or establish a position in the company that has industry-leading growth and is very innovative in the space >> i've had a couple of people in the last couple of days jump into the name on the pull back bryn and jason snipe i believe steve weiss. >> dick's sporting goods they don't report until the 23er down a little today on the retail sale, less than ten times earnings, compelling skyworks is on cramer's show today. i advise you to listen >> thank you for that. "the exchange" begins now. thank you, scott hi, everybody. i'm kelly evans. here is what is ahead this hour the return of the mall, the need for homes and the need to drill, all involve one thing and it is land so is it better to bet on the location rather than the land itself with every investor looking into this lately we will explore that plus, chips and candles, the action, story and trade on nvidia, sysco and bath and body works, i'm still getting used to

as a publicly traded company by i.t. evil. get back on the bike after a huge drop on the backs of an earnings miss and a 70 decline on the all-time high, is it a buying opportunity? one analyst says yes dom chu is here to walk us through themarkets >> we are dipping today, but record highs not that far from where we are right now, however the dow is down half a percent, the s&p down about a quarter of a percent and near half percent decline for the nasdaq just to give you some context on the move so far today, at the highs of the session, right after the opening bell we were up one point there down 16 points at the low, so that gives you an idea of the trading range. currently down one right now if you look at some of the other parts of the market, cryptocurrencies, a ek to us right now, it might not seem so crazy, we're only up -- only 1% or so, $773 for bitcoin. 60,376 the last trade there, but at one point today we went below

the 59,000 for a coin mark, and we are roughly, call it, 12% below the record highs we have seen for bitcoin watch the cryptocurrencies of course, the retail earnings parade koblts this week. today it will be target and lowe's, moving in somewhat different directions target, lowe's, both with better-than-expected results top line, bottom line, the concern here for target is that target says they're going to absorb a lot of the pricing pressures on the cost side and not pass them on to consumers. what that means is that they're going to take maybe a gross margins hit. profit margin space squeeze. concerns driving that stock down 4% lowe's is up half a percent. it upped its forecast. an idea of the context, target shares this year up roughly 44%. roughly 54% gains in 2021 for lowe's yes, the pullbacks could be there but it is not from the depressed levels back to you. >> thank you, dom. see you again soon

with of while the market debates how hot inflation will be next year and the timing of rate hikes, my next guest is focusing on one thing he says will be inflation proof, land. he says we need it to drill for oil and gas, to build homes and to develop shopping malls and it is a great inflation hedge joining me is bill smead, portfolio manager of the smea d.va fund. you are nearly double the s&p. tarring is one of the top holdings land, let's start with your advice to investors very interested in this right now >> well, if you go back and look at the 1970s when inflation was a problem for the whole decade, there weren't a whole lot of areas that actually did benefit. i notice a lot of people are coming out and saying, well, this company can pass along pass increases, so, therefore, they're insulated from inflation. but oil and gas and real estate did extremely well during the

'70s when almost nothing else did well, when inflation became the number one issue >> so which kind of land are you interested in? because there's a lot of people literally online, you know, buying parcels of land in states everywhere across the country. is that a strategy you would recommend or are you talking about stock picking with land as the most important aspect of it? >> yeah, two or three years ago people thought i was off my rocker, and some people still do, but because we thought that the millennials would spread themselves out all across the country, right we thought it would be the biggest migration in migration we had seen since the coal mines closed that didn't happen for the first year or two and then the pandemic hit and what did we have happen? now the second and third and fourth tier cities are seeing that population, and all you need is water and wi-fi. so we think there's more money in that case by building the house, because the homebuilders make their money from building houses, not developing lots

today, which makes them a much less difficult, much less cyclical business, and that's the only way that an individual household can insulate themselves from inflation, is being their own landlord and that payment is fixed rent >> again, for those who bought a house in the rush over the past year, year and a half, you are saying to them, you know, they're worried they bought at the highs and you're saying it is still a good inflation hedge an could hold the value well over the next decade let's talk about what is going on with oil and gas where you like continental and occidental. what are your thoughts on the biden administration trying to lower the price of oil here? >> we're not political in this at all i find it interesting that you pay a dollar more for gasoline in california than you do in arizona. so what's the difference the taxes. i don't see -- i don't hear president biden picking on states that are raising the price of gasoline by taxing people to death.

