of -- a very broad range of metrics when we think about what maximum employment is. and one of the things we look at is unemployment rates and participation rates and wages for different demographic and age groups and that kind of thing. so we will do all of that. i think if you look back, what were we really thinking? so we all saw the benefits of a strong labor market. if you look at the last two or three years of before the pandemic hit, you saw after a lot of long progress, you saw really strong labor market and you saw wages at the low end moving up faster than everywhere else, something that's great to see. we also saw the lowest unemployment rates for minorities, for african-americans, for example, and also participation rates we saw really, really healthy set of dynamics. and by the way, there was no reason why it couldn't continue. there were no imbalances in the economy, and then along came the

pandemic but it was nothing in the economy that looked like a buildup of imbalances that could cause a recession. so i was very much thinking that the country would really benefit from a few more years of this. so, we're all quite eager to get back to that we also said we wouldn't raise rates just in response to very low unemployment in the absence of inflation so that was another aspect of it because we saw that that really benefitted labor market participants in a broad and inclusive way. that's of course not the current situation. we have significant slack in the economy and inflation well above target, not moderately above target so that's really how we think about it it isn't really just targeting the headline numbers but it's about taking all of those things into account in your thinking about what constitutes maximum employment >> just to follow up, should

there be a significant gap between black unemployment and overall unemployment for structural reasons that are outside the control of the fed that other people should be doing something about? or should the gap be narrowed if not down to zero >> well, you really -- i mean, first of all, ideally there wouldn't be any gap. of course we would all love to see no such gap. this is a persistent gap, and it's very hard to explain based on typical metrics it's quite troubling but it really -- we have, you know, famously brought in blunt tools -- broadened blunt tools, racial disparity is really something that fiscal policy and other policies, education policies are better at focusing on and i think we've identified the

part that we can do, and we'll do that part but i've always been clear that it's going to taking policies broadly across society to work on these problems. >> thanks. >> thank you let's go to michael mckee. >> -- a plan for dealing with a debt default that included prioritization, that included changes in bank regulations and possibly selling defaulted -- or nondefaulted treasuries and buying those that are. are any or all of those still on the table? do you think any of those would work and what would happen to the economy, in your view, should the debt ceiling not be raised >> so, i missed the first few words, but i got your question it's just very important that the debt ceiling be raised in a timely fashion so that the

united states can pay its bills when and as they come due. that's critically important thing. the failure to do that is something that could result in severe reaction, severe damage to the economy and to the financial markets. and it's just not something that we should contemplate. i'm not going to comment on particular tactics or things like that. i'm just going to say that i think we can all agree that the united states shouldn't default on any of its obligations, should pay them as due, and that, you know, no one should assume that the fed or anyone else can protect the markets or the economy in the event of a failure, fully protect in the event of a failure to make sure that we do pay those debts when they're due. >> good. if i could follow up, have you discussed options with members of congress? >> you know, i don't generally ever talk about the

conversations i have with elected officials or other appointed officials. you can see that this is a major focus among those who have responsibility for it and including elected people >> thank you let's go to hanna lang >> hi. thanks so much senator warren sent you a letter last week urging the fed to break up wells fargo, citing what she called ungovernable behavior from the bank i'm just curious under what circumstances would the fed actually consider revoking the financial holding company's license, and if the indiscretions at wells fargo, in your opinion, warrant such an action >> so, we're of course very closely monitoring wells fargo's efforts to fix its widespread and pervasive problems the firm is required to remediate them and we will take appropriate supervisory action if the firm

fails to meet our expectation. we continue to hold firm accountable for its deficiencies with an unprecedented asset cap that will stay in place until the firm has comprehensively fixed its problems and we're not going to remove that asset cap until that's done so, bottom line is we'll take strong supervisory action if a firm is engaging in unsafe and unsound practices or violating laws but i can't speak to our confidential supervisory assessments of any individual bank >> thank you now we'll go to michael derby. >> thank you fortaking my question you noted earlier in the press conference that you weren't aware of the trading activity of the boston and dow's fed bank residence. all 12 bank regional presidents just went through the renominal

process. did anybody at the board level know about the stock trading activity, and going forward do you still have confidence in the dallas and boston bank presidents to do their job >> so, i don't need to tell you. people file these reports annually i think they were just quite recently filed for 2020. so i don't have any reason to think people at the board would've known about particular trading that's going on. we will see that -- there are people at the fed who see the trading reports, you know, when they're annually filed you know, in terms of having confidence and that sort of thing, i think no one is happy, no one on the fomc is happy to be in this situation to be having these questions raised. it's something we take very, very seriously this is an important moment for

the fed. and i'm determined that we will rise to the moment and handle it in ways that will stand up over time i'm very reluctant to get ahead of the process and speculate, though, about different things when we have things to announce, we'll go ahead and do that but that's really what i have for today. >> one small follow-up i know that you didn't have the 2020 forms in hand, but you would have had past year forms in hand, at least in the case of the dallas disclosure forms, similar trading activity was shown in years past. so that in theory could've been something that came up in the renomination process >> so that's a good question you know, the five-year review that we do under this unusual provision of law where all of the reserve bank presidents are reviewed for reappointment, at the same time every five years that is really a broad review about their leadership of the institution, their performance on the fomc, all of those

things and if there were a concern, a public concern or a private concern about something that someone had done, we wouldn't wait for the five-year, we wouldn't day that day if there were concerns. you're right though. as i mentioned, we have had a framework for a long time, and it's similar to what other government agencies have, only it's a little stricter and it is that you can trade financial instruments but not specific ones like bank debt you can't trade during the fomc period and during the meeting that blackout period and then during the meeting and then you disclose all this, and we have disclosed it for years so all of these things, to the extent they've been going, they've been a matter of public record but, nonetheless, it was seeming to work just okay, and now you look at it and you see this and you think we need to do better, and we will. but you're right, it has not been part of the process, and appropriately i don't think it should've been i wouldn't blame the people who conduct that review.

i really think if someone had raised concerns or if we had had concerns that it would've been, but it wouldn't have been part of that process. it would've been raised instantly rather than once every five years >> thank you >> thank you let's go to jean young >> thank you, michelle chair powell, i wanted to ask about how the fed would balance the two parts of its dual mandate if inflation stays elevated but we still have a labor shortage and participation remains lower than ideal, would you hold off on raising rates, or how would you think about that thank you. >> well, let me say one thing. you're looking for conditions consistent with maximum employment to lift off and those conditions can change over time. so you're not necessarily bound by a particular level of the

unemployment rate or the participation rate or anything else like that, which can change over time. but, more to your point really, we actually have a paragraph in our framework and something like this has been there for a long time i think it's paragraph 6 and you're talking about a situation in which the two goals are not complementary, there's somehow intention. if we judge that effect that's the case, what it says is we take into account the employment shortfalls and inflation deviations in the time arises judge consistent with mandate. so, we used to call that the balanced approach paragraph because it had those words so it's a very difficult situation for any central bank to be -- pardon me, to be in a situation where the two goals are in tension and that paragraph tries to address it by saying we would sort of weigh the equities between the two, how long would it take and how big are the gaps we don't really think we're in

that -- we're sort of in that situation, i'd say, in a short-term way but we do expect that this is sort of, because of the covid shock and the re-opening and all that, you're seeing this temporarily. >> thank you we'll go to edward lawrence. >> thank you, michelle thank you, mr. chairman, for taking the question. so on corporate debt, what happened with "evergrande" that we've been watching, is that a preview of what could happen with the amount of corporate debt that's out there? in the past you said you're watching the level of corporate debt what's your level of concern right now? and would you consider the "evergrande" group issue as sort of a warning signal? >> about the united states no corporate defaults are very low in the united states right now corporate leverage built up over the course of the long expansion that ended with the pandemic we were very concerned in the

