retaining customers, i think salesforce is the name here. >> it was part of the big call i mentioned earlier along with microsoft and snowflake as we were talking about it, and oracle by the way as well. josh brown >> uber, but i said my piece on that already sticking with it >> yes, you did. all right. and adding more is josh brown. thanks for watching. that does it for us. "the exchange" starts now. ♪ thank you very much, scott hi, everybody. i'm kelly evans and here is what is ahead this hour inflation. companies are seeing it, consumers are experiencing it and fed officials are calling for action to curb it, but the futures market says they aren't going to act any time soon so should you position your portfolio for a long winter of high prices? >> plus, the headline numbers may look pretty good, but are retail sales actually falling? we do some back-of-the-envelope math and see what the data is telling us shopping for trades, from

big box to home improvement. we have target, tjx and lowe's first today's market, michael santoli doing the honors at the nysc hi, mike. >> hey, kelly. a bit of a lift in the s&p 500. large cap growth strikes driving this so as it stands right now, looks like we are a little bit above the prior closing high this right here was a week ago friday that was where that five-week win streak culminated. the market was looking a little bit stretched. by the way, the intraday high from that day, 4718, still above where we are right now i mentioned large cap growth the nasdaq 100etf pretty much captures most of the move. the 400 level on the qqq, a lot of folks are telling me it is a lot of clustering of bets, are congregated there in terms of the options exposure you see right there, that as well trying to recapture the former highs we only got the minor dip. therefore, the dip-buying impulse is there but it is not

all that powerful. semiconductors looking good, along with banks this is on a year-to-date basis. it is tough to get too negative on the overall cyclical outlook if these two groups are basically in sync and outperforming right now. semis in particular a strong move >> michael santoli, we really appreciate it. see you in a moment. strong data this morning no giving much of a lift to bond yields to the cme where rick santelli stands by with more on that. >> you're right, kelly if you discount inflation into today's rio de janeiro tail sales numbers it takes a little bit of the thunder away. if you look at that from a four or five-month viewpoint you see the effects of inflation boosting retail sales. but it really was all about inflation today. if you looked at import prices, they were hotter than expected export prices at 18% was the all-time high going back to record keeping in the mid '80s and if you look at capacity utilization, we finally overtook

pre-covid levels we are now at the highest level at 76.4 since december of 2019 now, look at the break-evens it is hard to get away from the inflation topic. here is a two-day of break-even. why is it important because yesterday's high and today's high, around 2.77% guess what the all-time high yield close is on the break-evens? it goes back to 1998 on record keeping, and it was in '05 .2.784 that's how close we are on the chart. looking at the dollar, it is the highest levels in 16 months, but what is really going on? in large part it is euro weakness look at the euro currency chart from june of 2020 and you will see what i mean. the difference between our yields and european yields is now 21 basis points wider just month to date. the more that grows, the stronger the dollar will get kelly, back to you >> rick, dwell on that for a second so if our ten-year is at 162,

for instance, what is going on with european bond yields and why does it explain the strong dollar >> well, they're drifting. you know, about three weeks ago they were within striking distance, six or seven basis points of zero they haven't been at zero in three years, and they've started to distance themselves, moving into the minus high 20s. what it has done is, of course, that has played havoc with their currency to some extent because the markets are screaming for central banks to get tighter that's what the break-evens are telling us in the u.s., and that's what the weak euro is telling us about europe. >> interesting rick, always a pleasure. thank you, rick santelli inflation continues to be a major issue for u.s. businesses. mentions of inflationary concerns from s&p 500 companies are surging. according to bank of america, mentions of supply chain issues are up 360% so far this earning season mentions of labor pressures are up 250%. the high numbers have some believing the fed is very behind the curve on tapering, including

more current and former fed officials. st. louis fed president james bullard today saying the central banks should tack in a more hawkish direction to battle higher inflation, including up the taper from 30 billion from 15 billion a month former fed president bill dudley says the fed has no choice but to get the taper done quickly. if powell sticks with his plan, how can investors hedge against inflation right now? let's bring in the president and ceo of hinon and walsh asset management kevin, i will start with you are you concerned about persistent inflation and what is your advice for positioning around it? >> you think that cpi rose 6.2% in the month of october on an annual basis, the highest annual rate of growth in 31 years plus, americans are now paying more at the pump than they have since october of 2014. so inflation isn't going away.

