lease on their rentals >> okay. thank you. and last but not least, the doctor dr. j. >> it's going to shock you, scott. it's a tech play it's a cloud play and a plan p-l-a-n. the stock has been moving up >> everybody have a great weekend. it's good to see you on the other side "the exchange" is now. thank you very much, scott hi, everybody. i'm kelly evans. and ahead this hour wall street is starting to worry about washington is d.c. drama over the debt ceiling and especially taxes the thing that could derail this otherwise unstoppable rally? we're going to look at how high earners are shifting their money around and it's been a record year for companies going public but the results haven't been that great even if they're not a spac, we're going to look at why and the fallout. will it work or will the criminals always be one step ahead.

we begin with the markets this hour. dom chu here with a look at the numbers. >> it's a critical point in the markets. first of all, we are seeing modest losses across the major indexes. the dow industrial is down s&p 4435 or tlobts 30 point drop. nasdaq about 115 points. 15,066 the last trade there. this is a possible critical point for the over all market. let me show you a chart of the s&p 500 because some traders are watching a key level right now where we're at it's the 50-day average price on the rolling basis for the s&p 500. that's the magenta line you're seeing for the better part of the last year, you can see we've bounced in certain areas every time we've gotten close to the moving average, this 50-day so to speak, a number of times and we're there right now. if you watch what's happening,

this has been an area where markets have bounced when they hit this zone. we'll see if that holds this time or whether or not a drop below leads to more losses down the line the stock of the day, on the positive side of things, a record high for shares of thermofisher scientific, tmo up 8% here we get to put a star here. up 30% on a year-to-date basis this company is a maker of medical equipment and diagnostic tests. its most famous these days, covid-19 tests they had its investor day today. the company came out with earnings and revenues that topped analysts consensus estimates. that's driving the stock higher, even though, kelly, the company suspects a severe dropoff in testing revenue next year, they're going to do well projectswise just a big number for you. thermo fisher scientific to date has enabled 650 million covid-19

pcr tests. that's a big number. >> it certainly is i'll see you again soon. while some investors are worried about inflation or tape ring or economic growth, there's a big market of investments worried about taxes. for months it was all talk but now we see the numbers 26.5% for corporates for individuals, 39.6% how much of a concern is this for investors? joining me now is emily ruben, financial adviser at ups global wealth management. it's good to have you. this is one of those times when market strategy dove tails or has more important than normal emphasis with tax strategy, right? >> absolutely. i mean, the house bill last week came out and was actually a bit more moderate than the white house proposal so, the market was able to take it in stride but there are going to be a lot of changes and we're going to be watching them closely, anything that increases taxes to an

extreme amount or things that could come out could impact the markets. but this week i think it was a sigh of relief our ultrahigh net worth fly-ins, we're expecting increase in income taxes and the capital gains rate is actually a little lower than expected our entrepreneur clients are concerned about changes to qualified small business stuff and granter trust because a lot of them are impacted by that so, there's still a lot to come on this, but we'll be watching very closely >> one more question on this what kind of strategies become important if you have these kinds of concerns about policy you know, is it stuff that people do? i'm thinking, for example, about high earners you see all this talk about deferring income, all of these -- and the reason why i ask is it goes back to the net effect of all of these from a macro perspective. how much revenue is this really going to raise >> absolutely. and there definitely were strategies we could have done with capital gains the bill has the capital gains

rate will increase as the date it was introduced. so, it's too late for those strategies but certainly for people who have lumpy income or income they could pull forward, it's definitely something they should be thinking about before the end of this year >> so, how would that effect markets? people are going to pull income forward, what would that mean for stocks >> i don't think it's going to have much impact on stocks that is, you know -- if there were big changes to capital gains rates, i was concerned if it was starting next year that there would be a lot of sales. and that could have impacted the market but the investors that are impacted by the ultrahigh net worth investors impacted by this don't represent a huge percentage of the u.s. retail market i believe it's only 25%. so, any changes they're making really doesn't have a huge impact on the overall market >> it would be sort of interesting to think through would that be a big source of selling pressure and if so if

they're selling for fundam fundamentalen reasons, is that an opportunity values, financials, energy japan, one of our guests was saying don't get involved with japan. people always try to talk about how now is the time, now is the time but they've been destroying capital for years, he says let's put that aside and talk about the u.s. sectors you like like energy, which is seeing such a run, maybe for the worse for people on the other side of the financials values. it sounds like you think rates are going up, economy -- growth is going to continue and so forth. >> yes, we aren't concerned about a growth slowdown. we think it might have teeth, but we don't think that means a slowdown is imminent so, when we look at the economy and the reopening has certainly gotten delayed by the delta variant and has pushed off that reopening reflation trade.

