economic -- >> i haven't had the time to think about it and wouldn't want to talk about it in that way -- >> in contribution to long-term economic growth? >> i don't see anything objectionable about that >> all right well, i just very much appreciate your emphasis on investment that's what we wanted with the american families plan, with the american jobs plan we want to reinvest in america to keep those jobs here in america, and to invest in our communities so we have a solid foundation for the continues growth of the great american middle class and for the opportunity for lots of poor working people to get into the middle class with that, i will yield back to you, mr. chairman. >> thank you, gentlemen, for yielding back. the chair recognizes mr. jordan

for five minutes. >> thank you, mr. chair. chairman powell, the fed has two mandates >> maximum employment and stable prices. >> it seems like both have some problems today i want to spend time on the first. why are the jobs numbers so bad right now? >> i think we're digging out of a very deep hole we made a lot of progress, but i would agree, we have a long way to go. >> over 9 million jobs openings. is there a specific reason you point to as to why those numbers aren't where we would frankly hope they would be >> you know, it's a good question, and my thinking is that there are some temporary factors that are weighing on job creation i mentioned those earlier. another thing is actual hiring is at high levels, but being offset by high levels of quits and retirements.

what's happening is the net job creation has been lower, but actual hiring is high. in a sense, quits is a good thing, because people are looking for jobs they want more. retirement are just something that happens. >> what about unemployment benefits, does that factor in as well >> it may be a factor and will be a temporary one something likes 15 million people will see those benefits disappeared or significantly decrease. >> my understanding is plus the state unemployment and the federal enhancement is $37,000 a year might that discourage people from going back to work? >> i think we are finding out. you add in the stimulus package, for a family of four, it's about $110,000 every single employer i talk to tell me they can't find people to work. you think it's more of quitting in retirnlts or more unemployment or what is it

>> in terms of the things -- i think it's the people are still afraid of covid. maybe they're living with someone who is vulnerable. schools are closed still, and i think unemployment benefits, too. you would expect a significant -- a -- >> didn't you expect higher numbers in april and may >> yeah, i did >> it sort of surprised me when you pay people not to work, you shouldn't be surprised to not have workers i've never seen a situation like this, 25 governors who have have said we don't want the federal enhancement to unemployment. i've never seen that in my 25 years in politics. i think it underscores how

serious the problem is. >> we know the federal ones run out. >> what if the democrats renew them >> again, i don't comment on -- >> you said you expect it to run out, and that will help. i'm asking you, that's not what democrats are saying they're talking about renewing them if it helps if they run out, if they renew them, won't that hurt >> these are judgments for people who stand for election. >> i'm following your election i've got to -- >> i think we'll see strong job creation in the fall i really do. i think all these, as you point out 9.3 million job openings, many unemployed, there seems to be a speed limit it may be that it's hard to match up with a new job and people feel like they can shop carefully. >> i don't know that the democrats are doing anything right. they kept the economy locked down they're spending the money like

crazy, proposing a $6 trial wrong budget, all causing inflation. inflation has gone up the last four months, two mandates at the fed, unstable employment, high inflation, and now they're paying people not to work. that may continue then finally, on top of all that, they're thinking about raising taxes this is amazing to me. first you pay people not to work, and then you raise working people's taxes, and somehow you think that will help the economy. what do you think about they policy ideas from the democrats? >> again, it's not my job. >> no, but your job is stable employment and low inflation right now we have 9 million job openings, and inflation that went up five months in a row i'm not necessarily blaming you. i'm blaming the democrat

policies it seems to me the idea they're going to extend the federal enhancement makes for sense. and the they're going to spend $6 trillion absolutelymakes no sense. it seems to me there are doing everything wrong, making your job that much harder with that, mr. chairman, i yield back. >> and it's a good thing, too. with that -- >> i don't give comments when you make your statements tell me what i said wrong. >> it's good you yielded back so i can give five minute to say mr. foster. >> it's good that i made those points, and it would have been nice if the fed chair would answer the fact that, if you guys extend unemployment -- which he says if it goes away, it would be good for the economy, about you if you extend it, he wouldn't ants that question. >> with that, i yield five minutes to mr. foster. >> thank you i sympathize with mr. chairman being sort of left speechless by the logic we just saw

demonstrated i also would like to respond to some of my republican colleagues about the origin of the coronavirus. the science committee, investigations and oversight subcommittee i chair is in fact having hearings on the origins the first is scheduled july 14th at 11:00 a.m these hearings are going to be science based. i think it says a lot how my republican colleagues take science that they cannot even find a complete set of members to serve on that science subcommittee they only have two members, the ranking member and representative sessions. thank you, chairman powell, for your testimony you correctly note the porridge of the successful vaccination campaign under the biden leadership we have administered over 300 million vaccines the cdc has advised that vaccinated people can safely

engage in a wide variety of activities and states have been able to do that, and ease coronavirus health restrictions. when they do that, our economy recovers i think it's clear to everyone that the return on our investment on vaccines, starting with money and directions provided by congress before operation warp speed was even announce, and fooling decades of federally funded research into the underlying science, has had the highest return on investment of really any that hour country has ever made. would you agree with that? >> i don't have a number to put on that, but yes, i would think the return on the investment would be high. >> the return on investment is not limited to vac nating the united states. we also benefit economically by helping vac nate our trading partners would you also agree the return on that investment is like lip to be very high? >> i would, yes. >> would you be willing to have some of your brilliant economists that work for you

actually try to put a rough number on that it's an important think for us to appreciate as we decide how much of resources to defeat to helping our other nations around the world. >> i will be glad to do that. >> thank you the tight labor markets, commodity shortages. chip shortages, as you mentioned, due to underinvestment, and meme stocks proposals to move onshore the supply chains that have his turkeyly been offshore which will in general increase prices, and all of this happens against a continues back drop of long-term technological job loss, so how do you think this will net out.

>> it's incredibly hard to say, really you know if or positing an actual reversal, that could have implications as you suggest, but i wonder if that's really goods to happen because of policies with he do that. technology goes instantly around the world, it's not going to be easy to stop that. >> you can certain make thins. >> so the job will come back to the u.s., but taken by robots?