however, the fed does have a tnt program in place to help control inflation, promote full employment, and also grow the economy back from the depths of covid-19 that relates to taper, narrowing and tightening they've started the tapering process, and we believe they will start toaccelerate that tapering process such that we may ultimately see some tightening during the second half of next year with one, and perhaps now two 25 basis points interest rate hikes. >> jeff, do you have a similar view are you concerned they're behind the curve? >> you know, we are encouraging investors not to get overly optimistic or pessimistic about current trends our base case really is that inflation will be significant this year, around 5%, slow to 3% or below next year some of the supply chain bottlenecks, labor shortages ease, and i think we have to remember that data can change relatively swiftly. let's think back to 2018 when everyone was worried about

tariffs and recession that never happened the pandemic, we were thinking a great depression perhaps, that never happened there are embryonic signs perhaps we are at peak bottleneck and that's very important, and, yes, we are building a portfolio that would include some inflation hedges in it, but ones that would do well if inflation and rates rise or if we do get the moderation that we expect in our base case on the inflation process. >> sure. we can come back to those in a moment kevin, i will start with your picks, a lot of which are in cybersecurity and the cloud and those areas, which it would seem like might be protected from -- you know, they have strong secular growth, but they also might be high multiple companies in some cases that could be vulnerable to higher rate. >> certainly we're seeing some recent momentum in the small cap space and with respect to technology stocks if you consider the type of technologies that we are going to need as a society to transform into this new american economy now that's emerging from

covid-19, it is the smaller cap providers of revolutionary technology that should really provide leadership, whether it is in the areas of cybersecurity like you see with a1 networks, enter digital incorporated, and should also benefit from 5g spending associated with the infrastructure spending bill or, of course, with super micro. all of these companies have market caps of less than $2 billion, and we think are well positioned now for upside potential irrespective of inflation. >> again, a10, enter digital, super micro. those are your picks jeff, what about yours >> first of all, i would say when many people think about inflation they think of the 1970s, and so you get traditional hedges such as gold, precious medals, commodity, link securities that can do quite well and we have exposure to those. but, as i said, we want to be more diversified stocks we look at that will do well in a rising interest rate, inflationary environment, would be things like schwab with

exposure to money market balances in a big way, some of the industrials, but also the secular growth names that your other guest just mentioned in the '70s it was the small cap, growth-oriented names that did quite well, and we find stocks within large and mid cap also very exposed to growth. so names that i would mention, general motors, highly tethered to the transition towards electric vehicles and advanced driving. within technology, 5g-oriented, cloud base, qualcomm and service now. also within the industrials area for diversification, you know, we like the oshkoshes of the world and jci, johnson controls, which is hieavily exposed to th trend towards green and green technology >> since you brought it up, jeff, i'm going to ask you about rivian and lucid some pretty extraordinary market cap figures they're both putting up right now >> yes, definitely that's why we think gm is a

great way to play that transition towards electric vehicles without paying, you know, those types of prices. it is as cheap as it is, i think, because, you know, you have uncertainty in transition, but we think they're executing quite well and they're getting in at a much better entry point than some of these other stocks priced at these levels >> delicately said guys, thank you both for joining me today i very much appreciate it. jeff kcrump willman and kevin mahn one startup is cashing in big on a trend, seeing its valuation nearly double in four months the ceo of upgrade joins me next plus, a retail in bonanza exchange we are looking ahead to target, tjx and lowe's we will give you the story on these coming up in just a moment this is "the exchange" on

