the eventual recovery in leisure and travel-related recovery. >> finally, farmer jim >> i mentioned the record air traveler numbers, that's why i'm picking alaska air it does not have international travel it has a pristine balance sheet. >> good stuff. good to see everybody. thanks for watching. "the exchange" begins now. ♪ thank you, scott i'm melissa lee, in for kelly evans. stocks bouncing back after friday's big sell-off. did the markets overreact to omicron or are they too optimistic what, if anything, will the fed do about the new variant how will bond markets react to that plus, jack dorsey steps aside from twitter, the stock shooting up on the news, now falling back we will look at what it could mean for the company we begin the hour with a market come back dom chu has the numbers.

>> we are ten points on the nasdaq from getting everything we lost on friday's session, that's how dramatic it has been. but there are interesting cross currents playing out the reopening trade, yes, it is bouncing back a little more but not nearly as dramatic as technology, media and communication services for example, the dow industrial lost roughly 905 points. we have gotten 346 back. we are at session highs right now. the s&p lost about 106 points. we have gotten 75 of those back. but the nasdaq lost 353, and just a couple of moments ago we got to about 340 points upside or so, so the nasdaq is the outperformer here, up about 2% 1.5% gains for the s&p and the dow industrials about 46%. one of the themes i just spoke about has been the notion that large-cap technology, especially nasdaq-oriented names, has been an outperformer. i want to show you a two-month chart of the qqq trust, which tracks the nasdaq 100 versus the

i-shares russell shares. look at the gap that developed over the course of the last couple of weeks and, of course, over the last couple of months here that has been a pronounced theme many people looked at. by the way, if there are fears, even though president biden in his press conference this past hour said economic lockdowns are not needed right now, if there was a slow down, small cap stocks get hit more than the large cap cousins. watch out for that trend maybe markets are trying to tell us about what the anticipation for the future is. one place that's participating a lot in the upside, melissa, has been semiconductor stocks. i will note not a lot of stocks hit record highs in trading today because we've seen the big pull back, bxilinx up 2.5% it speaks more broadly to the semiconductor trade which bounced back commensurate with the market >> fears of the new strain

leading to the worst black friday session on record for all three indices. today the w.h.o. is warning the latest mutation, the seventh covid variant identified, poses a very high risk meg tirrell joins us with how the drugmakers are addressing the threat meg, they're in high gear right now. >> yes, they certainly are you know, we started to hear from them last week about this, really getting into gear over thanksgiving, starting work on whether they need to update the vaxes to this new variant. we spoke with moderna ceo this morning. here is what he told us about how high his level of concern is about this variant >> we believe this variant is highly infectious. we need to get to work on this, but it seems to be more infectious than delta which, of course, is problematic, and we believe it is already present in most countries i think what happened with the planes coming from south africa

to holland over the weekend is a good example i believe that most countries that have flights from south africa in the last seven to ten days have already cases in their country that they might not be aware of >> so moderna detailing a three-point plan to address this new variant. it has already tested a higher dose booster which it has available shall and they will test that to see if it could stand up against the new variant. they are looking at two booster candidates they've already developed that target parts of the beta and delta variants that may be similar to omicron, and they are working on an omicron-specific booster candidate. we spoke with pfizer ceo this morning, and he told us they started on friday developing a potential new booster or a new vaccine focused on omicron, and he had this to say about his optimism for the company's ability to pivot >> next year it is almost in the pocket $h4 billion we can make.

if there's a new one we can make, we can make almost 4 billion. with that in mind the availability is not an issue the efficacy is very high. there are treatments around. i'm optimistic we are preparing for that and we will win this battle as well >> pfizer also has told us this morning it has increased the manufacturing estimate for its antiviral for next year, now to 80 million courses, up from 50 million it had been projecting previously bourla telling us he expects because of the way the drug works it shouldn't be affected by omicron's mutations they will need to test it to confirm, but merck telling us the same thing for its drug. some hope for the antivirals >> when he was talking about $4 billion in the pocket next year and then another, is it another $4 billion if they have to work on a separate vaccine for omicron? >> i don't think so. think he was talking about being able to turn the manufacturing over and get that $4 billion >> and today we are hearing about a monoclonal antibody

