the lockdowns are not going to be a part of the strategy. if that's the case, again, i probably would look, as you suggested, to add to some of the value sectors like energy, basic materials. >> all right, jason. thank you. we got to run. >> what about brian kelly? >> i can't believe five seconds make sure you join us tomorrow "squawk on the street" is next >> good morning. welcome to "squawk on the street." i'm carl quintanilla with david faber and jim cramer m moderna's ceo suggests a drop in efficacy oil 67 gasoline futures lowest since april. our road map begins with the covid fears on track for a sharply lower open

>> plus the fda begins to meet this hour to consider merck's new covid drug if it gets approval from the panel, well, the pill would be the first oral home treatment available for covid. elon musk says the nightmare is not over. walmart and volkswagen say they see signs of improvement we'll start with this morning's action and regeneron, moderna, what do we do with this? >> we interviewed meg yesterday. she did not agdisagree with the. he told you, look -- >> moderna's ceo >>. >> if you go back -- i read the interview and he calls it a material drop in effectiveness did anybody hear that when he spoke to meg

what happened? what did he find out yesterday pfizer, meanwhile, bourla hasn't changed his view pfizer has something pretty effective. but then we had len from regeneron. he had been saying that his thing could be great and now it's not i say this means slowdown. it does not mean the end it means slow down and slowdown is such that when we have powell who spoke before he heard bourla in the remarks, i think he's going to come back and say, look, i told you that we've got real problems here and so, therefore, i think that we're back in slowdown mode and what do you buy? they're buying homes. >> we're not going to lockdown, no way. >> you saw the ten year? >> i've seenthe ten year >> i just -- what does it look like >> you want to know what it looks like you have to go secular growth.

you have to go back into the web. i have salesforce tonight. people are throwing away the drug stocks. i think that's a big mistake it's not like all of these health care companies require you to be able to do like medtronic where you had to go to the office there's nothing elective about most of these drug companies i'm not saying go by merck, people are worried about -- >> what parts of the economy actually start to suffer, then that's what i'm trying to fully understand we're not going to lockdown. demand is going to drop -- >> drop in travel and leisure. you don't want to say, i'm buying southwest well, there -- what i have to do, i am trying to teach is, when you see something and it sounds like you should buy it because -- while it's down it might be down for a reason. american air has fallen very

badly. someone is in possession of bookings and i just can't imagine the bookings go up a lot of us have holiday vacations that we have already canceled because we're fearful carl, i think fear means slow down but slow down does not mean the end. it means a shift -- >> question is, how long it is too. >> until the next variant. >> until the next one. >> we're all vaccinated. you know this would be a different discussion. >> it's moving through south africa through an unvaccinated it doesn't mean it will do the same here where we have largely vaccinated -- >> i've been saying over and over, we have not had the case here when we get the case here, that's the second shoe but what i fear is that we know -- >> we still don't know so many things. >> if this was insider trading we would be -- >> are they allowed to trade any one of these companies

>> south african doctor says symptoms are different and it seems to effect a different population to a certain extent. >> the south african doctor who is of some note, she's not saying the thing is horrible that's why the market came back yesterday. it's interesting, the ceo of moderna, what he giveth, he tookth away. i want him to explain how you can be bullish at 7:15 and bearish later in the day. >> he referenced talking to some scientists who said this is not going to be good that was one wrinkle that we did not hear on "squawk box" yesterday. >> true. but i also feel that when we had this kind of inconsistency we owe it to the viewers to have the ceo of moderna back and say, look, was it the -- i got to

tell you, i parse what he said yesterday. it was radically different. >> it's always good to hear from len. he made a point and people should listen. the antibodies, the antivirals, and we'll talk about the merck drug from a moment, could prevent that this virus was able to mutate in one immunocompromised individual for a very long period of time take a listen. >> people like to say this is man against virus. but in some respects it's mankind against virus. we're one organism if we have a weak link in the chain because some people, unfortunately, are having chemotherapy or in the province in south africa, the instance of hiv infection is 20% it's not a surprise that in that immunocompromised population that variants are emerging and they're emerging by leapfrog

mutation, not slow evolution and this is going to keep going until we deal with treating everybody, including the immunocompromised. >> although, the oral antivirals from merck and pfizer do stop and repress that mutation that would occur. they could be very important in mitigating variants as well because they don't act in the spike protein to begin with. and today, of course, the fda panel is going to be considering the merck drug that we've been following for a long period of time schleifer took a shot at it, talking about the interim versus the full analysis. but judging from the fda's slides, the staff and what they're saying, there does seem to be quite a bit of support for it from the staff and one would expect the panel will follow through as well. they allow as much as eight hours.