last year or so. we were concerned in the last year or so and very concerned at the beginning of the pandemic that if you got a highly leveraged company and your revenue stops for an uncertain period, as things happen at the beginning of the crisis, we were very concerned that there would be a wave of defaults. didn't happen, i mean, to a significant extent, because of the c.a.r.e.s. act and the response that we undertook and all that it was a much stronger response than we've ever had. and i think for whatever reason you have very, very low default rates now among corporate debt the evergrande situation seems very particular to china, which has very high debt for an emerging market economy, really the highest that any emerging economy has had, and the government has been working to get that under control this is part of that effort. the government put new restrictions in place for highly

leveraged companies, and evergrande is dealing with those strictures and it's something they're managing in terms of the implications for us, there's not a lot of direct united states exposure the big chinese banks are not tremendously exposed but you would worry that it would affect global financial conditions through confidence channels and that kind of thing. but i wouldn't draw a parallel to the united states corporate sector >> thank you we'll go to brian chung. >> hi, chairman powell just wondering if you could give us an update on whether or not you've had conversations with the white house about a possible reappointment and then whether or not you would like to be re-appointed as this chatter kind of builds up. >> i think the phrase goes, i have nothing for you on that today. sorry. i'm focused on doing my job every day for the american people, and i don't have any comment on that, brian >> sorry about that. let's go to greg rob

>> thanks for taking my question, chairman i was wondering if in your discussion about the tapering, you said that officials think it's appropriate to end around the middle of the year if there was any discussion about what happens to the balance sheet, then i've heard some fed officials say that they wouldn't -- was that discussed and what's your stance on shrinking the balance sheet? thanks >> so, my thinking on this has been let's get through the taper decision, and then let's turn to those issues there are a number of related issues you mentioned one, greg. which you need to start to think about. and we'll do that. but we want to get through this taper decision and then turn to those issues rather than start, you know, thinking about them now and having the minutes discuss them and get people

thinking that we are focused on those issues because we're really not we do have the experience of what we did last time. we watched other countries and what they've done. so, i think we'll be able to get to sensible decisions fairly expeditiously when it's time, but it's just not time yet, in my thinking. >> thank you >> let's go to scott horsley >> thank you, mr. chairman you talked a little bit about inflation expectations, and there does seem to be something of a divide between market expectations and the views of professional economists which are pretty much in line with the fomc members and laypeople's expectations, at least as reflected in the recent new york fed survey how much weight do you put on laypeople's expectations and what do you think accounts for that divide? >> so, within -- let's just take the household surveys generally.

the new york fed survey, let me talk about that specifically and this is from the new york fed. it's only an 8-year-old survey and it does seem as though they're looking three years out. it seems like there's a high correlation between three-year and one-year for the most part surveys are showing that households expect higher inflation in the near term but not in the longer term. and that's also what expectations are showing there are many, many different inflation measures, of course, and that's why we have this thing called the cie, which is an index of, it's market-based measures, it's professional forecasters, and it's household surveys. and you just put them all -- it doesn't have a lot of grand theory about it. you put them all in and you measure the change, and also you measure things like the dispersion and that sort of

thing. it tells a story of inflation expectations moving up many of the different measures will also show inflation expectations moving back up to where they were in, say, 2013, which was before the really drop happened around '14 and '15. so, that's not a troubling thing. but inflation expectations are terribly important we spend a lot of time watching them and if we did see them moving up in a troubling way and running persistently above levels that were really consistent with our mandate, then we would certainly react to that. but we don't really see that now. we see more of a moderate increase that is, the first part which is welcome and because inflation expectations had drifted down and it was good to see them get back up a bit. but, again, we watch carefully >> thank you let's go to heather scott.

>> thank you, chair powell, for taking my question again on the taper timing, you say it's going to last till the middle of next year. but with your concerns about the potential for upside risks to ininflation, do you think you would need to have liftoff happen before the tapering >> that's not my expectation of course, we can always -- we haven't decided to taper yet, and we haven't decided to pace yet. it's not my expectation that we would have to. we could certainly speed up or slow down the taper if it becomes appropriate, though. back in '13 when we tapered we always said we weren't on a preset course. i think this will be a shorter

period the economy's much farther along than it was when we tapered in 2013 so is it makes sense to allow the runoff to happen it's a very gradual taper, it will be when we agree on it. but we certainly have the freedom to either speed it up or slow it down if that becomes appropriate. >> but you wouldn't expect rate liftoff to happen until you're finished with that process >> it wouldn't, no as long as you're buying assets, you're adding accommodation and it wouldn't make any sense to then lift off. what you would do is you'd speed up the taper, i think, if that were the situation you're in we don't expect to be in that situation. but i do think it would be wiser at that point to go ahead and speed up the taper just because the two are then working in the same direction >> great, thank you. >> thank you >> okay. for the last question we'll go to jeff cox. >> thank you, mr. chairman, for

taking the question. i just wanted to check in with you to see if you have anupdat at all on the efforts from the fed to develop essential bank digital currency i believe that the report was supposed to come this summer, and indications it's going to come this month. but the drum beat seems to be kind of getting louder to see where the fed's heading on this, and just wonder if you can provide some update there. >> sure. i'd be glad to we think it's really important that the central bank maintain a stable currency and payment system for the public's benefit. that's one of our jobs we also live in a time of transformational innovation around digital payments, and we need to make sure that the fed is able to continue to deliver to the public a stable and trustworthy currency and payment system so, there's extensive private innovation, a lot of which is taking place outside the regulatory perimeter and innovation is fantastic, our economy runs on innovation but where the public's money is concerned we need to make sure that appropriate regulatory protections are in place, and

today there really are not, in some cases so with that in mind, and with the creation of myriad private currencies and currency-like products, we're working proactively to evaluate whether to issue a cbdc, and if so in what form. we have two broad work streams, one of which is really technology, both at the board and in the federal reserve bank of boston's work with m.i.t. the other of which is to identify, scope out, deal with, analyze the various public policy issues. as you mentioned, we do intend to publish a discussion paper soon that will be the basis for a period of public engagement, engagement with many different groups including elected officials around these issues. we think it's our obligation to do the work both on technology and public policy to form a basis for making an informed decision the ultimate test will apply when assessing a central bank digital currency and other digital innovations is are there clear and tangible benefits that outweigh any costs and risks

we're also, as you know, investing heavily right now in building a new settlement system for instant payments in the u.s. it'll be the first such major expansion of our core payment system since the 1970s we found case for this quite compelling for consumers, businesses, and just ensuring that all financial institutions have access to the payment system so, bottom line, we haven't made a decision about the cbdc, but we will be issuing a discussion paper soon in order to found the basis of this public interaction that we'll have. >> thank you very much [ inaudible can i get a quick follow-up? thank you. i was just wondering -- okay are you concerned at all with kind of falling behind in the global race for digital currency >> i think it's important that we get to a place where we can make an informed decision about

this and do so expeditiously i don't think we're behind i think it's more important to do this right than to do it fast we are the world's reserve currency and i think we're in a good place to make that analysis and make that decision by the way, which will be a governmentwide decision. we would do this, we would have to have a meeting of the minds with the administration and also probably with congress we would really like to have broad support for this it's a very important innovation, and i think we would need that to go ahead. and that's the process we're engaged in thanks very much >> welcome to "closing bell," everyone we heard from the chair there the taper test is all but met and that we could easily move towards a taper at the next meeting. of course, some members already think that test has been met, and about half of the members

