change the pay scale how come a waiter can make $100,000 a year and a sous chef makes $60,000. it's already difficult the whole supply chain changed now deliver -- >> chef, we have to skee dadle thank you so much for your time. one of the good guys thank for watching "power lunch. thanks for watching "closing bell," too it's up next. thank you, tyler welcome to "closing bell." happy friday, major averages bouncing s&p 500 and the nasdaq both hitting record highs, the dow is up triple did you get. let's look at what is driving the reaction

energy is leading the way, as oil prices move higher ahead of an anticipated storm in the gulf of mexico this weekend on the data front, another soft reading on consumer sentiment for august, though personal income topped expectations for july 59 minutes left to go in the session. s&p 500 up above 4500. coming up on today's show, council of economic advisers member jared bernstein, with his read on the economy and imp flation. and we'll hit the gym trade with the ceo of f-45 it's having a strong day in the market steve liesman has the highlights of the fed speech today.

>> et's tiptoe through the taper minefield. in an exclusive interviews fed vice chair followed up the speech, by saying he expects the economy this fall to meet the fed's conditions for tapering. >> we've had 800,000 jobs for the last three months, so i expect those gains to continue in the fall. if that happens, i also would support reduction of our purchases later this year. >> yeah, earlier in the day fed chair jay powell did tiptoe through that minefield >> my view is that the substantial further progress test has been met for inflation. there has also been clear progress towards maximum employment at the feismt omc's recent july

meeting, i have the view, as we are most participants, if the economy evolved broadly, as anticipated, it could be appropriate to reduce the pace of asset purchases later this year and that the rate hikes require a higher standard. while powell was careful, several fed presidents viewed in the last couple days said they had growing concerns about inflation, and could prove to be more permanent than previously expected so, mike,maybe a spli on the fomc. we'll continue the conversation now joining us here first on cnbc is the council of economic advisers jarrell bernstein. always good to have you here

>> did steve liesman just say something about tiptoeing through the taper? that is very melodic >> he did say that it looks like we could see it before the independence of the year, did not give a specification timeline i would think this was music to your ears. what did you make of it? >> very much as you suggest, but additional music just came from your show, where you heard the expectation that strong job growth should be ongoing that's very much our expectation as well. obviously that is underscoring the importance of the president's agenda, but most importantly it suggested the job market is going to continue to tighten and deliver critically important benefits to the american people. that, in tandem with the narrative on inflation pressures coming largely from supply

constraints, pandemic-induced parts of the economy is a narrative we, of course, share. >> here's the think with the supply constraints the supply crunch is lasting a lot longer than expected retail earnings this week, we talked to so many ceos a lot 6 them are expecting the supply shortages to last four quarters into next year we hear that from a lot of consumer ceos as well. why is that transitory >> may, june, july, core inflation 0.6, 0.5, 0.3. durable goods went up 1% in june, up 0.3%, a big deceleration in july i don't want to over-interpret one month, but at least if you look at the core, you see a trend that very much supports the narrative of the federal reserve appeared ourselves

i think you asked a fair question it's going to be different for different things lumber is already clearly rolling over, and has been for a while. i think we might see used cars rolling over, and some of those inflation rates coming down. because of global supply constraints, semiconductors remain in short supply that's going to affect auto inventories. >> what it means is they're widely accepted to decelerate after that and again, it's a pattern consistent with our own forecast, in the midst of an economy is creating hundreds of thousands of jobs with great wage opportunities for the american working people. >> jared, the fed now is essentially getting near the point of say the economy has enough underlying strength that they can start to remove

accommodation. where does that leave the administration's sense of what is needed from the fiscal side >> yeah. >> obviously there's proposals out being worked through congress to what extent do we think that the economy isself is not necessarily cries out for things like -- on top of infrastructure, the further fiscal push? >> the right way to thing about that, in my view, and this is not just politics, this is just core economics, is that that statement about the fed is correct, and that the economy is not going to need the kind of demand supports that it needed when, of course, you know, we were in the depths of a lockdown now we have a strong wind of gdp growth, well above trend, expected to continue, we're adding jobs at a pace of over 800,000 per month. what we need to see now is not just getting back to where we were, but building back better the economics of that means we

need to get to work on the economy's supply side we need to make sure people have elder care and child care, and improving people's productivity, giving them two, three years of community college, and cut taxes po people raising kids, invest in climate, electric vehicles, capture market share in battery production those are the supply-side investmentings that don't just get us back to the other side, but build us back better once we get there. >> when do you expect the president to make a call and announcement on if the fed chair gets another term? >> when he's good and ready. we don't have any guidance on that right now >> it's a question you sound like you're backing the fed chair. is he looking at alternatives? >> i don't think we've said

anything in terms of backing anyone, but when the president is ready, he will make that call. >> you're not giving me anything there. >> correct delta, do you see it hurting the economy? are you looking at any high-frequency data that concerns you >> michigan, yes others, not so much. no, i haven't been looking at any high-frequency measures, you've been looking at all of them i've been pretty obsessed about this until a few week ago i couldn't see delta, now you can see it a bit more what i don't see it in is invite broader macroeconomic indicators in terms of the momentum behind in job creation pace, well before people expected i certainly don't see, you know,