meg tirrell says certainly by the end of the day. >> i've been involved in drug trials 30% is okay. >> that's important. and don't forget, again, this goes back to what she was tal talking about, immunocompromised people are the incubators. knocking down the virus -- >> an average of 50,000 people die in the last ten years from the flu. if you're telling me that you can take this pill, which has now been -- pfizer has something better allegedly if you have this pill, it's going to kill fewer people than influenza. we could say the world is coming to an end or we could say -- i prefer to go back and buy power. i want to buy one of the faangs because it's -- digitization

does not stop. witness the fact that we should -- we have to understand there are two forecasts for what happened on black friday -- >> oh, yes >> and i'm going with harley finklestein. the adobe numbers represent the new modern capitalism. the resignation is not to resign and sit around and watch netflix. it's to actually have your own company. >> start your own business that's why you've seen record business creation. adobe did come out a few moments ago and say sales down one four for the weekend and they said buy now, pay later, revenue. huge bump. >> affirm, affirm. affirm and after pay, square. we haven't -- >> we'll talk about him in a moment is there a slowdown already?

>> no, there's absolutely not a slowdown capitalism has changed here. i think that we -- this is modern capitalism and it's happening very quickly we don't seem to realize that people do not necessarily want to buy traditional when you look at etsy's numbers, etsy has been a fabulous stock shopify is doing well -- >> etsy plays on both sides. all the sellers who now devote most of their time and to carl's point -- >> this is modern capitalism >> they have left the workforce, so to speak -- >> you like my term? modern capitalism. >> how about post-modern how about contemporary capitalism >> listen to me -- listen to me. >> okay, i'm listening when you look at shopify and etsy, you should think about, no

supply chain problems. second, back to a level of capitalism that is almost prepre -- what i record as -- not the cotton gin, but the factory floor. i don't know if you order anything on etsy, they always come with notes. you don't get those notes when you shop at nordstrom. they suggest, here's a better idea you want to have -- i had way too much all spice this year not next year. too sweet. >> too sweet. >> you can't have that there's nothing worse than a bad pickle. >> how about 57 jars of bad pickles. >> we'll talk about some of the metrics we're going to watch today. i think the ceo of moderna is speaking later on -- >> he's jekyll and hyde this

guy. >> when you have these guys -- let's say i'm speaking with pfizer and they said you're going to need a booster. that's going to make a fortunate for pfizer, that's you you're going to be trying for a booster three months later this is pfizer making a little more money no i got my booster >> maybe the fourth booster is going to be against omicron. >> what do you think about omicron? >> it's not the easiest greek letter. >> delta air lines is probably grateful -- >> someone saying we have to go -- today i'm completely ignoring it because of the variant. the variant trumps anything. >> a warning to the booth this morning. >> take a look at futures here we're off of the early morning

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welcome back 24 hours or so -- almost exactly since we told people that jack dorsey would be stepping down as twitter ceo. and twitter does have a new ceo. reporting since then, of course, and many others have this as

well, this was something in terms of the succession plan that had been put in place for some time, it does appear, based on a number of conversations that i had with people familiar with the situation parag agrawal was the chosen successor to mr. dorsey. the only question was, when would dorsey choose to -- when would the board come to an agreement that it was time for him to see you later he's not been solely focused on twitter to say the least for quite some time. he will continue as ceo of square where a lot more of his net worth is at stake. if that matters to him he's one of the richest people in the country and he's focused on bitcoin and crypto and things of that nature but the question now, jim, is, what's this guy going to do? the board -- i have reported and others -- was fully behind him for quite some time as the option they would go to when dorsey stepped down. and in his memo yesterday as