so it is just bizarre. i mean you restrict the keystone pipeline, you say no drilling on federal lands, you don't do anything else and you wake up when the law of supply and demand is demanding higher prices and say, you're a bad people >> yeah, no, i take your point and your holdings speak for themselves on that front let's talk about shopping malls. what kind of upside do you see these names have already doubled this year. >> well, we did some forensic research last night. we saw the james bond film at the bit more mall area and then went over and had a bite to eat at one of the restaurants that they're the landlord to. you couldn't get a parking spot. it was a tuesday night and you could not get a parking spot, and not all the snow birds have come down here yet so it is -- we don't know what is going to happen with covid. we have another spat here, people could back off a bit. but what we think is happening is people are spreading their

christmas shopping out over a three-month time frame to make sure they're not stuck looking for something not in stock, and it is very favorable for the landlord >> so how much upside do you see for those names? i will throw target in there as well, because we saw obviously the stock reaction, some concerns about profit margins. >> yeah. target's been spectacular for us ever since jeff bezos laid that in our lap in 2017 when he went into the grocery store business. i thank god every day for jeff bezos going into the grocery business you are to understand that we are looking at shopping that people thought was going to be completely dead and now what we know is the combination of online and physical stores is magical, right 80% of theorders that ecommerc for target are picked up at the store. what bezos did, invited walmart

and target to be major competitors because of their physical presence and not having to provide the logistics by the way, target is down today because they're worrying about gross margins. how come amazon is not down because target is worrying about gross margins? they have a nightmare going with doing all of the logistics so it is interesting >> i know your views, you're concerned about tech and how it would trade but it has come around your way this year. again, up about 46% year-to-date, one of the best years you have done. bill, thanks for your time today. we appreciate it >> thanks, kelly >> bill smead with smead capital management this news alert out of the 20-year bonds that went up for auction went over soggy. rick santelli with the details >> soggy, perfect word i gave it a dog plus, but there's definitely roger maris as terrific on this grade, and i will tell you about that in a minute 24 billion, 20 years, the auction -- the yield at the

dutch auction, 2.065 the when-issued market was trading 2.05 so it tailed a basis point and a half, but the problem is look at the chart. you see what happened with treasuries they rallied pushing yields down that helped get the tail -- helped make the tail so large. you can see that yields popped up right after the 1:00 eastern results came out so dog plus, i gave it a d-plus. all of the metrics from the bid to cover at 2.34, indirects, directs, dealers at 20.4, they were all actually very close to ten auction averages the pricing really was the problem, and the rallying really distorted potential results but it is what it is and it really underscores the avoidance to some extent by investors here. there was lots of investors that jumped into a 30-year boon about five years ago in europe, which makes us the sell side look for the spreads against european rates to continue to widen kelly, back to you >> all right rick, thank you very much. rick santelli, again, with

another pretty weak demand at the treasury auction let's switch gears to general motors which president biden is visiting today. the stock hitting a new all-time high and on pace for its best year since emerging from bankruptcy 11 years ago. still, the shares have only doubled since then meanwhile the newest ev makers on the block are growing much more quickly rivian's market cap blew past gm's phil lebeau spoke ahead of the president's visit with the details. >> a huge day for general motors as it opens fact torrey zero it is the old plant that for years was building internal combustion vehicles. they've taken less than two years to go from building those internal combustion vehicles into saying, you know what we are only going to build evs here it has a number of people saying what is next, what can general motors do to super charge the

