narrow and large cap or very broad and emphasizing small caps also internationally pretty quietly not a lot of mention that european stocks have really kept pace and have slightly outperformed maybe a little surprising given the fact that obviously reopening at an earlier phase having some stumbles on a vaccine rollout but markets like that when good news is to come and you have the liquidity environment that's helping in the tilt toward cyclical and value and financials doing pretty well. that's something to note as well, guys. >> it's interesting, mike.

actually the worst performing year to date is the ftse 100 and that is in part because of a stronger british pound but it's clear that you can't just immediately jump to the conclusion that better vaccination rates leads to better stock market returns. the thing that that triggered a thought of for me, though, on the european point is we keep talking about higher u.s. rates and clearly they are higher relative to six months ago on 12 months ago here in the u.s but every time we jump up 10 or 20 basis points, we'll probably find buyers from overseas who are facing much lower rates. >> there's a lot of work showing that even paying to hedge away the currency exposure, there is pretty good yield available in u.s. treasuries and other u.s. debt instruments happening from japan, from europe so it probably helps explain why that advance in treasury yields has been slowed and kind of flattened out. yeah, there are offsets.

they have a little bit of a pullback because around the world they still have some juice in them. >> mike, thank you see you soon. let's turn to apple. japan's nikkei news service reporting that apple is delaying the production of some mac books and ipads due to the global chip shortage that's rocked a number of other industries. let's bring in steve covac steve, how surprising is it that apple is being impacted potentially or reportedly by this chip shortage >> it's a little surprising because we all know tim cook is legendary for his management of the supply chain but the good news here for apple, sara, is that it doesn't seem like it will affect supply and demand right now if they can work out these kinks with their suppliers, they're going to be in great shape keep in mind the mac was the pandemic gadget for apple. they were selling macs at levels they normally sell in the holiday corridor during last

spring as everyone was stuck working from home and finding new gadgets to make that possible we're due for a rebirth of the mac. lots of new models expected with the new chip that apple dwomd instead of using intel chips so they have a few months to work this out if there is indeed a problem, but it's still looking pretty good right now. >> my question, steve, is more to why they haven't felt the pressure of the shortage sooner when clearly lots of other companies and sectors have is that because they use a different type of chip that hasn't yet fallen into shortage, or do they just have much better contracts because they're apple, which means the shortages, they feel it last >> a lot of it is the latter they negotiate their contracts down to a fraction of a penny per part also keep in mind there are lots of different chips we're not just talking about the main processors. there are other chips that go into these devices too that could be seeing the supply constraints and that's also why

this report didn't talk about the iphone and the chips used for that if that starts to happen, then there's real sound for alarm for apple. >> steve kovach, thank you for joining us apple, by the way, one of the gainers in the dow, up 50 points near session highs. after the break i spoke earlier with fed chair jay powell and got his thoughts on the pace of recovery here in america and his outlook for inflation. those comments and reaction from investor mark mobius next. headed for a record high close on the s&p incomparable design makes it beautiful. state of the art technology, makes it brilliant. the visionary lexus nx.

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welcome back the dow up 51 points earlier today i spoke with fed chair jay powell as part of the imf's debate on the global economy and asked him about the pace of the u.s. economy in light of strong data. >> there are a number of factors coming together to support a brighter outlook for the u.s. economy, which looks like faster recovery i'd point to fiscal support, vaccination. we vaccinated at least over 100

million americans at least one vaccine, over 60 million fully vaccinated and we're doing something like 3 million per day. of course monetary policy is still supportive we got a taste of what faster progress will look like with the march employment report. close to a million jobs, particularly if you add in the revisions for january and february, and we want to see a string of months like that so we can really begin to show progress towards our goals the recovery remains even and incomplete the burden is falling on lower income workers the unemployment rate in the bottom quartile is still 8.5%. this unevenness is a very serious issue. viruses are no respecters of borders. until the world really is vaccinated, we're all going to be at risk of new mutations and we won't be able to really resume activity with confidence all around the world

so it's not only the right thing to do, it's also the smart thing to do. >> chair powell, you've said inflation coming is transitory even ecb lagarde used your word. a lot of people wanting to know what does transitory mean? how high would be too high for you to tolerate in terms of an inflation rate can you just expand on that? >> sure. let me be really clear what we mean by transitory there's a difference between essentially a one-time instcreae in prices and persistent inflation. that means inflation that goes up by 2% or 4% or whatever it is year after year after year that level of inflation tends to be dictated by underlying inflation dynamics in the economy as opposed to things like bottlenecks the nature of a bottleneck is that it will be resolved the supply side, if you will,

will adapt and, therefore, whatever costs people have to bear in prices because supplies are temporarily tight as the economy reopens, those won't be repeated next year we wouldn't think they'd be repeated we think that the supply change will adapt and be more efficient but that will happen that's essentially what we're saying remember, sara, that we're -- we've had 25 years of inflation dynamics, roughly 25 years, where inflation has been low many advanced economies around the world, at least for the last decade, have been able to reach 2% inflation some are fighting off disinflation that has been the dominant set of dynamics about inflation for some decades now we have a situation where the economy is reopening there is -- there will be a surge in demand perhaps. there will be bottlenecks perhaps. but it seems unlikely that will change the underlying inflation psychology that has taken deep

roots over the course of many, many years so that's what we think. we think there will be upward pressure on prices, which may be passed along to consumers in the form of price increases. we think that that effect will be temporary now let me say that there's no certainty in this. if it turned out that inflation and inflation expectations were to move up materially in a way that suggested that they were being deanchored and inflation might move persistently well above 2%, we would react that would be our job. one of our two mandates is price stability and the other is maximum employment we don't think that's the most likely income but we have the tools to deal with that outcome. we will use it to guide inflation back to 2% if the need arises, but in the most likely case, this period will show temporarily higher prices but not persistent inflation. >> what would you do, you would raise interest rates >> that's the principal tool we

have with inflation, yes the traditional tool is to restrain the economy and reduce -- and reduce inflation that way again, we don't think that's the most likely outcome. that is the playbook, though if inflation were unexpectedly, counter to our expectations, to move meaningfully above levels where we were careful, and particularly inflation expectations. >> what you heard there was a full-throated defense for the policy that the federal reserve is pursuing right now and that is chair jay powell is totally fixated on those that remain unemployed, the 8.5 million. those that are long-term unemployed those at the bottom of the income scale that have remain unemployed that's really what this was about. the entire panel there, we had the head of the euro group, the head of the wto and imf. the u.s. was the bright spot and the bright light what stood out to me most about chair powell's commentary is how

fixated he was on the unequal nature of the u.s.' own economic recovery and that is why for everyone on wall street who continues to question how dovish the fed can be and how low these rates can stay for how long and how much the $120 billion of asset purchases can stay, he is not having it. he is offering reassurance he is going to be there and this is not a complete recovery and he's got a lot of concerns, including mutations, not inflationly high long-term unemployed and he is determined to fix that. >> it was incredibly dovish once again. we joked six months ago that he's not even thinking about, thinking about, thinking about raising rates. today he said inflation would need to persist year over year over year, so again, it's just making it very clear that in 2021 there's not going to be any glimmer of a rate hike scott wapner did talk about some of the headlines coming out of