>> there's some of that, as you know so you're maintains some uncertainty. >> okay. let's see you've been talking a bit about high-speed broadband, which i think is an important investment with huge return. an important part of that, that they're also provides a secure digital idea, and allows them to safely participate in our economy. they're going to need to have, to allow people to transact in digit at dollars in a safe way that could be abused are you working internationally

to get these security ids? >> i think it's part of the discussion i would say we're not as. >> will it be addressed in your white paper coming out this summer >> a lot of things will be addressed. that's something you certainly need that down the room. probably oui just laying it out do you think the road >>thank you very much. >> my understanding is that dr. green as joined us if so -- he's now recognized for

five minutes >> can you hey mer >> yes, thank you. thank you. i want to thank chairman powell for being here today i expressed some kernel that the excessive spending might caused sin flation. already -- the numbers are in. when congress spends trillions mis'got to give. it's created by entrepreneurs,

creating i genuinely believe these are attacks. they see it as attacks are dollar the government spends has to come out of something's possibility. if we don't get our fiscal house in order my first question, chairman powell, are you concerned from an economy and really a national security perspective about russia and china dumping a that in what appears to be a move of an alliance between the two of them

the dollar is the world's reserve currency there's no currency close to being able ko compete. dodds the threat of capital gains as a threat? >> i don't really comment on tax and spending proposals we don't have any authority over that over the past ten years, the federal government's net interest costs have grown about 25% relative to gdp despite the

historically low interest rates. if any remains reach that is historic did you do you think the federal government will be able to pay its bills? i have no question that the u.s. government will pay its bills for the foreseeable future we have the strongest and largest and most flexible economy. it's also true we're on an unsustainable path we'll have to address that as i mentioned, the time to address that is when the economy is strong, unemployment is low and economic activity is high. is it move that it could be as bad as the '70s, if not, could you answer why

>> higher interest rates or inflation? >> inflation. >> very, very unlikely what we're seeing is inflay in particular categories but directly familied by this historic event called reopening the economy after closing it so you see extremely strong demand for labor, for goods, for services, and you see the supply side caught flat footed and trying to catch up you see this all over the world, by the way, this is not just the united states. it's very similar kinds of situation. you also, you have a central bank that's committed to surprise stability and has, you know defined what price stability is, and is strongly prepared to use its tools to keep us around 2%. all of those things suggest that

an episode like what we saw in the 1970s. i graduated from college in 1975 i had a front-row seat i don't expect anything like that to happen >> mr. chairman, i can't see the clock, unfortunately i don't know if i have any more time. >> you are out of time. >> thank you, mr. chairman i yield. >> thank you for yielding back the chairman recognizes -- >> thank you, mr. chairman, and thank you, chairman powell for appearing before you back in 2019, you want, we try to create a strong labor market, for many, many people and many, many communities that's enough but for people who are at the margins, the low to moderate income community, that's not enough they need a chance earlier that year you said you were cutting rates in part to help those who are, quote, left

behind how do you see the impact of the pandemic on these groups of people that -- for whom you expressed empathy and concern back in 2019 how do you see the recovery affecting them >> well, in the first instance the pandemic hit the service industries very hard, industries that involve dealing with the public -- hotels, travel, entertainment. the people in those customer-facing, public-facing jobs, they tend to be relatively low paid jobs, and minorities and women are significantly overrepresented among the people in those jobs. that's who got laid off. a big chunk of the layoffs disproportionately were in those industries so it's clear this pandemic really hit those people hard why it was even more painful was that in the last couple of years of the very long expansion that ended in march of 2020, the

longest in our history, you really began to see benefits going more to those groups than to the high end. wage gains at the lower end of the spectrum were bigger than they were at the higherened. that began to be the case in year eight, 9, 10 and the 11th year that was a very positive thing high labor force participation, and it could have gone on for a long time, but for the pandemic. so we have the pandemic. those industries are hire people back a whole lot of the job creation is in those structure. you're still several million short of those industries of where the employment was but very high, in terms of the service industry so i really am hopeful that over

time, and not a lot of time, this will sort itself out and we'll find ourselves in a very, very strong labor market, low unemployment, labor -- >> may i jump in for a moment? thank you for the answer you talked about the matching function that's happening between people who are perhaps dislocated and people -- the job openings that exist. what is your perspective on efforts by educational systems working with governments, state, local and federal, in upscaling people to match them with the jobs that currently exist in the post-pandemic economy through skills-based education or career technical education and the like >> you know, i've been exposed to a number of programs of that nature they seem to work really well. some of them do, anyway.

the idea being companies -- you actually see it in south carolina quite a bit you see companies teaming up with schools and technical schools in the apprenticeship program. they really work i would say that's a great idea and would great to see more of it, but those things take time they take policy support they take time to really build and produce value. >> yes, sir. last question. what is the impact of other countries in the world not getting their populations vaccinated at the rate that we are, and the covid fire is continues to rage over there what is the impact on our economy? if you have any metrics that can measure that, or that you would be willing to share, i would be very interested in that.

>> i don't have any metrics, but i will say, and to mr. foster's earlier point. to the extent large populations are not getting vaccinated, we're giving time and space for more virulent strains to develop. viruses do not respect national borders, so i think it's very much in our interest to support broad vaccination around the world. it's also the right thing to do, but clearly the best thing for us as well no one is really safe until we're all safe >> very good thank you so much for your service, sir i thank the gentleman for yielding back. the chair now recognizes the ranking member for a closing statement. >> thank you, mr. chairman i appreciate the hearing, chairman powell, i appreciate the work you do. obviously some of the questions

that we have, both republican and democrat members, are more in the policy realm, which is not your purview you have tools as the chairman of the federal reserve, you have main dates, as mr. jordan and you were talking about, but many of those tools every harsh tools, tools we don't want to have to get to if we don't have to i think that's where we, as policymakers need to step up and do a better job so it doesn't falling in your lack if you look at the two mandates, maximum employment and stable prices, right now we don't have either it's because of policy decisions, policy decisions primarily by the biden administration, paying people not to work is causing real damage to our economy. you can't have 9 million openings for jobs right now at the same time that we're paying people on average $35,000 a year not to work and wonder why we have 9 million job openings.