plans when it comes to electric vehicles the president of general motors, mark royce, tells us this is just the beginning >> we're going to do 30evs by 2025, and no one else, no oems, no spacs, no startups can make that claim so, you know, we're in it for the long haul. >> notice his reference to no oems, no spacs that's because they know what is happening with the market valuation for other companies. here is what they're banking on, the appetite for evs is only expected to grow dramatically from here. that 2 million figure by 2025, that would be about 12% of the total u.s. sales that are expected to come along and yet you heard him reference oems, spacs and new startups in the ev space take a look at the market caps again. this is what he is talking about. the fact that tesla has by far the largest market cap, that's not new, but it is what has happened with rivian and with lucid. briefly, lucid surpassed general motors earlier today before it pulled back.

for rivian, while it is pulling back today it is way past general motors in terms of market capitalization, which has a lot of people saying, hey, is the market a little too frothy here about the expectation for the ev makers? quickly take a look at shares of general motors we asked mark royce the question, kelly, a lot of people have been posing which is, look, should general motors spin off cruise or some of the ev action to capture the ev entities he said, no, that's not the plan they're too integrated and they believe too much that those assets are crucial to growing general motors in the future there's no plan to spin off the evs at this point. >> it has been an impressive and amazing display to watch those cruise robo taxis take the roads in california, obviously early days, but it will be interesting for the president because they're trying to push down high gas prices, but as long as they

stay at these levels it is making the evs a little more attractive >> a little more attractive, no doubt about that, but keep in mind that the evs generally on the market right now are higher-priced models you are not getting to the point where you have people saying, look, should i buy an ev for $35,000 or should i buy a camry for $35,000, giving you a point of reference here on a couple of more modest-priced vehicles. when we get to evs down under 40 grand, that's when you see the comparison for the mass market between prices at the pump versus going electric. >> and tesla has been raising prices quite a lot just in the past month or so phil, we appreciate it thank you, sir we will check in soon. phil lebeau in chicago today >> you bet coming up, peloton is back in the red after the second best trading day ever one analyst is naming it a fresh ti tick he will make his case next plus, covering nvidia, cisco

and bath and body works set to report after the bell. we el tell you what to watch and how to trade it. stay with us this is "the exchange" on cnbc (rhythmic electro rock music) (crowd cheering) - bito, bito, bito, bito! - [announcer] bito, the first u.s. bitcoin-linked etf.

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♪ welcome back to "the exchange". let's talk peloton it has been a wild ride for the stock, which is down about 6%

today after climbing 15% yesterday on a billion dollar stock offering p-ton up 8% in the past week even with the gain shares are down 41% over the past two weeks and almost 70% off the 52-week high my next guest says the stock has been punished enough with us is jonathan comp, an analyst at rw baird. he has an out perform rating and $90 on the stock jonathan, welcome. why now? >> yeah, great question. thanks for having me, kelly. i think to call the downdraft here in the stock stunning would be an understatement the stock has been cut in half over the last two months and most of that is the last eight to nine trading days and we think it is overdone here. we think there's a lot of signs that the low 50s could be a bottom on a sustainable basis here for the stock yesterday's announcement of a billion dollar equity raise certainly helps that that removes one near-term overhang in our view, and looking forward over the next

several months and quarters we think that the catalysts here could actually improve relative to the very low expectations here >> have you been surprised at how poorly peloton has traded this year? >> yeah, there's a lot of factors at play. i think it is always difficult to separate the short-term trading from the longer term prospects. if you step back and look at the long-term prospects, both for peloton and the connected fitness and at-home fitness industry, we think the prospects are brighter than ever if you look since covid, the adoption rate at home has accelerated. we still think there's potentially as many as 70 million households in the u.s. alone that would consider a connected fitness device, and there's tens of millions of bikes and treadmills that are installed in houses in the u.s. alone today. so we think the opportunity is as bright as ever. certainly there's been a pull-forward of demand and sort of a plateauing or flattening this year against some pretty tough covid-driven comparisons

