bearish point of view or the long-term point of view, what happens now that it is already a $1 trillion company? you know, what are the biggest risks, especially maybe highlighted by some of the full self-driving problems that could maybe have a regulatory backlash there? you know, does 2022 then become a year where sort of the actual production has to catch up to the $1 trillion price target >> yeah, i think the biggest risk, they have to work with regulators and fsd, that's clear. china, that's 40% of deliveries going into next year they have to play nice in the sandbag with beijing in terms of the pr issues and other safety issues they've had, but it comes down to supply if austin comes on, berlin comes on -- remember, right now at tesla they don't have a demand problem, they have a supply problem. >> all right thank you so much, sir we really appreciate your joining us on very short notice today. >> thank you >> just quite an incredible headline, just about one trading session after first punching above $900 billion, tesla a $1

trillion company dan ives from webb bush joining me to discuss that let's switch gears, talking from -- i don't know, new economy to old economy energy has been one of the hottest sectors tv market lately, but my next guest says the stocks are still trading at 30% discount joining me, david, it is great to have you. it is a letdown talking about old-world stuff, but people have called this the ee venrevenge oe old economy. it is obvious under investment is causing the price spikes. my question to you is do i want to buy equities in an area that failed to deliver returns for investors while tesla is up 20,000% or something >> that's definitely a hot question thank you for having me on the show it i heard you say you were 12 out of 10 excited for the show at this hour. of course, definitely not for me phil, dan ives are great conversation pieces but, yeah,

energy feels definitely old age here jed clam pet probably from "the beverly hillbillies" is a happy cam per today, loving on the black gold texas tea but from a serious perspective, energy continues to mark all of the three boxes that i look for in investment. technicals are definitely there. i believe the macros are there from a fundamental side, well, the fundamentals have a valuation perspective have definitely been there for the last eight years you definitely had the returns that you have had in a tesla, but i think most traders would call it late to the trade here that a lot of the easy money has been made. >> right >> i don't agree at all. i think they're wrong. i think short term, yeah, the sector looks a little bit over bought right now it looks like it could possibly take a little bit of a pause, but longer term we are very bullish on the entire sector, specifically emp why are we long-term bullish right now these companies are being priced at a 40% discount so the forward 12-month strip pricing which is $74 give or

take a few dollars in 2022 >> right >> meaning their pricing oil as if it is $45 >> right >> i don't think any of us here really on the show, you know, would expect oil to be close to $45 moving forward, especially when you are considering the environment right now where you have substantial shortages as well as prolonged underinvestment in the space, you know, regarding new projects in development >> right >> so we're big on energy, so let's go, texas tea. >> maybe the way to flip it around is that from your point of view that means the stocks are going to catch up, but there's plenty of investors in capital that are saying they're not sticking around to find out. pioneer is a name you like and even scott sheffield said he is not going to drill if the price is high, only if the price doubles. to him it is a question whether they will enjoy that kind of performance. anything else you would tell our investors if they want this exposure >> no, you know, we love small caps, we love mid caps, we love

quality. pioneer natural resource fits that bill. it is more of a mid cap, smaller mid cap, but definitely on the higher echelon of quality in energy we continue to view their deep inventory of high-quality drilling locations in the core of the midland basin you couple that with the strength of its balance sheet, a long-term investment framework, which in our view should get this stock rerated >> right >> you have seen a lot of the energy stocks trade at four times where historically they traded at six times. so i think the investment rationale looks very simple in our opinion. >> all right david, thank you for joining us. we will have you back on as we follow the story into early part of next year david wagner with aptus private investors. facebook is coming off the longest losing streak as a public company shares are down 15% since the publishing of the journal's first facebook files report. with more damning documents coming to light, will the c suite be able to survive

what is the impact for the app's ecosystem. we're tracking the fall-out. the latest direct-to-consumer name joined war by parker as a direct to consumer property. we will dig into what we are calling the war over traditional retail this is "the exchange" on cnbc