treatment in the pipeline. how does that compare to the antiviral pfizer is working on >> well, it is a really good question we need to look at the clinical data to see how they would compare. it would be an injection rather than something you take by mouth for five days like pfizer's antiviral. they're looking at it in preventive situations, so that's different, too these drugs could have different roles to play, whether you want to take a pill for five days or get a shot, all of these things can play potentially different roles. and it is up so much because it is expected it could hold up against omicron. >> meg, thanks so much we will see meg later on with the ceo of adagio therapeutic. that stock is up making a comeback following friday's sell-off, today's market action suggests last week's action was a knee-jerk

reaction john, great to see you >> great to see you, melissa >> what do you think friday was all about. do you think today's market reaction is where the market should be? >> yes, to us friday was about low-volume trading and a new headline, and the new headline was not favorable. you have been reporting on it this morning those are the two things that caught our attention on friday most of the people in the states were out and a bad headline. >> so where are we in terms of where we go with the markets toward the end of the year with the sort of cloud hanging over the markets from omicron there's a lot we don't know and there's a lot we will learn over the next few weeks in terms of the efficacy of the current vaccine, the efficacy of the drugs in the pipeline that could possibly treat it? >> totally safety is first, so that's number one then as everyone has been saying this year, the path of the virus dictates the path of the economy. so there will be much debate about that, but we see very positive headlines coming out with respect to omicron so far

today. as far as how it affects you and potential variants of it or death rates of it, don't want to really say that, but down the future so stocks are coming back, too the large stocks, as dom talked about earlier, and then it is coming back to all sectors now to being up. it is really building strength as we move through the day in our view, and that's -- that's the correct view given the pace of the economy, given the pace of earnings. >> do you think that the path of the virus has been the predictor of the markets for, say, the past six months or even, i would go so far, as to say a year, or has it been much more so the ten-year yield i guess i'm asking that question because in terms of the trajectory of the gains made in certain sectors, the ten-year yield could arguably be the more important driver of that >> yes and no. so they seem to offset each other just as they did on friday, stocks down, yields down then yields down, nasdaq up, so

there has been that play as dom talked about earlier with the large tech stocks benefitting from that. so they seem to alter each other or go side by side, lower yields, higher yields, et cetera what we would say is that stocks were impacted by the delta variant, really in august and september, almost through the beginning of october, before it became under control or known by the markets that it was going to be under control this one, as you said, wedon't know all of the science yet, but stocks are taking a more optimistic view today, and ten-year is up a little bit today. >> are you just staying the course at this point, john, through the end of the year? do you stay with big cap, do you stay with big cap tech in particular do you go to financials? >> so the equity team, our equity team is going more to a barbell. they will go to the cyclical and then they will stay with some defensive. that's been the right approach they've used that approach because we didn't know the path

of the virus, and that's coming back again do we keep the stance of stocks over bonds yes, we keep that stance real yields are still too negative for us to be moving into, so we keep the stock stance, keep it mostly in the u.s. but we are keeping some small and mid caps, because we think growth is pretty good next year. >> all right john, great to see you thank you. >> thanks. happy holidays >> thanyou too. john augustine jack dorsey stepping down as ceo of twitter and the stock is still down plus, bitcoin is rebounding from the lowest level since october, but the crypto is still on pace for the second negative month. "the exchange" is back right after this this is "the exchange" on cnbc

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♪ welcome back to "the exchange." it has been a volatile day for shares of twitter after the company announced krshs eo jack dorsey is stepping down effective immediately. the company's chief technology officer parag agrawal will be taking over. dorsey returned in 2015 and the stock rallied more than 75%

since then joining us is jason helstein, head of internet research at oppenheimer. great to have you with us. >> thank you >> what do you think accounts for the stock move, a pop and now a drop >> yeah, you could kind of argue there are very few -- i don't know how many, you know, ceos of public companies who run two public companies and, you know, i think it has been a criticism. you know, you have that. we can kind of talk about why. i think when people saw perhaps maybe promoting the cpo and not doing -- and i don't know him, so making no judgments, but not kind of looking for -- doing a formal search. maybe people were disappointed in that. i think you folks and others have been talking about why maybe he decided to do this, maybe had some bitcoin claim so is jack less excited about twitter than he is about square? so you can kind of probably -- i mean the volatile market, right, we can kind of come up with