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year upgrades revenues have jumped rising 70% from june to october. and the upgrade credit card is now one of the fastest growing in the country the co-founder of upgrade joins me now many remember you from lending club how is it going at upgrade and what is the key difference with the company this time around, also in the personal loan space, from what lending club does. >> thank you for having me good to be back on the show. i think the main thing for upgrade, as you said, it is quite a difference, critical than everything else that exists in the market. it is truly -- it is good for you. it is really only critical that helps consumers access credit as a convenience and -- credit card, the building -- finance -- installments -- but really helps customers pay

down the balance much faster than they would with a traditional credit card so they save on the cost of credit that way. >> in other words you are using a credit card to effectively achieve something like buy now, pay later? >> that's right. yeah buy now, pay later, installment loans. it sort of combines the best of both world, installment loans, buy now, pay lay, utilizing partners it is available everywhere where a credit card is available everywhere at millions of merchants but it is very high cost, high rates, a lot of fees, and it is structured in a way that critical -- have been very small, structure credit cards in a way that keep consumers in debt as much as possible and the balance doesn't really come down every month. so we look both. -- so available all -- merchants but at the same time you get the lower rates, low fees, and a balance that comes down every month and just keep better as

you know you are paying down principal and interest every month. >> how do you deal with adverse selection, which has been a problem, again whether at lending club or now in a buy now, pay later risk. i understand most folks deal with -- if it happens on affirm or one of the others, that's the last time i can use affirm does it mean customers hopscotch from one bnpl to the next and next and next and can kind of continue to be bad credit risk that way >> so the way with the npl, critical -- really use the same type of underwriting you would be using for a personal loan so it includes verification, employment verification, pretty strict underwriting -- to help -- assets -- consumer -- are getting positive because

the type of consumers look for their credit card rather than a traditional credit card, it is about the consumer that is interested in keeping their good credit standing, but and as a decent way to pay down principal and interest every month as opposed to the traditional credit card where you can just carry over the balance every month and never quite take care of it and having this never ending debt. so when you choose -- it means it has discipline to pay down your debt every month. >> there's a tremendous amount of innovation in the fintech and payment space right now. regulators have hinted they might need to crack down because a lot of bank-like activities are happening in nonbanks. would that be a headwind for you? i know you partner with banks but who is it you are effectively trying to disrupt. >> i think we are -- to traditional credit card. we actually work with banks in terms of issuing banks, partner

banks, a lot of the credit card balance created by -- actually purchased by banks we have a lot of relationship with banking actors, but they -- something we are watching disrupting is traditional credit card we think it is better for consumers and that's something -- to appreciate, the fact that instead of pushing consumers further into debt and i mean the trillion dollar outstanding credit card debt in this country that carries leverage at 17% interest rate, instead of that figure -- consumers access -- paid down their balance every month. >> very interesting. you even offer crypto rewards to people looking for that. renaud, great to have you on we appreciate the update thank you so much.

>> renaud laplanche of upgrade still ahead, elon musk's multi-million dollar stock sales are raising eyebrows on wall street and capitol hill. we will tell you why speaking of tesla, look at the market cap of the ev makers. tesla stands at over a trillion dollars. rivian hasn't had a losing day since going public last week you see lucid vaulting ahead of ford today we're back in a moment

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what's strong with me? what's strong with me? with me! with me! what's strong with me? with me! with me. ♪ welcome back to "the exchange," everybody a quick check on markets a few points off session highs, dow is up 189. that's a half percent gain s&p is up .6 of a percent and the nasdaq adding .7%.

activision blizzard report is falling. a spokesperson says they're disappointed in "the journal's" report and they won't stop it is their worst month in three years, down 26% california regulators filed a gender bias lawsuit in july. peloton was the mystery chart we showed you earlier shares rebounding from the lowest level in 17 months after the company raised just over a billion dollars by selling around 24 million shares at a discounted price of $46 today. we should note less than two weeks ago peloton cfo was asked about the company's cash levels and said they didn't see the need for additional capital raised based on the current outlook. shares are down 69% from the all-time high in january and down 43% in november, although they are rebounding, 11% today hanging on around $53 a share.