the panel, sara, during it taking place i think the market took a little bit of a lift. it's been a fairly steady day in the market but definitely dovish and good for equities as we stand. interesting as well following lael brainerd yesterday but also the comments from jamie dimon we discussed yesterday which is saying we're not sure that the monetary policy aspect is as helpful as the fiscal stimulus but it's not going anywhere any time sgloon. >> you get a jobs report where a million jobs are added or a services report where you see a record number in terms of services and just wonder how long the federal reserve will be able to stay on hold with these rock bottom levels and this mode what you heard from powell which echoed what we heard from brainerd and from what we heard from messner later in the week, they're not satisfied. the outlook is brighter, but

they are outcouplesmes based. so it was great to hear that from powell again today. the global economy, i just want to be mention -- >> and to flex your muscles. >> that was very cool. that brand new studio, high tech, amazing. i was happy to use it. i just want to mention another conference we have where global economy will definitely be part of the focus it's the global evolve summit for cnbc happening june 16th it features as you can see ceos of carnival, dick's sporting goods, coca-cola you can get more at cnbc.com/events. 42 minutes left in the session. as we stand we're pretty close to the session highs, which we hit right at the start of this hour, up 50 points or so on the dow. the s&p you can see up half a percent. up next, fresh concerns about the allocation of j&j vaccines

in america, plus new reports about a mixup that led to the loss of 15 million doses later, the ceo of the chamber of commerce will join us to discuss president biden's infrastructure plan and why the chamber opposes the tax hikes proposed to pay for it as we head to break, check out shares of gamestop moving lower today. the company yisang it will name ryan cohen as chairman of the board. it's down 5%

welcome back the s&p 500 on track for a record close european stocks also hit all-time highs today let's talk about the global economic recovery. mark mobius joins us now on the phone from mobius capital. mark, thanks for joining us. good to hear from you. >> thanks. nice to be with you. >> what do you think is going to be the key differentiating factor for global national equity market indices by the end of the year? is it as simple as gdp rebound rates? >> well, the big picture and the most important thing now is the spending by the u.s. government, this enormous program, which will result in lots of imports into the u.s. from emerging countries, in particular china, india and other countries like

that that will give a big boost to the economies around the world, particularly the emerging market economies. so that's the one big, big issue and big program that will have enormous impact on markets in addition, there's the regular recovery that we're still undergoing since march of last year remember, we had a big bear market, very short bear market, but now we're still in the recovery from that so the markets, i think, will continue to do well. the only danger now is the whole cryptocurrency issue, which i believe many people are going to get caught up in and could lose an awful lot of money and that could put a damper on optimism and the general tone of markets globally >> talk us through that a bit then, mark a, you're bearish it sounds like on crypto, and b, you think if we see a big pullback it could derail all sorts of risk assets?

>> actually i'm not bearish on crypto i think it's done very, very well and a lot of people seem to be making money. but i'm afraid that we're already seeing some kinks in the armor of this crypto currency boom as you pick up the newspaper, you read from day-to-day new disclosures of people losing money with bitcoin scams and all kinds of things going on so this could result in a decline in the price of bitcoin and other cryptocurrencies given the number of people who now feel wealthy as a result of their so-called profits in cryptocurrencies, that would put a big damper on their willingness to continue to be in the markets. >> that's a risk we don't hear about every day. mark, we usually turn to you to find out where in the world you see the most opportunities right now. how are you doing that

are you looking at vaccination rates, fiscal and monetary stimulus, where the cash is flowing? how do you pick the winners? >> well, the first thing we're looking at is the whole tech area particularly semi conductors, because there's a big shortage of semi conductors around the world. and we're involved in going to companies that are doing the software in some cases the hardware, but mainly the software and the design of semi conductors and the various pieces of semi conductors that go into cell phones and computers and of course the growth of cloud results in an incredible demand for service and each service requires a number of semi conductors so that's one area we're very excited about, particularly in taiwan and korea and in some cases in china and then the other area is software generally companies that are doing all kinds of software for the

internet and for companies upgrading their technology every company in the world now has to be involved in some way with the internet. of course that's creating a tremendous demand for software the other area we're looking at is the medical area, particularly in esting yes, sorry >> finish your thought >> the other area, as i said, in testing. medical testing. and not only involving covid but generally speaking, the demand for testing, medical testing is growing at a very rapid rate globally so we're investing in companies that are offering those services >> mark, just to finish off, i wanted to ask a big picture question about china i guess a lot of us thought that tensions would ease as the administration changed from the trump administration to the biden administration it hasn't seemed to happen what percentage chance would you put on there being a really

major escalation of tensions between the u.s. and china in the next, let's say, five years, whether triggered by human rights questions or taiwan or whatever >> i think there's a very low risk of that because i don't think the chinese want to enter into that kind of situation because they realize that it would be detrimental to their long-term plans. from the u.s. point of view, i believe also, even though the current administration doesn't look like it's changing very much from the trump attitudes, i believe underlying their entire approach is to be more friendly to countries around the world, including china. so i think it's not going to be a very big risk going forward. >> mark mobius, thanks for joining us. >> thank you turning now to the virus and new reporting that the allocation of j&j vaccines to

states is slated to drop dramatically next week meg tirrell explains for us why. hey, meg. >> hi, wilf. we've been hearing this from multiple states. to get a glimpse of what this is looking like, look at washington state's allocations. they report the three-week forecast that they're given from the administration every week. last week they said they expected 41,000 doses to be allocated to the state next week now they are saying that's down to about 13,000 doses. in that three-week forecast, last week they had expected another 41,000 doses for the week of april 18th and now that's down to 4,000 doses of the j&j vaccine. they are not indicating similar changes for either of the other vaccines multiple states including washington citing the issue with the emergent biosolutions plant of losing those up to 15 million doses of the j&j vaccine what it seems like may be happening is because that plant has not yet been authorized by

the fda to start releasing doses that they manufactured, the states may be in for getting fewer doses than they had planned for. johnson & johnson in a statement telling us that the company continues to work closely with the fda towards the emergency use authorization of the emergent bayview facility so we'll have to see just how that goes after that incident there, whether the fda clears it and when but as for the approach for vaccine supply, there's still a lot coming from pfizer and moderna as well. just bumpiness for j&j. >> overall pretty good meg, thank you. time for a cnbc news update with rahel solomon. a group of women who work for representative matt gaetz have come out in support of the congressman. he has meantime denied any wrongdoing. prosecutors and defense lawyers say this they expect a plea deal for gaetz associating joel greenberg

he's indicted on a number of charges including sex trafficking and stalking the admission of guilt could mean he will serve as a witness in the probe of gaetz. they say it was philip adams who allegedly killed five people before taking his own life this morning. with more on the case and the search for the motive on the news with shepard smith. the fight is heating up over jail conditions for ghislaine maxwell. she is creating a stink by failing to flush her toilet. she is being fed salad with mold on it her lawyers say. she has been in jail on sex trafficking charges since july you are now up to date i'll send it back to you, wilf. >> rahel, thank you for the lovely details on that story we'll see you again next hour. we've got a news alert on robinhood. kate rooney, as always, has that for us hi, kate. >> hey there, wilf

