$8 billion into evs. i think they'll continue to benefit and grow from here >> they're going big time in evs. dow is currently down just about triple digit we do have the countdown, less than an hour now until that fed decision the news conference to follow. surprise or not, we shall see. that does it for us. "the exchange" is now. >> thank you, scott. hi, everybody. welcome to "the exchange." it's a big hour as we awade president biden's news conference in geneva following his summit with vladimir putin we'll have more on that as soon as we hear from the president himself. in the meantime, we're also counting down to the fed decision on interest rates and then chair powell's news conference which happens at 12:30 eastern time inflation, transitory, tapering, those are the key words today. let's start with a check on the markets. we have been in a holding pattern. it feels eerily calm out there >> circling around the airport right now, waiting for a spot to land that's what traders are looking at in terms of the overall

market dynamic again, we're red across the board, but it's very much a marginal decline the dow is down about 90 points. .25%. similar declines for the s&p 500, 4237, the last trade there, and the nasdaq composite off about .1%. it's been a key focal point for many investors, especially vis-a-vis the interest rates dynamic going on right now and speaking of that interest rate dynamic, one part that is always a key focus around fed time is the banks, the financials, insurance companies. you can see the financial specter spider, the s&p, the banking etf on a year to date basis doing fairly well. we'll keep a close eye on the banks and regional banks especially if the interest rate dynamic starts to change or the future outlook starts to take more hold. and then, the stocks you want to focus on today are numerous, but check out the cruise lines in particular carnival up over 1%. royal caribbean up about .75%.

same with norwegian cruise lines. they're being helped along by a general positivity about the reopening trade. also, analysts have upgraded all of these companies to the equivalent of a buy. they like some of the northern american booking trends and interesting they use this word, they think some of the uncertainty around some of the futures is, quote/unquote is transitory >> don't say it. >> i did back to you. >> thank you, dom chu. we're an hour away from the fed's decision on interest rates. we had a surge in consumer prices pressuring the fed to change its stance. we have had a surge in commodity prices but all are starting to move off the boil. if the fed changes its stance, are markets ready for that joining me are michael schumacher, head of microstrategy at wells fargo steve whiting from citi global wealth, and anita, chief of financials at jefferies. michael, you think they might raise interest on excess

reserves while it sounds wonky, people are going to panic if they see the fed is raising rates on anything explain the sigqunificance good they go forward with it. >> it is wonky to be frank, and really the fed might do this, and we think it will, is to take pressure away from the money market funds to keep things relatively brief, yields have been negative or close to negative for a while. this is a bad situation. it could probably get worse if the fed doesn't act. it's a pretty cheap insurance policy we think the fed will go ahead with this. >> michael, can you sort of tell people whether all of this liquidity that is pushing those really short-term rates negative, what is that a sign of a lot of people say it's a sign there's too much liquidity in the system and the fed is going way too hard in terms of its liquidity injections is that true or are people drawing the wrong conclusions? >> we think that's part of it, but the u.s. debt ceiling comes back into play august 1st. that means treasury has to take

the cash balance down dramatically there will be fewer treasury bills in the market for the next month and a half that puts more downward pressure on yields. it's a combination of lots of liquidity and diminished treasury of bills. that puts the fed in a tough spot >> that's interesting it could get worst before it gets better. that's one aspect. there's a lot of different things here today. not, hey, the fed left rates unchanged. okay, it might raise rates and sort of the sphere that michael schumacher is talking about, they have the rate decision itself to decide upon. they have the forward projections, the dots as we'll call them, over the next couple hours here and those projections as seen as a sign of what they really expect to be doing with monetary policy and the rate hikes themselves, no one is expecting until 2023, but they might pull them forward implicitly. what do you think markets are positioned for >> look, i think markets should and clearly already have been anticipating that the federal reserve, if it wants an early

warning, right, about just tapering, just slowing the pace of easing, and these technical issues that michael just mentioned, for example, are not going to determine policy. that it's time to start acknowledging that a period of time is needed here for us to just cool the base of easing that at this pace, if we were to keep adding jobs at this pace, for example, we would have the unemployment rate back down to 3.5% level in about 16 months. that's if we get the 3.5 million people that have left the labor force back at the same time at this pace. so we clearly have seen distortions. these are real issues. we have had demand move rapidly from one big part of the economy to another no supplier could possibly anticipate that. that can generate inflation spikes this is not really what this is about. it's that going forward, we can't keep prices level easing