think a rate hike could come in 2022 the median is now for three hikes in 2023. interesting on the market's reaction to all of this. slightly hawkish when you look at the dollar's rise during the session, but not enough to derail equities. quite the opposite we're up 460 on the dow was 500. but more than 1% of gains. all three of the major averages certainly not derailing the optimism >> i think a lot of it was priced in. i think chair powell was as precise as he ever has about rolling back that extraordinary stimulus a gradual taper. he talked about it could begin as soon as next meeting. said likely conclude by the middle of next year, and then the debate is going to start when are they going to raise interest rates he says that will not be a signal in any way of when we will lift off the dots are causing some chatter here. nine versus nine fed members want to raise interest rates as

soon as next year. nine of them do, nine of them don't. we'll see what happens >> with the meeting of three by 2023, the chances that at least one of those gets moved forward to 2022 is significant the other point, a less than convincing response on why he and other fed members did hold certain securities at the fed was buying last year he said, quote, we need to do better and we will not a market-moving factor - >> joining us now with their take on today's fed meeting is chief market strategist, former chief economist, and cnbc markets commentator mike santoli. mike, first, set us up with the market reaction here stocks not hearing anything that they don't like with regard to an advanced time line on interest rates >> first of all stocks had a huge steam up going into the press conference we obviously were in rebound mode already but, yes, nothing really disturbed that very much value led. you say that maybe there was a

hawkish interpretation it's only distant. it's only about when you might expect the first rate hike now versus the last meeting. banks are screaming higher that would sort of fit with that mode but in general, no, i don't think that there was a lot in the way of any stock investor's change of perspective here i think finishing taper by the middle of next year probably was more exact and a little bit quicker than you might've assumed but not necessarily something that is fundamental to what equities are up to right now. >> any big surprises for you >> not particularly. i think the gdp downgrade was pretty well expected the market liked to see that they're accepting the slowdown but i think jay was really casting this as a delta story, and there's nothing more to it than that. i felt like in the middle of the press conference there were a few weird parts where jay got --

i sense a hawkishness that wasn't there before, and i think you saw it react in the s&p. we were trying to figure out how he was positioning himself a little bit more hawkish than where the median was and where the committee was in general and i thought that was interesting. and i'm not exactly sure what that was all about i think the market sort of shrugged that off, and i think it's a nuance that's not particularly important but i'd agree with what mike was saying and what you were saying earlier. there wasn't a lot of new surprises here >> do you think tapering begins next meeting >> yes, i do i think that chair paul has wanted tapering to be the most anticipated and discounted event in monetary history when it happens. and i think that was one of his key missions today was to be taken to the finish line it's a done deal unless something comes in that's a surprise and then the other thing he wanted to do was pound the table that there's a different threshold for liftoff so as that

he decoupled these two policy decisions. i think he did a great job on that he's a good script writer. >> what about the upside - >> you're right, he read a little, he adlibed a little. i thought that was a little bit new. he was a little more tolerant of the idea that maybe this isn't transitory i didn't hear the word transitory repeatedly as he has in the past. but it sounds like he's open to the idea that maybe this is going to stick around for longer and they might have to do something about it >> i think the market noticed that i think it was both the sort of discounting of the growth slowdown, which, you know, may have something other than just delta behind it that we don't know instead of saying no, no, no, i think this is going to go away and i think being nervous about the inflation outlook. like i said in the beginning, i sense just something a little bit more hawkish in jay than usual, especially coming after

his jackson hole speech, which was extremely dovish where he was talking about how the re-emergence of disinflationary trends would be coming back. and all of this was very transitory we didn't hear that this time. i've got to think about it and read the transcript again of the press conference but i detected a very different tone in jay today. and i'm not exactly sure why that was >> let's get another perspective. senior economics reporter steve liesman who was of course part of the panel there he joins us with his take. >> afternoon, wolf yeah, i've got to read the transcript zen, too. i felt like this is a natural progression, david, just to respond to your query there. i think he's grown increasingly hawkish. he's wanted to do this tapering, getting it going he didn't want some in front i guess my expectation right now is for an announcement in november for it to begin in december that's how you would get to the

middle of next year. june would be the last month of purchases. so that's my expectation now i wouldn't be surprised if they said if they took a vote at the november meeting and said we're going to start tapering now. but it makes more sense for them to start in december i think that train has sort of left the station i was one of three people to ask chair powell about the issue of the code of conduct by the federal reserve and their holdings and he did agree that federal reserve officials, which has been reported by cnbc, should not be holding the same assets that the fed is buying here's what he said. >> i think that's a reasonable thing. and of course for the most part we don't it was a real coincidence. i happened to preown these munis. it was really not -- it just was an unforeseen event and i couldn't sell them so what i did was i just held them, checked with the ethics people and went ahead. but as a general principle, yeah, that makes a lot of sense. >> so it looks like changes are coming to the code of conduct

for fed officials. we'll see when that happens. no time line, wolf, coming from fed chair powell today >> a general principle that could have blood peen put in ple years ago, decades ago but we will leave it there on that topic but i wanted to come to you on rate hikes three now expected by 2023, nine members wanting one by next year does that significantly increase the chances that we do end up seeing one as soon as next year? >> i thought the odds were pretty high that we would have this discussion in any event but, yes, i think dot plot makes that conversation easier to have i think chair powell is very emphatic about the notion that it has to be after they finish the tapering process but it's a very logical sort of thing for them to have that discussion atthat juncture,

particularly given his little bit more hawkish expression on inflation. but i think that rate hikes -- not hikes necessarily, but liftoff is in play as we get towards the end of next year, and the atmospherics both in the dot plot as well as in his comm commentary make that more likely yes, i would agree with that >> david, on this question about the ethics and the fed trading, there were a number of questions, as steve mentioned. fed chair powell made it clear that he takes the issue seriously, that he thinks they can do better on it. i thought he was actually pretty humble about it. what are the implications of this do you think that it impacts at all the decision that president biden has to make about whether to reinstate him as fed chair in february what's the importance here >> yeah. i think it is important, sara. and i think there is going to be, you know, the progressive

side of the democratic party is probably looking to not have a republican as the head of the fed going into the midterm elections and into the presidential election in 2024. so, anything they can, you know, push forward to kind of make that happen i think will get pushed to the forefront of the media. and this is a blemish. this happened on his watch, and i think -- it reduces the odds of a reappointment, i would say. it has to. how much is debatable. i think there are a lot of politics to play going into the february reappointment and we'll learn a lot with randy corals' replacement in october and we obviously have another vice-chair that comes up in january. there's four people out of seven because we have one open governor's seat that could really be put on this board by february of next year. so that's a big change to the board of governors that one president can make and politically that's something

the market should be paying attention to i think it's an important part of how we look at next year and how we need to think about how the dots and the process of responding to whatever happens, inflation or growth, differentials that are outside of expectations, how the committee does that. and it adds a lot of risk. >> david, so, we get that you think he was a bit more hawkish today when we were discussing the dots and the likelihood of the hike next year but you still think that inflation is transitory, so much so i was reading that you're getting hats and t-shirts. so do you think those points -- >> there's always a schtick. >> i want one, by the way. free swag. but having just criticized the conflicts of interest of jay powell owning munis. david, do you think those dot plots are wrong and that we're not going to see a rate hike for