a broad spate of markdowns to the kind of economic forecasts that we have seen. by the way, one reason for that is, when we got here, 1% of the adult population was vaccinated. now, of course, it's closer to 70%, and that's going to make a big difference in the impact of delta on the economy >> jared bernstein, thank you for joining us and weighing in on the hot topic of the date let's turn to the broader market stocks are sitting at record highs. mike, what are you watching for the first one? there's tons of optimism out there around the fed chair in the speech >> there is. relief, which is feeding into optimism i think is the way to characterize it. the day is not complete without a bit of etch-a-sketch here. weds a bit of a wobble yet down 0.5%, so this rally gets us above where we closed on thursday

it's still a relatively measured move as we enter september, two thirds of the way through the year, and the index is starting to sort of stretch that upper end much that past we had watched. it tells you that things have actually started to get a bit of the upward pressure, and sometimes it has a pause, it flattens out again august was supposed to be a good month, and it has been just as a reminder of what the s&p 500 did during the original fed taper, 2013 into 2014, when we first got warning of the fact that the q.e. was going to be sunset, and what eventually did go on. from the end of 2012, very strong start to that year, this, as far as the equity market is concerned, this was a taper tantrum. about a 6%, 7% decline, the bond yields were soaring at that point, but in general, it was one of the stronger

low-volatility years we've had for a long time, and the relative lack of volatile as this year, so it tells you the market can accommodate that. 2014 is when the taper was happening. and i do think that there's also a concern out there, the economy was probably decelerating at that point, too, so the touch-and-go about whether the economy could handle the lack of health was there finally financial conditions remain ultra-loose therefore it would seem an as opportune time for the fed to slowly take back the bond purchase programs. this goes back to the mid '80s we had loose financial conditions this is the great finance crisis, now we have plunged below that so if not now, when is the

question. >> if i were doing a dashboard, my chart would be the intraday of the u.s. dollar that was quite a dramatic move off the powell testimony for those who said we'll still taper, look at this. the fed is in no rush to start tapering, to start raising interest rate. i just wonder what that ultimately will mean for the equity market. there is a thinking we might not taper? he clearly is not seeing full substantial progress yet and not committing to any date >> i definitely think the chair preserved the flexibility he wanted to with today's remarks the reason there's been relief is the lead-up to his remarks were this drumbeat of let's get started with the taper from all the regional fed chairs that were out there speaking. however, i think the market is separating tapering from tightening as the chair want

i think what is going on today is very consistent, we have a plan in september, november to wind down, and that gets completed within several months. it doesn't immediately segs into -- so i think there's a distinction there, but you're right, you know, obviously there's always a way to change course. >> he is dovish. mike, see you in a bit after the break, we're hitting the gym train. newby public f45 fitness company is getting a lift. we'll talk to that company's ceo about in-person workouts the market is near session highs, and we are tracking for record closes for the s&p and the nasdaq

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42 minutes left on trading the kate rooney has the details. >> hey, sara, disney shares popping on a report that espn is exploring a sports betting deal worst at least $3 billion that includes season's -- draftkings, over a number of years we should know that espn has

existing market partnerships no comment on the story. other companies have not responded. we did reach out for comment, though seeingsers up more than 3%, and no comments from those companies. mike, back to you. >> people love that theme. thank you, kate. peloton shares tumbling today. they are lower by about 8% >> saying it's been subpoenaed by both the justice department and homeland security department peloton reporting a wider than expected loss and slowdown in growth

we'll stick with fitness f45 reporting its first earnings since going public last month. the mark wahlberg-backed company grew by sales, with full guidance in line with expectations joining us here, is the founder and ceo adam gilchrist clearly there's a ton of growth. what is driving it the reopening, people wanting to get back to gyms or something about what you're offering >> firstly, thank you so much for having me back on your show. we're excited to be reporting our first quarter as a public company, but to answer your question specifically i think people are excited to get back into gyms.

it's not just gyms, but restaurants. people are wanting to travel again. you know, what we obviously deliver, in our view, is the world's best workout, and we're really fortunate that we have recently announced that we're the first third-party gym operator in history to go on to a military base to train these soldiers before they go into combat that really underscores this belief system that we have an incredible workout, but more importantly, what is fueling our growth is the incredible returns. we have over 35% of cash returns in the locations, which is expanding dramatically i think a better sound bite that is the 126% growth was the fact we saw 540 franchises last

quarter, which is an incredible effort from what we have seen in comparison to our peers. >> i think you said 7 million is the potential size of the market as far as franchises in the u.s. what do you say to those about the fitness trends and whether they're a fad. >> yeah, i think it's a question to understand what a fad is. one thing we consider very important in avoiding or business being a fad is the fact you have to innovate your workouts each and every single day. i personally hate doing the same workout. i can't think of anything bettering that again to an f45 workout where with we currently have over 6,000 exercises, and

never repeat ago workout from day to dade. we describe a fad as something that becomes popular and dies quickly, but you have to consider why that happens. the fact is people get bored with the same workouts we get excited about control the narrative tomorrow's workout will be totally different than yesterday. we're excited about our three key pillars, which has never containinged h. innovation, motivation, training with friends. there's nothing more enjoyable than being able to step into class with a few buddies, have high-fives and get a sweat on, but the third pillar is results. what's concerned us with some of our peers is the style of training, because some people have the potential to get

injures. our exercises are choreographed so people don't get injured. but more importantly, what is more fun than training with a few of your friends and more portly new friends you can meet in our little communities. it's a great question. we're excited about our future >> adam, i just wanted to drill into the potential market and the capacity of the concept and of individual franchises as well i just wonder, a lot of -- planet fitness, for example, very low cost, low intensity maybe not everybody shows up at one, what is the capacity of an individual franchise, how many people can be there at once, and what does that mean ultimately for how large you can get? >> excellent question. we typically run or system with ten classes per day, average 30 people were class. if you runthose numbers out,