we have new numbers from robinhood on the amount of users trading crypto they have 9.5 million users trading cryptocurrencies that is up from 1.7 million users at the end of last year. the last number we had to put this in context was 6 million at the end of february, so that means in just about a month and a half they have added 3.5 million users. this is important ahead of an ipo. we saw coinbase this week putting out quarterly numbers. they brought in more than a billion dollars in revenue mostly from crypto trading robinhood also heading for an ipo. if it's the same situation as coinbase, it could mean good things for robinhood heading into an ipo, which is expected in the beginning of june guys, back to you. >> also sets up an interesting competition between the two. kate, thank you. kate rooney. >> it does. still ahead, the new chamber of commerce ceo on why she thinks president biden's plan to

hike corporate taxes could be a job killer. plus celebrity chef bobby flay on his new business venture and the future of the restaurant industry. as we head to break, a check on bonds yields are falling across the board. we've seen this over the last few sessions the 10-year is down to 1.62. we are at 1.78 not too long ago and that was causing a lot of consternation. now these lower yields are helping tech outperform again as we look to a record close for the s&p. we'll be right back. flexshares are carefully constructed. to go beyond ordinary etfs. and strengthen client confidence in you. before investing consider the fund's investment objectives, risks, charges and expenses. go to flexshares.com for a prospectus containing this information. read it carefully.

s&p up 0.4 of 1% the u.s. chamber of commerce pushing back against president biden's proposed tax hikes to fund his infrastructure bill in a new statement the chamber says although it supports him wanting to invest in infrastructure it doesn't mean we should proceed with tax hikes that hurt american business and cost american jobs joining us is the u.s. chamber of commerce new president and ceo suzanne clark. welcome, suzanne so you're applauding the infrastructure package and the investment in our nation's

infrastructure but not the corporate tax hike so how should this be paid for, deficit financed >> that's exactly the right question and the one that we need government officials to come together and solve. there are lots of ways to pay for this over time, the way we do a lot of investments. there are bonds, there are user fees, there's extending out the time we use to get that return but this is the hard work of governing and it's the right thing to do, not raise taxes at just the time that businesses are getting back on their feet and ready to have an economic recovery >> there's been some talk of flexibility on that corporate tax rate going maybe not all the way up to 28, to 25, some leniency on the multi national part of it would any higher rate be acceptable to the business group or no? >> i think what's going to be important is figuring out what the best policy is, how do get our crumbling infrastructure to a better place, prioritize those investments and figure out how

to pay for it. there are ways to come to the table to negotiate but only if that's done in a bipartisan way and with business at the table. >> which is the best tax to increase as we sit here today, suzanne. >> i don't know that we ever think there's a best to increase as the u.s. chamber. but i do think it's probably more fair to think about user fees and gas taxes so people who are advantaged by the infrastructure help pay for it over time. >> if you look back over the trump administration, and you guys have hailed the trump tax cuts as very beneficial on the flip side for the economy and for business but if you look back on the results, you see things like buybacks growing a lot 23faster than r & d and capital investment isn't it harder now for you to make the case that that would hurt growth to raise taxes on the other side >> on the contrary i think there are lots of examples of investment in r & d,

investment in capital, investment in people but the last year has changed an awful lot in terms of the impact on american workers, american companies, and the need to really rebound in an effective way. a part of our position is just this is not the time >> i wanted to also ask about the new proposals to reform international taxes. many of them seem to suggest that big u.s. multi nationals will be paying more tax in local markets going forward. now, even if that is fair, even if it makes sense based on analysis, should the u.s. government be signed of ceding ground on that front or should it stick to the global taxation position the u.s. has had for a long period of time? >> i think where we standing at the u.s. chamber is we have to make sure that our government is making our companies competitive. we want to take care of american workers and american communities

and think about that first some of the suggestions that we've seen out of the administration about maybe other countries could raise taxes just show that they can see that this is not competitive for american companies and we're not ready to bet american jobs and american competitiveness on the idea that other countries might help us out and raise their taxes. >> you were saying, suzanne, that business should have a say in all ofthis in figuring out these policies we talked yesterday to deputy treasury secretary and he said he's been talking to ceos about the tax issue. have you found this administration less forthcoming or at least inviting of business to the table to these discussions? >> on the contrary i think we've had really good conversations with the administration, really good conversations with folks on the hill and we're optimistic that there is a bipartisan compromise here that can get this critical work done on infrastructure, help american families, help american companies, help us be more competitive we want to see it done that way.

let's do the hard work of coming together at the table and doing the right thing for america right now. >> do you have numbers of how many jobs and how much growth would be hit if the corporate tax rate went up to 28%? >> our friends at nam released a study that said these tax hikes could cost a million american jobs. >> hmm well, we'll wait to see on the treasury for that. they haven't really put out analysis yet but thank you for joining us, suzanne clark, with the chamber's reaction. >> thanks for having us. still ahead, a trip into the jean pool. shares of levi going up and numbers after the bell plus the outlook for resat as yields pull back hard from recent highs we'll be right back. this is how you become the best!

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13 minutes left in the trading day. we're now in the trading bell market zone, commercial-free coverage of all of the action heading into the close mike santoli here to break down these crucial moments of the trading day. today we've got hightower chief investment strategist stephanie link with us as well a very good afternoon to you, stephanie. >> hi. >> stocks near session highs the s&p 500 hit an all-time high this hour and is on track for a record close it's up a third of a percent the nasdaq is up 0.9%. mike, let's talk about the s&p first given that it is on track for another record close, pushing towards 4,100. what would be the percentage rise or fall that would kind of

bat no eyelids from here based on recent numbers. >> i think this is basically a not much is changing so the path of least resistance seems like it's higher and the market is finding a way, depending on the different sectors in a given day to get it there. i think another 3% or so if it happens to the upside, the market will look like it's getting a little bit stretched, like maybe there's a very short-term overshoot but it looks like that a lot when you're in these persistent uptrends so i think there's a little bit more of an even risk/reward being set up by these incrementally high prices. it seems like most people are onboard with the bullish economic case so it's tough to have an edge in the near term. you have a day like today where apple and microsoft both up well over 1%. it's basically just flows toward stable mega cap growth stocks. everything else pretty much holds still. >> steph, what do you make of the tech leadership, now the

better performing sector of the week information technology up more than 3%. communication services, consumer discre discretionary, apple, microsoft, mike just named it, all up again today. >> yeah. it's been kind of a quiet week i think everyone is waiting for earnings, to be honest with you. but the big story is 17since th beginning of the second quarter we have seen a massive rotation back to growth, back to tech i think a lot of it is because they got very oversold big laggards in the first quarter. the xlk, technology index, is up about 7% year-to-date now even with the rise this week. but the xle is up 28%. the xlf is up 18%. even the industrials are up 13% so that was the place to be in the first quarter. you get a little mean reversion now. let's see what earnings bring and the reaction to earnings is always a huge tell i'm glad that financials have