going on in a fully recovered economy. >> that makes sense to everybody, and i think you're a little bit on the paul tudor jones camp, if the fed doesn't acknowledge the inflation pressures that are here and might be coming, put those trades on. it's lunacy, and so forth. here's the thing, though, that everybody sitting here is wondering. what's going on with the ten-year yield if we were all really concerned the fed were behind the curve, the ten-year would already be spiking. unless they thought, okay, they're going to be so far behind, they have to catch up quickly and that's going to hurt the economy. other speculations as to why it's so low, say, same thing we're seeing in the meme stocks? all these short squeezes, that's happening in the treasury market, and this is just a -- so how, given everything you're describing, for all the people who agree with you, why is the ten-year bond yield where it is? >> let's just keep in mind that global yields are about a full percentage point lower than in the united states. that the federal reserve is providing and buying about the

equivalent of the entire need for the whole corporate sector in the bond market this is a reasonable distortion, but i think the federal reserve has some credibility just in the past month, long-term inflation expectations have dropped 20 basis points because i think markets are more prepared to understand the distortions in the economy we have just seen that i think pretty clearly when you see that the may cpi reading was big, smaller than the april gain, and if we take a look out to the sources of inflation going forward, that when you have some notion that the federal reserve is not going to keep doing this, right, that they're going to change this, you get a little comfort at the long end of the bond market. having 100-basis point rise in yields from the lows a year ago, unless we're in a period in the 1980s where the fed is going to knock the economy down, and end all this. >> right, and let me bring in anita. we'll get steve back in a moment you have a lot of interesting

thoughts you're a little different from michael in not necessarily thinking we're going to get the hike on interest and excess reserves yet, although we're close. you're looking at some of the dots in particular you think could be important tell us which ones are most important to watch in terms of markets at 2:00 p.m. >> yeah, so everybody is going to be focused on the 2023 median dots, and consensus is split on that i personally think they're not going to move them you basically need two officials to move their dots to create a tie and three to actually lift that median by 25 basis points here's why i don't think that's going to happen. the data since march, which is when we got the last dot plot, have been very inconclusive. obviously, upside inflations on inflation, downside on employment, but more importantly, the data has created a lot of uncertainty more questions than answers. in light of that uncertainty, it's hard to imagine anybody really changing their outlook in that dramatic of a way

for anybody to move the 2023 dot higher, they have to either revise up their inflation forecast for 2023, which would sort of fly in the face of the transitory thesis that the fed has been pushing,o they have to revise down their unemployment projection for 2023, which flies in the face of the recent disappointment on the data front. so you know, could they move the medians, their dots without adjusting the economic forecast? they certainly could, but that would create confusion about the fed's resolve. what makes the most sense at this point at least is to keep steady >> although the one thing to kind of make this all make sense is if enployment were slowing because of shortages if we're only hiring a couple hundred thousand people because we can't get people, that's more consistent with an oefr overheating theme than one of a slowdown, but the data have been mixed enough let me ask you about end gdp for those who say this is all transitory, someone like him, a

monitorest, would say nominal gdp is rising so fast, if we don't have actual sort of potential gdp catchup with it, we are going to have sustained inflation in this economy. what would you say about that point? and again, how -- why are bond markets completely ignoring it >> i would agree with that, although i come to it sort of from a slightly different angle. when i hear the rhetoric about inflationary pressures and it being driven by supply distortion, i think that's a little misplaced to me, this is about excess demand this is about u.s. consumption of goods being 20% higher than it was pre-pandemic, and there's simply not enough capacity in a global economy, manufacturing or shipping wise, to meet that level of demand. this is about excess demand that's creating everything from chip shortages to shipping bottlenecks, and until that demand for goods comesdown pretty significantly from here, i don't think these pressures are going to go away maybe by next year, but certainly not in the next few

months, and in fact, if anything, those pressures might get worse before they get better because we're going into heavy sort of seasonal demand from consumers, back to school, and then christmas that's creating kind of seasonal peak for the shipping industry, which is operating at maximum capacity so i think by september, we could actually be looking at more intense product shortages than what we have seen so far. >> it's fascinating, michael, because some might say, maybe the fed should lean against this and slow the demand side a little bit so the supply side can catch back up. as we have been observing, that flies in the face of what they're trying to achieve socially, which is let this run hot long enough that the gains are felt in the income distribution and not just in the assets where higher income people are exposed i know that's not, you know, something you want to pontificate about, but if you were to bring this back to what the fed is most likely to do in this scenario, is it that they're going to wait until we get through the fall, maybe even the holiday period that anita is describing, into next year to figure out what the true picture