well, dorsey indicated he also was fully in support of that for a long period of time. >> david, do you think that having the technologists with technology that we all know frankly isn't that good is the best hire? i understand this ipo, it was only up 12% from the ipo >> twitter >>. >> that's all it was. >> i think in the end, i was hoping for someone who would be dynamic about being a salesperson for twitter. ned was not -- >> he was not really considered. >> no. other than by me >> other than by you >> they overrode me completely but brett taylor was heavily involved. >> he's becoming the chairman now. elliot put a statement out

saying they're excited about agrawal but taylor. >> do you think it signals any sort of major change in direction? >> i think there's a hope that he will mirror the fact -- nadella was an insider too. >> that's true. >> look what he's been able to do there was a hope on the part of some shareholders that it will follow a similar playbook. somebody who's been at the company for some period of time but is unleashed in a different way as a result of not being the ceo. >> nadella sold almost a quarter billion dollars of microsoft. >> can you really blame him? that stock has appreciated tremendously. >> twitter has a headline out, starting today, you will not be able to share private media such as images or videos of private individuals without their consent. >> you have to pay >> that's just the headline on the reuters a moment ago. >> somebody who takes a video on

their camera of somebody and puts it on twitter, no more, unless that person consents. >> interesting agrawal is the youngest ceo in the s&p. >> really? >> interesting note yesterday, that the heads of ibm, microsoft, twitter and google are now all immigrants raised in india. remarkable. >> i'm so proimmigration half the people probably hate that when you look at salesforce, always has the list of people who weren't born here. maybe that's our nation's strength is the melting pot. >> for a long period of time >> remember your parents were saying, we have a melting pot. that's good. then the melting pot turned out to be a witch's brew. >> don't go back too many generations for us all -- >> 1848, my grandma. >> 1848? >> yeah, out of germany.

i'm not on the mayflower. >> i forget adobe. >> that's a lot of value those guys have created. >> yes >> we'll get cramer's mad dash and countdown to the opening bell the volatility continuing today. wee ckn mont'rba ia me

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let's go to a mad dash on this tuesday we start trading about eight minutes or so from now you've talked a lot about ford but you have more to say >> i have to tell you, adam jonas has a lot more to say. he is what i call the most thoughtful and productive analyst in the industrials today. he says this, i thought this was

a little shocking. ford on pace to sell more evs than gm in 2021 and a lot of this, the mustang mach e it's not just something that they threw out there david, here's something interesting. gm, they've got the hummer coming out with 1,000 horsepower a car -- what happens when you have a car or truck, more horsepower, that means more powerful. >> got it, thank you appreciate that. >> i like this they're going -- jonas thinks they're going to go from 3.5 of ford's volume to 11.5 in fiscal year year 2025 i would tell you, as much as i love adam, i think those numbers are going to be dramatically too low. >> so even with this -- by the way, you have been there for every one of those percentage points.

>> actually here >> you still think more to go? >> no -- investment club name and i think it has more to go. i know it has more to go. >> you know? >> if you believe in ev. >> this man is changing ford radically. they don't make stuff that they can't make money on and they are ev-ing their line up like you wouldn't believe you're not going to be able to get one of the -- get in line. the hummer you can't get either. but the hummer is 100 gs i'm excited abilout the f-150. >> it can act as a generator. >> unfortunately, i bought a different one. i bought the maverick. >> okay. >> let me know when that comes. >> will do a lot of people waiting for cars, whether they're teslas, rivians, lucids, ford f-150s. >> can you believe that lucid hangs in there

when i went 0 to 80 in half a second, people remember that i remember that too. it was like a thrill ride. what are you pumping here, the podcasts >> i'm doing the podcasts. you can catch us every day, don't forget, any time, anywhere, it's the sq"squawk on the street" opening bell podcast. we'll talk investment club later.