many years >> i don't have a strong -- look, this is not a lot of rate hikes. we're talking even by the end of 2023 it's four rate hikes. it's still not even one a quarter if we get one in 2022. and that's only three rate hikes during 2024. so it's not like they're running off to the moon. i think that was a pretty dovish, especially when you consider how many hawks have been spinning a hawkish message. i think what jay said at jackson hole about the long-term inflationary trends that are going to reassert themselves are very likely to reassert themselves is the real story in the medium to long run and the short run story is disruptions and create more of a stagflation. and we go back to the problems of the last decades which are

really disinflation, not inflation. it's been my core view for a long time on the long-run story. it's how we work this temporary supply story and how much fuel that gives to what i like to call the inflation istas and how much they're going to push on the fed and the markets, if you will, on the ten-year treasury yield as we get, i think, a pretty volatile period for inflation data >> and just how it temporarily proves to be what temporary even is >> and, sara, this is important because you were highlighting this before. jay sounded a little bit more nervous about how this inflation data's going to evolve in the next few years and i think that was an important takeaway again, steve and i will go back and read the transcript and try to really flesh it out but this had some weird hawkish undertones to it that i was a little less happy about. i'm happy to see the market doing as well as it is and the

s&p. but the dollar's stronger, the curve a little flatter it's a weird market reaction today, it's not big but it's weird. >> we'll leave it there. thank you all for joining us on a fed day. up next we're going to dive into how two new ipos are faring in their first day of trade here on wall street stitch fix soaring after posting a surprising profit in the fourth quarter we'll talk to the company's ceo about that a check for you on bonds post fed the ten-year yielding around 131%. we mentioned that a little bit of -- welly, no, it's a little lower now. short end higher, dollar firmer. we'll be right back on "closing we'll be right back on "closing bell." i became a sofi member because i needed to consolidate my credit card debt.

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welcome back we've got two companies making their wall street debut today. and they're moving in opposite directions kate rogers has a look and courtney reagan is following aka brands >> surging today after pricing at $40 a share, raising 870 million in the ipo the stock gaining more than 60% today looking to close higher today by more than 50% the restaurant technology sells both hardware and software and is used in 48,000 locations in the country after adding 20,000 new locations in the past two years and seeing its valuation more than double in the past few months the ceo told me today that the company and the industry have learned from the pandemic. take a listen. >> we look at the delta variant,

and covid in general, we feel like the industry has been battle-tested with the covid pandemic and the industry and toast are amazingly resilient. so we feel like, while delta maybe dampened things, this industry is in recovery and we couldn't be more excited to lead the charge ahead as the industry recovers and restaurants start to thrive again. >> it's the second restaurant tech company to go public this year sara, back over to you >> we'll send it now over to courtney reagan for a look at how aka brands is faring in its first day of trade courtney >> yeah, unlike toast it's not a great start for aka brands in its first day as a public company. shares priced at $11 that was the low end of the 11 to $13 per share range trading slightly above that now, but still down about 10% into the close. a.k.a. brands is both an owner of digitally native fashion brands and a network that those

brands can tap into for expertise as they grow now each brand is meant to operate independently so that innovation continues along with growth and that a clean exit is then easier and possible when the time is right. the ceo joined from macy's with previous experience at wall mart a -- walmart and ebay as well. >> thanks so much for that one, down 9%. broader markets up healthily 1.2% a little off the highs the dow is off 520 up next we'll dive into the first delivering alpha survey to see where investors are putting money to work. we're back in a couple of

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♪ nothing's gonna ever keep you down ♪ [triumphantly yells] ♪ you're the best! around! ♪ [ding] don't get mad. get e*trade and take charge of your finances today. ♪♪ ♪ welcome back we are now in the closing bell markets. cnbc's senior markets commentator mike santoli is here to help break these down let's kick things off with the broader markets, all the major averages rallying after the fed indicated it expects to become tapering a bond buying soon. up more than 1% for each of the major averages a little bit off the highs i guess today's rebound started

early today before the fed but it just didn't get derailed by the fed and that was really off the back of improved sentiment from china >> really started overnight. you did see almost a 1% rally in the index futures before the open today and that was on this news, which, i mean, i guess the market only tells you what it was really worried about after the fact i thought it was pretty easy to see that there would be some kind of back-stopping measure in china of evergrande. but here we go the market is very oversold. tremendous number of stocks. and the market is now seizing on that and they managed to have this nice rally with very, very good volume splits. it looks like a very broad rally today. you mentioned it's the best day since late july. we're back up to levels the s&p first reached in late july you can kind of play this either way that it was just kind of a reflex bounce, it didn't get us back to friday's close or we put in a low for the month >> you always say don't trust the first reaction to the fed. it's usually the opposite

direction. it's usually a negative reaction and people realize he was really dovish, maybe we should be buying the market. i wonder when this sinks in today it's a little more like, okay, the tapering is going to start, and then we're going to be talking about interest rate hikes and maybe it won't be so celebratory. >> it's possible i still think there was not enough incremental change in the stance or the message for us to have some grand reassessment tomorrow morning but you're absolutely right, that sometimes does sink in. as david was saying, when you look at the flattening of the yield curve and this idea that a lot of the committee seems to want to get on with things to some degree toward getting away from easy policies i don't know >> i think a lot of them are paying attention to inflation and the fact that it's lasting longer and coming in higher. >> almost 5% pullback over the last week that we got from the recent highs is a buying

opportunity. >> yeah. listen, we do a ton of custom indexing and we utilize days for monday for what's called tax laws harvesting, which from a wealth management perspective is one of the highest-valued task we can carry out and the reason that's so important is because one of the things we're always reminding clients is that you can't eat pre-tax returns. you really want to be mindful of both sides of what you're doing when you're buying and selling i think it's a pretty safe bet you could make that when you see it down a 600 point dow. we're not counseling clients as to why we should take less risk. what we're doing is making sure our allocations are where they belong, where there are tax laws harvested and opportunities and we take them and we're paying as little attention as possible to things like an evergrande restructuring, which is totally irrelevant in our clients' lives. so, i think the best way to think about the opportunities that have been granted to us

this week are to say if you weren't a panic seller over the last few days, you don't have to be a panic buyer today and that continues to be the way that we think about these types of moves >> 1% gain now for the s&p large institutional investors are weighing in for the outlook for stocks and the first in the first-ever delivering alpha investor leslie picker. >> the survey of 400 money managers was conducted this week but before today's fed announcement showing though that 71% believe it's time for the central bank to taper its bond-buying program. that matches respondents' views of inflation with only 19% in the camp that believes it will remain in check. however, 43% believe inflation is only temporary. investors think the implications for the market are that the ten-year yield will rise with