it's pretty clear. every small business in america will tell you why. i hear the same thing across the board. they can't get all their workers to come back because of that, they can't even their business fully s restaurants just scrapping and claws to hold everything together want to reopen fully, and in many states can, but they can't because they can't get their workers back they're being paid more not to work than to work. that policy has to end you even said it, when the benefits run out, it will help the problem is democrats here in congress don't want those benefits to end it makes absolutely no sense. that's where it would go, if we

leave it up to other entities like the federal reserve we need to confront this here, in congress. we can look at how states have done well and how states have done poorly. we don't have to reinvent this while. georgia probably has the lowest unemployment 4.5% they were the first to open. they took a lot of criticism, just like when florida open their economy early. some said, oh, everybody is going to die the only problem is when you look at the states that stayed mostly closed, they were the states that had the higher covid death rates, right now to this day, just looking at recent numbers of seven-day averages, georgia 14 per 100,000 cases a day. new york, 36 per 100,000, almost triple georgia georgia is actually open new york is still mostly closed. broadway won't even open until september.

there's no reason for that this could be open today schools should have been open months ago we've had peep sitting in the chair you're sitting in, including dr. fauci, say under oath schools should be open months ago this it's policy of local governments that are hurting their economies and their people, and especially the children that are paying a big price. this is what's got to end. we need to focus on getting the economy fully reopened, on getting kids back in the classroom. oh, while we're doing that we surely ought to addressing the origins of covid-19, not a month from now, it should have been months and months ago, because nobody should sit here and go, why, why did this happen why did this calamity, deaths, destruction of economies, people's whole livelihoods

suicide rates, we didn't even talk about that today. suicide rates, drug overdoses, all off the charts because of what we went through, yet not a single hearing in a year on the origins of covid-19. hopefully we can focus on the very policies to help us get through this the right way so that it doesn't end up in your lap and things end up having to be abruptly changed to the point where it actually harms real families even worse than they've already been harmed. as we've seen, so many things that are happening like all of this inflation across the board, that shouldn't be happening right now. we shouldn't le seeing this inflation brought on by president biden's policies in his over-reaction to something where the science -- in fact one of the things we have seen is a lot of political science being practiced than medical science hopefully we can get to a lot of

common sense so let's focus on getting things open the right way, following that science, and do it -- not reinventing the wheel. many states have gotten it right. many states have gone it wrong less's not have the federal gooch continue to do it the wrong way. with that, i would yield back, mr. chairman >> thank you, ranking member, for yielding back. i want to close by thanking chair powell for his testimony today. we appreciate the opportunity to discuss the lessons learned from actions the fed took during the pandemic to support our economy. the fed's current outlook, as our economy recovers, and the action needed to ensure a strong sustainable and equitable economic future.

today's hear has made clear the fed must improve its crisis response tools to ensure that communities, small businesses and workers, not just large corporations receive support during emergencies the fed's pandemic relief efforts, while innovative and well intentioned were often too little too late and did not have the impact they could have had to bolster the economy the fed must learn from this experience do improve on these responses in future crises the good news is that, thanks to smart and bold economic policy by congress and the fed alike, our economy is recovering swiftly. the american rescue plan is delivering desperately needed

relief that is supporting a broad-based recovery since march, the economy has been adding an average of 540,000 jobs a month and new unemployment insurance claims have dropped dramatically. direct payments have seesed americans ease financial concerns and enabled them to support their local economies. soon the department of treasury and i.r.s. will begin to deliver advance payments for families from the expanded child tax credit relief that experts project will cut child poverty nearly in half as vital as the american rescue plan is, it must only be a first

step toward a better economic future the pandemic exposed significant faults in our economy, and we cannot be satisfied with a return to the pre-pandemic status quo i notice our chairman wallace has finally made it. >> just off the plane. >> i understand. i'm glad -- i don't think we ought to close this hearing without hearing from you. >> well, thank you very much, mr. chairman i'm pleased i was able to get in, you know, at the end of the hearing, but let me just say that, of course, i've worked with chairman powell for quite some time now, and i was so very pleased with the way that he

worked even with the treasurer during the pandemic, and of course now with yellen, who is our secretary of the treasury now. the two of them worked very, very well together i was very pleased that at the beginning of this pandemic they both said you have to go big, you have to think big, and that's quite unusual for a fed chair, who is usually more cautious and more careful about, you know, expenditures also, i'm very pleased at the way that he opened up and initiated so many facilities some of them i still don't understand, but i do know there was ever attempt to be able to meet the needs of the business community with the main street fac facility i was very pleased after opening that up and getting the information out from that, they

modified some, and they brought in the opportunities for smaller businesses to have access to the main street facility so i compliment and thank chairman powell for not only his leadership during this pandemic, but his creativity, and the way he was available to us to always help us think through what more can we do, and how can we do it. so i'm pleased i was able to at least come in on the end of this hearing today to say to mr. powell, i credit you along with others who worked so very hard to get us, you know, past this pandemic and to get us back on the road so that our economy can do what we know it can do. i've never really been worried about inflation, but i want to keep an eye on that, and i want you to keep us informed about what is happening in our economy. i think we're coming back and

we're going to come back strong. we've got to answer some questions about employment we've got to find out what is happening with the need to increase the minimum wage, because i think that is what is keeping some of our people from wanting to come back to work they're looking for better wages, better opportunities. so with that, let me just say, thank you, mr. chairman and thank you, chairman powell >> i'm sure chairman powell is very pleased that i did not close this meeting without your comments. >> thank you. >> let me continue to close by reminding, many of you may recall when we passed the c.a.r.e.s. package, i said to the meeting that i thought this would give us an opportunity to build an economy with vision,

and i was chastised for having said that, but i want to say once again, fulfilling the vision of this country, as we heard from chair powell today, is integral to our what you are call -- as we close our pledge of allegiance, with liberty and justice for all. that's the vision that all of us have for this great country. that is why we are working hard to pass the american jobs plan and the american families plan, which will make the investments in our infrastructure and our families necessary to build back better as we listened to the testimony today, and the q&a, we talked about why people are not going back to work

i talked to a lot of people in my state that that they'll go back to work tomorrow if we could cure their child care problems that's what we've got to do. we've got to make sure this families is put in place so people's children will not be in danger when they go back to work chairman powell, thank you so much for testifying today. the fed continues to play a critical role in helping our nation recover from the coronavirus crisis, and ensuring equitable -- i trust you will never lose sight of the fact that millions of americans are dependent on the fed to continues to support the recovery with that, and without