reasons. >> yeah. >> but this was an unusual situation to have kind of, you know, being the ceo of two public companies >> so right now are you more optimistic about the stock than you were, say, you know, five hours before the news was out, jason? i mean the first thing that came to my mind when i heard the news is i thought, oh, maybe they are going to sell the company because they didn't do an extensive ceo search or really bad earnings are coming, it will be a really bad quarter, bad things are coming down the pike. what do you think? >> yeah, i'm a little less worried about being a bad quarter. we actually think it will be a pretty good quarter for brad advertising. they don't have some of the headwinds around apple some of the other companies have, so we think it will be a good quarter. you know, look, him not being here doesn't make it easier to sell the company maybe a little bit, but i mean, you know, i can't imagine he would have really stood in the way if it was fair value you know, look, again, i do think kind of again that

disappointment, like this is a very interesting company with a lot of opportunity, and whether there would be a lot of people out there who would want to run it so that's probably i mean if you just back up and look at the metrics in the past -- you know, look at a two-year case, they've grown, monetization -- users, 23%, at least in the u.s. on a two-year basis. and then monetization is up 17%. we take a step back and think about this company, on average they spend about half the amount of time per user than on others. so you have the opportunity to increase time spent, improving the monetization gaps. jack, definitely visionary we think he, you know, put together a pretty significant technology roadmap for them. i think the issue with this company has been execution it has been a little bit less about, you know, what do we need to do but let's actually kind of roll up our sleeves and do it.

he really has improved product innovation so i mean, look, for i think -- what do you want to call it? 24 months, they have a pretty straightforward roadmap i think on what they need to do, and now it is really execution >> so what do you now about agrawal? he has been at the company for ten years. >> nothing >> not much. >> yes >> isn't it strange as an analyst for you not to know much about the executive who is taking over as ceo, who has been at the company for ten months, and it just dropped in your lap, you know, one morning that this guy is going to be the head? >> well, our sense is they will, you know, have some kind of analyst introduce him to the street look, it is typical for public companies, the investors are familiar with the ceo and cfo and the rest of the executives are kind of busy running the company. so it is not unusual that investors may not know a cto or a chief marketing officer.

look, historically there was a chief revenue officer that was pretty well-known at the company. so we will get to know him, but, again, if we are just trying to understand the immediate, you know, kind of reaction in the stock, perhaps investors would have wanted a more broad search that would have looked at candidates outside the company >> all right jason, we will leave it there. thank you. >> thank you >> jason helfstein with oppenheim. next, will the omicron derail the fed's next move as we head to break, look at the ev makers. another ev maker is on its way to the public market with phoenix motors filing for anpo i this morning, another name to watch in this crowded space. be back right after this

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♪ welcome back to "the exchange." what a bounce back in the markets from friday's sessions we are close to session highs right now with the dow up a percent. the s&p up a couple of points, up 1.6%. the nasdaq adding 2% on the day. peloton and zoom, lower today, reversing course as they each saw gains during friday's sell-off peloton is down 70% from the recent high. citi cutting the price target on merck to 105 to 85, saying the pipeline struggle will hold the stock back the analyst citing merck's new data indicating that its covid pill showed lower efficacy for more head over to

cnbc.com/pro disney is benefitting from the president's remarks that lockdowns are not needed right now. jim cramer writing that he is bullish on the stock long term and buying more of the stock for his charitable stock sign up for his newsletter by pointing your phone's camera at the qr code on the screen. let's get to rahel solomon for a news update. >> hi, melissa president biden is urging americans to wire a mask indoors and in public places biden says the new omicron variant will appear in the u.s. sooner or later but there's no reason to overreact. >> there are three messages about the new variant i want the american people to hear. first, this variant is a cause for concern, not a cause for panic. we have the best vaccine in the world, the best medicines, the best scientists, and we're learning more every single day

we will fight this variant with scientific and knowledgeable actions and speed, not chaos and confusion. on the news, learning more about the newest form of covid, team coverage tonight at 7:00 eastern. russia says it has successfully tested a hypersonic missile. officials say that the cruise missile hit a practice target from a distance of more than 200 miles. lee elder, a golfer who helped break down racial barriers, died at the age of 87. in 1975, elder was the first black golfer to play in the masters. you're up to date. back to you. >> thank you, rahel solomon. coming up, shares of adagio therapeutics surging today after the company said antibody treatments should be effective against omicron. we will talk to the ceo next this new variant may have tempered the taper timeline. an fdetails on what it could meor the bank stock, still ahead. "the exchange" will be right