really is? and at that point, will it be too late >> we think the fed is going to stay the course. it's interesting, if you would have rolled the clock back six months and say from the fed's perspective what would constitute a good start to 2021, what would that include? inflation goes up moderately interest rates go up modestly, 50, 60, 70 basis points on the ten year equities do well what do we have today? all those things and oh, by the way, the labor market, although it stumbled a little bit, has generally done all right. so the fed probably looks at things and says, they look all right. we're not completely clear about the path of inflation. yes, it's up, but everyone knew that it's going to become a lot more obvious in a few month when you have things like supplementary unemployment compensation roll off, so it seems to us at wells fargo the most likely path to the fed is simply to hold off for a couple months. chairman powell is going to get lots of questions about tapering he'll bat them away, we suspect, and let the market do its thing.

>> steve, i'll give you the final word on the whole conversation with about 48 minutes until we get this decision, the statement, and the projections. >> thank you and sorry i was on a dramatic roll before being cut off. so i think the federal reserve has a very credible growth forecast what it doesn't have is a credible interest rate forecast to go with that. and if you listen carefully at chairman powell, he's said if the economy unfolds the way the fed expects, it would change its interest rate guidance we don't think that the federal reserve has to go up to its long-term expected interest rate of 2.5%. that's its long-term normal rate, but it does if it wants to be early, it has to just start easing a little bit less >> we will see where they stand at the top of the hour especially when we hear from the chair himself and when the news conference takes off, we'll see how the markets take it. michael, steve, anita. >> and with less than an hour to

go until we get their call, we'll speak with the ceo of hunhunt hun huntingten bank. >> and we're also waiting for president biden to make his way to the stage in geneva for his news conference following the talks with russian president vladimir putin soon as it happens, we'll bring you there.

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president biden's news conference you can see officials prepareing the way we expects to hear from him pretty soon. in the meantime, let's speak with fred kemp will stand by, and we'll come back to him in a moment i believe shep is over in the studio shep with some thoughts, as we get closer and closer to the president himself taking the podium >> kelly, good afternoon we're told we're just about two minutes away now president biden set to speak to reporters in just a few. we heard from the russian president, vladimir putin. now it's president biden's turn. their summit lasted 3:21 shorter than the white house predicted. the two leaders decided beforehand they would do separate individual news conferences instead of standing side by side at ajoint news conference as you may remember he did with president trump preceding him and you may remember the reviews on that were not stellar president putin said there was no hostility in the meeting, called the talks very constructive, said there was a willingness to understand each

other. president biden has plenty of issues to confront mr. putin on. russian interference in the 2020 election relentless cyberattacks from russian hackers, including the poisons of alexei navalny and the russian aggression toward ukraine. the russian president was asked about most of these and largely in his news consfrn, mr. putin engages in a serious amount of whataboutism on alexei navalny, he dodged the que question on the matter of ukraine, he shifted ed blame to ukrainians on the matter of what is going to happen now in the matter of cybersecurity, president putin said the russians weren't doing it and it's all the americans' fault. i want to get to eamon javers there in geneva for the news conference that president biden is about to give before i tusoss it to him,

chairman powell and the fed coming up in 42 minutes. if mr. biden is still speaking, we will interrupt and have jerome powell and the fed. we know that's what many of you are looking for. 2:00 market time for now, over to eamon the russian president was kind and gentle toward the sitting pred, as he has been toward the last four or five. but the rest of it seemed to be a duck and a dodge >> a couple interesting moments. one was when he was asked when he saw when he looked into biden's eyes which is the reverse of what americans have been asked about. putin had an interesting line. we don't need to look into each other's eyes or souls. we need to represent our countries and our country's views. vladimir putin views this entirely in a transactional way. he seemed to be almost mocking president biden. we'll have to look at the translation on that, when he

said biden mentioned his mother and his family he seemed to be almost downplaying those as unrelated to the topics at hand, but he said those are attractive qualities because it shows how much biden cares so he's either praising or mocking biden. we'll leave that to the russian experts, language experts. but putin here offering some insight into how he views this, very much a transactional moment he said when people sit down across the negotiating table from each other, they need to be able to do forthrightly. that's a fascinating insight, shep >> thanks very much. now to president biden >> been a long day for you all i know it was easy getting into the pre-meeting. no problem getting through those doors, was there anyway, hello, everyone.