objection, all members will have five days within which to submit additional written testimony for the witness to the chair, which would be forwarded to the witness for his response this hearing is adjourned. there ends the subcommittee hearing in the house titled lessons learned, the federal's response to the pandemic unclear whether any deeply lasting lessons were learned perhaps the standout comment from chairman powell that strong job creation should arrive in the fall t. perhaps implying that it would be -- but stuck to his script, very dovish overall, suggesting he has for fears. markets did respond, equities at session highs, and the dollar sinking during the course of that testimony both of those moves did begin

before the hearing. >> that was painful, are you joking >> no lessons learn? >> le didn't get a single question on taper or interest rates. the market has been throwing a tapering question. there was a bit of discussion around inflation the republicans used it as a chance to rail against the democrat policies of big spending, higher taxes, and the democrats used it as a chance to talk about how some of their policies have helped, and to praise powell, and the fact that, you know, we are recovering the republicans went after the lockdowns and after the originalens of the virus there was a political show they missed an opportunity. >> who would have thought that >> this is a pivotal time for the markets, and investors are struggle to figure out on when the fed will scale back, and we

didn't get anything of the sort. i was going crazy. >> i know. i was trying to tone it down, i'm not sure any lessons were learned. you spoke for both of us ylan mui has been watching this closely for us ylan, key takeaways? >> this is really a great example of what drives washington is different from what driving wall street what i heard was the fed chairs using it as an opportunity to tamp down fears of inflation that both investors and lawmakers are having he described the supply chain as being caught flat footed at times and he doesn't believe inflation will leave a mark, but you're right there were a lot of political landmines he sidestepped deftly, whether it was about the originalens of the virus or capital gains tax or

the declare, try to go define what infrastructure is i think he made the most of this opportunity to talk his book, even as obviously the politics swirled around him, and republicans and democrats used it as an opportunity to go after each other on other issues. >> which he would not bite on. ylan, thank you. if there's one takeaway, we did get more on the powell world view he's worried about vaccinations globally, variants that's something that's kept him a beneficiary carb. up next, has the covid recovery trade run its course? maybe what stocks you should buy as a result. and talk about a business cy cycle? we'll talk about peloton's move to sign on corporate clients that's all coming up on "closing bell." near session highs hey, dad! hey, son! no dad, it's a video call.

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perfect times as microsoft hits $2 trillion in market cap. do you think it will last? >> i think so. these big tech stocks about well in 2020, and they outperformed then for the last few months they have been trending sid sideways, because people have rotated away from the secular growth story i think in terms of valuations and given where the fed is, i think the leadership will change from cyclical to sec ullr stocks >> you still like financials despite that point of view >> it's almost like a barbell approach you said a hedge to some extent. this inflation is going to be transit free

however, there is still a chance you could have a spike in inflation. if you were to choose one cyclical stock or sector, which you would like to hold, it would be financials. even if they have varied quite significantly, they are not as rich as some of the other cyclical sectors such as consumer discretionary and industrials. maneesh, we have to leave it there. the afoyer mentioned chairman powell ran long. >> of course thank you. down 10%, and then back up about 10% intraday we'll break down those moves and what's ahead for crypto, as we go into the market zone.

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don't get mad. get e*trade and get more than just trading. investing. banking. guidance. we are now in the market zone, commercial-free. mike santoli is here, and also charles berbriske as well. the markets of rally ing the nasdaq is trading around that level.

the dollar is weaker that's been a recipe for the rally. powell didn't say anything about policy. >> powell didn't say much, except hi tremendoused to set aside any imminent inflation concerns i think the market anticipated there would be a bit of a walk back from last week's meeting. more to the point, people were caught offoffsides we came into this week kind of cleaned up we tested this 50-day average, it's trading very technically. always kind of bottoming around the 50-day average definitely kind of proving that that pattern is holding for now. >> amazing we have that on friday and two days later we're close to a record. charlie, any kind of update from you on your outlooks for

inflation and the extend to which the fed will be forced to hike against its wares, following chair powell, both day and last week? >> you know, i think i was on a monday ago, wilf, since then every piece of inflation data has come in even worse than i had expected we had the highest cpi numbers we had monthly runs of 0.6, 0.7% so there's lots and lots of signs of inflation today's housing price number was up i think 23%, 24% versus a year ago every piece of data is saying inflation is hotter than even the bulls like myself thought it would be all we have on the other side is chairman powell. so he has ha motive to say it's

transitory he said inflation won't be as bad as it was in the '80s. we had 13.5% cpi even i don't think we'll have 13.5 so the short answer is no, the inflation data is still very negative he's going to have to at some point adjust policy. markets just coming offer the session highs over the last 10, 15 minutes bitcoin taking investors on a roller coaster ride. kate rooney has the details. >> this was a wild session for bitcoin, briefly wiping out its gains for the year it dropped below 30,000 for the first time since january it later recovered to around 33,000 bitcoin is now down about 20% for the week it is also now underperforming the s&p year to date

investment products saw their sixth straight week of outflows, according to coin share, they saw a third consecutive week of outflows, that's the longest bear run since crypto winter back in 2018. >> mike, interesting thing, whichever an unanswered question back in march or april, it can fall, it can fall aggressively, or bounce, and it doesn't affect equities. >> not directly. it hasn't really spilled over into any other kinds of distress you assume a lot of leverage is being wiped out. volumes have really come down. it shows you this is crowd psychology in motion at the same times -- at all times, but it's holding in there, still up huge from a year ago, and i think it's all about, you know, very

big holders wants to defend this level. >> charlie, is it enticing for a value investor like yourself yet? >> no, absolutely not. i think the precedent that people need to remember is in the 30s roosevelt outlawed individuals owning gold. more recently the u.s. government outlawed swiss bank accounts, all the for the same reason they don't want people t transact in ways that the governments can't see, so i think the risk of real government regulation to reduce ra ransomware, reduce tax avoidance i think is real. i think we'll get regulations that will be very tough on bitcoin. soaring home prices continue to rail. >> sara, sales may have dropped