but looking beyond the next few years we think the outlook is very bright. even though there's a lot of volatility in the short term we don't think it should detract from the long-term opportunity >> people were scratching their heads yesterday because usually you do a secondary, especially if one under a bit of pressure, and the share is tanking and instead they rallied one analyst said maybe they need to announce some mna quickly that would validate the share's performance yesterday. would you like to see them go that route >> yeah, that's not necessarily our view at this point i think if you look at what's impacted the stock, concerns about the need for equity and more capital has been one of three or four different factors. so we think having a balance sheet now at more than $2 billion of cash on hand helps alleviate some of the short-term questions. whether or not it goes towards general purposes or mna, you know, that will be seen here going forward. we think just the base business, the bikes, the new tread they launched, some of the new products, really in its own can

drive a lot of the growth we expect going forward so mna would sort of be on top of that but it is not part of our fundamental thesis >> so would you say that your fundamental thesis is the same as it was from the summer when you were more at like a 160 price target on the stock? in other words have the facts changed or has just the stock price changed in your view >> yeah, it is a very fair question i mean certainly the short-term uncertainty about demand has changed from a short-term picture and we are still ahead of the next few months, which are very important for this category we think it is actually going to be a good holiday as seasonal demand shows up and as demand for the new tread starts to show over the next several months maybe stepping back, bigger picture, if you look at the stock today it is still up 70% versus january of 2020 the subscription business is also about 70% larger than we thought at that stage, going back pre-covid this is a better business fundamentally. it is larger, it is having

better engagement, it has still low churn, and we think very strong opportunity here. so we think this is a good opportunity even though the path to get here has been a lot bumpier than we would have expected >> sure. i'm still contemplating whether to get one i probably will be a permanent contemplator unless it is free on a monthly basis, the price has come down. thank you for joining us >> thank you, kelly. >> jonathan komp with rw baird still ahead, one startup is looking to bridge the gap between the metaverse and real world without relying on ads and backed by big names in media and tech world take a look at work day hitting a record high ahead of the earnings tomorrow after the bell cowen updating the stock to buy, and jim cramer says he expects it could be a blowout quarter. sign up for the cnbc investing club camera. just point your phone's camera at the qr code on the screen we're back in a moment

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♪ welcome back to "the exchange," everybody let's get a quick check on markets as we are almost half past the hour. it is the worses performer today, quite clearly down .4 of a percent. s&p is only down 8 points. a mixed day for the sectors where rally, financials and industrials are lagging. discretionary and health care are your winners we are watching financials in particular after the 20-year auction wasn't that great. here are some of the movers. tjx, marnt of t.j. maxx, leading the s&p on the back of strong earnings tjx is up 8% today we are watching the 71 level, if

you remember, on earnings exchange yesterday it is at 75 now. visa hitting a nine-month low after amazon said it will stop accepting its credit cards issued in the uk citing high fees the visa underperformed the dow, down 17% the auto dealers are lower after morgan stanley's adam jonas worried about direct-to-consumer threats by ev makers like tesla. he is down groiding penske and sonic and cutting. they're all in the red today in fact, penske is down 11%. group 1 is down 10%. he doesn't have a buy rating on any. moments ago moderna filed for emergency use authorization with the fda for the covid booster vaccine for all adults ages 18 and older. mrna is getting a 5% pop on the news to rahel solomon for a cnbc news update rahel. >> hi, kelly here is what is happening at

this hour. the man known as the qanon shaw man has been sentenced to 414 months in prison after storming the capitol on january 6th he said his behavior was indefensible but he is not a violent man or a white supremacist. on the news, the defense is set to begin closing remarks in the trial over the killing of ahmaud arbery. hear their last words to the jury at 7:00 eastern steve bannon has pleaded not guilty to obstructing the january 6th congressional probe. bannon was indicted last week on two counts of contempt of congress more than 125 victims of the deadly astroworld crowd surge are suing rapper travis scott and others for at least $750 monday other defendants include the rapper drake who also performed at astroworld and apple which streamed the music festival. the tsa says it is getting ready for a thanksgiving surge of air travel. it expects to screen 20 million passengers during the thanksgiving travel period,