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♪ welcome back we are just about two weeks away from the final fed meeting of the year and the emergence of

the omicron covid variant may be having an impact on the taper timeline steve liesman joins us with that story. steve, in what way >> melissa, unless convincing evidence emerges before the next fed meeting the new variant is a mild one, an accelerated taper is almost certainly off the table as the fed is not going to make a move like that faced with the current uncertainty. ian shepherdson writing over the week end, if a clearer and reasonably positive picture has not emerged by the time of the december 14th to 15th meeting, the fed will accelerate the pace of tapering. if it feels like i'm hurting you neck going back and forth, it is, because it turns it on its head days ago the job market looked to be accelerating and there was growing conviction the fed was worried enough about inflation to speed up the taper. what looks to be the new base case, the fed would keep the current taper in place while it

awaits information in the best case where the variant ends up being contained or not as bad as delta, the fed could revisit the idea of a faster taper in january, and then possible rate hikes in spring or early summer in the worse case where the variant requires a reset of the immunizations to date, as in everybody has to get revaccinated and lockdowns are put in place, the taper would halt, growth forecasts would come down. one outcome to look out for. an increase in inflationary pressures because of the new strains could further limit supply, and the fed, melissa, as we've seen can do little about that >> yes, steve, thank you steve liesman. how will all of this uncertainty at the fed impact bank stocks that were crushed in friday's sell-off and slightly down today our next guess joinsing barry knapp, good to see you >> hi, melissa >> if what steve said is correct in terms of accelerated timeline, it doesn't sound like a good thing necessarily for

banks. >> i think it will be fine for banks. so i think steve's probably on to something i have been operating under the assumption that friday's payroll report will be quite strong. the inflation numbers for november, released mid-december, would be strorngng, and we probl would have gotten acceleration of the taper in december okay you move it to january, and then think about what is likely to start to happen to the fixed income market again. this isn't the core of my thesis for bank stocks but we'll start here because it clearly impacts how the stocks trade and investor psychology around them. but you will start to get the same sort of push that we were getting up until, you know, the omicron variant emerged where you will start to pull rate hikes forward. the fed will be even further behind the curve i strongly agree with steve's final point, is this is more of an inflationary shock than a dis

or a shock likely to slow growth we have already seen lockdowns in asia, so that's going to put further pressure on supply chains and it increases the probability of goods price inflation being permanently stronger so you will start to push rate hikes, at least in the back end of them, up further. you will also see there's inflation break even start to move out quite a bit it will be another one of these fed is behind the curve kind of trades that will probably help bank psychology but what is more important for me with what is going on with banks right now is you are seeing a real pickup in loan growth they're starting to cut securities holdings or slow securities holdings. this is good for return on equity which is at the highest level since preglobal financial crisis the underlying fundamental story is getting better and this is really only going to delay the

fed's behind the curve the further they are behind the curve, the more they have to push the front end up and that's what is going to drive bank profitability. >> when i hear further behind the curve, i get concerned that the markets will be in for much more of a shock because the pace of fed tightening will be much faster than what the mashtrketsr anticipating that overall while it may seem good on paper for banks, for market psychology it is a really bad thing. >> it is in the sense that you will undoubtedly get, you know, a four- to six-week shock when we reach that point and the market starts to deal with it. if you go back through every business cycle since world war ii, typically you had one of these fed normalization risk-off episodes last cycle we had eight, and those happened when they tried to end the various qe programs, end zero rate. so that transition, that risk-off episode is unavoidable

and there will be no place to hide, melissa. those are highly correlated sell-offs. everything will go down, but typically that is not going to be terminal for the business cycle. it will be hard for asset prices for the course of four to six weeks, but that ultimately is your buying opportunity. however, if you think about, okay, well, we were positioned for year-end, strong year-end seasonality, i was concerned if the fed announced the taper in december or acceleration of the taper that the first trade out of the gate in january would be down now that looks more like a february type event, something akin to what happened in 2018 where january was fine, it extends the 2021 trends, and then we get to the end of january, they accelerate the taper and we'll have to deal with this in february. so it is a little tactical, but still through next year i would expect because of bank asset mix starting to shift towards loans that they will have a very good year, and that profitability,