you look at the bandwitt of trying up to 300 people per day. so really great performing studios have 400 to 500 members. on average our studio network is closer to 200 members, and we break even with only 75 members. you know, we believe that we can roll out in the u.s. alone 7,000 franchises here. we believe that the market across the rest of the world is over 8,000 the reason we're so confident in our u.s. number is because of our experience in australia, where we have a gdp and population that's approximately a 15th of the side, with over 600 franchises back in australia. extrapolating that number out -- giving it a bit of a haircut to be conservative, lands us at approximately 15,000 across the globe. we are launching in some

systems, trying them at the moment for over 50-year-olds we're fortunate to have greg norman, cindy craved, im -- crad and magic johnson assisting us you're early in that pros if that's the case. thank you so much. >> thank you so much for having us still to come, china is reportedly planning to ban ipos from some internet firms looking to list in the u.s we'll talk about what that means for investors.

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and dave & buster's is upgraded by truist. sara, i think you might have some dave & buster's birth day parties in your futures. time for a news update with rahel solomon. >> here's what's happening florida governor desantis will appeal a ruling that blocked his ban on mask mandates a spokesman for desantis said the judge's ruling was politically motivated. the judge found that desantis falsely concluded that masks are ineffective and misrepresented research to back up the mean. japanese judo expert was hit by a self-driving bus. he was said to compete tomorrow.

and cristiano ronaldo is going back to manchester united, just two weeks after messi left his team it was a surprise because he had a year left on his contract. he joins for a fee of $18 million, which could go up to $27 million. >> if wilfred were here, i'm sure he would have a big reaction to say. ahead on the show, krishna guha, and why he said powell was dovish and bonds, a bit lower following the remarks. ten-year yielding just around 1.31% that is a dovish interpretation of fed chair jay powell we'll be right back.

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higher across the board, near session highs, s&p is up almost a percent 1.5% for the s&p, almost 3% for the nasdaq this week, and more that 5% for the small caps when we come back, china could be proposing new rules that would make it harder for tech companies to go public in the u.s. we'll break down the details with gary dvorchak we'll be right back.

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joining us on the cnbc news lin is gary dvorchak he advises chinese companies looking to go public in the u.s. just your initial read on this report specifically, the journal saying this order or maybe new policy applies to chinese companies that have a high amount of consumer dahl, is this a way to dissuade them from accessing the

u.s. markets >> thanks for having me on we've been scratching our heads a little trying to figure this out. obviously the journal scooped on this, and we've been looking through the chinese language media to see if similar announcements along these lines have been put out, and we couldn't find anything so our sense is, while it definitely is real the journal's reporting is always good, our sense is it could be more of a trial balloon, to put it out there as a next level for possible regulation, and see what the reaction is. it's interesting, because in english language media, directed toward the u.s. market and not in china >> and so where do things stand right now, though? has there been enough of a chilling effect? are companieses sort of no longer looking to potentially list in the u.s. how are they perhaps approaches the possibility of doing so

right now? >> yeah, chilling factor -- the companies that we're working with and the ones we are talking to, everyone is working on a plan b it doesn't mean that the u.s. ipo won't happen, and certainly they would like to list in the u.s. for the reasons they originally thought about it, but they're facing practice reality. most of the companies are either pausing to say, wait and see, let's see how things going toward the end of the year when the i po os got slower, and a lot started looking at spacs now, you know the spac market is getting more different, so i don't know that there's an option to do a spac, so the next thing is hong kong listing so -- and/or the shanghai start market

so we have clients now, saying, look, hong kong will probably be our first choice and we'll see what happens later >> when you're advising they companies, gary, do you read the situations of ad didi, and/or ar there important differences based on the subsector, their personalities? or is it all a part of one thing? >> that's an over-arching issue, you know, didi, bytedance, i think they would like them listed domestically, so it's really the mid-level companies where it's a gray area and they don't know what will happen. i think it's the chinese

government trying to sort things out. basically they're saying slow down, wait a minute, let's see what companies are okay to list in the u.s., really which ones we don't want to happen, but they don't want to be heavy-handed something like we saw with the journal is, again, one way, if you put it out there, a lot of the companies are just going to pause, and that really is probably the ultimate goal >> gary dvorchak, thank you for that color we really appreciate it. >> thank you. we're getting news from washington on the covid origin report eamon javers has the detail. >> reporter: this is the unclassified summary now s. the intelligence community's investigation into the origins of covid-19 what they're saying is all over the map. it's an unconclusive report. a number of elements feel one

way about this other elements feel another way about it the headline here is they all agree ultimately that the virus was not developed as a biological weapon. the points of disagreement, though, are where this virus came from, and how it came to infect human beings, the unclassified assessment is one community's element 'sayses with moderate though the first human infection was most likely a result of a laboratory-associated incident probably involving experimentation, animal handles or sampling of the virology. so one element of the intelligence community is assessing, but only with moderate confidence, that this virus was a result of the experimentation it is wuhan institute, however, four other