so, i know we've been saying this for a while, but we do think that is still the area to put your money in for going forward into year end. and that means the cyclical trade, which is energy, financials, industrials. energy and financials have been behind the s&p by 13% i think since the end of 2020. there's still a lot of room to catch up, and they're the companies that are going to do better in high growth, higher inflation, higher yield in the environment. >> all right emily, thanks for your time today. it's good to have you here >> thank you so much >> emmy ruben with ubs global wealth management. several fed presidents are facing scrutiny after facing investments in stock trades over the past year. steve liesman is here with the details and the fallout. steve? >> kelly, thanks amid an outcry about fed officials owning and trading securities, fed officials owned financial disclosures, finds

three who last year held assets the same time the fed itself was buying eric rosengren made 37 during 2020 the fed last purchased almost $700 billion last week he would sell these positions and stop trading while president. dallas fed president, robert kaplan actively traded millions of dollars in stocks he said he would take the same action as rosengren. made sure his personal savings and invs.ment transactions complied or permissible under fed ethics rules jay powell held between one and a quarter and 2.5 million in muni bonds they are just a small part of his portfolio. they were held while the fed bought $21 billion in munis. a spokesperson telling cnbc that powell had no say on the

investments in his family's trust. an officer determined these holdings did not violate ethics rules. fed president thomas barken held 1.3 to 3 million in corporate bonds purchased prior to 2020. he held these bonds while the fed bought 46.5 billion in corporate bonds. he had no say over individual bond purchases by the fed. these holdings or trades do not appear to be barred by fed ethics rules but they raise the question should those rules have banned officials from holding or trading the same assets the fed bought after it widened the purchase in response to the pandemic the fed's own code of ethics say -- code of conduct says officials should be, quote action careful to avoid any dealings or conduct that might convey appearance of conflict between their personal interests, the interest of the system, and the public interest, kelly. >> this is a pretty broad statement. so, were the actions against the rules or not >> they don't appear to be

against the rules or at least the letter of the law. but dennis keller, ceo of the non-profit better markets tells cnbc if such fed actions are not against the rules, well, the ru rules ought to change. to think that such trading is acceptable because it's supposedly allowed by the fed's policies only highlights that the fed's policies are woahfully inefficient. a spokesperson released a statement saying jay powell ordered a review last week of the fed's rules surrounding permissible holdings by officials. >> i have about 19 questions i'll rattle you have a few of them number one, has this always been the case that fed officials held a lot of securities while they were in their positions? two, were most of their positions or all of them taken before these people became fed officials. it sound like they were not although a lot of them may have been made before the pandemic. number three, is there any limit

to how much trading they can do or is the kinds of -- is there 30-day rules or something like that and number four, i guess the most broad observation is based on their own code of conduct statement, anything that would give the appearance of a conflict of interest, this would certainly fall into that category how could it not >> yeah, i mean, i'll let you make that judgment and others as well as to number four as to number three, i believe, i'm not sure -- i think the issue here, the broader issue, kelly -- i'll just cover all three with this one comment which is that the fed dramatically changed the assets that it purchased last year. what happened is that they didn't change their ethics rules to account for this. it seems more like one of omission rather than comission in the case of powell and barkin, they both previously owned those shares, did not buy any additional through the year.

in the case of rosengren, they bought it throughout the year. there is a blacked out signature on his disclosure form, so he did not believe he was breaking the rules. kaplan and rosengren both said, we shouldn't be doing this, so perhaps they're acknowledging they shouldn't have done it. >> thank you good to have that report today coming up, rising rates are having a big impact on the housing and mortgage market. the fallout from the eviction ban and the long term risks to the real estate market plus vietnam is the world's third largest producer of textiles and garments. but with growing concerns about covid's impact on manufacturing there, where else could companies go if they're trying to go beyond vietnam we're back in a moment >> announcer: this is "the exchange" on cnbc.