70% seeing a jump there, only 3% going lower. the majority believe the overall american economy will strengthen 30% think it will do so in the short term while 28% say that improvement will come in the long term over the next year or so guys >> leslie picker, leslie, thank you. any insight there from institutionalinvestors anything surprise you? >> one is that the fed's message has been well absorbed, which is it's time for a taper, it's no big deal, it's not really the thing that's keeping the economy growing. and also that inflation seems like it's more likely to ease back toward longer-term trend levels than not. i'm not sure those things are necessarily consistent with bond yields going much higher, which is the other majority position this doesn't have to be internally consistent, but i do think that reflects the fact this is why they've worked so hard to try to take the drama out of the tapering decision

and it seems to have worked at least in the mindsets of investors. >> nobody ever gets the bond trade right anyway >> the "delivering alpha" conference is back the 29th of december facebook shares under pressure after issuing a warning about its advertising business julia boorstin's got that for us >> it limits ad targeting on the platform the company reiterating that it expects the ios updates to have a greater impact in the third quarter than in the second quarter and noting the challenge of measuring the impact of ad pend issing, saying that they've underreported ios web conversions. that lack of accuracy could make businesses lose confidence in the impact of their facebook ad campaigns. facebook says it's working to find new ways to improve ad measurement, ands you can see, those shares down nearly 4%. >> julia, thanks so much for

that is this another buying opportunity for the long-term believers? josh, either in facebook or growing advertising spend 4% down >> so, look, i'm into alphabet i've never really been a big fan of facebook. i respect what they've built i think it's an incredible advertising platform with a lot of skeletons in the closet but that's consensus, everybody thinks that. this happens pretty much every six months or every nine months where all of a sudden the validity of what they're delivering to advertisers is in doubt or there is some sort of a panic over a pending regulatory decision or fine or settlement or appearance in front of kong regulation or whatever and the stock reacts at first and then very shortly after makes all the bears look like fools by printing a fresh high i can name five or six episodes of off the top of my head and

i'm sure many of the viewers can as well. it really has been a tough way to trade this stock historically i am not personally buying this dip, but it someone else is, i wouldn't blame them. >> down 4% nex is also an underperformer. it's the worst performer right now in the s&p 500 after reporting weaker than expected quarterly results. worker shortages are causing expenses to soar fedex also said online sales took a hit as more customers return to shopping in store. competitor ups also sinking today on the back of those fedex results. josh, what do you do with this stock, fedex in particular it already was such an underperformer it was a buy yesterday because he likes their pricing power investors not necessarily taking that away today. >> so, i really -- i don't have like a lot of insight into fedex specifically but i want to address your question from a broader

perspective. i put something on the blog yesterday thousands of people read it. where i'm basically saying the taper when it finally comes is going to feel like a relief. i don't think the tapering of bond purchases is going to be looked at as a negative catalyst i think when you think about who owns the stock market, shares of fedex included, small business owners, people who are living in the real economy and have real wealth at stake and own shares in businesses as investments as well as as owners, they don't like the current environment for all of the reasons fedex cited on its call. it's impossible to hire people and get them trained up fast enough to meet the demand. and i'm not blaming the fed entirely there's obviously a lot of forces at work in the economy. but i don't think wealthy americans in the upper middle class and the upperclass who are the investors in the market are enjoying the atmosphere. how do i know that look at the sentiment surveys.

why are they in the gutter with the s&p within 3% of all-time record highs this is exactly the reason why it's a problematic environment there's too much capital it's too hard to do things in the real economy and i don't think the fed is helping the situation by continuing to spray more capital in everyone's faces. it's not great and so i think people will be relieved when we see the beginning of the end of emergency accommodation. it's too much money. >> we will talk about a little bit about the tightness in the labor market there's evidence of slack. do not miss an exclusive interview we've got tomorrow with the ceo of ups tomorrow carol tome we'll talk about all these issues and the fedex problems with her tomorrow. that's going to be a good one. she doesn't talk too often >> let's get to the market internals just slipping a tad. >> yes, in general all day and if you look at the internals new york stock exchange, really strong

let's see, is that even? it's not quite a 90% of all volume to the upside, i guess, but that was where it was trending for a while take a look at the pejs, the leisure and entertainment etf. it's actually positive and outperforming a lot on a month-to-date basis. it really hasn't been about, you know, delta, it hasn't been about people getting back out there. it's been about global stocks and positioning. volatility index has descended down more than three points today, around 21, getting back to somewhat more normal levels that's a good spike on the chart. above 20, still some agitation in there >> just under a minute to go that's 312 points on the dow the high this session was 520. but nonetheless a resoundingly strong bounce today. the nasdaq reached 4%.

the dollar is higher there was some hawkish interpretation of jay powell today but not enough to derail stocks which are closing at more than 1% in the dow and the nasdaq and just shy of that for the s&p 500. [ closing bell ringing ] >> fireworks in the stock exchange >> who gets fire works the company that went public today ringing the closing bell the stock actually finished lower, but they did have a nice celebration here welcome, everyone, to the "closing bell. now they're chanting i'm sara eisen, and mike

santoli. take a look at how we're going to shut the day on wall street 1% near the highs of the session. we got to the highs a few times post-fed statement at 2:00 p.m then a little bit later during the news conference of fed chair jay powell where he did indicate the taper is coming soon the s&p 500 rallying 1%. best day we've seen here for the markets since july, july 20th, 2021, last time we saw a gain this big s&p 500 seeing some broad strength as well with every sector closing higher. energy the leader. financials did well. utilities and communication services just ending negative on the day. technology also had a good day the nasdaq closed off by a full percent as well. and small caps up 1.5% 100 points higher since 3:15 on monday when we saw that big, big selloff on some fears of china, a hundred points for the s&p one of the big winners on wall

street today after reporting an unexpected quarterly profit. the company's ceo will be here to break down the results. plus, we are awaiting earnings from blackberry and kb home this hour we'll have instant analysis of that for you as soon as they are released job brown is still with us welcome, sevita. mike, first to you on this rally that really did begin monday afternoon after the big china selloff and continued through the fed meeting and news conference >> this weird stutter step yesterday we thought the market might be able to take advantage of the fact that it was stretched in the down side didn't happen, but overnight green light given i guess by this gesture in china that evergrande was making an interest payment but also credit markets the entire selloff in stocks did not really act up at all so that was always a kind of flashing green, it wasn't necessarily big -- you've also seen it turn higher in the last

few days in the economic surprise index from low expectations but all that stuff feeding together treasury yield's been firm all saying that it wasn't some kind of macro panic. that said we're up 1%. you kind of drifted off the highs. we're not where we closed on friday you can absolutely look at this as market kind of had this reflex bounce and now we're back into some kind of a neutral position in the zone >> one point i wanted to come to from your notes that i think is perhaps a difference take or different interpretation to what we heard earlier in the show and of late on the network is that your reading of sentiment is that it is euphoric in the moment >> it is on the measures we found to be most predictive of equity market returns which are basically looking at wall street broker allocations to stocks. and brokers are, if you go to your broker and he or she is going to tell you to put more

money into stocks than brokerage firms have in the last ten years. so we're closer to a cell signal on our sentiment indicator which is wildly bullish right now than we have been in 2007 so that gives me a little bit of -- for the s&p 500 this is not the case for europe equities, for china, for small caps, but it's really more about large cap u.s. stocks and really tech i think that's where we're seeing the bullish >> what do you think ultimately that means for the market, savita where are we headed? >> i think it's really easy to navigate this market i'm going to tell you how. so, i think wherewe are right now is an environment where you don't want to fight the fed. and the fed is telling us two things the fed is saying we're likely to keep rates low, although we might start gradually moving higher but yields are still scarce. but the fed is also saying we're

comfortable with inflation, we're comfortable with higher inflation that is normal in a cycle. so the fed is basically saying we want inflation and we're going to keep rates low. what do you buy in that environment? you buy inflation-protected yield. and i think that's where we see the real opportunities within equities and there are a few themes that come out as really attractive based on this theme. one is small caps. if you think about small caps, small caps are actually trading at a much lower valuation to large caps therefore they offer more earnings yield for the same price. if you look at small caps, they're also tethered to a u.s. economic pickup which i think to be a really positive advent for the market and if you look at sectors like energy and financials, which led today, these are two sectors that benefit rather than are hurt by inflation, but also offer growing income, growing

dividends, and can beat inflation as well as low nominal yields from bonds. so i think those are the themes that we're really grasping onto at this point. and i think energy and financials are two sectors that today led the market and are likely to continue to lead the market for the foreseeable future, given what we heard from the fed. >> josh, i know you were concerned about the trigger for monday's selling in china evergrande but i wonder whether you ever get nervous when the selling starts to take place that it might just trigger for technical factors or sentiment factors more selling, in particular given we haven't seen that 10% pullback do you think we might see one of those before the year's out? >> it's absolutely possible. i would never want to give anyone the impression that when the market is in the midst of a mini panic, which is what i call monday or when the selling starts to trigger more selling, nobody should have the