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welcome back the shots keep coming for facebook now the facebook papers, a series published by a group of 17 news outlets with access to leaked whistleblower documents, they started to trickle out on friday one of the whistleblowers, frances haugen, is testifying in the uk today facebook responding to the papers today saying in part, at the heart of these stories is a premise which is false the truth is we've invested $13 billion and have over 40,000 people to do one job, keep people safe on facebook. now, facebook shares are on pace for the longest weekly losing streak ever, and it is all ahead of their earnings after the bell we are covering this, the fall-out from the leadership to the ad impact, looking ahead to earnings paul argenty with tuck school of

business and mark ductous with streaming and connected tv paul, we will start with you facebook has been heavily criticized for their handling of all of the publicity what should they do now to try to change the narrative or is it too big a task for corporate communication? >> i mean it has to be more than corporate at this point because the problem is much bigger than a communication problem. i think it is a problem in terms of what they're actually doing in the past facebook would kind of trot out an apology and do a mea culpa and that was actually closer to what they should be doing than what they're doing now. now they're focusing on more of a marketing strategy, trying to rebrand and use techniques that won't get them out of this hole. they need to go back to basics, apologize for what they've done wrong, say they're looking into what happened and try to move ahead with more trust and more transparency >> does that mean that we need to hear directly from mark zuckerberg and sheryl sandberg

as sort of, you know, we know and we're sorry and here is what we're doing now? >> yeah. i mean this is a full-blown crisis for them. i mean you think about the number of news organizations involved, the amount of information and the way their own image has been going steadily downhill starting back in '18, i think, yes, you need the ceo, you need the top leaders. the problem is neither of them have any credibility anymore, particularly him i think it is a bigger problem for them in terms of leadership. where do they go from here is a really big question in my mind >> you know, mark zuckerberg is talking a lot about the metaverse. they're reportedly going the rebrand the company, if "the verge" is correct about that, in that direction is the best he can do is to move on to these new digital worlds that are forming i mean do they need to fix the trust issue before they move into that paradigm >> i think they need to move -- you know, fix the trust issue before they do anything. i mean if your credibility is shot, your reputation is shot and your reputation is the most valuable asset that you have

trying to rebrand and come up with a new approach to how you are doing business in the nays o face of a crisis like this is like pushing a big ball uphill it is not going to work. it is going to go in the other direction. i have a really strong feeling that they just don't understand basic strategic communication tactics. >> so, final question, paul, because we are about to talk about their strength and domination as an advertising platform, doesn't that speak for itself you know, for all that we all say about it, you know, i always give the example how i use their buy-nothing page all the time. i'm on instagram all the time. you know, so we can all say, oh, yeah, facebook, yeah, man, what a company. but until the facts change, why should the company really worry so much about all of this corporate communication that, as you say, they sort of botched? >> you are not managing your reputation for just this moment in time. you are managing it for the future i think as people become increasingly hostile towards the company in terms of its

reputation, you will see effects starting with they won't be able to recruit or keep the best people, which we're already seeing they won't be able to attract the kinds of advertisers who they really want, and it will just steadily erode. yeah, could they keep it up for a while? sure would you want them to no it would be just about the worst strategy you could possibly follow it might be the strategy a financial adviser would give them because they're making money, but it certainly isn't my advice >> very, very interesting, paul. thanks so much for your time today. we appreciate it >> thank you, kelly. >> paul ar genti as i mentioned plenty of investors are sticking with facebook because of the success in advertising and that will be a big part of the decision around earnings tonight. should we expect this dominance to last or not joining me is mark douglas, ceo of mountain, a leading ad agency for streaming and connected tv mark, what would you say about the risks around the strength of their core advertising platform? >> i don't see many risks at the moment i think the average -- the thing to remember is facebook doesn't

really sell ads. they match consumers, the people using that platform with the brands that want to deliver products to them there's really no place else to go for advertisers except for page search. now streaming is coming online and playing a role there but there are literally millions of businesses dependent on facebook to reach consumers and those businesses are not going to stop spending with facebook today. it is going to take an actual impact to their business for that to happen >> let's go through the case we just heard from paul argenti point by point it is going to hinder their ambitions in the metaverse or whatever their plans are going forward, what do you say in response to that >> i think it is true. in terms of attracting the best talent, you know, people are worried about their individual, you know, basically reputations and they might have pressure from family. but facebook is a big company. it pays extremely well, and i