kind of -- i'm glad that they're sitting here a little bit. they had a nice run but i'm glad they didn't rocketship higher. i think the setup is better, we'll see how the reactions are. but i've talked about this a lot. i think the economy is getting better we cite data points all the time each week and i'll do it again because i think there are some real pockets of strength and this economy will lead to better gdp and better earnings. a little more inflation, a little higher interest rates that's the recipe for value. but ism services at a record high including new orders and consumer pretty healthy. i know the low-end consumer is not but there's a lot of parts of the consumer that's doing very, very well, especially if you look at confidence and the revolving credit revolving credit rose for the first time in five months but is still down 11% and then if you look at the savings rate, 20.5% is way too high it's not staying that high over

time that's another actional point of pent-up demand potential if you will so i still like the cyclicals. i own some tech but lean much more on the cyclicals because the economy has some momentum behind it. >> uber and lyft are facing a driver shortage. deirdre bosa with the details. >> so, sara, investors have been betting on ride-sharing as a reopening trade. while we see demand recovering, supply isn't keeping up. both companies are spending million dollars on cashin sent i -- incentives these are public companies touting paths to profitability for now investors don't see these new incentives as material costs but we'll have to see how this plays out key here, if it reaches the rider side of the equation, if they start to fight over market

share, guys, we could see the pandemic as a sort of grand reset for the companies. >> deirdre bosa, thank you very much don't miss an exclusive interview with the ceo of uber during the premiere of "tech check" monday at 11:00 a.m steph, these stocks, uber and lyft, have been reopening plays. both doubled over the last year. is it still a place you'd look for opportunity? >> i've not been involved in them but they're up huge and i just kicked myself i didn't look at uber last march i think they're doing all the right things and pivoting where they need to pivot but setting themselves up so strongly, so nicely for the longer term that being said, yeah, they're going to see some pressure in terms of this driver shortage. but this isn't the only industry seeing that. you guys are talking to ceos all the time the airlines and pilots and industrial companies i'm hearing from, they're having a mini renaissance and can't find people

even tillman fritatta said he's offering bonuses because he can't get people in. the question is if you pay, will they come? or is it because they're still so scared about the unknowns of covid, do they want to stay home because they make more being unemployed, is it child care so there's questions, i think it's a little bit of everything. but unit labor costs are zero and i think wages are going to have to rise as a result of all those shortages out there. apple and epic games laying out their cases for next month's antitrust trial. julia boorstin has that story for us >> the tech giant and game maker are explaining their positions in the battle over app store fees epic says apple has monopoly power in the app store influencing what apps users can download and protecting its own apps and says it abuses its power. apple's defense that it doesn't

make much money from the app store because most apps are free it also says it faces a lot of competition, fparticularly when it comes to making money in fees in apps. it competes with microsoft xbox, playstation as well as the google play store among others apple saying it's not a leader there, therefore, it says it doesn't have a monopoly. >> julia, thanks so much for that mike, all the big tech companies face the threat of more legal or regulatory action. slightly different cases for each of them clearly this one an antitrust one for apple. do people really price in any likelihood of serious damage to their top and bottom line from it. >> it's hard to find it in the valuations right now i think arguably you could in facebook because until this recent run high it really did trade at a decent discount to what you would expect given the growth rate and all the cash holdings at the company. when it comes to apple, i doubt it

it's pretty much at the upper end of its range valuationwise people assume it's around the edges. even if it is important in principle for apple to enforce the way it's decided it's going to keep some control over it's app so it is an interesting argument they are saying they don't have much market share in video games, but of course they could literally have a monopoly in the apple app store. if you consider that to be a 100% crucial thing to participate in, then they have a monopoly over that part of your business, which might be make or break for a developer. >> which is what some of the antitrust authorities in europe and the u.s. are looking into. netflix reaching a big movie deal with sony let's bring back julia boorstin with that story. >> netflix has secured the rights to stream sony's theatrical releases in their first paid tv window starting with sony's 2022 slate so they'll get future installments of spider-man a

jumanji among others netflix committing to a certain number of films, we don't know exactly how many netflix will also license some older titles from sony's movie vault. this will certainly be a valuable new source of content for netflix as a lot of the other major studios are putting their content exclusively on their own streaming platforms. guys. >> julia boorstin, thank you steph, the economics are changing for movie theaters, for the streamers, when it comes to these deals. how do you play this in the market >> well, i don't own netflix i used to own disney and then i owned viacom but made so much money in viacom in two months time i took some profits there but i think you want to have an exposure to one of these kinds of names i'll look for pullbacksif we get one. netflix i've never owned i couldn't get my hands around the valuation. but look, this is a win-win for both companies in terms of

netflix as well as sony because netflix now has an 18-month exclusivity. we hear that they paid a billion, who knows, it's not official but that's a big price tag but they get the exclusivity, they get direct to streaming and it offsets, as julia mentioned, it offsets the losses from marvel and pixar and losing "the office" and "friends" and that sort of thing. so i think it's a win for netflix. for sony, they don't have a sub service so this gets them in the game as well they have a lot of muscle behind them and a great balance sheet it's a great announcement. i'm sorry that i don't own either, to be honest >> mike, how has netflix held up recently >> it's held up. it had this amazing run right into the beginning of the stay-at-home period. it's kind of gone a bit sideways from there but it certainly re retained most of those gains the way things are coming around, people are assuming

netflix is kind of the core of whatever streaming packages you're going to get. there's not a lot of churn there's considered to be some pricing power but the best days of sub growth are behind it. the excitement of growing a low base is in the other ones but there's no sense that there's attrition in netflix subscribership so i think that's why it's managing to hold on to those gains that it got right at the beginning of the pandemic. we've got two minutes left, mike what are the internals showing you? >> the internal story has been just a little bit lacking. there's been some harping about the fact there's not been great breadth or participation in the upside of this phase of the rally. the new york stock exchange pretty much an even split between advancing and declining volume that's been the story most of the day and most of the week the mega caps are taking up the slack as you get profit taking in the market. so far it hasn't hurt the overall market very much at all. also take a look at the yield

sensitive sectors. utilities well outperforming banks. that's really a give-back because banks had a great run. so you said this push/pull, the choreography of rotation following what's happening in treasury yields is pretty clear there. and the volatility index is by one angle essentially normalizing back into the teens, which is where when the market is strong you would expect it to be it really does have some downside momentum. it seems right here after tipping past that 20 mark, sara. take a look at the major averages, dow up 51 points the biggest contributor is goldman sachs, right up there with some of the technology giants like salesforce and microsoft. if you look at the biggest loser in the dow or the biggest laggard, it's nike s&p 500 is higher, headed for a record close anything positive would take you to a record close. up 0.4 of 1% it feels like small moves but so far we're up 2% on the s&p

sectors leading, technology, consumer discretionary that's an amazon kind of day, apple kind of day. industrials and staples are also higher energy is the biggest loser. the nasdaq is up a full percent at the close and small caps bounced back 0.8 of a percent. it doesn't look like such a strong day but finished very strong added to gains for the week. welcome to "the closing bell," everyone. another record closing high for the s&p 500. i'm wilfred frost along with sara eisen mike santoli as well as always anything positive for the s&p 500 would have been a record we're up on the s&p. the dow up 56 points which was pretty much its session high up 0.2 of p1%