well, i have just finished the last meeting of this week's long trip the u.s./russian summit. i know there was a lot of hype around this meeting, but it's pretty straightforward to me, the meeting. one, there's no substitute, as those of you who have covered me for a whaleile know, for face-to-face dialogue between leaders. none and president putin and i share a unique responsibility to manage the relationship between two powerful and proud countries. a relationship that has to be stable and predictable and it should be able -- we should be able to cooperate where it's in our mutual interest and where we have differences, i want president putin to understand why i say what i say and why i do what i do and how we'll respond to specific kinds of actions that

harm america's interest. now, i told president putin my agenda is not against russia or anyone else it's for the american people fighting covid-19, rebuilding our economy, reestablishing relationships around the world with our allies and friends, and protecting the american people that's my responsibility as president. i also told him that no president in the united states could keep faith with the american people if they did not speak out to defend our democratic values, to stand up for the universal and fundamental freedoms that all men and women have in our view that's just part of the dna of our country. so human rights is going to always be on the table, i told him. it's not about just going after russia when they violate human rights it's about who we are. how could i be the president of the united states of america and

not speak out against the violation of human rights. i told him that unlike other countries, including russia, we're uniquely a product of an idea you have heard me say this before, again and again. i'm going to keep saying it. what's that idea we don't derive our roiights frm the government we possess them because we're born, period and we yield them to a government so at the forum i pointed out to him that's why we're going to raise our concerns about cases like alexei navalny. i made it clear to president putin we'll continue to raise issues of fundamental human rights because that's what we are. that's who we are, the idea is we hold these truths self-evident, that all men and women, we haven't lived up to it completely, but we have always widened the arc of commitment and included more and more

people and i raised the case of two wrongfully imprisoned american citizens, paul whelan and trevor reed i also raised the ability of radio free europe and radio liberty to operate, and the importance of a free press and freedom of speech. i made it clear that we will not tolerate attempts to violate our democratic sovereignty or to destabilize our democratic elections and we would respond the bottom line is i told president biden we need to have basin rules of theroid also for the benefit of the world and the security of the world. one of those areas is strategic stability. you asked me many times what was i going to discuss with putin before i came? i told him i only negotiate with the individual, and now i can tell you what i was intending to do all along

that is to discuss and raise the issues of strategic stability and try to set up a mechanis where we deal with it. we discussed in detail the next steps our country should take on arms control measures. steps we need to take to reduce the risk of unintended conflict. and i'm pleased he agreed today to launch a bilateral strategic stability dialogue a diplomatic speak for saying get our military experts and our diplomats together to work in a mechanism that can lead to control of new and dangerous and sophisticated weapons that are coming on the scene now. that reduce the times of response, that raise the prospects of accidental war. and we went into some detail of what those weapons systems were. another area we spent a great deal of time on was cyber. and cybersecurity. i talked about the proposition that certain critical infrastructure should be off limits to attack, period

by cyber or any other means. i gave them a list if i'm not mistaken, i don't have it in front of me, 16 specific entities. 16 defined as critical infrastructure under u.s. policy from the energy sector to our water systems. of course, the principle is one thing. it has to be backed up by practice responsible countries need to take action against criminals who conduct ransomware activities on their territory. so we agreed to task experts in both our countries to work on specific understandings about what's off limits and to follow up on specific cases that originate in other countries either of our countries. there's a long list of other things we spent time on. from the urgent need to preserve and reopen the humanitarian carters in syria so we can get food, simple food and basic necessities to people who are

starving to death. how to build it and how it is in the interest of both russia and the united states to insure that iran, iran does not acquire nuclear weapons. we agreed to work together there, because as much as russia's interest is ours. and to how we can insure the arctic remains a region of cooperation rather than conflict i caught part of the president's -- president putin's press conference and he talked about the need for us to be able to have some kind of modus operandi making sure the arctic was in fact a free zone and to how we can each contribute to the shared effort of preventing the resurgence of terrorism in afghanistan it's very much in the interest of russia not to have a resurgence of terrorism in afghanistan. there are also areas that are more challenging i communicated the united

states' unwavering commitment to the sovereignty and territorial integrity of ukraine we agreed to pursue diplomacy, and i shared our concern about belarus. he didn't disagree with what happened he just says it's a perspective of what to do about it but i know you have a lot of questions, so let me close with this it was important to meet in person so there could be no mistake about or misrepresentations about what i wanted to communicate. i did what i came to do. number one, identify areas of practical work our two countries can do to advance our mutual interest and also benefit the world. two, communicate directly, directly, at the united states will respond to actions that impair our bilateral interests or those of our allies and three, to clearly lay out