elements with low confidence say it was caused by a natural exposure with an meal infected with it or a close progen ditor. the numerous vector foss natural exposure and other factors the bottom line here, sara, is one element of the intelligence community. they're not saying which agency this is, is assessing it moderate confidence that this thing did emerge as a result of some kind of experimental accident at the wuhan institution of virology. other elements disagree with that assessment. all of them agree it was not engineered as a biological weapon some of the intelligence community is pointing to an apparent lack of foreknowledge by chinese officials that this was happening, as evidence this

wasn't intentional so there's a lot to sift through, and a lot of significant implications about this pandemic that's been affecting everybody across the globe. this idea that the virus had emerged as a result of a lab accident had been treated as something of a conspiracy theory now ear seeing at least one element of the u.s. intelligence community endorsing that idea, but only with moderate confidence remember, intelligence estimates are on a spectrum. sometimes they say we're about 75% confidence or 50% confident. that's what makes this difficult going forward. >> really not settling any of the debates or questions thank you very much. ceos weigh in on supply chain issues those stories and more are next in "the market zone. our promise to deliver your order on time within the delivery window and for the lowest price compared to other apps, or you'll get back at least $5 in perks.

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♪ we're ten minutes left in the trading day. we're now in the "closing bell" market zone. today we have charlie brabinskiy, and victor jones here as well we're going to talk about these markets. looking at the broad irindex, the stocks near record highs rallies after jerome powell's jackson hole speech. nasdaq is also on track for report closes. charlie, you know, i've been in the camp for a while, you think inflation will be higher and more persistent that bond yields should be going up, the reaction to powell's speech seems to be the market buying in

you have growth stocks also working today. where is the disconnect, in your mind are you going to believe the facts or lying eyes, to quote groucho marx it's at the the fed's prefer rate exclusion energy, food, autos. working family spends a love of its paycheck on car payments, rent and paying the bills. right now, the bond market, you are absolutely right, is still trading at what i think are noneconomically low levels i think you have to star thinking about the bond market as an insurance policy people are buying bonds in case we get a worse covid environment, but there's just no way you can tell me at 131245 you're going to earn a positive

return yes, i think it will be a strong economy, a lot of inflation for at least in the next year. >> how does that resolve itself? your view is very different from jade powell. he spent the bulk of his speech explaining why he thinking it's transitory what does that mean for the market >> first of all, it is going to an -- if you look at the it's all pointing to inflationary pressure you have to invest in companies that have pricing power where they can pass inflation on, our of to investment in companies that are commodities or real state companies, it's not a

debatable point inflation is happen he thinking it's transitory. whatever the macro inputs or interpretation today, definitely a bit of a tension release what does that tell you, in terms of where investors are positioned and sort of the condition of this rally at this point >> i would agree with everything up to this point the vix, after getting into the mid 20s here, now to the 16 handle, traders only expecting a 1% moves on a day already basis. raci regardless of what the inflation picture looks like, i have to agree there are durable elements there are transitory elements

you've seen a collapse in volatility in the vix, but also in the rvx we've seen that collapse from 30 to 23. pre-covid volatility levels, we have in the teens, like 16, but we remain at these elevated levels you probably get a little more value there or if you want to flip that russell is trading with higher volatility. >> best-perform ing wti crude up

nearly 2% on the day, up more than 10%, having the best weekly performance of 2021. a reversal of what we had seen in prior weeks, where the fear was about delta it feels like there's a bit of a relief for this week on that front, so what do you do with these stocks? >> i think there's a lot of energy stocks that are trading very effectively investors having badly burned by the energy stocks frankly for the last ten years that a lot of people don't think they're very much -- investable these companies can make a lot of money, and frankly, i think energy is a good hedge some of this is stocks are going

to benefit for it. here's what the ceos of nordstrom and abercrombie & fitch told us. >> no doubt the environment is challenged right now we don't see really many signs it's going to end anytime soon we think the prudent thing is to plan on that being around for a while, at least through the next four quarters. >> we're managing it better than moth we've been platforms fabrication, so we have a lot of mitigation strategies. >> frank holland has more on this story. >> shares of big lots, and some weak guidance that they attribute to supply-chain issues

the cost of trucking is about 75% higher both fall hard, next week we want to watch for a supply-chain impact on both 6 those companies. back over to you. >> frank, thank you very much. how are you filleders these pressures, deciding what companies can stand them >> they it pass with higher prices or investing in asset classes that tend to do well, like real estate, madison square garden entertainment, that will do well in an inflationary environment.

>> yeah, i wouldn't call out smucker's as being a great example. they've had the pressure frankly, know is the short answer >> i thought somebodier was one of your favorites. >> it is, but not for this reason. apple settling a class-action lawsuit josh, the impact on the app store? >> apple could soon have one last legal headache, announcing it's going to let developers contact customers for payments outside of the ios app this always come as part of a settlement over app store policies also a new to assist

they seem to hope for more, saying this new acby apple is a far step, but she says more must be done. marketplace, including common-sense legislation to set rules of the road. and actually they're saying that the app store model is under pressure, but the changes he says have been immaterial so far to the company's bottom line. just a quick look internally very strong basically everyone in the pool rally to the up side

u.s. dollar index it's coming off, year to date, take a look at the vehicles, it's a sickly c cat. 52 record closes he's in for wilfred frost. mike cal it the everyone in the pool rally dow closed up near session highs. see that spike up? that was when fed chair jay powell gave his remarks to jackson hole, which were