welcome back to "the exchange." the housing market's been on a tear since the pandemic with people relocating and looking for bigger properties, and prices have soared as a result zillow saying prices are up nearly 18% year-on-year in line with other recent data points. and my next guest says home prices can keep rising matthew, it's great to have you. explain the fundamental basis

for this >> well, there's a number of reasons why i think house prices can maintain the current level i think house prices are going to slow. i'm also ruling out a house price crash. firstly, as rates rise, most borrowers are protected. they have long-term fixed rates. refinancing boom over the last few months, it's locked in the record low mortgage rates. secondly, mortgage lenders haven't responded to house price booms by loosening credit standards. they've done the opposite. they've timed up, we've got credit scores going up, debt ratios coming down and that means that the current market is pretty safe as far as well-protected from increasing rates. another point is home equity has surged house prices up 18% year-on-year, record gains most borrowers have a lot of home equity and a lot of skin in

the game they're going to want to keep up their mortgage payments as they can. that's why we think that's going to rule out forbearance surge on the horizon and of course the forbearance -- sorry, the exposure coming out. >> so, i think for a lot of people they would look at these headline numbers and go 18% price gains to just 3% price gains, wow, that's a huge slowdown it means prices are still rising it's like the transitory inflation discussion, which is to say that even if inflation slows to 2%, it's coming after a couple of chunk years. point being, why don't you think home prices could outright decline? >> because i don't think outright decline prices, you normally need to see sellers, you need to see a lot of foreclosures on the market with homes. we are on the horizon. if we did get some increasing foreclosures, the market is incredibly tight right now

demand is still high so, any foreclosure is going to be snapped up. there's lots of demand out there to take up these houses if they're on the market. so, we already see the big increase in foresellers really causes house prices to decline >> to put it differently, if we see that for whatever reason, that would be a worrisome sign, even with affordability declining with the increase in prices we'll leave it there thanks for joining me today. it's good to have you. matthew pointen with capital economics. the u.s. treasury is tracking down on hackers who use cryptocurrencies to profit we'll dig into how they're doing that plus, should you sell stocks or property before the capital gains spac takes effect or is it too late we'll look at the race to llse as confusion grows over the tax timeline

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♪ i had a dream that someday ♪ ♪ i would just fly, fly away ♪ welcome back to "the exchange" everybody. about 50 points off the lows, the dow is down about 185 right now. its the outperformer if you want to call. that nasdaq down about 1% today. here are some of the individual movers this hour after posting its best week since december, peloton is going everyday this week and on track for its worse week since may we're talking about a 40% decline from all-time high in january. it's been struggling to find its footing. it's down 1.5% today back to about 103 a share. sticking with the state home theme, zoom video is the best performing stock in the nasdaq today after firm iss recommended

against a vote setting growth concerns, having a positive impact on shares, up about 3%. iss is saying the all stock deal would expose your shareholders to a more volatile stock and zoom shares are down 20% since the deal was announced finally take a look at shares of moderna, which are down but off their lows, the fda holding a meeting deciding whether to recommend booster shots. ever core saying they don't believe the fda will recommend the shots. moderna is down 4.5% today bringing it to a 7% drop this week now to rahel solomon for a cnbc news update. here's what's happening at this hour. the biden administration is buying hundreds of millions more donations of the pfizer vaccine for donation to countries around the world. "the washington post" say an announcement is planned next week at today's white house covid briefing officials say that the u.s. has plenty of doses available for boosters and is

ready to start next week if that's what regulators recommend. and on "the news" tonight the latest from the fda advisory panel that is meeting today to decide if a third pfizer shot is safe and effective amid doubts that boosters are even right now. apple says customers are having trouble making purchases with their apple credit card that offers 3% cash back on credit cards other cards are not affected and rescuers working together to save a baby killer whale that was stuck in shallow waters in eastern russia they think it was hunting too close to shore at low tide they spent hours pouring water on it to keep it alive until the tide rose enough that it could swim out to sea on its own not something you see every day. >> my son's favorite animal. he loves it in the black and white pages. why 2021 has turned into a spectacular nightmare for the market half of this year's i.osp.