and the russell regaining 0.9% energy was down more than 1% and tech up more than 1% jeans are hot right now. coming up we'll get the latest reading on denim demand and the strength of the consumer when levi strauss reports their numbers. plus celebrity chef and restauranteur bobby flay on the outlook for the restaurant industry as more people get vaccinated and the new product he's partnering with he's not the founder of the business but kind of is. that's your tease for that one still to come. stephanie link from hightower is still with us and victor jones joins the conversation also, mike santoli, to you first of all and tech the leader, energy pulling back. there's a sort of rotation that happens every single week that allows the headline indices to keep going higher. >> it's certainly been evident,

especially this week, when the market seemed to be getting ahead of itself, instead of having broad selling pressure that pulled the indexes down, people just look at the general uptrend, the general economic story that says things are fine. the fact that the fed is not going to do anything to disturb the picture by all accounts and you have this recipe for money just essentially remaining in the market we saw this in 2017, that's maybe the best case example where it just rotated and rotated and ground its way higher and stayed overbought for a long period of time. that being said, getting to this point, 4100 in the s&p a lot of people have been pointing to as not really sure there's a lot left in the short term but we could also rotate back away towards small caps and financials and everything that have been resting for a week so that's your dream scenario. you just don't always have it put together so neatly. >> victor, give us an update on

the activity from retail traders. what are you seeing? >> i think a lot of people are talking about whether or not the reopening is taking some activity away from the markets i think there might be some truth to that. i think the broader story, sara, is a lack of volatility in this marketplace. we went from an abundance of volatility across asset classes to what seems like -- i'll give you a few examples the nasdaq as we came into march we were expecting on a daily basis 2% now we're expecting 1.5% bitcoin at that time when we came into the month had volatility now 70%. even mean stocks, you're talking about 600 implied volatility at the end of january 400% and now we're down to 200% to the same idea of cyclical rotation we're talking about, as we rotate into longer duration asset classes, those are things that tend to have less

volatility not surprising that the vix is meaningfully below 20 here but on a relative basis, this is a market that feels very, very different from where we were at. >> victor, thank you very much and delano, i wanted to ask what you're buying here it's been a good day for week and a good week for tech but is it still a buying opportunity for big cap tech >> wilfred, yes, i do think it is we're not back to our highs for some of the big tech names that's still the highest conviction stocks that we like, we're buying obviously we talk about the mega cap stocks that have pulled up during the past couple of weeks here if you look at the backdrop as we had great comments from jerome powell about what's going on with the recovery these are very good tailwinds with the overall economic.

mega cap stocks are also tailwinds for investors. you see investors with a lot more money supply now. you look at the picture last year at this time and now money supply is up, savings are up, stimulus is still coming there's a lot of upside still left for investors if you look at what jamie dimon spoke about, you're looking at a potential bull run for the markets. >> you mentioned the fed comments earlier we did have a chance to speak to fed chair jay powell. he weighed in on the fed's extended asset purchase program. here's what he said. >> what we've said about our asset purchases is that they would continue at the current pace until we see substantial further progress toward our golds and that will mean actual progress of the we're not looking at forecasts for this purpose, we're looking at actual progress toward our goals, so we'll be able to measure that inflation. it's also the indicators of maximum employment i would look at global vaccination as a risk really,

something to weigh in as a risk to the progress that we are making >> steph, i thought that was sort of surprising that he saw global vaccination rates as a risk, as we contemplates how close they are going to get to their goals. obviously their mandate is maximum employment and stable prices and he said they're far from that as well. butt panel was about the global divergences and the discussion was about how much of the world still is not vaccinated and needs to be and clearly it's something the fed is watching and will keep them on hold for a while. >> yeah. i thought it was a great panel he's digging his heels into his story and being very, very accommodative, taking their time and staying patient. i did like the comment about them watching what actually happens versus what is being forecasted but i look at inflation break-evens and look at that chart, i look at a lot of commodity prices up double, triple digits. unit labor costs are zero,

that's the good news the bad news is it's zero and probably only goes higher. so i think we have to watch it i think we can enjoy this time for now. there's $100 trillion in stimulus globally in the system. it's going to work we are going to eventually get vaccinated but it's going to take some time so to me if you have limited inflation for the time being and you have better growth and better earnings, that's a very nice setup for risk assets overall and very nice risk/reward on the cyclical side of things as well. >> delano, how are you getting exposure with your clients with crypto >> we're definitely bullish with cryptocurrency it's still volatile. this is something where investors have to figure out what is the best percentage of their portfolio that should be allocated to cryptocurrency.

i'm only looking at the two top mega cap coins i have exposure to a little bit of the smaller ones. but we're saying safe but we are getting invested for people with a longer investment horizon, we think about what technology can do and what the actual code can do, that you can really get excited about it so we're definitely exposed and definitely bullish, but we're making sure the clients have the correct exposure to cryptocurrency. >> victor, what about you? could you offer bitcoin trading and do you see it as a correlated asset in any way? >> so i would say two things one, we just started rolling out fractional share trading to our clients today and on path to offer cryptocurrencies in the next couple of months. to the point about bitcoin, i would say long term short. i think you have to take it serious. i think the price target after basically doing an about face is probably what makes a lot of sense. i think we heard some comments

coming out of both the fed as well as the treasury and the comments were that it's not effective as a store value and i would take a little bit of an issue with that. i think the fact that you have noncorrelated volatility is precisely the reason that investors, both retail and professional, are interested in the asset class to begin with. i think transactional relevance will likely come later, sara, but in the short term i think it's liquidity that has to come first. and it's looking for volatility and that's what's attracting people. >> we're just getting levi strauss numbers. >> so levi strauss is beating for both earnings and revenue. adjusted earnings of 34 cents coming in above analysts' expectations of 25 cents and revenues, $1.31 billion versus expectations of $1.25 billion. levi also raising the first half revenue and eps outlook.

that eps outlook does look higher than the street for the second quarter digital sales up 41% gross margins improved there's a note about better mix with price increases and fewer promotions, which is something we heard from many retailers with lower promotions in the quarter. inventories also down about 2% the dividend increased from 4 cents to 6 cents you can see levi strauss here shares higher by about 7% after hours in response. back over to you. >> big jump. 6.7% now thank you. don't miss jim cramer's exclusive interview with levi's ceo at 6:00 p.m. eastern time. what a time for retail it's changed so much, up 9 spok9.5% i remember when they said they were laying off hundreds of workers and it was dire.

look at what a turn-around they have seen. has it already been priced into the stocks apparently not look at the jump we're seeing now. >> i know. it was up 24% going into it, right? these are great, great numbers, especially the gross margin number and inventory numbers those are really phenomenal and digital up 41% they're doing a very nice job transitioning into e-commerce, that's what a lot of companies are doing. so i don't own levi but i do own vf corp and they do have a jeans division, wrangler, but they also have very good brand names in general north face and vans and that sort of thing. that stock is down 3% on the year that company has a good balance sheet and actually adjusted a $1.5 billion acquisition to beef up their brands in general if i'm playing it, i'm playing it on the vf side. but levi, you have to give them all the applause in the world because they have navigated very, very nicely. >> the stock up 9.5%

stephanie, thank you very much victor jones, delano, thank you all. up next, blackrock's russ koesterich, why he's bullish on high-yield bonds. plus bobby flay on how the reopening of las vegas is impacting his restaurants and the rest of the industry we're back in just 90 seconds. , now anyone can own companies in the s&p 500, even if their shares cost more. at $5 a slice, you could own ten companies for $50 instead of paying thousands. all commission free online. schwab stock slices: an easy way to start investing or to give the gift of stock ownership. schwab. own your tomorrow.

we've got a market flash on fubo tv. julia boorstin with the details.