that's from this friday through the sunday after thanksgiving. that's nearly as much as pre-pandemi pre-pandemic levels. kelly, between this and sometimes square and the ball dropping, times we're getting there. >> we're getting there shares of bath and body works sliding. will holiday spending get it back on track? cisco earnings haven't missed in 20 quarters. will today be the one. we have all of the key metrics to watch and how to position ahead of today's "after the bell reports" right after this. ♪ feel stuck and need a loan? move to sofi and feel what it's like to get your money right. ♪

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♪ welcome back, everybody. it is time for another edition of "earnings exchange" where we give you the action, story and the trade. today's line-up is nvidia, cisco and bath and body works. let's kick things off with

nvidia the street expecting earnings of $1.11 per share on about $6 billion in revenue this afternoon. shares were lower into the report, but still up 130% this year let's bring in josh lipton with the story along with tim see more of see more asset management, cnbc contributor welcome to both of you josh, nvidia, i have to imagine high expectations for this >> as you mentioned the stock is up about 130% this year. it is about 50% since the company last reported results in august so expectations certainly hot headed into the print. beside the bottom and top investors will have questions about the segment. there's some interesting puts and takes in the quarter and also i'll point out supply is relatively limited of the

company's latest and greatest product for gaming how does it impact average selling prices in the quarter? also the data center segment, faster growing, higher margin chips. i caught up with chris rohan for him that's the bogey that he wants to know about. for him the number will be $2.71 billion. if he's right, a jump of about 2 hadn't 47% >> tim, what would you do with the stock? >> i'm reluctant hold on nvidia. i think josh outlined the pressure performance in six months you are up 118%, and the valuation of the stock is kind of why i'm reluctant hold i don't think you sell nvidia on valuation, but, you know, it is traded expensive in the past i do think the mentions on the strength in cloud, even there's some implications i think, you will see some strength there even for some of the hard drive, for wdc, for scan disk i think there's a broader story they will help tell the tale on. i think we priced in a lot of

love in terms of ai and the metaverse. and as much as nvidia has than a own omni verse, which is that essentially digital simulation platform essentially meeting up with the metaverse, there's so much in the stock but i would never bet against nvidia i think the competitive landscape including amd are hot on their trail >> it is well said it is interesting, josh, this is another one of the companies that has run well ahead of the street i think the shares are around 294 and the average street price target is still around 280 >> yeah. listen, you've had some analysts certainly have questions about valuation here others will say, listen, they think nvidia is simply well positioned in a lot of areas that investors care a lot about, ai, cloud, autonomous vehicles and the metaverse. that will be interesting because there we know some companies are building out virtual realms and some investors bet nvidia is a beneficiary. as tim said, nvidia rolled out its own software, the set of software tools nvidia says will be critical when inventing the

virtual realms weemt w we will be on the 5:00 p.m. call, kelly. >> we will see if the shares return to earth. thank you so much. let's move to cisco, out with first quarter earnings tonight. analysts expect 80 cents a share on $13 billion in sales. they should get a boost from remote work, but in the last earnings the company warned supply chain struggles could hurt results it is the first report since they split revenue into seven new categories including hybrid work, security and internet for the future shares are up 26% this year, outperforming the s&p as old tech names seemed to turn a corner here. julia boorstin has more. what are we watching for >> i think, kelly, it is really this struggle between two things on one hand we expect enterprise spending to increase significantly, and on the other hand the question is how much are the supply chain issues going to weigh on results. we got warning in the company's last quarter that they were seeing shortages of certain