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welcome back to "the exchange," everybody it's been a tough year for the

ipo market totally different story than 2020 this year about half of the ipos trading low. posh mark down more than 30% in the last month all birds and warby parker are set to debut soon. was it poor pricing or poor fundamentals or just a different investor appetite. let's bring in gina sanchez. she will be with me for the next couple of stories here and santos reo santos, it's not all spacs problems even regular ipos aren't doing that well. why? >> i think compared to last year's second quarter you're going to have a different ipo market you had blockbuster ipos last

year so, the comparison is not great. i think investors have become very selective they are -- i think companies focused on data, enterprise software, cloud and all that, the selected markets that are going to be around in the post-pandemic world are doing well, will continue to do well and the companies that are struggling off the gain in terms of revenue growth and all that, they've been punished. overall i think the valuations were high. they're getting more rashal. rashal. so, you will see them settle down as the news flow comes in, you will see them do well. but the fourth quarter -- we'll have some good ones in the fourth quarter >> gina, okay, so, would you -- is it that spacs spoiled things for everybody, gina? or is it that as the ipo market has been so strong more and more companies coming to market, investors are getting more discerning it's just interesting because -- or were they just priced too

high what do you think is going on here >> i think it's a few things, kelly. first, ipos that went up last year were going into a weak market with expectations for recovery we're not peaking. so, the expectations going forward are being revised down so, it's going to be a challenge for ipos if you look at ipo profitability, postipo profitable, we've been on a ski slope. we peaked out at post-ipo profitability in 2009 as high as 80%. we're down to 22% of 2020 ipos that are profitable postipo. this is an all-time low, which is to say that investors have been looking for anything to invest in and taking more and more risk and getting less and less in turn in terms of profitability. that's the biggest challenge right now. it's fine if you expect the markets to turn around and turn up, but now we're expecting downward revisions from here and

they're not profitable >> i wonder, santos, what would your advice to investors be? is now the time to look at these names? we see this dip with a lot of companies, especially around their first earnings report. or is it not time yet? just some of these companies are not profitable do investors need to wait until they have a clearer path to profitability? >> yes, investors need to look at companies very carefully. they need to have a good path forward. they need to have good revenue growth trajectory just in having a large market is not going to do it. they need to execute right out of the gate. you'll see a lot of them coming down the line. so, i think there are some good ones down there. the fourth quarter is going to be muted compared to fourth quarter last year. but they're definitely good, solid companies that are out there that have come out >> we'll see if that turns things around. thank you. gina, stick around we want to stick with this theme. as the spac craze has come to a screeching halt, goldman is

pointing out that 93% of active spacs are trading below their par values since the february peak, the cmc spac 50 index is down nearly 20%. are spacs literally on their way out? let's bring in mike santoli on this as well issuance of spacs, whatever you want to call it, the numbers are plunging are they gone for good >> i would doubt they're gone for good there's a chance they go back to the prior status of being a niche boutique area of the offerings market for specific circumstances, particular sponsors where it makes sense is a better mouse trap structurally as opposed to this gold rush this is the after the gold rush moment too many deals indiscriminate capital being thrown at them and the performance after the stocks found a merger partner has been terrible. i think there are long term hedge funds that have done little else expect ride the postmerger stocks down

what happens when you're trading below par and they're in the money, you can redeem at some point in the future at $10 and trading below $10. then it becomes just kind of a boring hedge fund arbitrage thing. one final point, there are too many of these looking for deals. i think there are 300 or 400 of them that have raised money. they need to find a deal in the next less than two years at this point. it's a pig and a python problem. >> 300 or 400 is something investors to think about as they start coming to market the fcc has started to crack down on this a little bit as well is that going to push the companies into the traditional ipo pipeline does it mean that the ones who are coming to market in the spac -- and the companies themselves who have done spacs, gee narks i've heard from one who is regret it they have to be careful how they talk about it, but they are certainly not thrilled about this outcome >> no. and quite frankly the money that's been raised into those spacs, those spacs have a

ticking time limit in order to find that company which is to say it feels like 2006 it feels like 1999 where there was too much money chasing too few opportunities. and i think there are going to be a lot of very bad investments in terms of vintage year terms it's going to be a terrible year to have invested in a spac because there's too much money and too little opportunity >> mike, i'm going to ask you a direct prediction question 2020 was the year that ipos did phenomenally the renaissance ipo index outperformed the market. it was the year for innovation this year has been the opposite. what do you think 2022 looks like >> i think there's a decent chance -- first of all i think the pace of deals will slow a little bit and there's a decent chance we have a more normal year, which is maybe the majority of ipos work, but it's still not across the board a great asset. throughout the course of history, ipos have not been great. one of the reasons people have defended the business of pricing