our country's values and prioritieses so he heard it straight from me i must tell you, the tone of the entire meetings, i guess it was a total of four hours, was good. positive it wasn't any strident action taken where we disagreed, i disagreed. stated where it was. when he disagreed, he stated, but it was not done in a hyperbolic atmosphere. that is too much of what's been going on over this last week, i believe, i hope the united states has shown the world that we are back, standing with our allies we r rallied our fellow democracies to make concerted commitments to take on the biggest challenges our world faces, and now, we have established a clear basis on how we intend to deal with russia and the u.s./russian relationship there's much more work ahead i'm not suggesting that any of

this is done we have gotten a lot of business done on this trip. and before i take your questions, i want to say one last thing folks, look, this is about -- this is about how we move from here this is, i listened to, again, a significant portion of what president putin's press conference was and as he pointed out, this is about practical, straightforward, no nonsense decisions. that we have to make or not make we'll find out within the next six months to a year whether or not we actually have a strategic dialogue that matters. we'll find out whether we work to deal with everything from release of people in russian prisons or not we'll find out whether we have a cybersecurity arrangement that begins to bring some order because look, the countries that most are likely to be damaged by

a failure to do that are the major countries. for example, when i talked about the pipeline that cyber hit, the ransomware hit in the united states, i looked and said how would you feel if ransomware took on the pipelines from your oil fields he said it would matter. this is not about just our self-interest. it's about a mutual self-interest. i'll take your questions, and as usually, folks, they gave me a list of the people i'm going to call on. so jonathan, associated press. >> thank you, sir. u.s. intelligence has said that russia tried to interfere in the last two presidential elections and that russia groups are behind hacks like solarwinds and some of the ransomware attacks you mentioned. putin in his news conference just now accepted no responsible for any behavior your predecessor opted not to demand putin stop these disruptions.

what is something concrete that you achieved today to prevent that from happening again, and what will the consequences you threaten >> whether i stopped it from happening again, he knows i will take action. like we did when this last time out. what happened was we in fact made it clear we were not going to continue to allow this to go on and the result was we ended up withdrawing -- withdrawing ambassadors. we closed down some of their facilities in the united states. et cetera. he knows there are consequences. look, one of the consequences that i know -- i don't know, that's unfair of me. i suspect you may all think doesn't matter, confidence matters to him, and to other world leaders of big nations his credibility worldwide shrinks. let's get this straight. how would it be if the united states were viewed by the rest of the world as interfering with

the elections directly of other countries and everybody knew it? what would it be like if we engaged in activities that he's engaged in it diminishes the standing of a country that is desperately trying to make sure it maintains its standing as a major world power. and so it's not just what i do it's what the actions that other countries take, in this case, russia, that are contrary to international norms. it's the price they pay. they are not, they are not able to dictate what happens in the world. there are other nations of significant consequence, ie, the united states of america being one of them. >> mr. president, a quick follow on the same theme of consequences you said just now you spoke to him a lot about human rights what did you say would happen if alexei navalny dies? >> i made it clear to him that i believe the consequences of that would be devastating for russia. i'll go back to the same point

what do you think happens when he is saying it's not about hurting navalny, all the stuff he says to rationalize the treatment of navalny and then he dies in prison i pointed out to him that it matters a great deal when a country in fact, and they asked me why i thought it was important to continue to have problems with the president of syria. i said because it's a violation of international norm, it's called the chemical weapons treaty can't be trusted it's about trust it's about the ability to influence other nations. in a positive way. look, would you like to trade our economy for russia's economy? would you like to trade? and by the way, we talked about trade. i don't have any problem with doing business with russia as long as they do it based on the international norms.

it's in our interest to see the russian people do well economically i don't have a problem with that, but if they do not act according to international norms, then guess what that not only will not happen with us, it will not happen with other nations. he kind of talked about that, didn't he, today about the need to reach out to other countries and invest in russia they won't as long as they are convinced that in fact the violations, for example, the american businessman who is on house arrest, and i pointed out, you want to get american business to invest, let him go change the dynamic because american businessmen, they're not ready to show up they don't want to hang around in moscow. look, guys i know we make foreign policy out to be this great, great skill. that somehow is sort of like a secret code.