entereded as dovish. every sector rallied today, energy in the lead for the day and for the week, as we mentioned, having a great week like financials, consumer discretionary, those are all your winners nasdaq closing up on a record high tech was an overall winner the usual suspects there the russell 2000 index playing some big-time catch-up it finished up almost 3%, and for the week up more than 5% coming up this hour, krishna guha and whether the fed chairman's dovish speech will

continue this rally. first up, though, on this record close, victor jones is still with us. picking up a rally today as he discussed winding down the stimulus program >> meaview is the substantial further progress test has been met for inflation. there has also been clear progress toward maximum employment at the fomc's recent july meeting, i was of the view, as were most participants, if the economy evolved broadly, as anticipated, it could be probably to -- >> they had the reduction in asset purchases is not intended to signal the timing of interest rate hikes and the test for that is going to be more stringent mike. >> i felt he didn't break any

new ground on the taper, and the rest of the speech, which was so do muchish talking about inflation, going through numerous examples to they the fed will not be in a rush to get on top of it >> agreed he didn't necessarily break down that's only because we had a parade of officials ahead of time saying they were more urgent. the only way it's make tained is if the economy unfolds as expected right now, continues to grow and

having the fed benignly have the taper get started, seems pretty well accepted. >> do you think the market can continue to go up with that view >> absolutely. we have a very strong economy, 88% of economies beating estimates. fast-breakly we're going to reach a high in the plateau weep have a reopening we have everything pointing in the right direction. so, absolutely, we have a lot of things pointing in the right direction.

you've got to look to the value, you're say historically financials perform very well when rates are higher, right in that's going to happen eventually when it does finances are ready financials are definitely somewhere where i would tell my clients to be. and be in there for the long term every knows them action long as they continue to outperform, you have to be in the banks.

i think the underpinning has been i think you saw a bit of a relief rally here today, but the question here is, is there enough to be sustained over a longer period of time you have, of course, the short-term disruption you also had positive news this week on wednesday, dreing in both crude the dollar getting weak here. and then the realization it was not written in stone and it does manifest itself, for all of those reeks. if you look at how they're positioning, it's obvious lip -- there hasn't been exxon mobil in the chevrons of the world.

it's actually been in the smaller cap higher beta names. in what was likely a bit overdone energy sell-off here. i think it might be longer term -- if i can take two, but xly has been really weak i think the last two weeks was supposed to answer some questions. i don't think it really did, but 22% of the etf is weighted toward amazon, which has had a difficult time three out of last four sessions, you have seen a bit of a recovery. around this 3100 level might be a bit of value or opportunity, but a real mixed bag in terms of discretionacy you had maidy's, good stories in kohl's and t.j.

maxx, the nikes of the world, starbucks, those things are overweighted in xly, so just looking at sector etfs, maybe you get a distorted picture of discretionary here if we see rotation there could be an opportunity there, it may just take more time. >> it might give you a more broad play on that sector. the retail trade revelation haus help shares of gamestop and amc post astronomical gains, but those traders are moving on tore more complicated investments. >> some are calling it a graduation effect. so investor who is started with the single stocks are quickly moving on to more complicated trades with the help of social media and low-cost apps. over the past two your we've seen a spike coinciding with

that rise in retail trading also has gone up there in lockstep. trader education is happening on a lot quicker. while there's more upside, there's a lot more risk as well warning about gameification there it can happen retail investors, if it prompts them to care additional risk >> victor, is this something you

are seeing in rare retail trading shop >> or people are engaging in risky behavior let me give you an example when it rains, it pours, whether it's accounting issues, they miss earning be nearly 50 cents. there's might be a lot of who today come out and upgraded stock. , so if peloton is trailing at 106, which means if the stock goes down, i have an expectative buying price to me that's a smart way to engage, a smart way to control

your spring price. overall option, and today it makes up one out of every three. and if everybody is talking about this market being frothy, there's way to you'd like the portfolio risk i think this is much more nuanced conversation that's people using lunch money what happened in gamestop, that was a sophisticated strategy that was nuanced.

we talked about this froth y fr. >> you know, obviously, depending on the client, we're talking about risk tolerant they're having more cash, and they want to spend it, and they're buying, you know, real estate, second homes, interest rates pretty much at all-time lows, but folks are going to continue to buy. to impact the lower stratosphere

in this country. so clearly we have the dry -- market smith, victor jones, thanks for the time today. on when he thinking the fed will -- plus peloton cutting the price of the original bike by $400 an analyst says selling the stock now ulbewod like selling apple when it cut the price of the ipod we're back in two minutes.

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switch to xfinity mobile and save hundreds on your wireless bill. plus, save up to $400 when you purchase a new samsung phone or upgrade your existing phone. learn more at your local xfinity store today. stocks closing higher today. after the fed chair jay powell stressed that the fed will begin to scale back the bond

purchasing later in the year, it does not mean interest rates adjustments are not soon. >> it's not a direct signal of the signal for the timing of interest rate liftoff. >> he also talked a lot about inflation, and why, according to the fed chair, he thinking it would be temporary krishna guha joins us now. should we pencil in tapering guidance at the september meeting and tapering to begin in the november meeting that seems to be where wall street is now. >> i think that's a bit right, where you do expect it in september teeing up in effect a tapering decision and tapering plan in november there was nothing in powell's speech today that suggesting the fed is getting cold feet more

broadly he said a dovish framing around inflation and employment and the rest look, what is not to like here from a risk asset perspective? he was optimistic about the outlook, right he was dovish, edefiantly dovish at a point, and while he made clear they moving toward that tapering, nothing hurried, nothing rushed that suggested the fed might be, you know, turning hawkish, and, you know, as he said the actually flagging