types of chips, but one thing that could work to the stock benefit is that that might already be factored into estimates and expectations for the quarter. so that's going fob the key struggle at play here. then, kelly, just want to point out some other key things, that the company has really been pivoting to focus on recurring revenue streams. that makes it a lot more predictable. in the prior quarter 80% of software sales were from subscriptions. the more chips over there, the more predictable the revenue becomes. also, this is the first quarter in which cisco is breaking up its divisions into seven new divisions. so services and products into the seven new divisions including hybrid word, end-to-end security and internet for the future, so these will be key areas to watch it is a new way to pars results for the company. >> tim, this is the only one of our trio today i think you are clearly bullish on >> yeah, i am. i own it i think the valuation makes a lot of sense and we'll get to that in a second

julia outlined it where the trends at least on enterprise spend and even small business, smbs are very, very strong i think we've well flagged in some of the networking peers have, you know, given us all the necessary insights into where supply disruption and what not are hitting the business i think to the extent you factored that in, but it gets back to where cisco really is building on this is a hardware company that wants fob a software company again, julia talked about the recurring revenue. and even perpetual software. so this is the higher part of the valuation, and i think investors are comfortable with putting a hybrid multiple on this old tech company going new tech, and i think you're somewhere around 18 times with hardware at a 10 times subscription software, 25 times, everything else somewhere in between. it makes it a really attractive, longer term story. i think the high single digit growth numbers are enough with the profitability inherent in those new-age models really like the story. i think you've weathered some, i

think some reassessments, and i think the bar has been well set going into the number. >> i think we said 20 consecutive quarters they beat we will see if it is 21 tonight. julia, thank you finally today the tongue twister, bath and body reporting results later. they did crush earnings estimates last quarter they've now got a holiday shopping boost coming their way practices. they have a leg up in the supply chain, sourcing 90% of their inventory from north american, still down about 6% since formally changing their name in august let's bring in courtney reagan for the story here >> hi, kelly i know you love the confusing tickers. this is bath and body works. remember, this is the company that sells the lotions, the hand sanitizers and sort of just that being fundamentally what it is, it is something that gives a lot of analysts some positive momentum going into this print they believe it is going to be a winner for the holiday season. they believe it is going to put up some good results even though

it is comping a really tough quarter from last year it saw same-store sales growth 54%. it is one of the retailers allowed to remain open, remember, when many others were sold because it sells things like hand soap and sanitizers. so were really able to capture on the repeat customer and the consumable purchase. it is also a highly giftable item as shoppers return to stores and find comfort in those special smells around the holiday season, i know a lot of my best friends still love this namesake brand here they're expected to see strength going forward. as you pointed out in the introduction, i think it is really important to note that supply chain issues may be much less here for this name because the vast majority of the production is done right here in the united states. >> incredible. they should get a visit from the president, tim what do you say about the stock? >> and i'm going to be careful not to call them - >> bed, bath, body works and

best buy and best best buy but i think this is in the retail growth space, this is a value stock. actually, if you compare them to an ulta and where they have a similar growth margin in terms of their top line, but at growth number on their top line, but that the margin, if you look at the business it is a low 20s margin business and a much higher margin business for some of the reasons related to supply chain, some related to the products they sell, lower labor, no expiration dates, you name it that's the reason why although i am a hold here, i think the holiday season is going to be great for them i think i'm probably a buy into the holiday season and probably a sell as we get into the next year because i think some of the same trends that were secular headwinds for this type of a company and other big box and other retailers that i think you can beat amazon on a lot of this stuff is something to worry about. but if you put an ulta, ebitda ulta on this, this stock is probably 80% cheap on a relative

basis. in the short term you probably stay higher. >> all right we'll leave it there tim, great stuff appreciates, courtney reagan we have a news alert coming. leslie with the details. >> this one we have been waiting for. they filed confidently in july for chobani, now revealing the goods through the s1 which was filed a little while ago now they say they're going public, listing on the nasdaq under the symbol cho lead underwriters will be goldman sachs and bank of america. this is a company that has seen pretty big top line numbers, over a billion dollars annually. however, growth around 13% and still remaining unprofitable, showing net losses for the first nine months of the year totaling about $24 million. now, i was just going through some of the risk factors, and it is clear that there is one word on the mind of this company, and they know it is going to be on