impression that myself or any other professional is sitting there sanguine about it and not nervous at all we're safeguarding people's entire financial futures so of course it's not that we're not nervous about it it's that we have a playbook in advance. we know exactly what we're going to do, if this, then that. we're not trying to figure out, you know, what the right signal to pay attention to it in the heat of the moment so i think that's what separates a professional from somebody who pretends to do this on social media. i wanted to ask savita about something she put out this week because i think it's the most important takeaway you are talking about us potentially transitioning from mid-cycle to late cycle. and in late cycle there are very specific styles that do extremely well versus the market in particular you talk about high return on equity or high-quality stocks and

high-depend stocks and what i think is interesting is that this time around, those stocks are all easily found within tech, whereas in past cycles tech was not really known for high-quality or high-dividend. so what do we do with that c conundrum? >> it's a great question, but i think the answer is, no, you look for your income and your quality somewhere else because, by our lights, tech doesn't actually offer the most attractive dividend yield anymore. the sector has gotten much more expensive. there are better pockets to go to for yield energy and financials i think are much more attractive areas for yield. from a quality perspective, i think the most important barometer to pay attention to is free cash flow and free cash flow yield for energy companies is really starting to hum for the first time in a very long time the free cash flow yield on

energy companies is at a record high compared to the yield you're getting on tips but both offer inflation-protected income so this is where i see the opportunities are in some of the really reviled commodity-oriented or maybe rates-focused sectors like financials and energy, which are actually generating healthy cash and also paying a dividend with tech or equal weight, i think it's a dangerous sector for a bunch of reasons one is it's got the most global exposure of any sector in the s&p 500 and we're seeing a lot of protectionist noises, or we're hearing a lot of protectionist noises out of the u.s., and china and also parts of the globe we're seeing supply chain risk and dislocations and pricing power versus input cost pressure there is a lot of air on tech right now and it's also a super crowded sector doesn't offer as high of an income prospect as other cheaper sectors like energy and financials and then i think small caps are

actually a really interesting place to get dividend yield as well real estate in small and large caps are another area where you can get inflation-protected income but, to your point, i don't think it's time to go for early cycle consumer stocks, companies that are hurt by inflation here's another sector that's a closet -- that is actually hurt rather than helped by inflation is industrials we saw this with fedex today but i would avoid any sector with a lot of labor intensity because we are continuing to hear negative preannouncements from this cohort of the market so, i think it's an easy - >> oh, i was just going to -- let's pivot quickly and we'll come back to the market implications let's go back to steve liesman from today's news conference from the fed steve? >> hey, wolf yeah, the federal reserve strongly suggesting it's on the verge of reducing its asset

purchases, tapering that is, saying if the economy continues to progress as expected, a, quote, moderation may soon be warranted. i was a bit unclear but it appears as if the fed is announcing it will reduce its asset purchases in november and then beginning the reductions in december >> no decisions were made, participants generally view that so long as the recovery remains on track, a gradual tapering process that concludes around the middle of next year is likely to be appropriate >> fresh round of fed forecast reduce the outlet for growth because of covid nine forecast the rate hike next year and nine are forecasting no hike so an even split there on the fomc powell also addressed controversy over trading practices and asset holding by fed officials. he said the recent news reports by fed officials show the fed's code of conduct has to change. >> it is now clearly seen as not

adequate to the task of really sustaining the public's trust. we need to make changes and we're going to do that as a consequence of this. this will be a thorough-going and comprehensive review >> powell did not say how long it would take to the fed to make those changes. sara, real quick, if you start in december, go down by 15 billion a month, that brings you to what powell talked about, which is ending it by june of 2022 >> yes, gradual makes sense. steve, on the interest rate forecast, a lot to chew on there because there are some new forecasts. nine of them want to raise rates next year. nine of them don't i think what's also funny is all but one member thinks we'll be raising rates by 2023. is that neel kashkari?

>> he would be probably the most dovish fed president out there right now. he may be in that camp of wanting everybody to get back to work, less concerned about inflation is where that would put him. but really i don't think the difference of the end of december or january really makes that much of a difference. i think the real concern for the market would be if they don't get inflation under control, if they have to bring those rate hikes further forward into 2022. >> steve liesman, thanks so much for that our thanks also to josh and savita we'll have to leave the markets on there for today banks staged a big bounceback after recent selloffs up next wells fargo on whether these stocks could be on the verge of a break > 'rba ia up of > 'rba ia up of minutes.

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eps came in at $1.60 but there was a miss on revenue coming in at 1.47 billion versus estimates of 1.a69 billion this is what we're seeing across the board. we saw it with lennar on monday. that miss on revenue because closings are not coming in as fast as expected due to supply chain issues the ceo of kb said while our third quarter deliveries were impacted by the ongoing industrywide supply issues and labor shortages, we are working through solutions to mitigate the issues and stabilize our construction times part of that of course jacking up the price up 11% to $426,800. deliveries though were up 35% just slower than expected. >> thanks so much for that down a couple of a percent financials, meanwhile, were up about a percent and a half

today. outperforming the broader markets, following a slightly tough couple of months for the sector as a whole. senior analyst mike mayo joins us on the phone. first a broad question on the sector and all the main banks that you follow basically seemed like the fed today that we're not going to at least have rate hikes for a good year, year plus does that mean it's going to be a sort of sideways move until we see yields move up >> if the fed is right this is a good environment for banks over the next one to two years. there are three items from the fed press conference number one, rate, the fed chairman used the t-word, taper, and if that happens potentially as soon as november 3rd, you could have a steeper yield curve, that's good for banks number two, economic growth, the fed forecast 2 to 3% gdp growth.

loan growth should be around the corner and unemployment, the fed expects that to be below 5% in even below 4% for the next three years. that would be great for credit quality. that's good for banks and since the fed announcement of the stock market went down a half a percentage point and bank stocks went up a little bit higher. i read from this is the fed's getting a little bit closer to raising rates. bank stocks have been in intermission between act one, and that was the improving credit from the pandemic, and act two when you actually get that loan growth and higher interest rate, you're still in intermission, but you're getting closer to that act two when you are likely to get a new wave of bank stocks investing. >> i want to check in on some individual stock specifics with you. i haven't had you on in a little while. what do you make of the u.s. bank deal for union bank yesterday? >> oh, that was an excellent deal they waited a decade

they finally pulled the trigger on an acquisition that increases their size by one-fifth. but they only pay one-tenth of their market cap so very opportunistic and it's an example of a stronger bank financially, technologically taking over a weaker bank. and it also supports our view that goliath is winning when it comes to u.s. banking. here is a firm that said they wanted to be a top ten bank. they didn't have the scale so they eventually sell out to -- >> overall who is the best position, mike, to take advantage of these higher rates if they are coming and the better loan growth that you see in this act two scenario that you think was highlighted by the fed? >> well, mathematically bank of america is the most sensitive to higher interest rates than any other large bank but it's also their structural positioning and enhanced

leadership when it comes to esg. i think they are a trifecta when you are thinking about cyclicly, structurally and societal. >> final question, mike. so many different individual stories, but i'm going to go with steven sher stepping down at goldman sachs did that surprise you? >> yes, it did goldman sachs, a short career at cfo. the tenure seems to be getting less and less. having said that, it is something to at least monitor. >> goldman finishing up, 2.6% today. mike mayo, thank you for jumping on the phone on the big rally today. an unexpected profit helping stitch fix today the ceo joins us next on those results. and why the company is taking a stand against the controversial texas abortion law and tomorrow we will get another read on the consumer

when nike reports earnings that stock has been outperforming the dow over the last year. find out what to expect from those results, later on "closing bell."