think they'll be able to retain most of the talent they need to continue to manage and grow their business so that's not a short-term impact to the business, although it is somewhat of a long-term risk >> you think there's literally nowhere else to go we always say investing in the stock market today, there is no alternative. are you saying there's genuinely no alternative to advertising on facebook >> if you are what is referred to as a direct-response advertiser, you spend all of the money you can on page search and all the money you can on page social when it comes to page social, it is nearly all facebook and instagram. you know, snapchat is definitely coming up, but it is $84 billion in revenueor more compared to $2.5 billion for snapchat. there's literally no place for the advertisers to go other than facebook >> final quick question because we saw this big impact to snap and even facebook on friday after snap areas 's earnings rea

hit from the apple tracking they won't let happen anymore what do you make of that issue is it a short-term headwind? >> it indicates a longer term problem. apple referred to it as ipfa, it is not a big problem for facebook because you are locked into facebook, on your phone, probably on your computer and all of these devices so they're not dependent on apple to know who you are. where it comes into play is knowing what you are doing across devices and maybe some of those devices you're not locked in, but it is not a material issue for facebook it is more of an issue for snap because snap just simply doesn't know much about you. facebook has so much more information from snap, and they have the ability to identify who you are based on your device >> that's interesting and maybe suggests why apps might move in the direct of wanting a more direct relationship with their users from now on. mark, great insight. we appreciate it >> thank you >> mark douglas from mountain. again, facebook reports after the bell today coming up, with bottlenecks

breaking every link in the supply chain, we will speak with the head of one company working to fix freight problems with technology speaking of costs, david zervos joins us with his hot take on hyperinflation and whether faith is restored in the fed after the central bank's new ethics rules. as we head to break, here is a look at the s&p 500 heat map some of the names hitting new highs include netflix, auto zone, lowe's, costco and, of course, tesla. back in a moment but all my employees need something different. oh, we can help with that. okay, imagine this... your mover, rob, he's on the scene and needs a plan with a mobile hotspot. we cut to downtown, your sales rep lisa has to send some files, asap! so basically i can pick the right plan for each employee... yeah i should've just led with that... with at&t business... you can pick the best plan for each employee and only pay for the features they need. it started with an idea...

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♪ welcome back, everybody. just off session highs, dow was up 110 it is currently up 92, that's a quarter percent gain, but nasdaq is outperforming today

let's check the sectors where energy is leading after posting the sixth straight week of gains. here are some of the biggest movers at this hour. not huge energy, materials up about 1.5% elsewhere moderna is getting a nice bump after announcing the covid vaccine produced a strong immune response in 6 to 11 year olds the company will submit information to regulators. kimberly-clark is on pace for the lowest close since april of 2020 they missed earnings expectations they lowered guidance saying results were negatively impacted by, you guessed it, significant inflation and supply chain disruptions emanating from china. knb is down 3% today a look at tesla. this stock crossed the $1 trillion market cap at the top of the hour, currently around 994. i think we'll have to check but it is pretty much around the $1,000 mark we hit the $1 trillion market cap, so a hair

below the level with a 9.4% gain after only crossing $900 billion on friday. there you can see market cap, $99 billion. over to rahel solomon for a news up today hi, kelly. here is what is happening. democratic senator joe manchin says a deal is possible this week on president biden's big spending plan. he said he is open to any tax that would ensure people pay their fair share towards infrastructure improvements. >> all of the -- everything in it, crossed and dotted, it has been to be difficult on the senate side. but as far as conceptually it should i really believe, you know, just have a lot of good faith in it >> do you think there will be a framework agreement? >> i think the framework there should be, there really should be in krarks krarks, 100,000 customers still without customers many around san francisco bay. severe storms dumped record rainfall on the news, what is still ahead for southern california as

wildfire concerns are replaced by flash flood alerts? that's tonight at 7:00 eastern and in spain's canary islands the volcanic eruptions going five weeks are stronger than ever. officials are watching to see what direction a new river of lava will take as our people who live in the area, i'm sure kelly, back to you >> thank you very much, rahel solomon. up next, it is jack versus janet. dorsey voices inflation concerns while secretary yellen down plays them who is right and with new members meeting around the corner, what is the next move? look at digital world acquisition company, the company taking president trump's media group public via spac. we're back in a moment