over to rahel solomon for an update hi, kelly. here is what is happening at this hour. autopsy photos of ahmaud arbery have been shown to jurors at the murder trial of the three white men accused of killing him the medical examiner said he was shot at close range with a shotgun and the wounds so severe first responders would not have been able to save his life a trial is underway for a suspected serial killer charged with killing 18 elderly women in texas. today's developments tonight on the news at 7:00 eastern congresswoman jackie speier says she will not seek a term in office cleveland will have two teams called the guardians the city's major league baseball franchise and a local roller derby club settled a lawsuit filed over the name. the cleveland indians delayed they're transition to the new name because of the legal dispute. and crowds will be allowed to fill "new york times" square

on new year's eve. the city's mayor say the celebration will be back full strength spectators ages 5 and older must prove proof of vaccination, and those who cannot get their shots or choose not to get their shots for medical reasons must prove they've tested negative for covid. it should be a great time but what a logistical nightmare it sounds like. >> are you going >> i have gone once before in college. i will not do that again but i think you also have to wear a mask, which i mean how do you even enforce all of these things in times square >> i know. i know >> but glad it is back >> that's true we will celebrate that at least. rahel, thank you very much up next, target has only missed on revenue once in the past five years. can the positive momentum continue the street expects tjx to post strong international sales. we'll see if they can do that. plus, lowe's has climbed nearly 30% over the past three months is the stock getting ahead of itself the key numbers to watch and how to position ahead of the key reports is next. be right back.

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♪ welcome back, everybody. it is time for earnings exchange where we bring you the action, the story and the trade on the biggest upcoming reports today we have three retailers reporting before the bell tomorrow target, tjx companies and lowe's let's begin with target whose shares are up nearly 50% this year, far outpacing rivals like amazon and walmart heading into the holiday season what have they been doing right and can they keep it up? joining me with the story is jim kniffen. here with our trade is matt maley, miller tabak's managing director she said welcome to both of you. it is great to have you here i will start with you. you said you used to say walmart, target and amazon couldn't be strong statement but no one believes that anymore >> that's until we call them the watch, walmart, amazon, target, costco and home depot. we have target in with the five of the best retailers in the world right now, and i think that we've got that group right.

i don't think target will disappoint us tomorrow, especially since target's the really domestic company as far as its sales we know that retail sales last month were up 16.3% year over year when is the last time we saw that like maybe never so, yes, i think they will be strong i think they're one of the great companies. they're well capitalized they have a great logistics group. they can get the product into the country. they're doing a great job selling out of every store whether the sale is digital or physical, and i don't think they'll disappoint us tomorrow they will show us one more time why they're in that group of five >> matt, what about you? especially when you look at the charts, what are you watching? >> yeah, i mean this stock, it is interesting because we saw a nice high in the stock over the summer and it started to pull back and people start worrying about how strong is the consumer going to be. i must admit, you know, obviously that has changed everybody is pretty bullish on the consumer, but i must admit i got nervous this past weekend

when the cover of "barron's" talked about how great the consumer is. when you get the cover of a financial magazine you start to get nervous it is too bullish. as i said, it is just testing those highs from the summer. so if this earnings report can be a catalyst from further upside, that will give it a nice higher high, and everybody is looking for momentum stocks going into the end of the year, especially institutional investors, ones that can help the performance. this thing breaks out about 265, but above 270 will really confirm it has broken out, and it should give us a nice rally into the end of the year >> 266 it is interesting if i read it correctly, the forward p/e is only about 21. amazing. >> right it is fairly cheap from the point of view of looking at it on a multiple basis in this marketplace, right so we also have to believe that they have one of the strongest managements in retail. they've proven it to us as they've gotten progressively better versus everyone else. like i said before, they're well