a little less than 1%, but it's the fourth straight month of declines realtors say more and more buyers are getting squeezed out that pushed the median price up 23% from a year ago. that's both the highest price on record and the strongest price appreciation ever. the builders are trading slightly higher before tomorrow's new home report. >> diana, thank you. charles, where are you on the housing group? now with higher prices, questions about whether demand is saturated, what do you do with the stocks? >> we've had ten years of below average housing stocks there isn't enough housing supply we're investing through things like masco, the paint company,

stanley, black a& decker, this i just another indication of inflationary pressures 23%, don't bury that lead. 23% increase in the price of homes. that is inflationary >> that said, mike, lumber and other raw materials costs have come down significantly. >> yeah, it's an incredibly compressed cycle home builders themselves slowed down production because of the materials cost and then they have come crashing down. it's glib to say, but when you see these massive surges in prices, it races the denominator for future inflation rates it's silly to say, but m mathematically you can't expect this pace to continue. a lot of these homes being bought, a lot more in the prior

cycle at a 20% down payment, which means a little firmer footing, even if it is making the sort of rent versus own equation pretty much. >> i was just going to say it factors right into that debate we have about two minute to say go we have come off the highs, technology very strong what do you see any internals? >> less strong than you might think. it started deep in the hole. right now it has turned positive, but really very mixed. a little more than 1500 down it was negative before, as i said, but it shows there's a lot of back and forth in the megacap growth stocks, really driving the index action take a look at software. this is an area that exemplifies sort of the return to the steady, more secular growth areas. that looks like it's just on the

verge of trying to get to a new high the nasdaq looks even better than this, poking above to a new high it shows you the reorientation of the market, at least for the moment the volatility index has also come back into line, under 17 right now, really remember we burst above 20 on friday, and that is now essentially i would call it normalized and the shape of the investment. x, futures and all of that stuff is pretty much in a comfortable position. we are set for a record closing high for the nasdaq and nasdaq 100 the s&p was close to bun, but just slipped off the session hides. well off the session lows, as you can see. the dow also much closer to its highs than lows, but only about a -- the nasdaq 100 gains close to 1%.

real estate and utilities are the only two sectors of 11 in the red. [ bell ringing ] >> at the close the s&p 500 up, the dow, and the nasdaq up for a record closing high. strong finish to the day welcome back to "closing bell. i'm sara eisen here with wilfred frost and mike santoli take a look how we finished up the day on wall street there is the do you, fell into the close after running up to a session high in the final hour of trade didn't learn much from powell. he isn't worried about inflation, but is concerned

about the variants and the fact that not all corners of the world are getting vaccines s&p 500 up at half a percent, 21 points, best performing group there, technology, was strong all day. consumer discretion was is the betts performing group the nasdaq posting a record close. nasdaq 100 as well the biggest triple impacts goes to apple, amazon and microsoft russell 2000 closing up 0.4% coming up this hour, chart watcher to be mcclellan, why they could be setting up for a july rally. and.oton shares are up since the pane, making it one of the best winners for stay-at-home. and now the company is making a big bet on the

reopening. first up, though, charlie from a iryell investments is with us. and gregory branch joins the conversation first to you, mike, on day two of a rally, which was a bit of a question mark, because on friday there was a lot of concern yesterday you could say was just a bounce back. >> yesterday looked like it was a bit mechanical i think it's fair to say we came in as if the downside reaction, and really the violent action in the bond market was out of proportion to whatever new information we had coming out of fed. it was a very fast repricing of long distance fed policy we no longer had much crowding in certain positions it seems as if we got this fortuitous -- we can pick up big-growth stocks that don't look as expensive as nine months

ago. i think it keeps the market in shape. we're cruising to midyear with a 13% gain is that something to defend or build upon >> you're maintaining the view that you think inflation with continue to surprise to the up side does that make you bearish on stocks, particularly as one against one of the major averageses closes at a record high >> you know what ipt going to say, there are different kinds of docks what we think is going to, we think there is a lot of catch stick.

so the economy will surprise to the up side, and value stocks will therefore relatively outperform >> charlie, i think it's -- to make this point last hour with you, and i know your point is everything we have seen so far has pointed to hotter inflation. however, the market is going the other way. f it has come way down some of those levels are back to march levels, so the bond market is going against your call on inflation. >> right, i don't want to say this in too harsh a way they have spent $8 trillion with a t in trying to keep interest rates

low. that will end at some point. right flow we have negative real yield, which makes no economic sense, when we stop having that very heavy hand on the scale, we'll have much higher interest rates. >> greg, microsoft crossing the $2 trillion market cap, is that where you want to be at the moment >> yeah, at the moment. >> so growth did what it's supposed to do, when we see the ten-year pull back and sigh that the fed is comfortable to sit here, though all the availability evidence points to much higher -- and they're going to do nothing, yeah, it creates an environment that's ripe for growth, particularly when you think about going into the quarters with the most difficult compares, and then continue to blow away the numbers, given an answer to the narrative, maybe some of those gains -- but cloud numbers, digital advertising,

hardware, software, all the numbers show that we're in the mid-to-of a spending cycle so from a performance perspective -- from a fundamentals perspective, i agree with charlie, we're going to see -- and when you lay on top of that, the fed seems content to ignore that -- that indicates their view or at least their narrative on inflation is not accurate and they're not going to take any adjoining action, and it creates an environment where growth can actually prosper >> let's discuss a bit more of that testimony of jay powell ahead of the house commit year, getting into a heated exchange over the labor market. ylan mui has the highlights. >> there was no talk of rate hikes or tapering during that hearing with fed chairman jay powell before the house coronavirus committee, but there was plenty of debate over enhancedening employment benefits and the impact they're having on the labor market gop represent that i have jim

jordan called out powell as missing the market on both of his mandates, inflation and maximum employment. >> democrats are talking about renewing them. if it helps if they run out, if he renew them, won't that hurt >> these are judgments for those who stand for election. >> i'm just following your logic. >> i think we'll see strong job creation in the fall i really do. >> jim clyburn got powell to biff his own definition of maximum employment, which powell said was brought and clouinclus. he repeatedly argued it is transitory and a return to 1970s-style inflation is very, very unlikely. back over to you. >> interestingly, we did see the dollar sell-off.