out that in the post-reopening world there's a risk things could be too soggy, so powell is selling us a dovish taper. that's what the market wants >> that certainly is the stance that powell is striking right now. he went back and said central bankers learned in the 1950s not to over-anticipate and therefore choke out expansion. he said we have to wait, we can't be preemptive anymore, but the market presumably would not buy that line if in fact it had a lot of evidence that reality was otherwise? it wouldn't necessarily say the fed said it's not going to react, i guess we'll go on the premise that inflationary forces remain where does that take you in

terms of how markets are priced right now? whether they have that right. >> you're 100% right, if powell was talking a dovish book, but no backing for this, then, you know, his words wouldn't have a lot of impact on anything. however, in a sense, what you're seeing powell lining up with a view of the bond market has been expressing for a while bond yields are extraordinarily low, in both real and nom nat terms. inflation compensation longer term, alternates soft, actually, relative to what the fed would like in spite of the excess inflation today. so i think what gives this a big of legs, what powell is saying, the perspective he's offering, one that the bond market hag offer for some time. it doesn't mean they're both right. if i were powell, i would have acknowledged more certainly

around the central case that it proves transitory. he did come across as doubling down on the dovish thesis, even though he was, of course, careful to say they would monitoring all the factors that they think it will be a bout of price pressures. >> you have to wonder what that will look like it's going to be a changing composition with some of these hawkish retail, if we are continues to see hot inflation rates, and according to a lot -- they are expecting the supply chain issues going on into next year is this going to be the pattern, the fed chair will say it's going to transitory lasting into next year? >> so i think if excess price pressures prove to be more persistent than the fed is anticipating, and if that excess

inflation really stepped, by the time you're in eight '22, also depending on what's happening in the labor market, but let's assume that labor market is also tight, i think you're definitely going to be having a conversation about a late '22 rate hike. you know, that's a world says in which core inflation prefers pce measure. and for sure the fed last quarter moving towards a rate hike around, say, the end of '22, even possibly sooner than that i think what you are seeing from powell today is indicating, as of now, they haven't seen anything that shakes their confidence in the view that inflation is going to be transitory, excess inflation, and they're going to see, in a sense, accumulating evidence slowly from here onwards that we're past the peak and things are moderating my own personality view, that

sounds about right, but there is some uncertainty as to just how far, how fast those inflation pressure will go down. like you, i'm also hearing that some of the supply-chain disruptions are more extended. and of course, delta is causing trouble with the supply chain, may impede some supplies in u.s., at least in the short term >> wages just don't come down after they've been going up, do they >> well, certainly if you have a hire bonus, that a ne-time thing. a step up in pay is not likely to come down again however, powell's ceasant, which is backed up by most of the data, those outsized wage in thises, a one-time signing bonus, and they're quite concentrated in these retail leisure hospitality type of

sectors, you know, where all that work is going it's certainly a place where you want to watch very carefully going forward. >> cribbia guha, good to have you. >> thank you. up next ciara, and christin day, the challenges of launching a women's clothing line during a pandemic and we'll hear from an analyst who says investors that are selling the stkeocr making a huge mistake his bullish case is coming up. and one we explore one that's been paved and one that's forever wild but freedom means you don't have to choose just one adventure ♪ ♪

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ciara is unveiling a new clothing line called vida, which stands for love is the answer. the ceo and co-founder christine day talked about the challenges facing the industry right now. >> i don't think it's ever too complex a marketplace to raise

the bar on fashion so even though we've got things like covid and the pandemic going on, we really see the white space in the market is bringing together sustainability, transparency with style and pass, so that's really the focus of our line, really raising that bar, and having price points for entry does help us go after a lot of the fast fashion, but also longevity and long wear, so really raising the bar on the industry, but importantly sustainability and transparency in everything we do. >> i know you have worked hard on ethical sourcing, paying attention to how the product is made and where it comes from has that been extra-challenging during this time with so many disruptions? >> actually for us i think it's

been the opposite. the markets we chose to launch in, we have a lot of small-batch factories in italy we work with, some in india. we were in the same traditional hot spots and weave working hard to bring production into north america, south america as well, which reduces our shipping times to who weeks, so by actually starting and understanding the global supply change all at the same time, we were actually able to build a supply footprint that worked well during this covid pandemic at the container shortages. >> ciara, as creative director, how involved are you day to day in the design? >> i'm involved every step of the process from the choice of materials, to the designs, checking it continually, the photos, every part of the

process, and pouring a lot of love into the process. honestly it couldn't be done any other way. i think it's important for people to feel my presence again, i'm an everyday girl like every woman around the world, i want to feel that connection to the creative design and the fashion. it's super fun, a lot of work, especially being a mom and obviously the music and everything, my hands are full, but i'm doing everything i love, and it's a dream come true. >> finally, christine, because of your deep experience in the retail world, i'm curious what you make of the environment right now, where even struggling brands are doing so much better. traffic is up, prices are up, the consumer is healthy. where does all this go >> you know, i think actually it's been a big lesson, in that there's way too much product, a

way to poor quality in the marketplace. i think as markets improve and inventories stabilize, that actually make comes back into the product a bit. i think it's not been good for the environment,not good for consumers to make products that last ten wears, no matter how cheap they are i hope this is a bit of a watershed moment in the industry and we rely less on discounting, but making meaningful product across the industry. i think it's a chance to reset, if we use it wisely. the latest line from christine day, which i find interesting she has taken this on she was considered a successful ceo at lululemon, and previously at starbucks they told me they'll eventually have to start raising money as they continue to expand and they're going after fast fashion