capitalized so they've been able to reinvest in the business and give the consumer exactly what they want. the other thing we're seeing here, of course, is about 6% inflation as well. so that's bleeding into everybody's numbers. now, we know walmart held that down some, but the actual number is closer to 6% in spite of what happens inside walmart stores. i imagine target competing with that, but i also think given the ability to raise price in the current environment they're not going to have any trouble with the cost of goods line either, despite all of the problems of importing goods right now and how expensive that is. >> it is really interesting. we should note, by the way, the target ceo will be on "squawk box" tomorrow more an exclusive interview following the earnings report and we have positive trends from both walmart some that note let's move along to tjx companies, a parent of home goods and t.j. maxx the stock is up 8% in the past month but basically flat on the year they're making strides into

ecommerce and continuing to open stores they have only one underweight weighting on the street according to fact set. matt, why has the stock been a struggle this year >> one of the things, you m mentioned the issue of online retailing and they need to improve on that. one thing i like about the stock that gives it potential going forward, finally help the stock maybe outperform, is a divergence we are having between, as i mentioned earlier, about how everybody is bullish on the consumer right now, and i do agree i think, you know, last year was such a lousy holiday season in terms of just the way people had to spend it, all shot inside i want to spend money, i want to spend it on the people i love. so it will be good however, we do have divergence last friday, of course, we had a lower-than-expected consumer confidence number so we have divergence there i think it will be an issue next year, but on a near-term basis, people -- the reason why conference is low is because of concerns over inflation. what is going to do well in

areas where you are worried about higher prices? you will go to some of the lower priced retail outlets like t.j. maxx i think they will pick up market share as we go through the holiday season and that will be really bullish the other mention, we talked about the technicals on target, this is also coming up against the $71 level. that's a key resistance level. it is bumped up against that a couple of times. if it can break above that, again, it will give it some of the momentum and finally help it to outperform from now through the end of the year. >> it is like a sales price. 69.69, tjx a moment ago. it is a hair higher than target at 22 on the forward basis i'm curious, jim, what you think the story is with consumer confidence it is not just a one-off we are seeing a lot of readings about people being unhappy and even about buying intentions for durable goods plunging >> people really don't like inflation. people really don't like to go to the store and find out that exactly what i wanted isn't

there because it is on a boat someplace. people don't like to think about the fact if i don't buy it now i may not get it for christmas because i won't get the delivery or if i go to buy it at the store it won't be in the store that is putting pressure on their confidence but if you look at what they're doing, they're spending like drunken sailors, so they're clearly saying, i'm willing to spend, i'm not really that afraid but my view of the future is not that given because i see all of these things i don't like. >> sure. >> that's what is happening, but it is not going to hurt tjx tomorrow tjx probably had great sales i have the same concerns matt does about tjx, ross and burlington, the off-price guys, because i don't think they're strong enough in digital, and i do think they've got supply chain issues they're going to have to deal with just like everybody else does. it is going to be harder and harder to get what you want where you want it. but in the short term they've got plenty of stuff in the stores, they're advertising on television which they haven't done before, they're bringing in the customer the customer loves tj as we know and they will have strong sales.

as we get into next year i can worry about the things like over storing like i do in the off-stock price. but right now the consumer is very healthy they're willing to spend, and i will guarantee they're spending in all three of those off-price guys as i said and we will find it out tomorrow when we see the numbers. >> would you prefer an earnings report where they had good numbers but said we're going to invest a ton in ecommerce and the stock goes down as a result? is that what you want them to do, is build out a better online presence >> no, i do want them to build out a better online presence, but they're never going to be a big player i think in that space. i think what they have to do is win the in-store space, and they have to prove to us they're going to do that they're probably going to prove that to us tomorrow. it doesn't keep me from worrying about the over stored thing going on because we know that business in general is transferring online, and they're going to have to live in that world. but i don't think i'm looking for them to do what walmart did