>> fubo shares spiking on the news that fubo tv, the tv streaming service, announced it's acquired live exclusive rights to the qatar world cup 2022 qualifying matches. you see shares are over 5% higher on this news. this shows fubo investing in these exclusive sports rights and excitement around soccer, guys back over to you >> i mean i get it, because i've been around soccer, i'm always good for that. but world cup qualifiers are not world cup matches, so i'm a little surprised to see quite such a jump. but as you say, it is soccer julia, thank you. >> well, it's a pretty volatile stock. >> no, no, exactly exactly. take it with a pinch of salt, exactly. now stocks finishing the day higher the s&p hitting another record high joining us is russ koeserich

good to see you, thanks for joining us. >> thanks for having me, wilfred. >> i wanted to start about actually talking about yields and the impact it's having on equity markets we talk a lot about the nominal level in the 10-year what, though, do you make of the real yield and what's that telling you about the outlook for stocks >> you know, if you look at where we are,rates are still extraordinarily low. obviously nominal yields have backed up quite a bit but i think you're right in focusing on real yields we still have the 10-year somewhere in the ballpark of a negative 60 basis point real yield. first of all, that is inconsistent with even the very low rates we had both nominal and real in the post-gfc decade. second of all, it is very inconsistent even the type of growth we're likely to see in q2 and q3 given the massive stimulus that's been put in place. so our view is we're likely to

see higher rates the back end of the curve has already done a lot of work we're already looking at higher rates. that has implications for the parts of the market you wanted in one of the casualties of higher rates have been long duration growth stocks. companies where you're not likely to see earnings for a number of years. one of the biggest beneficiaries has been the financial sector. one of the biggest laggards, banks have got it a bit. >> are you overweight banks and other cyclicals even though they had a strong start and a recent mini buyback opportunity >> we don't have an enormous overweight but we have been adding to banks both in the u.s. and europe we've been adding on the consumer finance side. other types of cyclicals, adding some of the mining companies, machinery companies, both in the u.s. and europe. and again, i go back to one of

our high conviction views and that is we're likely to see both nominal and real gdp numbers not just for this year but probably into 2022 as well that we've not seen in years if not decades and part of what people loved last year, they loved the resilience of stable growth companies that could survive in a world where people were very uncertain about growth this is a very different environment. one of the things they're really trying to make sure in the portfolio is having that leverage to the cyclical rebound that is becoming more and more evident every day. >> why are yields going the other way, russ? we're back down to 1.62 on the 10-year. >> it has moved back i don't have a good answer for you. our view is that it's temporary. yields did back up quite a bit the one thing i would say is there's still a very substantial bid, whether you're talking about pension bids, endo you

meants there's a significant bid from finance companies and banks. you have a lot of retirees and aging population looking for income our view is this pullback in yields is modest, it's temporary, and long-term rates, while they're not likely to go to the moon are going to be higher by the end of the year than they are today. >> russ, i noticed that you like european stocks. not uk stocks. a little bit of a surprise there, given the relative vaccination rates and outlooks for gdp this year. talk us through that call. >> absolutely. so most that we have in europe are large multi national companies, machinery, large industrial companies, banks. the key point that i would make, first of all, we like these names from the bottom up perspective. they also are in the direction of travel that we like in the u.s. as well again, having more of that cyclical exposure. the key thing is many of them

are trading at a reasonable price because they are in europe but they are geared to global gl growth you're not just selling to europe but the rest of the world as well. if you look at what we expect for global gdp, that's likely to rise and those companies will benefit from that trend. >> europe having a pretty strong week so far. just recently taking it to pre-pandemic highs russ, thank you for joining us let's go back to mike santoli for a look at margin debt new data, mike, shows investors are borrowing record sums of money to buy stock. >> absolutely. there is a record high margin debt but also we have record high stock prices so i do think on a relative basis is where you really get a glimpse whether investors are over their skis. this is margin debt as a percentage of total u.s. market cap. you see broadly speaking it runs from 1.2 to 3 historically over

the last 25 years. this was the year 2000, 199 1999-2000 spike. that was a warning sign. what was going on here is that stock prices were crashing faster than margin debt was coming down. it wasn't so much that people were levering up, it was just lag and timing for most of this bull market it's been basically flat so i see kind of no signal it doesn't tell you people are over their skis. take a look here at the rate of change recently. this is the rate of change in the last few months of margin debt and it's kind of a standard deviation thing. i would point out also around '19, 2018 as well. it's not necessarily kind of end of bull market or massive risk being piled onto the system. it's worth keeping in mind that you can't take the absolute loan number as being telling of

anything. >> not just 2007 and 1999 where we've seen the experience before. >> right you're similar to those levels but in 2007 nobody thinks equity margin debt was part of a big core of the problem anyway. >> no. but we know what happened next. >> absolutely. >> mike, thanks. still ahead, david rosenberg says economic data is no longer moving stocks, and that could be a warning sign for the market. he'll join us to explain. plus celebrity chef bobby flay on his latest pet project there's your hint. as a reminder, listen to us live on thgoe on the cnbc app the dow closed up 57 points. s&p 500 closed up at a new record high. these are the people who work on the front lines. they need a network that's built right. that's why we created verizon frontline. the advanced network and technology for first responders.

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we're getting some news on amazon and the warehouse union vote deirdre bosa has got it for us hey, dee. >> vote counting is under way at the amazon union election in bess mer, alabama. and we are monitoring it in realtime via zoom. now, the union needs a majority of returned votes to win a tie would go to amazon meantime, guys, more reporting is coming out regarding alleged behavior by amazon to discourage union attempts "the washington post" reporting it has seen emails showing

amazon pressed the postal service for mailbox, a move the union believes violates labor law. we reached out to amazon for comment but haven't heard back yet. there have been other moves that were criticized, like amazon's action to have the traffic lights to change near the warehouse to make it harder for unionists to canvas employees. all of this guys which simply signals that there's more drama and likely legal battles ahead keep in mind, hundreds of ballots were challenged and could delay an outcome and whatever the outcome, the losing side is expected to appeal we continue to monitor this and will bring you any more as we get it but we are unlikely to get a result tonight >> what is the market expecting, dee? which way? >> if you ask me, i'm not sure the market cares, wilf i've been reading lots of amazon notes from brokerages over the last week and there's barely any

mention of the union remember, this is a very tiny proportion of amazon's nearly million strong workforce in the u.s. that doesn't mean that it doesn't matter certainly we could see ramifications. we know that other labor leaders are watching this, lawmakers are watching this very closely, but we'll have to see some of those effects continue to play out once we get the results, once we get the appeals, once we get the lawsuits still lots more to come. >> so we should know tomorrow, is that what you're saying >> they -- last i looked, they had counted about 200. the magic number that we need to look for is 1,608. if you get that many yes votes, that means the majority has won. so that would be the outcome but like i said, hundreds of challenged ballots, so we may not even have an answer once they're counted because we could then get all of those challenges. >> keep us posted. thank you. well, we are big cat people, some of us not all of us on "closing bell."