either way, do you think that bounce has been gone at least the next three, four, five months. >> we do know it doesn't really change the trend it looks like a double bottom in the chart, but it didn't turn things positive to where you would say things had changed i don't know what about the next three months will say, but i do think that the fed is not going to be anticipatory and proactive. whether that means things get better or the average inflation we're running at gets to a point where they feel if taper has to be pulled in later this year, as we did here, a fed president, maybe that's the case, but i don't think powell gave you any reason here to think that hi thinking is much different than last week. >> greg, how much do you base your view of the market on what the fed is or is not doing and saying right now >> well, we have as to account for it, whether we agree with it or not i tend to place as much emphasis

on the data i'm seeing, so we've just seen, let's rule out the bates effect the year-over-year numbers i will concede is somewhat more aggressive than we would like, but month over month rules out the bates effect when we look on a month over month basis, we had april with 94 basis points and may with 74 basis points s the commodities ppi was at 19%, along with last month's 17 1/2, in the last 40 years, and so what we are seeing, the actual data and what the fed is saying. you know, looks, i'm sure they have reasons for trying to downplay the accuseness of the inflation we are seeing. i'm sure they're trying to land the plane softly and have as also or muted impact on equities as they can, but the data doesn't lie. the data defies the narrative that they're continues with. >> charlie, i thought i would end about asking you about your

positioning in the financial sector buybacks could be a big part of the total returns for some of those names, have you had changed your positioning in that sector >> goldman sachs is up a lot this year, when tiffs trading below book, we are pounding the table. i can't be quite at aggressive today. bank of oklahoma, still trading at around 11 times earnings, but i can't 30u7bd the table as even three months ago clearly these names worked well, and they're not as cheap as they were >> certainly it's been good for rumors to be m & a charlie and greg, thank you for joining us up next s. tom mcclellan. plus peloton is try to go

cash in on workers returns to the office the company's president on the effort to grow the member base we're back in 90 seconds snoo you need a financial plan that can help grow and protect your money. an annuity can help cover essential expenses in retirement, so you can live the life you want. this is what an annuity can do. learn more at protectedincome.org. it's coming back to you now... real pants. find amex offers to save on the brands you love.

one of the many things you can expect when you're with amex. ♪ ♪ when technology is easier to use... ♪ barriers don't stand a chance. ♪ that's why we'll stop at nothing to deliver our technology as-a-service. ♪ . nasdaq posted a record close. joining us is tom mcclellan. talk us through this recent market we've had a bit of a pullback.

>> then i expected the market to rally with its hair on fire. we got the mid-june dip last week, and monday was a great start. there's still more yet to come. >> so that friday pullback you think was the bottom for the short term for a two-year outlook what are we talking? >> i would call it a tradeable bottom it fits with the seasonality of the all year and first year of the presidential term i said they were have it with a presidential cycle pattern versus the s&p 500, and that pattern said we should expect a bottoming period june 17th through the 23rd friday watt at 18, so right on schedule, and got a lot of

people feeling fearful bitcoin will crash to zero, we're all going to die the fed will screw up nine different ways >> i love how precise you are with your dates, tom you talked about fear. i know you are watching the vix, the fear gauge to show just how much fear there was and what that means going forward >> the vix was a great tell. going into the bottom, i didn't know if it was going to be thursday or friday, but we get close at the predictive d. and they say -- when you see the investment x pops up with i like to use for both the 50-day moving average and one signal -- the 20 and two

sigma, which is the standard setting. it's a nice enough indication to say, yeah, we probably have -- at least in terms of reintroducing fear into the hearts of traders. >> well, what about -- we talked about before the break, what are the views of the direction of the dollar from here >> it's very mixed it's going to be a much different picture. i'm expecting in general, though, that the dollar will rise for a variety of reasons, mostly because of the lags in the banks system and the way the yield curve changes affects the dollar later on, not immediately so not a huge rise, but upward. >> i wanted to ask about tech,

we're seeing nice moves in names like amazon, nasdaq, how much staying power do you see here in this reversal back into growth >> big it ecshould lead the way higher amazon has had a nice breakout from a big plateau structure it sounds like a big range, but if you had a stock -- you wouldn't think it was so big, and now we're seeing the upside break out of that. when you see an upside breakout, what that means is the sellers have either given up or run out of ammunition, so you vanquished all of those sellers defending that level like i said, i own a

bit, but i think big tech generally will lead the way. also expecting small caps to lead the way, the russell 2000, that tends to echo the moods of the unicurve so that's good for small caps for the rest of this year and into next year. >> even though it's flattening out? >> yes, because it matters what happened 15 months ago there's a big lag. what we get to go through is the echo of 15 months ago. the flattening now tells you about what will happen to that 2000 versus 100 on relative strength 15 months from now. >> we'll be talking more with you before 15 months tom mcclellan, thank you for joining us back to mike santoli with

the look at the relative price of quality stocks? just north steadiness in their businesses this is from blackrock and shows the relative p.e. slide of the market sometimes people whether or not like s&p a-rated quality ratings, things like that, and you see they have rarely been cheaper relative to low quality credit markets improve quickly, so people have the risk appetites rising, and they go for the beta, the ones with the greatest improvement potential then the cycle kind of moderates. so here's how on a year-to-date

basis some proxies having doing so far there's a quality factor etf this is dividend growth stocks, the s&p dividend achievers, this is the morningstar wide moat etf, to try to decide how strong some of these competitive franchises are this is a lot of health care as well that has outperformed really well, so whether in fact this is the moment the quality trade comes back into vogue. >> we put the megacap to the quality bracket these days. >> as a matter of fact, yaw, bank of america has made this

point that the s&p 500 is of more skewed toward higher quality companies than in the past this theories it's like 60% of the s&p roughly qualifies. >> mike, thank you. peloton has been a huge winner, it is stoic up 400%, jumping today. we'll speak with the company's president about that news and more, next. and karen kaolanurrn-tbo reacts to the fed chair's comments we'll be right back.

employees will have access to the fit necessary subscription, and we spoke with william lynch and asked whether the program is intended to help with wellness or drive sales for peloton?