and they say there's an opening to have something more sustainable and more with a purpose. they see a big opportunity there, and they're continues to grow this business. >> and the ability to take one individual's following it's pretty amazing. and we have seen some real celebrity success stories lately jessica alba's honest company went public. rihanna, making her a billionaire, and she says we're trying to take care of our family at the moment, about you clearly they have ambition. kate rooney has some breaking news right now. >> amazon is getting into the buy now/pay later space through a partnership with affirm. the first-ever installment

option it will be available to some amazon customers starting today. i'm told there will be a broader roll-out in the coming months. it lets amazon customers split purchasing of $50 or more into smaller installment payments i'm told some of these loans will be interest-bearing others with a zero percent apr. we had square buying afternafternoo afternoon -- this is the first for amazon we have those shares popping more than 10%, 12%, 15% at this point, which is fascinating. they were done 3% probably following peloton's performance. this is clearly a bit of good news in the market's perception

outweighing that pressure on peloton. kate, thank you very much. still ahead, investors have seen an ununusual pattern. we'll look at whether that pattern can last longer. gold. your strategic advantage.

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here's what's happening, the u.s. intelligence community releasing a report they record they're still decided. one part of the intelligence community says what it's call, then a lap accident from the white house press secretary,in the aftermath, along with 13 u.s. service members, associated press reports the pentagon says

and braisings for a category three hurricane, with louisiana on sunday, 16 years to the day after hurricane katrina made landfall in south mississippi. new orleans mayor ordering evacuations for people who leave outside the levee system according to the national hurricane center, ida could produced 125-mile-per-hour sustained winds and a storm surge, in some areas up to ten feet tonight an update on afghanistan, on the news, 7:00 eastern, cnbc. see you then. we'll send it back over to mike santoli looking at recent moves. mike, what are you watching? >>well, sara, the longer a rally keeps going, the shallower the dips, the more it becomes.

this displays that pretty well this is the pullbacks from an all-time high by the s&p 500 going back to 2015 what you see from the march 2020 sell jon covid crash, you see increasingly small pullbacks from the all-time high the 10% correction last september into october, and since then, this year, you haven't even had a 5% one. coming up the to 16 correction, nayoer and narrower pullbacks, almost no downside volatility. also post-election year a lot of those excuses for why in fact the market should go down, but it refused to. just to hone in on that period of time, 2017, and what came after, you did eventually build up a lot of complacency and a lot of upside momentum, so this is the 2017, ver steady up trend, looks a lot like this

year what we got at the end of that y year. right now we're not -- ultimately if the market does not have in this downside give -- >> buy the dip alive and well these days still ahead, following weaker than expected results up next, an analyst week like selling apple when it cut the price on the ipod, a big mistakes. big wincer in the communications sector. we'll be right back.

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chick out what's going on with shares of affirm. we just shared the news a few moments ago. it now has joined a partnership with amazon for its buy now/pay later service, so customers can use that on purchases of $50 or more it's going to roll it out in the coming months. they've been testing it on select customers obviously if you're going to have a partnership with a retailer, amazon is the way to go

that opens a whole new market, and, as you say, takes some of the sting out of the peloton decline today. >> yeah, for sure. this is the one partner you would want in this world they're not getting into terms, but sort of legitimizes the whole thing at this point. the fact that amazon chose not to necessarily do it on its own, went to this partnership, says -- >> we'll get them back on soon, because they now have competition on that. >> let's work on that. anything you can vaguely call fintech has a lot of brainpower being thrown at it peloton finishing lower today, the company revealed it plans to slash the place of the original bike by about 20%, but our next test guess it's unwise to selling it, just as it would have been unwise to sell apple

when it cut the cost of the ipod years ago. daniel, let's quickly delve into that comparison. apple went on to create the iphone it probably was trading as a much lower valuation, but what are you really getting at when it comes to why you think investors are to be short-sighted right here with this price cut >> it's a fair question, mike. i think it really boils down to the fact that lowering the price increases your adjustable market that's what apple has done, what other technologies have done historically the lower price point is also justified, because you can increase your scale efficiencies by having more customers by increases thesubscriber count and increasing the number of units that peloton will sell,

it will be able to lever the -- lower the cost and make up any delta with lower prices with higher gross margin dollars. i fully expect gross margin percentage-wise to come down that's consistent with what the company guided to, but that said, when you look at overall gross margin dollars two years out, that will more than offset it with scale efficiencies >> i guess the real question comes down to peloton shares a clear beneficiaries of the huge demand for the product in the context of the stayed at-home economy. still has a $30 billion valuation. ultimately how big is the possibility market and exactly what economics do we expect? they're still not exactly bottom-line profitable. >> to your point, there's

various estimates you can use, 180 million or so gym memberships. peloton has roughly 5 to 6 million members, between the digital and connected platforms. so they're really only scratching the surface in terms of what they can do in terms of penetrating the market i think it's disingenuous to look at the 180 million or so global gym memberships as the addressable market, because when you look at the price points they're offering for household of two, it comes down to a $40 per month subscription price for content that is arguably better than what you would get in high-end gyms. so i think ultimately we'll sew both the addressable market opportunity estimates come up and peloton's penetration of that market alsoing in. >> just to play devil's

advocate, i think it's important because people are debating this price cut and whether that is bearish. you don't do that from a place of strength. the cut price when is there's increased competition and increased inventory. you increase the promotions and increase the marketing that, some see as a sign of desperation and a problem. >> yeah. i cite the first ipod price that apple did 12 or so engineering, but if you look at the first generation iphone in 2007, they cut the price of that almost two months after the launch. obviously one of the most successful products, if not the most successful product launch in history so i think, you know having price declines for products and especially technology hardware is just, you know, par for the course in terms of what we see with technology companies.