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stitch fix shares soaring today, finishing up more than 15.5% on the back of posting a surprise profit and beating out revenue estimates. the stock is still off about 60% from its highs joining us now in an exclusive interview is elizabeth spaulding, stitch fix's ceo. elizabeth, welcome back to the show good to see you. >> great to see you. thanks for having me, sara >> so you gave investors a lot to like in this report, especially that surprise profit, the better revenue growth, revenue per user explain what's driving these better trends. is it back to school >> great question. we're so excited, sara, on delivering such a strong quarter. 29% year on year growth for the quarter. almost 300,000 net active clients in the back half of this year really just a sign in the strength in our fundamentals and consumers moving to our model. the revenue per active client where we cross the $500 mark for the first time ever. and really to me this speaks to the strength of our investments in fiscal year '21 as a whole.

this is a year where our whole category is dramatically shifted. it's moved from 25 to 40% online, and stitch fix in this time period went on offense. we really innovated our offering we expanded where consumers can preview ten items in their fix that drove higher active revenue. and then we also expanded our new personalized shopping offering now known as freestyle. that absolutely contributed as well and we're super excited because now freestyle is open to all new customers to stitch fix, which is wonderful news. and the profit line also had positives, outperforming revenue for the quarter and also delaying a bit of our marketing spend as we move into the next fiscal year. >> definitely want to get into the next freestyle business. but first on the quarter, some analysts are quibbling with the net ads number, 58,000 kind of modest from the previous quarter. they say that marked a decline and also the overall number

about 4.18 or so million which came in below consensus. so what's happening with user growth >> yeah. i would point out the full back half number is close to 300,000. and q4 for us which is over the summer tends to be -- we tend to add a lot more clients in q3, that's spring shopping season relative to q4 we did deliver a delay some of our marketing spend as we're launching, as you mentioned our new personalized shopping service which is freestyle we kind of saw exactly what we thought we would see and feel great about the migration in our platform >> many would think that your broader industry would be squeezed at the moment because of supply chain concerns are you somewhat insulated from that >> great question. i think the whole industry, impact from covid on facutories with eexpect to be relatively insulated. we've ordered many of these goods ahead of time. we're not as exposed to some of the geographies that are

impacted >> i was also wondering about the guidance that you shared sales of at least 15% in 2022. you just posted 29% sales and have been in the 20 to 30% range. so i'm curious why you're going with a more conservative number, especially with the launch of freestyle and the kind of growth that you've been seeing there. >> yeah. we are incredibly excited about freestyle and what this represents for stitch fix. for those who don't know what it is, it is this entirely new way to shop. we believe we're defining the future of apparel retail sara, you walk into your own personal store and you can see goods that are curated just for you based on your style preferences, based on your fit a huge advantage we've seen with our current customers using freestyle, our return rates half of typical apparel ecommerce because our fit is so good we're not trying to send you

four items to see which one fits we're sending you one item that fits people know stitch fix as one thing, and now we're also offering your own personalized store. so i think what our guidance reflects is this building year of brand awareness we are going to be launching many new features, more brands, you can now shop your new balance shop or your kate spade shop within that experience. but it will take time for consumers to know that it's out there and appropriately we wanted to give ourselves time to really make this big transition into becoming the destination for personalized shopping and styling. >> i just want to ask because it's in the news today you were one of the companies to sign on raising some questions about the recent texas abortion law. i'm just curious i've been watching for any corporate response we haven't heard much. the letter you signed on to

calls for them to the government to not ban abortions how did you get involved in this issue, and why do you think it's appropriate to speak out >> you know, as a company that is founded by women, led by women, the majority of our employee base is women, it was an issue that we believe we need to take a stand on, and our deep belief on just in general and equity we also have our largest employee base in texas, our fulfillment center and equity is a topic we absolutely want to stand on and be on the right side of history. we believe in equal rights for women. this was something we felt like we needed to take a stand on >> elizabeth spaulding, thanks for joining us good to have you >> thanks for having me. meanwhile we've got some breaking news on facebook. julia boorstin has that for us hi, julia. >> well, fbi's cto is called by his nickname schrep announcing he's stepping down as cto after

13 years at the company he's going to be transitioning into a new part-time role as facebook's first senior fellow. now, taking that cto role in 2022 is andrew boswerth. he's also a longtime facebook employee he created facebook's ar/vr organization which was renamed facebook reality labs and there he oversees oculus, portal, and facebook reality labs, that is of course working on the metaverse right now. he was at facebook back in january of 2006 and worked on the news feed. so he is a longtime facebook employee, a long relationship with mark zuckerberg but still a big transition at the social network guys >> and surprise, right, julia? and just explain to us where does a cto sit is it directly below zuck? >> i've interviewed him before for cnbc he's the guy who's really dealing hands on with the

technology you have zuckerberg at the top you have sheryl sandberg who's overseeing a lot of the different operations and advertising and you have mike schroepfer bos makes sense, andrew bosworth makes sense because he has been at the company so long and is deeply invested in the metaverse and also some of these hardware initiatives but does have his history at the company working on things like the news feed which are really the backbone of the facebook app so, surprising in that schroepfer is not an old man, if you will but this is a longer transition, they're not announcing that he's leaving tomorrow, that does sort of bode better for the transition and shows more consistency for the company.

>> so schroep replaced by bos. both will report to zuck >> a lot of nicknames. blackberry results are just out. let's get to frank collin with those numbers. >> shares are up more than 8% after a beat on revenue and eps that was better than expected. estimates had a loss of seven-cents. the company will give guidance on its earnings call that comes up at 5:30 this afternoon. you see shares spiking sharply this was considered a meme stock earlier this year. the company tried to reposition itself as a cybersecurity player the majority of its revenues coming from cybersecurity revenues were 175 million. they said 120 million of those revenues have come from cybersecurity. they're also working with a lot of electric vehicler makers. better than expected earnings. a loss of six cents. back over to you >> frank, thanks so much for

that one up next, mike santoli looks at investor appetite for risk and it's hispanic heritage month. here is former goldman sachs' cfo marty chavez >> my mom always told me spanish was important. i thought, yeah right, i'm a computer scientist one day i'm doing my computer science, i was a quant on the trading desk at goldman sachs. boss comes by and says someone told me you speak spanish, i need you to go to buenos aires the day after tomorrow and talk to our clients about risk management that single moment changed everything fe wor monall street money aside for them, so...change in plans. alright, let's see what we can adjust. ♪♪

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on "squawk box," one of the fed's sharpest critics speaks out following powell's remarks what investors need to watch for.