return on equity numbers is absolutely crucial above 10%, they build capital quickly. they can return it to shareholders depending on what our fed looks like, but that's really the primary driver of bank stock performance, not the shape of the curve or, you know, moving in short-term rates even. >> even though the president said lockdowns would be off the table, at least at this point, there are lockdowns going on in europe, possibly in asia and other parts of the world because there are populations that are less vaccinated, for instance, and that could pose more supply chain disruptions, barry i wonder at what point do you think inflation caused by supply chain disruption is so sticky it becomes permanent, as you said, price hikes will stick, and that actually impacts the consumer and their psychology >> i think we have some ways to go before we get to real demand destruction. so the way i have framed this out is thinking about we were in a disinflationary regime, much like we were in in the aftermath

of world war ii through the early 1960s, then we went through an inflationary regime where core inflation moved from two to five. during that period, during the lbj administration when it was moving up through to 4%, 5%, equity valuations held because nominal growth was strong. it was finally a good period for banks. they performed poorly in the '50s like they did in the 2010s. so that inflationary regime was okay eventually you got to the point once you blew through 4% as trend, and i understand we're through there now, but assuming we settle down a little bit next year, if we get well above 4% for trend inflation, then that's when it is embedded in expectations that's when it is hard for businesses to catch up that's when, you know, the fact that you have operating leverage because you don't have to replace your fixed costs gets mitigated just by the velocity of that price pressure but i think that 2022 is not going to be -- it is not going to be the case in 2022

but make no mistake, i'm in the reflationary camp. i think eventually it will be a bigger problem for consumer. but the household sector is in such good shape right now it is hard to see demand destruction, in part because rates growth was accelerating before the pandemic and it has further accelerated so consumers will look at this and go, gee, my nominal wage growth is good, i can spend. eventually they will realize they are getting eaten up by inflation but that process takes time >> barry, great to get your thoughts as always barry knapp. >> thanks, melissa >> iron side coming up, shares of adagio up we will talk to the ceo next

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exchange." shares of adagio shtherapeutics soaring. morgan stanley upgrading the stock to overweight saying the company's drug is likely to take more market share relative to other antibodies as omicron becomes dominant with us is meg tirrell, joining us with dr. grimgross. >> thank you for being with us quite a stock move you are seeing in adagio shares. tell us about your approach with your antibody drug and what role you siee it playing against covid. >> thanks for having me, meg the role we see our antibody playing is both in the treatment of covid-19 as well as the prevention so we're running global trials right now in an effort to, you know, substantiate the efficacy of our molecule in these two indications. >> tell us about the way you designed it. where did it originate you know, we have heard about other antibodies taken from people who survived either sars

1 or sars covid-2 in the early days or like regeneron, designed in the lab using mice. how was yours developed and how does it have the ability not to be affected by the mutated variants like omicron? >> the reason is exactly how you phrased the question, is of how we went about discovering the molecule we very early on appreciated the potential danger from variants emerging, and you see this with many infectious diseases, in fact coronaviruses so we from the beginning sort of thought about that possibility and decided to design a molecule that is broadly neutralizing across the entire class of these sars-like viruses. we saw a molecule that neutral ices sars-1 and sars covid-2 and targets a unique site that the virus has not been able to change a lot without using

efficacy we developed this molecule which has shown to be resilient to date against any of the variants that emerged what we know is that our antibody, based on a sequence analysis, is likely to bind to omicron and not lose any of its neutralization potency >> can you walk us through, doctor, how it is that this drug can also treat but also prevent? in morgan stanley's note they highlight the fact compared to the other treatments on the market, you know, from lily and regeneron, theirs are compromised but yours is not they don't mention about pre-venezuela. can you tell us more about that? >> the key differentiating factors are the breadth and potency of neutralization. once you have that, you can improve them to have a half life our molecule has a half life just under 100 days. with that you can now think about a single intra muscular

injection that affords you protection for an entire year. that's powerful vis-a-vis what we have seen in the vaccine space where we have seen high efficacy at the beginning, but as variants emerged that efficacy has been eroding and as time goes by, news ralization titer tends to go down and with that we see the emergence of break through infections our hope is with a single potent neutralizing antibody that can be sustained in the body up to a year we will likely see protection for a longer period of time. the other big differentiator is that the antibody, unlike vaccines today, elicit immune response that often doesn't happen when you are immune compromised or undergoing cancer treatment. this drug upon administration will be there and be there, as i said, up to a year and protect you. that's the key differences >> what kind of clinical data have you seen so far