them low to get a pop is because it's risky to just across the board own new issues i think we're going back to that norm we did see a peak in the whole disruption let's just buy a piece of the five-year future type stocks in february the overall market has absorbed that pretty well because the general cyclical move in the economy has been strong enough to offset that weakness. >> it's been a huge rotation under the surface, under the seemingly calm waters. michael, thank you we appreciate your time. it's the expose that gets worse for facebook "the wall street journal" continuing to report on internal documents from the company detailing how facebook is struggling to battle misinformation and mental health issue in the way facebook is designed for users let's bring in julia boorstin for more >> what's interesting is the revelations that "the wall street journal" has reported over the course of the week is

it's less surprise what these revelations are and more that facebook knew about these things, that it had hard data about just how negative facebook could be, say, for teens, for teen girls in particular about their body image and that facebook knew that and didn't take more dramatic action. so, kelly, i think that's going to really be the question. should facebook have done more and one thing i have to point out is that instagram chief adam moez came out in a podcast and he said in a lot of ways, social media is like cars. people get into automobile accidents, but there's still great value in cars. and i think he really dug himself a hole there, kelly, because obviously the auto industry is highly regulated and it really raises questions about what other type of regulation could be coming down the line >> gina, remind me if you're an investor in facebook here. across the social media complex, what would you do with the names? >> so, investor in facebook, however it is actually not allowed in the esg portfolio for

this exact reason. and, you know, this kind of comes down to the question, will the company act ethically in the face of a profitability motive and what we're finding out is no, they won't profits matter to them and to julia's point, there is a reason that regulation exists, which is to say that companies are trying to do what they can but there needs to be regulation and i think this talk about regulation is going to depress the multiples of social media going forward because this topic of regulation is one that is equally shared on both sides of the aisle. nobody likes social media stocks right now. so, there is -- i think this just adds more and more fuel to the fire to look at the various regulations starting from the ftc regulations and on down. >> but at the same time, gina, they are still the places to be in terms of ad flow, ad dollars, digital ad market. is anything going to change

that and if not, won't they continue to perform >> if all of a sudden companies like facebook or like twitter become liable for acting on this information, it is going to radically change what they're going to be willing to do, who they're going to be willing to let on and keep off the platform, how big the platform can grow this actually feeds directly into whether or not they're going to be profitable >> interesting from that lens that would be shocking if they had to suddenly be liable for that julia, i'll give you a final word >> well, kelly, i think it's just going to be really interesting to see what facebook does now the company made the point that it was intentionally collecting this data so it could act on it, so it could understand what kind of content is negative for teens. but i think especially in this younger demographic, that's where they're facing increased scrutiny and i think they're going to be under more pressure to act and put up more guardrails

it will be very interesting to see, kelly, whether or not they go forward and launch instagram for kids as planned. and if they do, which i think they will, how different instagram for kids will look compared to the traditional app we all use >> that is a great, great point. julia boorstin, gina sanchez, thank you both vietnam was once considered the savior for u.s. manufacturing abroad, an alternative to producing in china. after the break, we'll look at why companies may be trying to look beyond vietnam to solve their supply woahs we're back in a moment when you have an irregular heartbeat, it's more. it's dignity. the freedom to go where you want, knowing your doctor can watch over your heart. ♪♪

it's a thirteen-hour flight, that's not a weekend trip. fifteen minutes until we board. oh yeah, we gotta take off. you downloaded the td ameritrade mobile app so you can quickly check the markets? yeah, actually i'm taking one last look at my dashboard before we board. excellent. and you have thinkorswim mobile- -so i can finish analyzing the risk on this position. you two are all set. have a great flight. thanks. we'll see ya. ah, they're getting so smart. choose the app that fits your investing style. ♪♪ many big companies with manufacturing facilities in china have moved those to vietnam. what was once seen as a haven has turned into more of a nightmare lately lauren moa rah coe join us. it's great to have you on set. we had a big warning about nike

this week. what's the back story here >> the back story is it's going to get a heck of a lot worse you've had a 109-day shutdown in vietnam in ho chi minh and it keeps on counting the country essentially locked down that major manufacturing hub. and we're not going to know until the end of september if it's going to be back open again. >> more than 100 days the entire place has been locked down that's why they're saying nike shortages could last into spring of next year so, this could go on for a while. so, they're having a hard time getting stuff out of vietnam but also into the united states. the shipping prices are through the roof there are two pieces to this problem. >> exactly so, the suppliers, they're really in a living hell. you can't get your product you can't have it made you can't get it out, and you're paying through the nose. and you've got the delays. >> tell me about edison wall >> edison is a vessel that was carrying almost 500 containers of nike product.