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the opening bell is brought to you by nuveen, a leader in income, alternatives and responsible investing. both powell and yellen will speak in front of senate banking today. we did get powell's remarks and yellen's yesterday afternoon talked about omicron being a downside risk, jim, potentially inhibiting labor supply and intensifying supply chain difficulties. >> we're going to hear from doug mcmillon, he's talked with the white house. all of my sources, whether they be railroads, trucks, retailers say things have gotten much better so i don't want to talk too much about supply

i do think that -- he might have gotten the early bancel and not the later one. because you notice he's, what -- you notice he's saying, listen, it could be a factor how about all the cancellations that you're already hearing? how quickly do people -- do turtles go ruight back into ther shell? how quickly? >> it's a fine line. >> between trying to mitigate risks and getting too far ahead of things and making a decision that's not based on anything and it's -- i don't know where the line is. you're right i'm waiting and -- for when employers who have mandated coming back to the office at least two to three days a week pushed that out. i'm sure we're going to see announcements -- we've seen many of the big techs say, don't even worry about it -- >> tech companies are able to close deals. i don't think the banks are as easily able to close deals i really don't they've been doing it -- why is

citi at 63 what's that about? >> it's not about closing deals on zoom. it's about other things. >> what? concerns about the book? you can't just shrug your shoulders. it's a major bank. >> let's get the opening bell here on the fed, a july hike is no longer being priced in now it's september we did have ten year below 142 is the lowest since the ninth of the month. >> mortgage rates going to go down again we had some logic numbers that show that continual rise in the price of homes, there's a shortage of homes. that continues -- it tells me you got to buy toll.

toll is up 47% for the year. >> i did not know that. >> isn't that interesting? >> yes, it is. >> youhow do you feel about the fact that your investment club owns boeing? >> not proud >> why do you own the stock? why can't you just sell it >> when china comes back online -- >> i've been sitting here for three years listening to the same thing. >> it's not three years. >> it's only two years. >> two years is a while. i want to bring back the cfo, greg smith >> what do you want him to come back as? >> i don't care. i just like the guy. he will tell you, things are good, things are not good. i like a guy who says things are not good when they're not good how about steve?

did you see his piece today? >> he rarely says good things. >> he's after them again he could have done this. >> talking about the breakup of ge, of course. interesting piece in the journal about the success of the appliances divisions as of sell and the fact that they've added jobs in the united states. >> i know. >> kind of surprising. >> and talking about how it could be seen as an endorsement of the strategy to split up the company with the focus, of course, of these various units. >> just another sign -- it's like you always say with apple, done it, don't trade it. >> ge was constantly trading huge segments of its portfolio. >> when we look back at what they should they got bad prices. buy high, sell low

>> when you do it for the fifth time and sixth time, it starts to hurt. when you're giving up cash flow and buying cash flows at too high multiples and you have a lot of debt, it doesn't go well. and i didn't >> larry has done -- >> now we're on the other side of that. >> steve does say that the unfunded pension, now he'sgot that one he has something every day up his sleeve i had the good fortunate to be with david blaine recently, the magician >> again >> but i think david blaine has many cards up his sleeve tusa has a whole deck of one eyed jacks. >> he's relent less. >> don't you admire a relentless ceo? >> if you listen to him, he's saying flanery had a better

shot what does that mean? flanery was after jeff >> he didn't last too long in the job. >> i got a new phrase coming up -- i'm going bygones be bygones. it's a new status for me i read a lot over thanksgiving he's about happiness do you have read the guy >> you got that going for you. >> he's so smart he's smarter than a lot of people. >> big hitter, that lama. >> i sadasked him if he was true what reagan said, how are you doing, fine, he asked him, how are you doing? tu tu, so-so.

>> bofa does upgrade square today, guys to neutral, 221. the fact that dorsey can now devote himself full time to the company they see as a positive, especially with the integration looming, jim. >> did you see that price target cut that they snuck in there that was one of those, hey, let me use this one to just slash -- take it down to -- well, he hammered it. >> 221 is the new target from bofa. >> here's what i want to tell you about square i have dan shulman on tonight. >> you do? >> yeah. >> from paypal that's the first time he will have -- >> what we have to say is, here's the stock that was 300. now it's at 180. can't really find footing because of square and afterpay,

klarna, affirm, stripe, sphopify are there too many companies in this sector? >> buy now pay later >> in the payment sector remember when payments was the holy grail of fintech? >> that's a good question. i have no idea >> i would have liked something other than no idea no idea. carl, ask me something. >> ask you something >> how are you >> i have no idea. >> you're funny today, though, i'll tell you that. >> i got sleep because the game was so boring. holy cow russell wilson, get up here. >> here's a story we were following last week, activision.