several years ago and just said, we're going to take it and we're going to fix the things we want to fix and we're going to be a big player online, we will invest a lot of money there. i don't think it is really the solution for tj, but i think they have to gradually get better in the digital approach >> got it. yep. there are the shares up just a hair under 3% year-to-date it can move that much on this report we'll see. let's turn to lowe's in the meantime they benefited from increased home sales and renovation during the pandemic the stock is up 4.5% today as investors are thrilled with home depot's results, stellar earnings this morning. you know, jim, you said a moment ago you have watch but you have to add lowe's in there, right? i mean same story. first you thought lowe's and home depot, has to be one or the other. lately it seems to be both/and >> i used to think both couldn't be good at the same time but i have to add them into the group, because right now they're still home depot's little brother. i will give them credit for what they're doing, they're getting closer to home depot all the

time they're becoming a better retailer every day they have a strong management. they have the ability to reinvest like the other big players do i think we will see really good numbers out of them tomorrow they don't have the pro business that hp has and we know a big chunk of why hd was so strong was the pro business but it wasn't the whole story the rest of the story is the consumer has not quit spending on diy and not quit spending on their homes and they're not going to quit spending as fast as we thought they were. we thought they were all going to go over to the apparel side of the business. they didn't. they said, we're just not going to go places we're still going to spend like crazy on both sides. we will spend for our home, we will put clothes on our back, but we're not going anywhere yet. that's what has been happening i expect a really good number out of lowe's tomorrow >> $22 billion in revenue, matt. about $2.35 in eps what will you be watching for this report and the stock? >> well, one of the things that i think a lot of people are missing, really in general, not just on lowe's and home depot

but housing overall is people are worried about inflation. we just talked about it. one of the things that people forget, in the 1970s, early 1980s, one of the best protections against inflation, best hedge was hard assets everybody talked about gold back then, but so was housing housing did incredibly well back then you know, even though higher interest rates were hurting the stock market, they did not hurt the real estate market at all. we've had a huge up -- you know, infliction of buying of homes, of people moving to the suburbs, and we all know about that but i'm not saying that's played itself out, but other people are sitting there going, hey, i've got a great asset here, i'm going to improve it, i'm going to put the addition on the side or i'm going to do whatever to improve my house, and that's, of course, right up the alley of lowe's and home depot. again, the stocks have had some great runs here. they're getting a little overbought on a technical basis so you might not want to chase them on an aggressive manner,

but i think they will rally after the earnings if we get a pull back in the next couple of weeks, use it as a time to get more aggressive. like i said, it is an asset that people don't really look at as an inflation hedge and it has been in the past >> absolutely. you're not the only one. bill socialmead, the best way p can protect themselves is own their home that's why we've seen the trend have more legs than everybody expected we were talking about the post-pandemic hangover, doesn't seem like it happened. >> last time this happened i bought classic cars and houses, the bad news is i paid 12.75% interest on the houses on the other hand, yes, it is exactly right. the consumer looks around and says, where do i preserve my money. they're in the market, they're in bitcoin they should be in hard assets. they probably have figured that out. so they're making their home one of their investments and they're

nesting because they really felt scared last year and they wanted their house to be their cocoon and they continued to feel that way. it may take a long while to wear off, and the inflation thing may take longer to wear off than we think as well. >> all right jim kniffen and his checker board cocoon here to explain things retail to us. good to have you thank you. matt maley, we thank you for your time today as well. good a news alert on goog ol let's head to josh lipton. >> kelly, news on google cloud, saying it is dealing with issues here specifically they say they're experiencing an issue with cloud networking beginning today, they said, our engineering team continues to investigate the issue. it does appear to be impacting some names, snapand spotify among other apps we reached out to google cloud for more clover. color. we will get you that if and when we get that. back to you. >> thank you very much up next, a new report showing one key inflation component is surging, and it is not food or fuel related either.