and it left vietnam back in late august, and it arrived in -- on august 27th in the port of l.a and it stayed there docked for 12 whole days. it was anchored out in the middle of the ocean. then finally it got into the port of los angeles in early september, and it took eight days for them to start, you know, unloading and doing their things and it's been such a delay, and everything is so congested there, the vessel finally left late last night. >> oh, my gosh >> yeah. and these are vessels that are containing the trade we need, right? this is how companies make money. >> and the final piece of it is they finally get through that whole process, and they have to get across the country with rails and trucks we know the trucking issue there. >> it's only getting worse i spoke to the head of the port of los angeles, and he told me that 30% of all truck appointments are not being filled every day >> oh, my gosh >> every day that's 30% of capacity that is

not being moved out. and remember trucks, rails, ships, if they're not moving, you're not making money. and that's what investors need to know. >> quick final question, if not vietnam because of this whole issue, made in america, can they go even more far flung if they're facing these shipping problems >> from some of the folks i have spoke with with vietnam, they're delaying moving more into the country. we have seen folks going to malaysia, cambodia, india. but that's a whole different set of problems because carriers aren't going to a lot of those ports. if you can't get a ship to pick it up, it doesn't really matter. and you've got the cost barrier here in the united states. we're just too expensive to make product. >> it sounds like there are no solutions right now. t thank you for explaining it to us the number of ransomware attacks continues to decline but the treasury department steps in you can catch the show any time anywhere by listenintog and

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welcome back, everybody. according to reports, the biden administration is set to roll out steps curbing the use of

cryptocurrency and ransomware payments eamon javers is here with the details. >> the white house and the treasury department are declining to comment on the report from earlier today. what "the journal" is reporting here is the biden administration as early as next week is set to take an array of actions to crack down on cryptocurrency transactions involving ransomware and cyber attacks not clear what the array of actions will include, but part of this they say will be sanctions on some of the entities involved. what they would need to do in order to be effective, the journal reports, is to target crypto platforms that obscure transactions and digital wallets that receive ran some payments it's not clear what the full pan mri of options are but clearly the cryptocurrency transactions are a key part of the whole engine that runs this ransomware

scam that we've seen over the past year or two so, the biden administration thinking here, according to "the wall street journal," is what you need to do is go after the money. if you can block those payments then maybe you can do something to disincentivize is ransomware itself and overall protect american companies we'll see what the biden administration comes up. so far no comment from the white house or the treasury department >> let's bring in lee reiners, duke law school's executive director you've been calling for going as far as banning crypto in order to fight ransomware. what do you think of this approach >> i think this is a welcomed development and it's long overdue. let's not fool ourselves this is going to solve the plague that has impacted so many businesses for the last several years in this country at the end of the day, kelly, as long as there are crypto exchanges abroad, primarily in russia and eastern european countries that are willing to convert crypto to fiat currency,

we are still going to have a financial incentives for these hackers to engage in ransomware attacks. >> eamon, what would your response be? it's interesting this story broke today. i was thinking how quiet it's been on the ransomware front lately what does that tell you? >> well, it has been quiet on the ransomware front i've been talking to experts on why that might be, and they think there might be a general cooling off in the wake of the colonial pipeline hacking. all of this just got too hot for the criminals. there's some sense that the criminals are lying low and waiting for the heat to blow over there might be effort by the russian government to crack down on some of this telling these criminals to go to ground for at least a time and let some of the heat blow over in terms of the international pressure lee's point is a good one. the challenge that the biden administration is going to face here is that most of the activity taking place is offshore, outside u.s. legal jurisdiction so, how do you deal with that? you could impose sanctions, and that's something that we've seen the u.s. treasury department do