>> you made your case, daniel. thank you for joining us 60% of analysts say this company is a bay it hasn't changed. up next, a race against covid-19 cnbc's new documentary how the covid-19 vaccines came together in record time it's now up on cnbc.com, and now we have details about pfizer areas concern about betting on mrna, coming up next. >> we calculated that we could come up within a few weeks with a number of vaccine candidates. >> frankly, i didn't know it would work until the last moment, until november 8th. >> breaking news from pfizer this morning about its vaccine, a 90% efficacy. >> what we're doing isn't playing in a sandbox trying to demonstrate our technology we're develop ago vaccine that will stop the pandemic. >> when you are forced to do something, because failure is not an option, you find solutions. arely a bobble.

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the development of coronavirus vaccines happened in record time. but the decision to pivot entire businesses to focus on covid wasn't obvious at first. meg tirrell has a new documentary looking at a choices

three companies made to battle the virus and she joins us now with more. meg? >> hey, sara remembering back to early 2020, it is kind of crazy to think that at any point there was a question that we would need a vaccine or that indeed the vaccines would work. but it turned out through the work of this documentary, we learned that pfizer wasn't convinced and when biontech knocked on the the door, they said they weren't interested. >> it was not given that we would go for mrna. it was the most counter intuitive decision because there was never a vaccine made with mrna so i wrestled a little bit with a decision we had another meeting and they convinced me and i said, yeah, let's take the ricksk and we go for mrna and while we wore doing that called catherine jenson. >> they called me and said we

have this concept, working on this for a while. >> i did a second test and told her that we have now candidates and that we are developing vaccine and that at that time the outbreak was already in new york >> of course the rest is history. moderna which is a company founded on the promise of mrna was going that route the entire time a lot in this hour long documentary about what it was like feeling very lonely in the early days on this work, guys. >> i can't wait to watch it, meg. because you're wondering what was going on behind the scenes as these companies shifted their business, their resources, and their money into this effort and the question now about the promise of mrna and just what could come next when it comes to this new technology that was put to work and quite successfully where do we go from here >> yeah, that is another thing

that we get into in the documentary. some of the opportunities are in things like flu vaccines, can mrna deliver us better seasonal flu vaccines and then beyond that, biontech was using cancer drugs before this so they have to turn the ship completely and that is a big area for mrna as well. >> meg, thank you very much. and be sure to catch meg's documentary a race against covid that is available now on cnbc and on youtube up next, your wall street look ahead zoom video is gearing up for results next week and investors are looking for clues how the stay at home stock has held up we'll discuss all of that when "closing bell" comes back. that's great, carl. but we need something better. that's easily adjustable has no penalties or advisory fee. and we can monitor

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looking ahead to next week, zoom set to report results on monday diedra is here with a preview. >> hey, mike, well investors will continue to look for signs that it is not just a pandemic conference play but a multi-category communication platform, platform being the key word here. so while tough come ans are likely to be part of the story,

newer products like zoom phone and zoom room and acquisition 59 will get invest your attention and watch about the broad push back of return to office plans that could change the calculus for full year estimates. shares keep in mind they're up about 40% from the 52-week high and barely positive on the year, though of course as you well know, way up from that ipo and way up last year back over to you. >> the ultimate stay at home play thank you. we'll monitor a few things over the weekend. hurricane ida could be a category three hurricane barreling toward the gulf of mexico we've seen oil prices rise on that and checking in on a firm because it is up 50% after hours on news that the payments company is going to do a buy now and pay later or pay over time option with amazon .com

that stock is rocketing higher what else are you watching >> well first of all, you know, late friday, august, you don't know what kind of market there really is. but without a doubt it is a massive boost for the company. it is also interesting to note that it is a partner of shopify which is not really a friend of amazon so maybe people think a firm becoming the industry standard for this particular type of payment. so we'll see if that carries through to next week i really want to see how the market behaves after one of these friday leavetations that we sometimes get after a news catalyst as we did with today's speech by jay powell sometimes it feels like a mission accomplished, culmination, s&p up 2.5% for the week so if we get follow through on monday that is -- and end of the month, we're working on a third straight gain on a monthly basis right now. >> and the week before labor day next week so we've seen lower

volumes but there is an important august jobs report coming out and powell wants to see another strong labor report after the million and plus jobs added last month so that is key when we talk about the taper time line. >> we're talking about september or november for a taper. sara, see you next week. have a great weekend in a does it for "closing bell." "fast money" begins right now. >> it sure does. live from the nasdaq market site overlooking new york city's time square, this is "fast money. i'm leslie picker in for melissa lee. tonight's lineup ton on "fast," check out the after hours action and shares of a firm the stock rocketing higher after inking a deal with amazon. we'll have the full details coming up. plus from worst to first energy stocks rebounding in a big way topost the best week since may. we're drilling down on all of the big moves. and later we have a special