it tosounded like from your updt a couple of weeks ago you expect to have the full package you need to file for emergency authorization in the second quarter next year and filing in the third quarter. so far what kind of protection have you seen your antibody able to provide >> we have not released any data on the protection. those are ongoing trials that, of course, you don't unblind until you have all of the patients enrolled and have data. but what we have discussed is the remarkable half life of the antibody so the ability of being injected once, and after six months the neutralization titers are significantly higher than we see with any of the vaccines again, this is what gives us hope we can in particular serve patient populations that are not responding well to vaccines and do not mount a sufficient protective immune response upon being vaccinated >> doctor, can you walk us through what the time frame is

to application for eua for this treatment/vaccine? i'm not sure what you want to call a treatment and prevention drug can you talk to us sort of about the window you might have to get it on the market because it sounds like pfizer and moderna are working hard on modifying their vaccines or testing another booster against omicron. if they get those vaccines to market, are you concerned that you miss the window in terms of getting your treatment into the arms of people as opposed to pfizer and moderna >> the short answer is absolutely not what we've seen now and what we have said all along is that this virus is shown remarkable ability of evading the immune system and coming up with new variants the joke we have internally is the greek alphabet is 20 letters and we are at 15 there are more to come the idea it is over with omicron is not the case. there will be many, many more variants we have to deal with.

so asking about, you know, the deployment of, you know, new vaccines, the problem with that is if you stock omicron today, by the time you are basically able to broadly deploy that, there's likely going to be another version or another variant. so i'm not sure that this is a credible strategy. >> all right we're going to have to leave it there for joining us dr. tillman berngross, ceo of adagio therapeutic our thanks to meg tirrell. the omicron variant is not the only thing driving the crypto selling what else is weighing on crypto? that's next.

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♪ bitcoin rebounding today along with the rest of the market after friday's steep sell-off, but the cryptocurrency still down about 18% from the all-time intraday high of $69,000 set just three weeks ago. joining us is the director of news at "the block." frank, great to have you with us >> thanks for having me on, melissa. >> are the highs of the year in bitcoin in >> i won't speculate on that per

se, but clearly we have an asset here that is illustrating a sort of tale of two narratives where sometimes it acts like a tech stock or risk asset and other times an inflation hedge i think if you look at the momentum that's going into the market right now, the amount of billion dollar funds being raised, i would say it is probably hard to say that the highs are in for the year. >> so it is interesting that you said that because i thought the same thing many times. you know, you can say bitcoin is a safe haven one day and it proves to you like on friday that it is not, in fact. so what do you think is the primary driver here and how does it sit with investors, i mean especially as we are looking at such steep percentages above his all-time high? are people getting sort of a little skeptical about the price action up here >> i think if you look at the news bitcoin is going to behave differently depending on the news when we had the cpi data drop on november 10th, i think there was a clear push upwards on the thoughts that it is a safe haven or inflation hedge asset, which

tons of investors like walter e. jones have talked about. if you look at covid headlines, melissa, bitcoin has not looked those headlines and tends to move with other stocks broadly in fact, i have been talking to traders all morning after the holiday, trying to get some insight into what is going on. a lot of them told me they had big-time investors trying to get ahead of a lot of the new variant headlines and selling some of their coin so just like other names, it has been dragged down by general macro on covid and then also, of course, headlines out of the fed. >> i want to ask you about nfts. you say in the notes, and this is a quote, there's a lot of salty sentiment over nfts right now. i want to know what you mean by salty. i thought thanksgiving was going to be the moment when you talked to uncle bob about what an nft is and, you know, we would see a bid in the market along with a bid in ethereum. >> well, i think maybe people on

crypto twitter had too much salt on their turkey if you look at some of the interactions people are kind of upset, obviously. if you look at nfts specifically, you see a lot of athletes and celebrities hopping in, even martha stewart, for instance i got an e-mai i got an email about her second nft drop but the volumes are way down we look at our data, we saw volumes on basis of around $1 billion. now it is sitting $200 million as of last week. i think that's why there are some folks upset about it not being as hot as it was but if you look down the road and the amount of capital sitting on the sidelines from new investors coming in, this is a big point of interest for folks. i was talking today. the person i was talking to is heading to miami for art von bass ill