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♪ welcome back to "the exchange," everybody inflation isn't going away any time soon, or is it? the answer depends on who you ask. twitter ceo jeff dorsey tweeting, quote, hyperinflation is going to change everything, and that he sees it escalating around the globe treasury secretary janet yellen

disagreed yesterday, dismissing the idea that inflation has gotten away from the government. >> i don't think we're about to lose control of inflation. i agree, of course,we are goin through a period of inflation that's higher than americans have seen in a long time and it is something that's obviously a concern and worrying them, but we haven't lost control. >> joining me now with his take is david zervos, jeffrey's chief market strategist. david, great to have you back today. i tend to think of you as more of a deflationist generally, but what does it mean in the current landscape? >> well, i think, kelly, it is -- i think janet kind of said it as well as i could. i think the idea we are losing control of it after coming out of a decade where we couldn't generate inflation more than 2%, in fact i think we averaged 1.3% or 1.4% over the last decade before covid with one of the best labor markets in 50 years,

i think it is a really tough sell to say we are going into something like a significant period of even much higher than 2% inflation, or even modestly higher than 2% inflation i'm sort of still stuck in the camp that charlie evans seems to be stuck in, which is that none of these supply disruptions really tell me that we have the tools yet to be able to generate that north of 2% inflation on a sustained basis. i think people are way ahead of themselves, and in particular jack dorsey. a very smart guy, a great tech guy. i'm not sure i look to him for my inflation predictions >> the way i'm trying to think about it, and i think jeff curry has been good on this at goldman talking about physical demand for commodities. it is structurally higher. he talks about the super cycle because we've had so much reallocation of goods towards the lower income population, which is so numerous but if we don't have an increase in supply, are we just getting price hikes? in other words how sustainable

is it if you increase demand 20% globally, let's say, you can't increase supply 20%, then do you end up in a recession? >> kelly, let's put it all in perspective, right gdp, which is where supply meets demand, is basically just a little bit above where it was in q4 of 2019 we're back to gdp levels of where we were just before the crisis so we really haven't grown in six quarters this idea we have some sort of mega demand shock, kind of weird to me. i think we're in a flat growth period for over 1 1/2 years. we turned off the economy. then we turned it back on. what we're finding is as we turn it back on, it is a lot harder to get everything back in place quickly. i think in particular in a world where our preferences have changed for many goods over services, and that's just the nature of the beast when you try to turn something back on relatively quickly i also say, kelly, we are all

turning on kind of at the same time it is not like there's a dispersed cycle where europe is going down, we're going up, or those going down and we're going up or vice versa that should add to additional pressure i'm okay with the pressures. i'm kind of excited about them i would love to see bond yields get back to 2.25%. i think it would be a great opportunity to use them once again as a hedge for risk asset loans. >> you want to buy them. >> yes >> you think if they went to those levels they would then fly back down or sort of stay in that range let me -- i mean i have eight other questions that i really want to ask you theoretically but let me boil it down for everybody that's watching. are you still, i don't know if i would say bearish on stocks, but you have had a long s&p 500 with a hedge of something in bond land, and lately you seem to be much more cautious about things, in part because of your worries about the fed. >> yeah. look, i think that's right you know, we have three great quarters riding our risk assets long, you know, up 16%, 17%.

we obviously have a big run-up now, another 4% or 5% beyond that, where we weren't participating. really, kelly, it comes down to transition i think the odds of a reappointment for jay have gone down, the scandal is still ongoing. he tried very hard to put some strong, rather draconian rules in place on trading late last week, but, you know, we have a democratic administration that probably would rather have a democrat in charge going into the midterms and into 2024 maybe not, but the risks around leadership changes at the fed have always been quite tricky going all the way back to alan greenspan, whether it was janet, ben bernanke or jay himself. we're going into a period around inflation that is tricky because of what we were just talking about. >> sure. >> all of that conspires to say, hey, it has been a great double digit, almost 20% year do we want to fight the story if the fed makes a big change or