>> we started seeing corporations come to us, and ask did we have a platform for employees to use peloton and engage for the last year we've been wor working a today's announcement, which allows companies to offer to their employees peloton services in a subsidized way imagine employees an samsung or accent your getting add to peloton for free as a benefits so we know employers are already spending $60 billion on health and wellness -- not on insurance, but health and wellness -- as a leader in

fitness employers want access to peloton, so today's announcement check as lot of boxes. >> to what extend doing fear your long-standing customers who pay full price are going to get a bit annoyed about this >> i think those customers are using the membership over 20 times a month, so we represent the best value we have the highest engagement, so existing customers are seeing an incredible utility. i think they understand if an employer is willing to subs advertise, which is what they're willing to do, the timing of this launch we they is optimal and they're willing to pay for some of that we think our now over 5.4 million members understand that, and we think they will embrace

all those members, the community is what makes peloton so compelling, and we think they will welcome that. >> there are constantly questions about what growth numbers will look like as people start going back to gyms what can you tell us and what do you tell investors who constantly wonder if this is as good as it gets >> we think this is a secular move to fitness and home connected fitness we believe offers the better experience with the better place and better community. we are growing triple digits before the pandemic. we see our growth profile. we're very bullish on it going forward. it shows up in our engagement number off of q3 as we look to the future, we think this will be one of the most exciting years in new product introductions. we have new channels, new growth channels like corporate wellness

and or direct-to-consumer business is super-robust, not only with retail stores, buttee ographically, so peloton has a lot of growth headroom, and we've never felt better about the future. >> what percentage of total classes taken involve the bike itself, as opposed to the tread or floor classes as reopening as occurred, which has seen the biggest tail off, if at all, of people exploring traditional methods once again to work out, like going back to the gym. >> that's a great question you know, four years ago it was almost 100% cycling, now we don't break it out, but it's much, much lower as we've added variety -- meditation, floor strengths, outdoor classes, so the faster growing are

non-cycling. as we look on seasonally as things open, our outdoor running gets a big up tick in spring you see that expand, but the point for us is we keep adding more and more utility to the peloton -- better, more instructors, more fitness modalities that's why we believe it's the best value in fitness. >> i'm personally a fan of the foam olling, which i think maybe i've one of the only ones who do we have to ask about the treadmill and the recall and when we might see it come back to market and any new financial fallout? >> our goal is to have the safest products, and we spend a lot of time on it. no news to announce on tread today. we are working hard against that goal, and working with the cpsc. we'll have news shortly.

we never got to launch the tread, which is the entry 46 level tread in the u.s as we worked on these features in fact e. we have said publicly we think, as you look forward, that could be bigger than the bike >> just looking back, because this is such a big deal, did you not know there were safety concerns around this treadmill before it even went to market, that things could get stuck underneath as i understand most treadmills are not built that way. >> you're talking about the tread plus, which is our high-end treadmill we had gone through rigorous safety testing and gotten all the certifications for it. these incidents were

unfortunate, obvious ly we pulled the product off the markets, because we want to have the safest products on the market we will work with the cpsc, and as we think about the tread plus, we'll bring it back to the market when we feel assured we have one of the safest products in fitness that's the peloton president, and of course peloton doing well today. it will be fascinating what the pricing is for those corporate deals, but at the moment anything that continues momentum of top-line revenue, by the way, is seen as a good thing. >> and thinking about the larger market and whole new tine for reserve and market size, which annualests are excited about the stock is down about 22%. it's obviously been a huge winner over the last year or two, since the pandemic, but

there are constantly questions about what growth is going to look like when people are going back to the gyms and socializing again. >> and you know a lot about treads, it seems. >> i researched it. >> potentially in the markets? >> no, and i think they're so expensive. it's enough that i get on the bike but i think there's serious questions about the recall >> i think it was a big surprise, and a big black eye, but they have bounced back. >> peloton is a two-time cnbc disruptor 50 and he's among the speakers at this year's summit still ahead on "closing bell", the best ways to hedge against inflation risks right now. and we'll discuss the

foxconn plant, the whoa debacle, could it lead to fewer corporate incentives being offered by states we move forward. we'll be right back.

hey, shep.

>> here's what's happening within the last few hours noise like this have been appears on roughly three dozen news web sites linked to the iranian government it says the domain has been seized by the u.s. an unnamed official tells associated press most of the sites have been spread what washington considers to be misinformation joe manchen says he will vote to revisit the voting rights bill that now includes his proposals for expanded early voting, along with voter i.d. requirements that will enunite the democrats. barren an unexpected turn, the bill will die before even discussion. and the polls close in about 4 1/2 hour, in new york's

mayoral primaries. the brooklyn borough eric adams is here campaigning today, but there's a lot of urn certainty as the city is using for the first time ranked choice voting. tonight steve kornacki is at the big board to explain the system that's about to become more common >> shep, thank you up next, on "closing bell", why karen says investors need to rethink their currency exposure. plus why mcdonald's is autbo to face a loyalty test from consumers, later on "closing bell." okay, imagine this... your mover, rob, he's on the scene and needs a plan with a mobile hotspot. we cut to downtown,

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jay powell talking about the inflation. >> look behind where the categories where the prices are going up, it seems to be areas directly affected by the reopening. that's something we'll go for a

period, it will be over and should not leave much of a market on the ongoing inflation process. there's no reason why it should leave a mark a year ahead, because we should be through it then joining us is part of our curb your inflation series, karen, welcome back to the show. it's good to see you. >> good to be here >> so, you they investors should be preparing anyway for inflation where powell doesn't expect it to last? >> absolutely. as an investor every time you have a big bias in your port follow, you are implicitly making a bet about what's going to happen. it also might not be in choosing not to have any inflation hedge assets, you're taking a very big bet that you know the answer to this question. >> typically you think inflation

has assets, gold is that what you're recommending what are you thinking? >>. >> i think it's good to be diversified. almost every investor you talk to definitely has some treasury bonds. very few people actually have a lot of inflation-linked treasury bonds. now you're just going to litelit literally get paid cpi gold is pretty good for more monetary-style inflation, but a balance mix of commodities gives you much more, what are literally the raw materials that might get stretched? so if you need more steel, iron ore, or more copper, aluminum, those sorts of exposures gives you a basket as the real economy has these pressures, you have a wide array of things that pay you. >> have you missed the chance, though, karen, on a lot of