all foreign policy is a logical extension of personal relationships. it's the way human nature functions. and understand, when you run a country that does not abide by international norms, and yet you need those international norms to be somehow managed so that you can participate in the benefits that flow from them, it hurts you. that's not a satisfying answer, biden said he would invade russia you know, by the way, that was a joke that's not true. but my generic point is, it is more complicated than that david sanger i thought i saw david. there he is. >> thank you, mr. president. in the run-up to this discussion, there's been a lot of talk about the two countries spilling down into a cold war. and i'm wondering if there was anything that you emerged from in the discussion that made you think that - >> i'm going to take my coat

off. the sun is hot >> anything that would make you think that mr. putin has decided to move away from his fundamental role as a disrupter, particularly a disrupter of nato and the united states. and if i could also just follow up on your description of how you gave him a list of critical infrastructure in the united states did you lay out very clearly what it was that the penalty would be for interfering in that critical infrastructure? did you leave that vague did he respond in any way to it? >> let me answer your -- actually, i'll answer your second question first. i pointed out to him that we have significant cyber capability and he knows it. he doesn't know exactly what it is, but it's significant and if in fact they violate these basic norms, we will respond. cyber. he knows

number two i think that the last thing he wants now is a cold war. without quoting him, which i don't think is appropriate, let me ask a rhetorical question you have a multi-thousand mile border with china. china's moving ahead, hell bent on election, as they say, seeking to be the most powerful economy in the world, the largest, the most powerful military in the world. you're in a situation where your economy is struggling, you need to move it in a more aggressive way in terms of growing it and i don't think he's looking for a cold war with the united states i don't think it's -- as i said to him, i said your generation and mine are about ten years apart. this is not a kumbaya moment, as they used to say in the '60s in the united states. let's hug and love each other, but it's clearly not in anybody's interest your country's or mine, for us

to be in a situation where we're in a new cold war. and i truly believe he thinks that he understands that. but that does not mean he's ready to lay down his arms and say come on. he still, i believe, is concerned about being, quote, encircled. he still is concerned that we in fact are looking to take him down, et cetera. he still has those concerns, but i don't think they are the driving force as to the kind of relationship he's looking for with the united states jennifer jennifer jacobs. >> thank you, mr. president. is there a particular reason why the summit lasted only about three hours? we know you had maybe allotted four to five hours is there any reason it ran shorter? also, president putin said there were no threats or scare tactics issued do you agree with that

assessment, and also, did you touch on afghanistan and the safe withdrawal of troops? >> yes yes, yes, and yes. let me go back to the first part the reason it didn't go longer is when is the last time heads of state spent two hours in direct conversation across the table, going into excruciating detail you may know of a time i don't know i can't think of one so we didn't need, as we got through and brought in the larger group, our defense, our intelligence and foreign -- well, my foreign minister, my secretary of state was with me the whole time our ambassador, et cetera. we brought everybody in. we had covered so much and so there was a summary done by him and by me of what we covered lab arauv and linkinginiiing bl

talked about what we covered, and it was kind of after two hours there, we looked at each other like, okay, what next? what is going to happen next is we're going to be able to look back, look ahead, and three to six months and say did the things we agreed to sit down and try to work out, did it work are we closer to a major strategic stability talk and progress are we further along in terms of, go down the line that's going to be the test. i'm not sitting here saying because the president and i agreed we would do these things that all of a sudden it's going to wurb. i'm not saying that. what i am saying is i think there's a genuine prospect to significantly improve the relations between our two countries without us giving up a single solitary thing based on principle and our values no, no, no there were no threats.

as a matter of fact, i heard he quoted my mom and quoted other people today there was -- it was very, as we say, which will shock you coming from me, somewhat colloquial, and we talked about basic fundamental things you know how i am. i explain things based on personal basis what happens if, for example and so there were no threats just simple assertions made, and no, well, if you do that, then we'll do this, with something i said just letting him know where i stood, what i thought we could accomplish together, and what in fact, if there were violations of american sovereignty, what we would do [ inaudible question ] >> he asked us about afghanistan. he said that he hopes that we're able to maintain some peace and security i said that has a lot to do with you. he indicated that he was

prepared to, quote, help on afghanistan. i won't go into detail now, and help on iran and help on, in return, we told him what we wanted to do relative to bringing some stability and economic security or physical security to the people of syria and libya. so we had those discussions. yamiche. >> thanks so much, mr. president. you say that you didn't issue any threats. were there any ultimatums made when it comes to ransomware, and how will you measure success, especially when it comes to working groups on russian meddling and on cybersecurity? >> it's going to be real easy. they either, for example, on cybersecurity, are we going to work out where they take action against ransomware criminals on russian territory? they didn't do it. i don't think they planned it in this case. and are they going to act?