the administration makes a big change in the fed, do we want to be there for some of the turmoil it might cause >> i think it sounds like you are sort of moving to the sidelines on stocks, but because you're not worried about hyperinflation, for you there's no opportunity cost. a lot of people are worried to get out because they think they're going to fall behind >> yeah. i don't think there's a big fall-behind risk i think we've had 12 years at jeffreys, i probably spent three months on the sidelines in 12 years. >> right >> i'm not going to lose too much sleep over it maybe i am making a little more than i should out of the federal reserve, but, kelly, i'm kind of disappointed in an institution, you know, that i held in very high esteem. not unlike many of the guests on here who like to bash the fed, i think the fed has done an amazing job throughout both of our crises we can criticize certain times when they've been too slow or made a couple of mistakes here and there, but generally i just don't like when they open themselves up to the ethical

issues that they brought to the forefront and that increases the risk for politicization of the fed, something that could be quite tricky to handle for the stock market it is not a long-term change still don't have any big views that somehow we're going into a major recession. i have a good growth call for next year. don't see a lot of risks on the inflation side that are more than just temporary. so waiting to see how this administration picks the new fed so i can understand what my back stop is. >> yeah. still team janet in the inflation battle in that sense >> well, not just team janet back at the fed. that would be the best thing that could ever happen in my book, that would be the biggest confidence boost for me to have. >> very interesting. david, appreciate your perspective. thank you for your time today. >> take care >> david zervos of jeffries. looking at the war on retail and how lionne brands are making what's old new again stay with us

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the direct to consumer retail space is making some pretty big market moves. warby parker just debuted. rent the runway starts trading on wednesday the street liking what it sees in warby since it started trading about a month ago. three bullish transactions alone. this all has us thinking despite starting online, all three have physical locations now. is the future of retail actually brick and mortar joining me someone who thinks so simeon, i don't want to make too much of the brick and mortar thing, but you are pointing out that direct-to-consumer has challenges today why is that? >> i'm not making any friends here, kelly. how is it going? on the other hand, maybe i am, right? i think what is so interesting, and we have talked about this before, is on the one hand brick and mortar is an easy way to make money i say easy, obviously i'm oversimplifying. but i pay once, you pay your

rent and every incremental dollar you make money on that. the problem is ecommerce is that it is continually variable that's a conversation we have had historically what was even more is my team did a study, took us about six months, and we actually realized you can make money selling through wholesale. that's idea where i think everyone is pivoting away. >> right >> at the end of the day the biggest brands, the healthiest brands got there by embracing this view of retail we are easily calling dead but is not >> give me the f corps as an example of that. >> the f corps last week reported an increase in direct i'm using them as an example, and yet where they reported the increase in direct, the total profitability, the margins were worse. i think it is this interesting forest and trees conversation where everyone assumes if i sell it directly and eliminate the middle man, that's been the line for dtc, forks direct-to-consumer, has been

eliminate the middle man and you will make more money we are finding out the middleman serves a purpose which drives higher sales and higher profits. we saw it with the f and with other large businesses >> this comment which is fascinating would have impacts for others what about warby parker and rent the runway, it seems to be integrated in where the invest dollar should be >> we have this fascinating thing called buzz word and everybody gave up the omni it was omni channel and everyone moved on we have to remember omni needs more than one. it became ecommerce in people's mind and the point is to have it all. when you think about the new brands, the companies you are mentioning are embracing stores. essentially embracing the retail model they disrupted what we are acknowledging i think is to become a big business, because at the end

they're loud and vocal businesses, we created an impressive platform behind the businesses but they're far from the largest of businesses. to scale up, scaling up involves following the path that others have outlined in the past. i think we will see all of the businesses embrace stores, but i think if you are in the board right now, the really important conversation is figuring out is it just a question of brick and mortar versus digital or is it also a question of recognizing that being vertically integrated has tremendous benefits. it allows you to own the brand and the customer >> true. >> but at the end of the day does it keep you at a certain threshold the way ecommerce did. i think that's a conversation we will have for years to come now. it is the biggest surprise >> to me it is sort of like the kids are going to be all right these micro observations about, you know, marginal profit dollars suggests that physical retail will be okay, that decisional shopping centers will be okay. this is a really fascinating insight, simeon, into a talking point much of the culture likes to talk about, that we all will