commodities that were shooting up a couple months ago and have started to pull back. >> i think they have a good secular story behind them. if you look at what we need to do to lower carbon, you basically need a whole lot of aluminum, copper, steel, so on and so forth, so it's going to take longer to bring online the mining we need it's back to the tactical versus strategic. how 24th do is how the real economy plays out, and by not having any allocation there, i think it's a very big view that you know inflation is definitely going to be transitory. >> you also are telling investors to watch their currency exposure given the inflation lessons of the pass. what do we knee to node? >> i think investors have been influenced, where you held your assets the choice you made of what currency to nominate them in,

almost didn't matter so when you held european equities or uk equities or japanese equities or emerging equities, you could -- so that occurrence hedging decision was a small part of the picture. if you look back at the 1970s that could matter much more than some stock market you picked the inflation had a very, very big effect as one country got inflation, you had very big moves in currencies the choice to hedge or not hedge made a big difference. the fact that inflation is even on the table again, says this is a good time as an investor to say what are my currency exposures? if currency i get volatile, how am i hedged? >> so, a lot of talk about

hedging, in terms of the core positions in your portfolio, what would you recommend people's weighting to u.s. equity relative to benchmark are you still suggesting that ultimately they're in a good place to be? >> i city like being in equities it still feels like at the core, policymakers want to let the economy run, so i think one of the interesting comparesens is the late '60s where you had a booming economic, fiscal expansion, and easy monetary policy those are good times to hold risky assets, and you hear jay powell saying we're not scared of inflies you see what happens with continued discussion, even as it gets stock going so i like holding risky assets that said, what ends up

happening is markets don't get priced in and inflation becomes a bigger deal, and it becomes one of your bigger vulnerabilities, so it's almost a way of saying i want this reflation exposure, but either in the real economy in the form of equities or in the nominal economy in the form of maybe companies won't do as well to me that's a nice way of betting on reflation, policies, betting that they'll let the economy run and how growth-y or inflation-y you have a mix >> thank you very much for joining us. >> thank you. cashing in on digital customers. fast-food chains are the big-name cpaesomni switching up their strategies "closing bell" is back after a couple

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- [announcer] dearest smoke shacks, defenders of the dry rub. thank you for giving your all to a 20-pound hunk of brisket. whatever you serve, we'll proudly deliver it. (bike rattling) (pleasant piano music) mcdonald's making a major move to cash in on digital customers. indicate rogers has the state. >> the loyalty program will be in the mcdonald's app and allow access to free business by ordering their favorite items. for every dollar you get 100 points to use. mcdonald's is focusing on the

digital experience it is certainly not alone. chipotle also focusing on digital. its rewards program is nearly 23 million members in just two years. by ply count it must be the fastest growing in the space now rewards to members will be able to redeem points across the entire menu and also do it more quickly. now having access to customers allows you to better market and tailor all of these deals. back to you guys >> kate, i'm honestly surprised it's taken them this long to do that, that we haven't seen it before hasn't starbucks done this for years? >> yes, starbucks has done this for several years. mcdonald's i don't want to say is late to the game, but a lot of investors and customers have been waiting on. as i mentioned, up to almost 23

million members with chipotle, so i think it's all about customer loyalty and engagement how you taylor deals to them, and how quickly they're ability to access all th thanks so much for joining us. wisconsin spent billions to lure fox scott to the state, but that deal isn't selling out too well for either side. why that could have a huge impact on the future of corporate incentives straight ahead. this is dr. arnold t. petsworth, he's the owner of petsworth vetworld. business was steady, but then an influx of new four-legged friends changed everything. dr. petsworth welcomed these new patients. the only problem? more appointments meant he needed more space.

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states have long tried to persuade companies to do business with big money incentives, but the massive fox con deal has proven to be a debacle in wisconsin scott? >> had he, wolf. this is supposed to be the eighth wonder of the world, at least that's how president trump portrayed it back when he was president a couple of years ago. this was going to be the giant

foxconn facility they did get the nifty glass sphere behind us built we're still trying to get word on what they're doing here they did develop this site 30 miles south of milwaukee for a giant manufacturing plant but it is a shadow of what it was supposed to be originally a $10 billion investment some 13,000 jobs now we're talking about a $1 billion investment and 1500 jobs tops so the state of wisconsin under the new governor tony evers has renegotiated the tax incentive. >> the goal with foxconn was to find a path forward that was beneficial for foxconn and protect the wisconsin taxpayers. i think we accomplished that now as we go forward, we're thinking about economic development in a new way. >> they're now looking at more targeted incentives, particularly trying to help small business we are rethinking economic development, too, with our new

america's top stage for business study coming next month to cnbc. we'll still be looking at incentives they are still a big deal. also, what states have been doing specifically to help companies through the pandemic that and a lot more coming up on america's top states for business you can read about it at top states.cnbc.com. guys >> it's going to be really good. scott cohn, thank you very much for the update on the foxconn sag saga nasdaq closing at a record high. the story continues to be inflation, right >> sure. >> the fed and how quickly is it moving towards tapering and just where the leadership is in this market the value over growth trade over >> is it over? is it on pause are we just seeing kind of the growth stocks take advantage of lower yields, the passing of this latest little inflation mini panic and the fact they hadn't been up to criticize the

market volume's very low. the number of stocks that really were pulling to the up side was not particularly impressive and so you'll see that there's going to be a little bit of back and forth, but what's absolutely clear is things like financials and transports after great rallies are still outperforming, they have pulled pack and have pretty weak balances the last two days where you did see software and the faang stocks take over. that's where the market cap is. >> microsoft 2 trillion. having a good day. watching bitcoin overnight pulled that below 30k. posted at 33k. s&p 500 50-day moving average. >> closed below it friday. pretty textbook. that's kind of how it's supposed to work if it's still a bull market we did go down below it back in february and march so it's not anything unique, but so far been three or four of these pull backs. none more than 5% this year. that's pretty much in the

vicinity of the 50-day average. >> the 10-year yield at 1.46 surprises people it can't decide whether it wants lower yields or higher yields. >> right parts of the market can seize on lower yields. >> like tech. >> yeah. and the transport. >> that does it for us on "closing bell. thanks for watching. "fast money" starts right now. live from the nasdaq market site overlooking new york city's rainy times square this is "fast money. i'm courtney ragan filling in for melissa lee. tonight on "fast" amazon in focus as we're hours away from the end of prime day or days but what do early results say about the state of the consumer? former best buy ceo hubert joly gives us their thoughts. bitcoin's big bounce crashing through the 30,000 level before staging a big