the cfo and coo are on a road show talking up the company on zoom it's a zoom road show. meeting with investors, getting sponsored to talk and apparently they're talking about making a lot of progress and they're blaming "the wall street journal" for their troubles. because "the wall street journal" -- >> one of the greatest, we no longer tolerate sexual harassment oh, i didn't know there was a toleration for it. >> you would think they would at least have a senior female executive on the -- >> they used to. >> that story came and went. we'll see if -- >> that road show is having the intended effect there. >> that stock -- that's not good >> my wife is not playing candy crush. >> that's suboptimal. >> my wife is not -- i told her, listen to this scandal

and she says, i still love candy crush before bed candy crush versus me. passed over that one quickly. >> i did i'm going to move on to disney do you have it in for me today when i hold it up to your head, i get a -- sorry >> where's that spac music disney has been a suboptimal situation for a little bit here. and i keep thinking that disney+ is one hit away from getting those mojo back. the espn numbers remain hideous. espn plus -- >> actually, the get-back documentary about the beatles is being seen as evolutionary because it's outside of the so-called disney-like umbrella which could be good for engagement you've got "west side story," reviews coming in pretty good.

"encanto." >> they didn't mention the investment club pick they spared me that. i happen to think, what i say to investors in my club, do you really think -- think a year from now do you really think this stock is on the rocks? do you really think that they obviously have a -- >> it may also -- it's got to be getting hit on concern about tourism, parks -- >> yes >> but is it going to go all the way back to before disney+ >> it had a strong 2020 if we look it's lost almost 20% of its value this year. not good as we pointed out many times, because it is interesting to see, netflix's market cap exceeds its own -- >> netflix is up 1 1/2%. >> netflix is a classic stay-at-home people are going back to that. i haven't looked at zoom in the last 30 seconds.

i'm sure that is up. the knee jerk thing is back. you buy companies that do well with lower interest rates and that means you buy toll and you buy lenar. i'm going to give you some aggressive ones. you can buy home depot, tractor supply why not? tractor supply i mentioned last night on the show, the analysts, if they went to the parking lot, they wouldn't see benzs. doesn't really matter if you're in the country in zoom or a suburb, no you go to the country. you go to the country that's like farther than the suburbs. >> understood, right rural. >> rural >> yes >> tractor supply's numbers have been extraordinary it's not even panting season when did i first tell you about

tractor supply >> a long time >> mr. trash me for disney. >> ford, i always give you kudos. nvidia tractor supply yeah, disney and boeing haven't looked so good for you what are you going to do >> david, i love you. >> you risk adjusting too. your returns are great >> thank you >> you still got costco? >> my cold dead hands you have to pry costco today. >> up to 600 returns this year not as good as tractor. >> the cfo -- is he coming to our cfo conference mccarthy, she's real good. but rich is on the call and he runs a masterful conference call and i'm not saying he has contempt for the analysts. i would never say that but he does explain to you, someone said what's the key to shanghai, why you're doing so well sea cucumbers.

when i was sick -- when i had my back surgery, he would send me a joke every day it would make me happy every one was good >> who knew? >> things you learn. >> that's very touching. very nice. as we go to break, take a look at the bond report. let's see how treasuries are doing. yields down across the board ten-year yield right around 1.44 we'll keep an eye on senate banking. don't go away.

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and get the best deals on every smart phone. welcome back to "squawk on the street." rick santelli live with breaking news our november read on chicago pmi and we're expecting a number in the neighborhood of 67 a big miss here. 61.8 61.8 that is the lowest read of the

year -- actually, i take that back that is the second lowest read of the year. the lowest read was february it takes us back to february when we were under 60. how bad is it? well, we know omicron is probably going to take a little chunk at least temporarily, potentially, out of the economy. so this may be already old news. i will throw this out there, that prior to covid, if you look at january and february of 2020, both those numbers were in the 40s, just to give you some perspective. "squawk on the street" will return after these messages.