but a lot of our producers are and here are a few of our cat pictures up next bobby flay on his new line of cat food "closing bell" back in a moment. ♪ ♪ ♪ ♪ ♪ ♪

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so, if you've got the guts to dream, we've got the guts to make it real. apex fintech solutions the guts to change everything. select chef bobby flay is expanding from restaurants into pet food flay unveiling made by nacho, a pet food for cats, inspired and created in partnership with his own cat, nacho

it's currently sold online and will soon be available in stores through an exclusive retail partnership with petsmart. bobby flay joins us now for more good to see you, thanks for joining us. >> my pleasure, thanks for having me. >> i am glad as i glance down at this little screen i've got that nacho is there too because nacho is the company founder, is that right? not you? >> yeah, nacho is the founder. i've been a cat person my entire life you know, nacho and i wanted to start a company that was really cat focused. a lot of pet food companies start with dog and when they have some success, they sort of move on to i guess it's time to do cat food as well. i've been a cat person since i was a kid. i used to tell people that i was basically raised by cats i was an only child. my mom always had two or three cats in our house all the time they were basically my siblings. i've had nacho for about six

years. i have another cat named stellar about two years and they're an incredibly important part of my life as most pet parents will tell you, we do talk to our animals, whether people are watching or not. i feel like nacho whispered in my ear at one point. listen, you feed people every single day, whether it's for your restaurants or your shows, your books, your tv shows, what about us and so we started really thinking about it and created made by nacho. it's taken us a bunch of years to go through it we created amazing recipes obviously with an eye on taste and we wanted to make sure that made by nacho was synonymous with top quality across the board but also a well thought out diet for cats and the way cats should be eating. >> so i have to ask this, bobby. if nacho is really giving you feedback during the process, were you involved in getting the taste right as well? have you been tasting the cat

food products? >> oh, no, i don't taste -- i have my own -- my own taste tester right here. between him and his sister basically it's a very different business the dog food business and the cat food businesses are a very different business because cats have a very narrow palette so it has to be protein first. we source things like cage-free chicken, grass-fed beef, sustainably caught salmon. we pair it with things like cranberries and millet and pumpkin so they have a well balanced diet. so it doesn't really matter what i think of the flavor, it's really about what they think of the flavor because they're eating it. it's not made for humans, it's made for cats and that's the most important thing. >> so bobby, we've seen so many new pet owners and cat owners lately and some of these stocks that we follow that are tied to this industry. >> sure. >> like chewy have just skyrocketed because of the pandemic

i'm wondering who you are catering this to i'm not sure every cat owner wolf t would feel the need to feed their cat grass-fed beef or sustainably caught salmon. >> i'm not sure i agree with you. because of the pandemic we've all become a lot closer to our pets they were an important part of our life before that, and i think over the last year, i think that we realize how incredibly important they are to us and there's new pet owners here as well. you know, what we need our pets is an important -- is an important component for their happiness but also for the pet parents as well. we want to make sure that they're eating well. and so i think that being thoughtful about what you need your pet especially in our case what you're feeding your cat is incredibly important so i think people should think about how they're feeding their pets. >> that's fair >> i wanted to pivot, bobby, and ask about humans eating food in

your straunds restaurants. what do you think about consumers' keenness to get out and dine in restaurants again? >> well, i think, listen, when you're in the restaurant business no matter what's going on in the world you have to be optimistic it's a very, very tough business without a pandemic but now that we're in the middle of the pandemic, obviously it's made things close to impossible. look, i'm hoping a new restaurant in may at caesar's palace in las vegas. it's going to be an italian restaurant called the malfie we're incredibly invited about it it's probably a month out. yes, our optimism is very, very high but i think the only thing you can do, because the pandemic has taught us this, is really take it one day at a time you know, we'll hope for the best as that happens

hopefully in a month from now, i'll talk to you from vegas and let you know how i feel about it that particular day. but for now we're building the restaurant and hoping that people will be enthusiastic. it seems like people are enthusiastic i mean there's a little bit of trepidation of course, but that's understandable. >> no, a restaurant opening in vegas is like the ultimate reopening play, bobby. but your industry has gotten killed, among the hardest hit because of the pandemic. what do you think it's going to look like on the other side? >> we don't know i mean i think -- i think that there's definitely going to be optimism hopefully people will wanting to get out and go into restaurants when they feel safe to do that that's not a decision for me to make, that's for the right people to make those decisions and obviously we'll make sure

that we protect our customers and employees as best we can and just follow all the guidelines we can but i think that optimism is high but i don't think that anybody would have guessed we would have still been in this over a year later when it all started. we'll be cautiously optimistic as they say. >> bobby flay, your cat is big maybe that's the magic of all those protein treats. >> yeah, nacho is very, very big. he's a main coon cat it's the biggest domestic breed there is but he's a gentle giant. >> with fine taste and ah itunesa, duck liver and turkey giblets. up next, big corporate tax hike ramifications president biden said he's willing to negotiate on the proposed tax rate hike, but what could that mean for the markets and your money we'll discuss with david rosenberg next. and the best cities for new

home buyers. thtop e places to live might not be what you expect we'll have the details when "closing bell" comes back. ♪♪ ♪♪

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welcome back time for a cnbc news update with

rahel solomon. new york state has set up a $2.1 billion aid fund for people who lost work during the pandemic it's aimed at workers who did not qualify for other forms of relief because of their immigration status it's the largest program of its kind in the u.s. portland, oregon, has hired a consulting firm to investigate the city's police department for racial and political bias. the probe comes after police reports were leaked that incorrectly identified a black city commissioner and law enforcement critic as a suspect in a hit-and-run accident. and french president emmanuel macron has a plan to do away to replace a school with an egalitarian institution. it has long come under fire for being out of touch with reality and also not diverse, so it's an interesting move. >> rahel, thank you. up next, fed chair jay powell discussing the american recovery and inflation with me earlier in an imf panel.

we'll hear what he said and get some reaction from david rosenberg when "closing bell" comes right back