we'll find out will we commit -- what can we commit to act in terms of anything affecting, violating international norms that negatively impacts russia. what are we going to agree to do we have real opportunities to move and i think that one of the things that i noticed when we had the larger meeting is that people who are very, very well informed started thinking, you know, this could be a real problem. what happens if that ransomware outfit were sitting in florida or maine and took action, as i said, on their single lifeline to their economy oil. it would be devastating. and they're like, you could see them kind of go, we do that, but, whoa, so it's in everybody's interest that these things be acted on we'll see what happens with these groups we put together >> follow? >> a third one

go ahead >> when president putin was questioned today about human rights, he said the reason why he's cracking down on opposition leaders is because he doesn't want something like january 6th to happen in russia, and he doesn't want to see groups formed like black lives matter what's your response to that >> my response is kind of what i communicated i think that's a ridiculous comparison it's one thing for literally criminals to break through cordon, go into the capitol, kill a police officer, and be held unaccountable and it is for people objecting and marching on the capitol and saying you are not allowing me to speak freely. you're not allowing me to do a, b, c, or d and so they're very different criteria steve, steve holland, reuters. >> president, sorry. president putin said he was satisfied with the answer about

your comment about him being a killer could you give us your side on this what did you tell him? >> he is satisfied why would i bring it up again? >> you talked to him do you believe you can trust him? >> look, this is not about trust. this is about self-interest and verification of self-interest. that's what it's about so i virtually almost anyone that i would work out an agreement with that affected the american people's interest, i don't say, well, i trust you, no problem. let's see what happens you know, that old expression goes, the proof in the pudding is in the eating we're going to know hortly igor, radio free europe and radio liberty. >> hello, mr. president. >> you want to go in the shade you can. can you see? >> yeah, yeah. yeah so i think you know attacks in

civil society and the free press continue inside russia >> yes >> for example, radio free europe >> yes >> radio, voice of america, foreign agents, and several other independent media. so we are essentially being forced out in russia, 30 years after president yeltsin invited us in. after your talks with president putin, how interested do you think he is in improving the media climate in russia? >> i wouldn't put it that way. if there's an improving the climate. i would in fact put tin terms of, how much interest does he have in burnishing russia's reputation, that is viewed as not being contrary to democratic

principles and free speech that's a judgment i cannot make. i don't know it's not because i think he's interested in changing the nature of a closed society or closed government actions relative to what he thinks is the right of government to do what it does it's a very different approach and you know, there's a couple really good -- i told him i read most everything he's written, and the speeches he's made, and i have read a couple very good biographies, which many of you have as well i think i pointed out to him that russia had an opportunity, the brief shining moment after gorbachev and after things began to change drastically, to actually generate a democratic government but what happened was it failed, and there was a great, great

race among russian intellectuals to determine what form of government would they choose and how would they choose it and based on what i believe mr. putin decided was that russia has always been a major international power when it's been totally united as a russian state. not based on ideology, all it was going back to czar straight through to the revolution, the russian revolution, and to where they are today and i think that it's clear to me, and i have said it, that i think he decided that a way for russia to be able to sustain itself as a great, quote, great power, is to in fact unite the russian people on just the strength of the government, of government controls. not necessarily idealogically, but the government

and i think that's the choice that was made. i think -- i'm not going to second guess whether it could have been fundamentally different, but i do think it does not lend lend itself to ra maintaining itself as within of the great powers of the world. >> one more question. >> thank you, sir. the military response come up in this conversation today? did you in terms of the red lines laid down is military response an option for a ransomware attack? president putin called you in the press conference an experienced person you said he doesn't have a soul. do you have a deeper understanding of him after this meeting? >> thank you very much. >> on the military response?