a huge focus for the art scene is going to be around nfts there is definitely more interest on the horizon. >> do you sense more interest? or do you sense skeptical interest as in interest because there might be a bubble brewing here, or there is going to be a lot of blowouts in nft land that are really going to hurt investors. >> it's a good question. there is no doubt that not all of these different projects are going to have sticking power some investors might get burned on a different project or drop we highlighted the state of the crypto market at the block 60 companies companies in the private market value of over $60 billion. a lot of them are in the game i ing. until 1990, none of the unicorns

were operating in nfts, now they are. you have over cs of the world, and coinbase and instagram i don't think they would be making that move -- especially kroibs, now having to answer to investors, i don't think they would be making that move if they didn't see a huge growth story. >> up next, had you are you on the hunt for yield higher yield in corporates ar'ten your best bet says our next guest

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markets are no longer as reliable as they have been in the past at predicting economic trends gilbert garcia joins us. great to have you with us. >> thank you for having me. thought inflation was transitory what makes you think it is going to stick around? >> i am not sure what transitory means. but it has been a year and you are seeing main components, housing, food, anything else, are continuing their acceleration looking forward into next year i think we are beyond transitory i also think we are beyond the fed's target of getting back to full employment. so in my view, the best thing the fed can do is start tapering immediately and get out of the way of the markets so the markets can function properly. >> even without the fed actually formally accelerating its time frame, gilbert, is there a thought in your mind that perhaps the bond market could do the tightening itself

anticipating the fed is behind the everybody curve. omicron even if it doesn't have the impact here in the united states as it could overseas, it could article? global supply chains even further, causing more inflationary pressure. >> there is no doubt let's talk about friday. friday was a pretty big move when you are in the markets you have got to avoid the noise. you had super rates fall 14 or 15 basis points. stocks corrected about % we are already back. stocks made up half of that. on the bond market we made up about a third of that, meaning rates have gone back up five basis points or so at the end of the day, i believe this new variant right now -- it's premature to push the panic button in our view, everything is still in place for continued acceleration of growth, inflation to be much longer than transitory and we think rates are going to be resuming their levels, frankly, back to where we were before the virals.

you have got to go back to 2018, before all the trade troubles around china, rates were wrapped around 3%. and the economy was on all cylinders. i think that's generally when rates will settle. >> at what point do you think the consumer gets so pinched by inflationary pressures you believe for one that inflation is going to be much higher, much steeper, much sharper. when does the consumer get pinched and therefore impact economic growth? >> i think it's happening now, especially for that's that are on fixed incomes like our seniors or some of those in the minority community i participated in a thanksgiving food give away here in houston and we fed 30,000 people it was remarkable. we have done some of the other turkey giveaways family were waiting in line for several hours for a turkey and for food so where am i going with all that i think it doesn't make sense to focus on things like exfood and

energy everybody needs transportation and everybody has to eat the headline inflation number is what matters, what's important it is running very hot i think we are going to run somewhere around the high 5s or 6% into next year. i think ultimately the best thing we can do is do the tapering much faster, get out of the way of the bond market and let rates go where they should and where they need to. >> what's the consequence of the fed being behind the 8 ball when it comes to their tightening time line? >> in my opinion, what will happen is the curve will get steeper. ultimately you are correcting your first question, which is if the government doesn't do what it needs to do you will see the bond vigilantes return and they will tighten for them. when you look at south africa and what is happening with this variant obviously they must have had good controls or good information to give the world that information

i think it is critical that we recognize that rather than having travel bans which is going to increase the panic and it is probably going to lead to others to be discouraged from sharing their data we need more vaccines there, we need to collect the data and help them with medical assistance. >> gilbert garcia. that does it for us other on "the exchange. "power lunch" starts right now and welcome, everybody to "power lunch. i'm tyler mathisen melissa will join us in just a second here's what's ahead this hour. news out of washington president biden meeting with major ceos on the agenda, the supply chain and getting goods on the shelves this holiday season we will bring you the details of that meeting in just a few moments. call caps struggling, the index sold off hard on friday. it is having a hard time finding its footing today. but a five-star fund manager sayings there are some gems in