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suggested that they were being deanchored and inflation might move persistently well above 2% we would react of course that would be our job. one of our two mandates is price stability, the other is maximum employment we don't think that's the most likely outcome, but we do have the tools to deal with that outcome. >> joining us now is david rosenberg. he continues to make the point that he doesn't think the climbing inflation is going to last year after year in the way the fed should do anything about it i know you agree, although we have so many fund managers and strategists saying you have to position for rising inflation. why are they wrong >> there's a famous bob ferrell rule which goes when all the experts and consensus agrees on something, the exact opposite is going to happen. look, you go back to the beginning of the last cycle, sara, and everybody was saying the same thing, that the zero

rates and repeated qe out of bernanke, the obama infrastructure package, that of course we finished off the cycle with a trillion dollar deficit, 3.9% unemployment. think of the last cycle. we created all those conditions to create a huge inflationary cycle that never happened, which tells me there's a lot of structural factors at play that continue to impede the inflation process. i would say one of them is excessive indebtedness, which now we have a lot more of on the books than we had previously we're going to have near term inflation, in doubt about it for the next few months. but i think powell is quite right. you can't have the central banker whacking around interest rates like portfolio managers can do to their portfolio. if the fed believes, and i think they're right, we're going to have a short-term deviation from the trend line then you don't do anything you only do something when you believe that the trend line is going to change. once we get past all this temporary stimulus later in the

summer into the fall, we're going to decree recreate the conditions of what happened in the fourth quarter of last year. we're going to have a very big slowdown powell can't talk about this because you've got janet yellen being the nation's economic cheerleader. when you go to the fed's forecast from the last meeting and look at what they did to this year's gdp growth and back out the quarterly pattern, i think that they agree with me. they won't come out and advertise it, but i think the fed has fourth quarter zero for gdp growth this year so why would you do anything with interest rates knowing that? >> so you're saying that a lot of this boom that we're seeing in growth and across the economy is just artificially driven by stimulus and there's going to be a ton of give-back when it goes away that's not the consensus the consensus is we're building a sustainable recovery that could last years. >> i'm not saying it's

artificial, it's real. but it's also very transitory. uncle sam did not give the economy a national wage increase this is like we got a temporary bonus. so what happens when your bonus runs out and so we're going to find, of course, we've got the reopenings we're going to have a nice little party for a couple of months the economy in most parts of the country, i'm here in toronto, i'm hearing most of the u.s. is reopen that impetus to growth is soon going to subside just as the stimulus checks run out. so what i'm saying is that, yeah, i can understand the consensus is a completely different view than my view, which makes this all the more exciting for me. especially in terms of how you want to be trading bonds and the forward curve futures that are priced in early fed tightening that's actually where the money is going to be made. so i'm very excited about the fact the consensus and i have parted ways. >> so, david, does the t-note

argument still apply to u.s. equities or would you not be wanting to be long them either >> well, look, i think when you have guests come on that say it's turned into a stock picker's market, more actively driven market, i fully agree with that. i think the days of throwing a guard against the wall or the past investing, i think that's actually not the way to invest and there's parts of the market that i do like but look, i saw today that the cape, you know, the schiller pe, it's touching 37 right now it's touching 37 we've only been higher in the past century back in the dotcom era. there's tremendous enthusiasm, public participation leverage. there's spots that i like. the overall market itself to me is just -- if i come down to one thing, valuation is not a timing device by any stretch of the imagination but valuation does tell you something about your

expected future return and i think it's going to be very limited for the overall markets strictly speaking. but what's interesting is you asked me about the stock market. look what bond yields have been doing. this is a classic by the fact that bond yields are coming down again and they're hugely overbought but you're seeing this rotation from value back to growth. the defensive sectors are doing a little bit better. utilities have been outperforming transports this is all very recent. but to me it's very interesting toe see what the message is from the bond market because yields are starting to come down. the fed is doing a much more forceful job, i think, not just from the top brass but the fed staffers are putting out more and more blogs and research showing that their models are suggesting that the inflation run-up we're going to see is going to be transitory in nature think how the markets are priced right now. the surprise will be that the fed is right well, if the fed is right, their models are right, i'm not saying that they can't be wrong but when i take a look at the

past and see the bond vigilantes play this game of chicken with the fed, guess what, for all of the laughing at the federal reserve, so on and so forth, they get it right more than they get it wrong >> david rosenberg, always a pleasure thanks for joining us. >> thank you up next, double charged. tesla tesl issuing refunds in a surprise perk to the cuoms arsterchged twice for their recent car purchases. some saying it's too little too late 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. now or in the future. with an annuity in your plan to help cover essential expenses, you can live the retirement you want. the right financial professional can show you how. this is what an annuity can do. ♪ ♪

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>> bank of america is deploying $1 trillion for the environmental business initiative in an effort to push for green finance by 2030. a significant increase from the target it setback in 2019. the bank says it puts total commitment to sustainability by 20 -- pushing for greening economy lending capital and investor services for low carbon and other sustainable businesses following jpmorgan's letter yesterday and outlining clear

commitments in this area, yes, you can say it is not a gift, it is in large part financing and lending, but if we were to say that year or two ago it was $300 million and now is $1.5 trillion you have to applaud this massive increase once again. a lot of heading in the right direction from big banks, bank of america in the spotlight today. >> no doubt. here's an update to a story early last week about tesla. so now tesla is refunding the customers it charged twice for the new car purchases and they sent an apology e-mail offering $200 in credit at the online store. six companies in california and north carolina we spoke with shared their record with cnbc and found that their refunds took about a week to come through after their initial complaint, they say they appreciate the gesture but it took too long for the response

time, saying it was inadequate, it took days before tesla had any response and they held our significant funds the whole time and it took them five minutes to take those funds from our account. re on that story at cnbc.com coming up, real estate run down, breaking down the best cities for first-time home buyers, next that's how you do it right. usaa insurance is made just the way martin's family needs it with hassle-free claims, he got paid before his neighbor even got started. because doing right by our members, that's what's right. usaa. what you're made of, we're made for. ♪ usaa ♪

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realtor.com releasing its annual best markets for first-time buyers. >> they usually make up 40% of the market but now less than a third, majority are millenials and are sidelined by heavy competition at the entry level but there's still hope, the pandemic has created more flexability where people can live and work which benefits the first-time buyers where are the best bets? four of the top ten best markets as dermotted by realtor.com are in the mid-west. bloomington, illinois. michigan green falls, montana oak clears, wisconsin. savannah, georgia. to name a few. but realtor.com looked at prices

relative to local income, share of millenials in the market, what's available for sale, job opportunities and distance within bars and restaurants that, guys, i certainly hope we'll all be getting back out to soon back to you. >> we certainly, certainly do. thank you very much for that time for some final thoughts i have to say my main thought the moment was that bobby flay was raised by cats. i guess we should pivot to the broader markets. mike, another thing we haven't mentioned, today clearly soft-dollar day, helping the broader sentiment of late to new heights. >> yeah it is, a little bit of pressure off that big cyclical trade and obviously the comments by j powell reiterating

everything on the front, the feds are going to wait to see upfront evidence before getting movement from the fed. >> we'll get more on that tomorrow we have an exclusive interview with the president of the ecb christine lagarde right here on "closing bell. that does it for us, "fast money" begins now. >> i'm melissa lee this is "fast money" tonight's trader lineup tim seymour -- tonight on "fast money", kds coming up how investors can navigate troubled waters plus, academy sports outdoors rising in the ranks, we'll break down what this company is and why day traders are piling in. later, for sale side of the times, the health of the housi