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that was his message today at a virtual covid-19 summit. the president pledging to send 500 million doses of the pfizer vaccine to lower-income countries around the world that would bring the total number of donated shots to 1.1 billion. according to oxford university, nearly 80% of shots administered globally have gone to wealthy countries. the haitian emigrants, many of them camped in an overpass i del rio, texas, are being released in the united states and will be allowed to seek asylum two u.s. officials confirmed that to cnbc news and put the number in the thousands. officials say many people are being released with notices to appear to an immigration office in 60 days in order to get a court date that system allows customs and border patrol to process more people and in the gabby petito case

they are searching a 25,000 acura near the family of her fiancé brian laundrie's house. petito's remains positively identified on monday by the coroner in wyoming tonight we're back live at that nature reserve plus details of a potential new development as neighbors of brian laundrie describe what they saw him doing in the days after he returned home without gabby on "the news"" right after jim cramer >> we are all glued to that one. let's send it back over to mike santoli for a look at risk appetite right now among investors. >> looking at it from a couple different angles first of all the long-running survey by investors intelligence trading and investment advisory services shows a pretty big drop

in bulls relative to bears you see here that was kind of the floor since the 2020 market low was around 30 as a spread between the bulls and the bears. there are still twice as many people saying they're bullish as bearish. but that shows you that just a 4% drop in the s&p got people a little bit nervous last week we showed you the retail investor survey also showing an unusual drop in bullish. that's net positive. maybe that helps explain today's very strong rebound rally, in part, because people were leaning to the negative side you remember this huge peak speculative stocks really were racing into the year this started to act a lot better people have been talking about how the recent ipos seem like they're gaining a little more traction however, i would sort of put an asterisk next to that because look at the ipo/etf next to the cloud software etf really been mimicking the moves.

36% in total snowflake, pallentier, data dog basically the largest cap, no profit cloud software and app companies are really driving this thing so it's not so much, oh, young scrappy companies are in demand again. it's just the waiting of the etf has really gotten skewed >> mike santoli, mike, thanks. shares of iron ore falling sharply. the company's ceo on china's decision and how new global growth concerns will impact metal prices and his stock metal prices and his stock we'll be right back. flexshares etfs are built with advanced modeling.

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china's evergrande debt crisis sparking concerns about global growth and weighing on commodity prices this week cleveland-cliffs among the stocks getting hit with shares down around 9% so far this week. but despite the recent slump, shares are still up more than 200% over the last year. joining us cleveland-cliffs chairman and ceo lourenco goncalves. thank you so much for joining us >> my pleasure to be with you, wolf >> let's touch, if we may, first of all, on the pressure we've seen on iron ore prices as a whole. is it just china growth fears that's been pressuring that?

>> look, this fluctuation at this point is absolutely meaningless. cleveland-cliffs, since we acquired steel in march of 2020 and -- in december of 2020 became the largest company in the company. we use all of our iron ore in house. so we are self-sufficient in iron ore, fluctuations in iron ore prices should not affect ourself, being a very large steel company. and it's not really relevant for us at this point >> how is the integration of the acquisition going? >> perfectly we're able to integrate extremely well not only operational but also on the commercial side of things. we are now in the process of

renegotiating our contracts. and a lot of our business is contract business with automotive, transformers and electric vehicles, stainless steel, all of these prices are being renegotiated at higher prices for next year so all the results that we got so far they were phenomenal. you saw my last quarter and the guidance for this quarter, $1.8 billion for q3. they should be higher next year because we are negotiating >> so, do you think that this is misunderstood? because on monday your stock was down like 10% or more at one point on the plunge in iron ore prices and the overall market concerns around evergrande, the chinese property developer >> yeah. that's exactly right you nailed it. prior to the break, you called

cleveland-cliffs an iron ore company. we are no longer an iron ore company. you associate cleveland-cliffs with iron ore. we are the largest -- steel company in the company the steel you see in cars and containers and appliances and pretty much everything we are very large, actually the seventh largest steel company outside of china at this point so we're pretty big, but we are no longer called an iron ore company any more >> do the fallen iron ore prices help you because that's the key ingredient for steel >> we mine our own iron ore. we're self-sufficient. we have our own. and we don't depend on fixed

stock from outsiders fluctuations don't really affect at this point. our costs are locked in. when steel prices go up, it all goes inside the margin and that's why our ebitda margin right now is in the 35% range. our revenues we wnt from 2 billo a year to 20 billion a year. that happened in the last year and a half so i understand that people are struggling to understand the new cleveland-cliffs, but we'll keep educating them on that >> i just finally wanted to ask what the takeout was like. you offered to pay bonuses to employees if they got vaccinated >> yeah. 75% at last count.

we think $1,500 to each employee that got vaccinated. and regardless of the performance of the site. and every site we have 46 sites throughout the country each one of the sites that got above the 75% threshold, we doubled. so instead of 1,500 each employee got $3,000. and that happened 31 of the 46 sites, including the largest steel mill in the country with 78% vaccination rate we got herd immunity inside cleveland-cliffs that's a good thing. >> well, that is one approach to doing it lourenco goncalves, it's always good to have you on the show thanks for joining us. >> nice talking to you >> you too up next, gilead out with some new data about its remdesivir covid treatment we'll tell you how well it worked to prevent hospitalizations, next and as we head to break, another check on blackberry and kb home.

blackberry soaring 8%. kb homes going south, just about a third of 1%. we'll be right back. ♪ ♪ ♪ ♪ ♪ ♪ ♪ ♪

welcome back there are a number of moving

pieces on the covid front today, from a cdc meeting on boosters as well. >> the day started off with a big government purchase. pfizer vaccine bought at a not for profit price to give to low income countries around the world. pfizer expects to distribute all of those by september of 2022. here in the united states, the cdc advisory committee has been meeting to talk about the pfizer/biontech booster. we are still waiting on a decision on authorizing that booster and for whom there was a new york times report saying that it looks like moderna holds up better over

time here is what the chairman and ceo said >> they don't exhaust from the time of the second dose and also pfizer was given earlier to elderly high risk people so we are comparing more months from seeing the first dose of pfizer and a very different population. >> he says there are different ways of measuring things you shouldn't compare. they are both great vaccines remdesivir, this is using in the hospital setting, but they tested it in folks not hospitalized they found if you give three days of iv treatment they could reduce the risk of hospitalization by 87% that's up there with the mono

clonal auto bodies >> when the government is buying a billion doses to give away for free, do they get a better price than when it was originally quoted at $20 last year? >> the indication is that it is a better price they call it a not for profit price. pfizer did this on a for profit price to other wealthy countries and they are profiting, making tens of bills -- billions. we don't know the doar aunllmot. after the break, nike highlighting a big day of earnings what you should be looking out for in that release, and the call, nerks. n. e. x. t.

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this is enterprise ai. >> now to our wall street look ahead. tomorrow jobless claims on a thursday

along with the white house meeting on the semiconductor supply chain and darden restaurants, costco and nike after the bell. look for nike as strong. it was basically unscathed from the pandemic but macrofactors could hurt. vietnam closures nike has 40% of its production in nvietnam which could cause shortfalls the country has been closed almost two months because of covid. and surveys are showing that nike is back in favor in china there are concerns about these rolling covid shutdowns in the country. the third thing to watch will be a bright spot. back to school we know shopping has been

strong air force one, air jordan ones, dunks, they have all been strong for what kids want nike, expectations are a little high, but there has been warnings especially on the supply chain side, vietnam and china. and a ceo interview. ups following the rough numbers last night on fedex. mike >> the supply chain stuff i think qualifies as the main incremental threat to the pace of growth. obviously delta is still with us, but that seems to be the thing everyone is fixated on >> temporary >> it's about the pacing, not the ultimate destination of growth nike is a good 10% off the early august highs because of these comments about vietnam

>> going forward on the dollar which had a strong inter-day move, dollar did gain and getting close to breakout levels >> exactly back up to the top end of the range year-to-date the market leaning toward the fed being slightly hawkish >> and rallied nonetheless so the tapering decision and announcement that does it for us. "fast money" begins right now. >> live in the nasdaq market square, this is "fast money. guy, karen, tim and steve. fedex leaves investors with more questions than answers, but have no fear. breaking down each of these stories.