we will reveal it next and if inflation is going to be persistent, how should you hedge? the assets to buy coming up on "the exchange. we also want to show you shares of pfizer as we head to break. the shares higher after the ceo says the company is hoping to submit the covid-19 pill for emergency use authorization as early as today this made it turn slightly positi escoen from the stat summit we are back in a moment. [aflac!] that's a lotta money. ♪ did somebody say money? he said aflac. well if they're paying out billions of dollars to help cover unexpected medical expenses, what's the difference? coach prime. what... no smoke machine? [aflac!] looks like aflac is ready for prime time. [eh eh eh! eh eh eh!] hey, coach to coach... what do i need to do to get one of those jackets? ♪ get help with expenses health insurance doesn't cover at aflac.com

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♪ welcome back to "the exchange." rents are starting to skyrocket, especially for single-family homes. a report out today marks a new milestone. diana olick joins us with the details. diana. >> reporter: kelly, rent growth is officially in the double digit for single-family homes, just over 10% in september year over year, according to core logic. compare it to barely 3% annual growth a year ago. more jobs and sky-high prices in the for-sale housing market added to strong demand for

single-family rentals fuelled by the pandemic vacancy rates are around a 25-year low. once again, it is the supply/demand imbalance pushing prices while rents are rising is all tiers, the priciest is seeing the biggest gain miami is topping with rents up nearly 26% from a year ago followed by phoenix, vegas, austin and san diego it is likely the top three are getting a boost from a return of the tourism industry austin is seeing a huge influx of tech workers. bottom of the ladder, chicago, boston, philadelphia, washington, d.c. and new york city, just under 5% growth from a year ago d.c., washington and boston had high rents and chicago and philadelphia have higher than average unemployment kelly. >> i guess from that point of view from homebuilder sentiment rising is a good thing, but i can't imagine it will help on the supply issue in the near term. >> reporter: the problem is they don't have the land, labor,

materials, the shortages in supply chains. we saw it from d.r. horton when the chairman said they're slowing sales to make sure they can get the homes to buyers fast enough, that they're not late on delivery you still have a lot of demand, which makes the homebuilders happy, but they still can't get enough homes out fast enough that's a real problem in the market >> and it is a big component of inflation, core inflation especially, and all of the economists are watching to see where we go from here. diana, thank you so much we appreciate it diana olick today. shares of disney having a rough month after an earnings miss last month. despite the miss, jim cramer is buying today he expects share to consolidate around current levels and the worst is behind them and the future is bright you can point your phone at the qr code on the screen to sign up for his investment letter. bitcoin sleeding while gold climbs to the higheest level in five months. which is the best? you can catch the show by

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gold regained luster as investors weigh which office greater inflation protection crypto dropped, erasing gains for the month. meanwhile gold has climbed to highest levels since june. gold or bitcoin, peter are you a gold guy >> i am a gold guy i am a gold bug. but keep in mind the bull case for gold is also -- can be the bull case for bitcoin. i think bitcoin and gold bulls are sort of soulmates in that they believe in a stable currency, they believe in a sound money. they tend to be more anti-central bank. so there is a lot of commonality in the beliefs of bitcoin and gold that's why i don't believe in this has to be one or the other. they can very much complement each other with respect to gold, something that's been around for 5,000 years, is not going to be just replaced like that by something

that's been around for 13 years. >> i love it i just tweeted it out. there you go basically what you are saying is whatever your concern is about what is going on with inflation and the money supply and all of the rest of it, if you are of one generation or philosophy you might choose gold, if you are of a different other might chooitcn talk about what the fed may or should do here what do you now think is the timeline for tapering and rate hikes? do you think it has to be moved forward? >> well, it should end you know, the fed's idea of confronting inflation now is to increase the side of their balance sheet by another 500 billion, then after doing that, still have rates at zero that's not really what they should be doing, put of course it is what they are doing. i think powell and the fed have become so afraid of slowing economic growth, slowing the