be buying online for the rest of our lives. >> i think right now there's a barbell. there's always a barbell no matter what we're talking about. if you are the largest of brands, simply walking away from department stores, simply walking away from wholesale is a mistake. that's how you got to where you are. if you are in that board room, how to figure out how to incorporate it all figure out where you should be and where you should go. on the same token, on the other side of the barbell, if you are the smallest of brand, you are taught, because everything we are teaching everyone the word is go direct, do not go wholesale and i think it is a mistake. >> interesting >> i think there are interesting brands that are small that are embracing all sales and they're selective. they are figuring out where will be the brand-elevating opportunity and those are brands that will scale up nicely. >> we talked about the revenge of the old economy macy's, kohl's, we talk to jim about the phenomenon and he agrees with you and says it is a real thing maybe figuring out how to leverage the platforms becomes an important part of growth for even the disrupters.

simeon, thanks for joining us o even the disrupters. thank you for joining us today still ahead, as i supply chain snarls per sigs, companies are getting creative with their shipping methods how one freight carrier is using technology and shared truckloads kind of like uber pool to speed up delivery times. stay with us one day, you're gonna take a hit you didn't see coming. do you stay down? or do you get up? [announcer] and this fight is a long way from over, leonard is coming back. ♪♪ ♪♪

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welcome back, everybody. here's a check on shares of tesla, up 9.2% right now market cap of $998 billion. we punched through the $1 trillion mark just about an hour ago. tesla only punched through $900 billion for the first time last week we will talk more about it on "power lunch." first, one company is fixing trade problems to tcmah make that's next on "the exchange."

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- [narrator] introducing the grubhub guarantee: our promise to deliver the food you love on time, and give you the lowest price, or you'll get $5 off your next order. welcome back a shortage of truck drivers continues to cripple supply chains it is estimated the u.s. is short 80,000 drivers right now one company, flock freight connect businesses to share truckloads to avoid unused space.

they rankinged 42 on this year's disrupter list and just passed the $1 billion mark and they are pledging to be carbon neutral. joining us, orrin landski. welcome. could this technology be deployed right now if there were sort of an executive order to fix spline chains? >> thanks for having me. you know, there are some real challenges there is the driver shortage that you mentioned and additionally, there are -- i think understanding the context of the landscape of the u.s. transportation industry, it's enormously fragmented. on the one hand that created opportunity for flock freight to thrive and you are looking at points of aggravated volume, how can i integrate and engage there isn't a simple or fast way

to do that unfortunately, we are audacious at flock in terms of trying to do our part to save the world. i would say probably not it is something that has be to invented, has to be built. it has to take a few years. >> tell me what sort of market problem your technology picks. >> our mission is to fundamentally change the way frayed moves by crowding freight shares palettes of tables, food, technology move from terminal to terminal slowly making their way across the country with our technology instead of having eight trucks and eight drivers, we use one. we ensure all trucks are full all the time and we are not creating greenhouse gas. >> could your technology remove

the need for say four or five truck drivers? >> yes and no. we are trying to make sure the trucks are full all the time i don't think, no matter how wildly successful flock freight is we are probably always going too much a shortage of truck drivers in this country. for instance what you are seeing at the port of language beach and san pedro is ten loads of freight that need to be picked up for one truck drivers that's available. unfortunately, a third of those truckloads are only 50 to 60% full if we could make sure all the trucks are full all the time you may not only seven trucks against that ten loads we are still going to have a driver shortage but we could see increased velocity in the supply chain. >> if you could require all the trucks to be full that might go a long way towards moving things around orrin, thank you for joining us. we hoke hope you check in soon. >> thank you for having me.

>> that does it for "the exchange," everybody busy hour. "power lunch" begins right now >> here, kelly s what's ahead on "power lunch." a new wave of cyber attacks. russia believed to be behind the aggressive campaign, ignoring u.s. sanctions that target the i.t. supply chain. we will look at the risk for companies in the security stocks that are in play plus, the facebook papers, the latest black eye to the social network the stock falling over the past month. will the bad news extend to its earnings plus crypto for the masses, mastercard will now let banks offer crypto credit an