>> no. we didn't talk about the military response. >> you said there's no substitute for -- dialogue and also with what you said at nato that the biggest problems right now are russia and china you've spoken many times about how you've spent perhaps more time with president xi than any other world leader is there a time you might call him ole friend to old friend and ask him to open chi to the world health organization. >> we are not old friends. it is just pure business. >> my question would be, you have said that you would press china. signed on to the g7 communique but china says they don't want to be interveered with him what happens now >> the imact, the world's

attitude toward china as it develops china is trying very hard to project itself as a responsible and very, very forthcoming nation they are trying to hard to talk about how they take and helping the world in terms of covid-19 and vaccine. look certain things you don't have to explain to the people of the world. they see the results is china really actually trying to get to the bottom of this one thing we did discuss as i told you at the eu and the g7 and with nato, what i'm going to make an effort to do is rally the world to work on what is going to be the physical mechanism to detect early on the next pandemic and to respond to it and early it will happen it will happen

we need to do that thank you. >> president biden speaking in switzerland after -- >> follow through with the discussion i am not going to walk away on this. >> why are you so confident he'll change his behavior? >> i'm not confident what the hell -- what do you do all the time when did i say i was confident what i said was -- let's get it straight i said what will change their behavior is if the rest of the world reacts and diminish the standing in the world. i'm not confident of anything. i'm stating the facts. >> given the past behavior has not changed, after sitting down with you he denied the attacks, he refused to say alexey

navalny. >> if you don't understand that you're in the wrong business. >> is china -- >> who are we to -- quickly, pool. >> president biden answering my questions as he answers as is a habit. the question there from katelyn collins from cnn pressing him hard whether he believed that president putin had come around and president biden with the finger in the air said don't say that about me. i don't think he's coming around in a cooperative way but the president said they agreed to talk on arms control, a goal here, agreed for more dialogue on that matter and the president said that they outlined 16 areas off limits for cyber attacks president biden not only essentially denied that the

russians were involved but suggested that the americans were the greatest offenders. eamon javers is here we'll interrupt for the fed coverage the president with a short news conference for us afterwards. >> reporter: we have an insight into the way biden approaches this and the differences president biden said, look, all foreign policy the logical extension of human relations there's no substitute to sit down face to face and needed to explain to vladimir putin what the consequences would be for theoretical actions and vladimir putin said we don't need to look into each other's eyes or souls but represent the countries. biden taking a human sort of american politician approach

putin taking a transactional approach a different world view from the two men. on cyber security, an interesting point why the president suggests that he is telling vladimir putin in clear terms what the consequences will be from specific cyber actions on the russian side. didn't issue threats but suggested what if your pipelines were shut down by hackers in maine or florida how would you feel he said he felt the eyes light up as they realized the consequences to their economy ol something like that. the president walking a thin line saying he didn't issue threats but raising specific consequences on future actions. >> no military action discussed according to president biden thank you. we'll check back with you tonight. 7:00 eastern after jim cramer for the news with coverage of

all the day's events tonight we are close to jerome powell and the fed decision as promised, cnbc will have complete coverage and kelly evans is standing by for that. kelly? >> thank you for your coverage there. jon fortt joins me now for the fed decision let's get to the panel for moments to hear the decision mona mahondrin is with us. david kelly and john bellows with 2:30 to go, what is your expectation? >> i think the fed will have to acknowledge that there's inflation stronger than expected have to upgrade the forecast for the fourth quarter of the year with a rate hike for 2023 and

overall they vice phaven't madea decision for tapering. >> mona, given that we don't expect the fed to change much technically what's the body language to use that turn of frads or suggestions on tapering to be most listening for >> clearly powell said in the past they haven't begun to think about think or talk about talk about inflation. you will hear him to say to some extent we are starting to talk about tapering i think a full schedule comes in set but the fed is together and starting to talk about it and no denying that the economy made progress. >> john, just a moment david, we are at session lows down 145 is that related to nato? is that nervousness ahead of the

decision >> no. i think technical factors holding long term interest rates down it's been held down by that and the stock market it is very high so when it's high it is vulnerable to a correction for any number of reasons. >> john, when will we get on 2% on the 10-year >> david started with the inflation data the fed needs to emphasize the employment data. we're not getting the string of a million jobs that powell expected if the labor market recovery takes longer then the fed takes longer to normalize. that's been slow i think that's going to shape their conversation today on 2% of the 10-year, adding only half a million jobs a month and got 8 million jobs to go it is going to be a long time and that's a message today >> just to follow up on that,

inflation then how much do you think that -- well, maybe put a pin in that. because we are just, kelly, moments away from getting something. >> we are. let's get a final look at the market ylan >> the federal reserb is keeping interest ratesunchanged. in its policy statement the central bach said that economic activity and employment strengthened inflation is rising. but still said that the increase largely reflects transitory factor, the same language the fed used last time and increased the forecast the outlook for gdp improved to 7% growth this year up from 6.5% the forecast for unemployment