the mind of investors, and that is inflation what pricing does to their future results, the changes in the market price for milk, which is, of course, the primary raw material used to make the yogurt that they sell they say they source over 70% of raw milk from one supplier, which is dairy farmers of america, and, of course, the raw materials that go into the packaging and all of the things that go into just being able to sell their yogurt and other products in stores and their ability, of course, to expand into other areas like oat milk this will be interesting to watch. the timing here suggests they could get out before the end of the year if they so choose, but we will be keeping a close eye on it. >> a very long time to wait for this one for chobani thank you so much. our leslie picker all over it today. still ahead, fancy financials we are not talking about banks the sector is posting big earnings growth thanks to a bit of engineering we will explain right after this

♪ welcome back retailers have shown some major earnings growth in their reports this week, and for the past decade really but there's a catch. bob pisani joins us to explain bob. >> you know, the good news here is the retail sales and earnings have really been very strong here is the bad news for some retailers, much of the earnings growth in the last decade has occurred because they've turned into buy-back monsters who have been aggressively buying back stock and reducing their share count look here. in the last ten years companies like dillard's, kohl's, gap, home depot, target and others have dramatically reduced share count by buying back stock the share count reductions made earnings look stronger because there are fewer shares outstanding. it is a neat trick in many cases revenue growth has been modest or nonexistent kole's and dillard's for example have roughly the same revenues of a few years ago but the

earnings is higher some of this is because corporations have learned to operate more efficiently so more of the profit flows through to the bottom line, but it is also because there's a constant endless stream of buybacks now, many retailers, including target, kohl's and tjx suspended buybacks during the pandemic, but they've since returned to buying back stock. tjx purchased 300 million in stock in the second quarter, which was the first buyback since first quarter of 2021, and they're increasing now with a recent report. with cash flow increasing, should companies go back to buying stock some would prefer companies increase the dividend instead. the thing here is the companies want them to invest more in terms of the company and put more back into it. but, you know, they already are. for example walmart is spending something like $13 billion in capital expenditures this year simply put, buybacks make earnings look better and companies want that and a lot of shareholders want it, too. controversial but it is getting

even bigger. back to you. >> it changed so much more quickly than expectsed we thought the companies would be paying back debt for years before they could pivot. what account, for the rapid turn about? >> you see the cash flow has dramatically increased for the companies so they can devote more to buying back shares again, it is very political now. the democrats want to tax buybacks they're so upset about this they want more money to go back into hiring people back that were fired during the pandemic or just for investing more money in the businesses themselves, but obviously individuals seem to feel they're getting something out of this. it is not just corporate executives it does increase the earnings per share. >> all right bob, thank you bob pisani >> okay. still ahead, more and more companies from nike to disney are talking about plans in the metaverse. we will speak with the ceo of an app that launched last night to the number one spot in the apple app store about how they plan to mint metaverse money that's next.

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it allows viewers to post videos like tiktok with objects to pair with their content it also allows users to upload nfts and features a coin-based system to reward growth on the platform it debuted as number one in the app store last night is it the start of metaverse social night. joining us now, justin fuse, for our audience who has no idea what i was just talking about, explain what opti is. >> it allows people to create content anywhere with anyone, with all of their friends. they can be in different worlds, be astronauts, merging the physical and digital world creating a new kind of content we haven't seen on social media. >> some of the clips we are showing looks like tiktok. what test difference. >> the difference is the user's ability to blend different worlds, different objects, different filters and mix and match to create a story line

that they want to create, to create a ditch kind of engagement also, there is a great interaction with the objects themselves so there is a full library of -- go ahead, kelly. >> i was going to ask if it was like tiktok crossed with a video game. >> exactly, it is a gameified social network system with a reward system. you are getting real rewards you are going to get opti coins that you can spend on digital goods. a number of users are already doing that but you are also able to buy physical goods from any of our 20 partners. >> yeah. there are a couple kind of business questions to talk about here number one is how you will make money. i don't know if anyone is concerned about that yet also i know it is important to you that maybe the ad model is not your business model. >> exactly. >> explain that choice, what