time and again with sort of nefarious actors in other spheres of international relations going after those assets, trying to freeze them, trying to block their access to the international banking system overall. the u.s. has enormous sway over that if they can inconvenience those people or freeze them out freeze them out altogether they might be able to have some impact it will be tough and indirect. >> lee, would you acknowledge it has been quiet on the ransomware front? labor day weekend passed without any major events after memorial day, other holidays we had often seen something big go down is there something going on behind-the-scenes or these overt efforts are working? and does that tell us that perhaps this kind of influence can have a big impact? >> it has been quiet dealing with critical infrastructure so that will draw a lot of attention

the economic cost, you know, vastly outweighs whatever benefits and i'm not sure what benefits crypto provides other than to get rich quick i've heard from small businesses impacted by ransomware attacks they're the silent majority. the most vocal are the people who have a vested interest, who come on this network every day to pump cryptocurrency, have skin in the game these are welcome developments i think vladimir putin plays a role here. there needs to be international collaboration. banking is only as strong as its weakest link we need countries like russia and north korea to come to the table, and that doesn't appear likely anytime soon. >> lee, i'm guessing you don't

own any crypto yourself. >> i teach about it so i do own a little bit if it goes to zero it will not ruin my kids' college fund >> right when you say it has no value whatsoever, i wonder if we're seeing some value overseas in fragile markets and economies maybe el salvador, maybe ukraine could be next. places like afghanistan. would that be a useful societal purpose? >> it's possible it's too early to tell at this point. what we're hearing out of el salvador it's been a very rough rollout. keep in mind el salvador embraced the u.s. dollar and it's still legal tender in that country. yes, there are going to be pockets where cryptocurrency is useful, but i still think from a u.s. standpoint we know it's undermining our economic

security so is it worth it is the question that if i were president biden and janet yellen i would be asking. >> eamon, a final word on this >> reporter: what's so interesting is what we might learn when the u.s. imposes sanctions, if they do, how much u.s. intelligence knows about who has been doing these transactions we don't know what law enforcement knows. when they do sanction on the iranian regime, they often name the individual people by name who are taking part in the financial transactions and block they are assets around the world and sometimes name those who have violated trade policies you might get a full picture of who the u.s. believes is doing all this and might put their names in a public document >> thank you both for talking us through this today on the future of ransomware and crypto still ahead, uncle sam asks

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changes to the tax code are coming an increase in capital gains rate likely among them no one knows when it will take effect some people are selling now. be robert frank is here with more robert >> reporter: kelly, accountants and tax lawyers telling me they are all getting the same question from wealthy clients, is it too late to sell president biden, democrats in the house and senate, have proposed an increase in capital-gains tax on high earners. the president wants 39.6%. the house 25%. a bigger source of disagreement right now is the timing and that has created mass confusion for tax planning president biden says it should be retroactive to april when his

plan was announced the new house plan a start date of september 13th when their plan was announced kevin brady saying no decision has been made. tax advisers say some clients are still racing to sell assets and stock hoping maybe for an even later start date after the bill actually passes others are looking at all their sales between april and september just trying to figure out what their tax rates might eventually be. all of this matters to the government because an analysis found that if it takes effect on january of next year that gives investors a chance to sell beforehand and avoid that higher rate revenue would be $50 billion less right now it's in the government interest to make us think it's too late but it may not be >> this would ensnare crypto, too, robert? >> reporter: yes, absolutely

capital gains applies to crypto. the other thing with crypto they would apply the wash rule. so it makes it harder if this passes to buy back your crypto immediately after selling. so if you're a crypto holder and betting on a later start date you probably also want to sell now. >> very interesting. i guess you would imagine, like you said, people aren't going to wait for this to be finalized either way >> reporter: we were told in april it was too late. it turned out not to be. that's $10 trillion of accounts. so this does matter and we could see selling pressure as part of it >> robert, thank you robert frank shares of u.s. steel, plans to build a new steel mill in the u.s. starting next year.

the new mill will boost capacity by about 20% they expect to begin construction next year still, prices have soared to nearly $2,000 a ton up from $500 last summer. that does it for "the exchange." "power lunch" with a special guest begins right now i am here. kelly, thank you i am dominic chu in for tyler mathison on this friday afternoon. here is what's ahead buy this, sell that. we have a list of the names to own and which ones to ditch in the best and worst performing sectors over the course of the last month is esg broken? the investments may not always be as green as they seem are they actually doing more harm than good the former head of sustainable investing at black rock weighs in on the debate and a not so happy hour. higher inflation leading t