demand side of the economy to recalibrate inflation, and just have their fingers crossed that somehow the supply side will solve itself and i think that's wishful thinking there's no free lunch here, if that's the point of raising interest rates, it is to moderat moderate growth to get in control of inflation can't have healthy economy and maximum employment without stable prices. right now, we have unstable prices which creates a fragile economic foundation. >> do you think the retail sales report is a case in point, looks strong until you dig through the numbers and adjust for inflation, right >> so in march after the 1.9 trillion spending plan came into being, retail sales went up 11% in the month of march. from april through october headline retail sales are up 2.4%, but headline consumer

price index is up 4.4% so on a real inflation adjusted basis since march, retail sales are actually negative. >> it is extraordinary to point out we have falling consumer confidence and plunging plans for buying big ticket items. it is weird. in a way the fed would say see, that's why we can't back away too quickly. >> that's why they're handcuffed because they reached a point where inflation is running to such extent that they have to address it, but they're afraid to slow the economy when you look at the 2022, they see the fiscal push this year is going to lap off next year and they're worried because they're focused on maximum employment, if we tighten, that slows growth, people start losing their jobs, what are we going to do. i'll say again, you can't have healthy economy without stable prices right now we have the furthest thing from that.

>> you don't think if they increase the pace of the taper, pull forward some rate hikes we would see the economy slow down in a significant way as a result of that, that the bigger risk is high prices let's call it are creating their own kind of slowdown >> that is a great point and we are seeing that slowly happening in housing where buyers are beginning to have sticker shock, beginning to back away from buying a home. high prices are impacting that i think as you cycle through more price increases which companies seem to be willing to continue on doing that you are going to hit a wall. there's no way in my opinion now to slow the inflation story unless you moderate the demand side because yes, the supply side will normalize at some point, but it can't just be a one way street the demand side has to meet the supply side. the only way is to moderate the demand side. keep in mind, mortgage rates in

my opinion if they had a 4 handle instead of 3, we wouldn't see housing prices up 20%. if money was not so cheap, you wouldn't have extreme demand for autos that created sharp increases for cars because of that and also the supply side issues you almost have to moderate the interest rate sensitive demand side to better calibrate the supply/demand imbalance. >> we talked about this before your inflation recommendations are by gold silver in the minors, gold, silver, copper, uranium. peter's inflation portfolio. appreciate you being here. thanks as always for the time. peter boockvar still ahead, first glance looks like elon musk is making good on his promise selling off millions of tesla shares digging deeper we will sort out musks strange

stock sale next.

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welcome back shares of tesla down 14% since elon musk started to sell billions of dollars of stock while part of the sale was planned, some of the moves have accountants puzzled. >> he is selling off another 930 million in stock to pay taxes on the latest options exercise. so far he sold $2 billion for tax withholding. he has a lot more to go. his tax bill could end up being between 12 and $15 billion on the massive pay package that expires in august. according to sec filings, musk is making two kinds of sales, one for taxes, one for straight cash or for reasons unknown. of that $7 billion in sales,

5.7 billion was not related to tax or options aside from the twitter poll, he hasn't given a reason for other categories of sales. could be selling to invest in spacex or another business he could simply want to take money off the table after a strong run in stock. he will have to pay federal capital gains. musk on twitter calling it closer to tax maximumization than minimumization. he might be able to save billions from not paying california state tax by selling now, he avoids tax increases from congress that if they pass could start january 1st. bottom line, he is selling to pay taxes. but he is selling more to cash out of the stock and perhaps avoid higher taxes in the future >> robert, thank you so much appreciate it. robert frank with the story today. that does it for "the

exchange." stick around "power lunch" starts now welcome, everybody a busy hour ahead. i am tyler mathisen. kelly will join us in a sec. spending up amidst the highest inflation in decades will high prices start to squeeze purchasing power a former industry insider will tell us which retailers may be most at risk and best insulated. the road ahead is filled with inflation. so says the owner of advanced auto parts we ask if his business is turning. and the ceo of qualcomm, diversifying into new markets. one thing he does in spare time to help him achieve his goals. kelly? >> now we have to think about that, tyler. thanks stocks are rising on signs of consumer strength, dow up 200 points, the dow is slightly