that means. >> i mean, it's a -- the traditional sort of tv ad model has been all over social media that's really the only model that we have seen with any of the major platforms. what is unique is that we are not doing that it sets up up in a different way. and your perspective with your youers is everdifferent. it is very much quality over quantity and that gives you a great advantage in building a social platform like this. >> it reminds me a little bit of kind the don't be evil mantra, which has now morphed into kind of a punchline with google today. >> yeah. >> when you are new and growing fast you can afford to be idealistic, but at some point it comes to, we are 90% ad supported because we are worth

$1 trillion. i am not saying you are going to morph into that. what is the change that allows you to not be ad driven? and how different is it from the platforms we have seen in the past. >> from the ground up there are no ads there will likely never be any ads on this platform it is all about the engagement with the objects, the brands, the items, the clothes, fantasy stuff, everything you can think of that we are trying to basically drive affinity for you have the whole cycle of consideration down into purchase on one platform. what that means is we are not just doing ads to kick people out to other places. we are actually doing everything here that's why we are never going to have that same problem and it is a powerful idea. >> how do you make money talk about what your plans are for 2022 >> sure. we make money when users actually buy thing so we make digital or physical goods. we make money. primarily on those physical

goods, we have relationships -- initially some of our initial partners were fully subsidizing the purchases. but users can shop for anything a gen z user would want to buy with their money and we establish relationships with our partners and take a cut on that purchase in many ways that's a more old school retail wholesale model. and we are applying to it this space. it is taking off people love it. >> the general store is the metaverse. something like that. >> exactly, kelly. >> you have explained it very well i feel like i understand it is great to have you on and kind of look at -- get an early look at what will play out here. thank you. >> thank you very much kelly. >> justin fuse is the cofounder and ceo of octi. still ahead, restaurants taking a threefold hit between rising costs the lack of workers and the supply chain issues. it is becoming clear who has pricing power and who doesn't. we will dig into those names next you

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welcome back, everybody. it is no secret restaurants are facing head winds from nearly all sides, supply chain snarls, labor shortages and inflation. some are better positioned to deal with them on others kate rommers has more. >> overall menu prices are up over 5% in the last year as restaurant commodity prices soar with beef up 5% and fats and oils upper inially 50% chipotle says it has pricing power, and the ability to protect margins moving ahead we believe we have plenty of pricing power to use at our discretion we will use it when we need to but obviously, we prefer to really keep our value proposition as strong as possible. >> now, mcdonald's said it increased prices around 6% and saw no consumer pullback this the most recent quarter.

shake shack said inflation and commodity prices and labor are reducing margins but think they have additional room to run. echoed by yum brands as well meanwhile, denny's exec said margins were volatile and it would be several quarters before staffing challenges were eased those with pricing power also happened to be the best performers for the year with chipotle, mcdonald's and yum brands up. meanwhile, denny's is up fractionally. >> there was a country song about appleby's which they think are driving its outperformance to chili's. >> all of those do impact sales. the beyonce red lobster thing a few years ago. as kuhl is more associated with

a sit-down experience, and the fast-food and qsr names are grab and go two different offerings. consumers tend to be gravitating towards the quicker experiences and better prices. >> just as we had ventured out to this one italian spot in town thinking it was so closed and we couldn't wait to come here all the time it closed a sign of the times. >> yeah. >> kate rogers on the restaurant beat today thats does it to have "the exchange," everybody but stay right there "power lunch" begins right now >> somebody remind me that i have to take kelly out for a fancy applebies type night anyway welcome to "power lunch," everyone soss ev stand for excessive valuations we will talk to one person who says yes we will also hear from the ceos of a company cashing in on the big ev craze, sowno group, a solar ev maker, going public today. and get this -- soar