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and this morning the volkswagen ceo says the worst of the supply chain issues are behind us seeing light increases in production volumes -- >> there was a note out today that says, don't panic, 22 times 2022 earnings. and guggenheim says it deserves a premium. they have no minimum on the delivery people are ordering a can of soda >> really? >> yes >> that's very unfortunate very wasteful. very wasteful to have a can of soda delivered

really >> i'm saying people are abusing the no limit and i think they ought to reinstitute a limit. >> and elon musk tweeting about the ongoing supply challenges. said this has been a nightmare it's not over. be nice to laer him on the call. >> even the four would agree to that look, he's remarkable and does a lot of stuff that is otherwise out sourcesd by other people. it's like he forsaw the problems with the supply chain. >> i don't know that he forsaw them, but he does like to have control. >> control freak >> and that includes all levels of their production. >> the calls were interesting. the calls got boring

i miss the -- remember, it was shana -- "saturday night live" should have done a spoof of it remember, they did that lousy deutsche coin thing? really, you are a dope next question. i miss those days. >> maybe we'll get him back. we did lose ground morning, bob >> the markets's doing what it always does with covid uncertainty. either way, tech will win. just take a look tech down slightly but holding up much better than overall market apple, ibm, intel. consumer discretionary holding up reasonably well industries, financial, energy. the mantra is very simple.

either way, tech wins. that worked during covid concerns and working so far today. and it's growth over value small cap value have been hurt over the last four or five days. you can see what the market's doing. so, tech is up 1% since last wednesday. industrial's down about 4% energy's down about 4% and banks down about 6%. you have your growth over your value. cyclical stocks underperforming. we don't know what's going on with covid or the variants europe has been struggling for weeks and their markets have been going on prior to omnicron.

germany, france, again they've been struggling with delta outbreaks over there they have problems before it came out ags ahas had a tough year in general. and korea, also has closed a at a 52-week low. this has been a problem all year with supply chain issues and the emerging market etf is near a 52-week low the nikkei has gone nowhere. it's flat the entire year. the nikkei is flat we're waiting for powell but we have his testimony our supply chain issues going to tonight with all the issues with omicron. greater concern it could reduce the willingness to work in person, which would slow progress and intensify supply chain disruptions.

a second wave of supply chain issues so, remember in the first wave, it resulted in higher labor material cost but they're passed on to the consumer 13% is a record for the s&p. essentially maintained in the third quarter. now the concern is if we have higher costs for much longer, we may not be able to pass on the higher costs and that's going to eat into the profit margins. we don't have an answer to any of this and that's why you see the knee-jerk reactions you were talking about. >> indeed. thanks let's get to jim and stop trading. the stock shot up to high 170s it's got a good yield. it's totally safe because they have triple a balance sheet.

and people ought to think about j&j or drug stop people should stop selling them and start buying them. it got so many good franchises and that stock's being thrown away jirts always been wrong to throw away j and, y. >> tonight >> he's traveling this week. marc benioff, i'll tell him to forgive you. >> he has forgiven me. you talk to him every other day. >> kind of true. wasn't he on last week >> you got a great show. i'm really looking forward to hearing. erant you? >> yes see, carl's a gentleman. you on the other hand. >> skounteral.

scoundrel. we'll see you at 6:00. "mad money." a reminder you can get on the new cnbc investing club. go to cnbc.com/investing club or use your phone and point it at the qr code. testimony from powell and yellen don't go away.

good tuesday morning markets looking for direction here, amid more commentary of concern, regarding the new variant. in a few moments, the foed chair and treasury secretary will testify on the economy we'll take you there live as soon as it begins. consumer confidence out. morning, rick. >> good morning, carl. indeed, our november read on the conference board is out. and it is a slight miss. expecting a number very close to 111. 109.5. and just like sthaugo pmi,

it' it'sest read since february and we're at 131 really puts a face on this number and present situation, moved from a final read last month of 147.4 to 142.5 that obviously is lower. and we look at what lies ahead, based on expectations, also sequentially lower by a lot. 87.6 vurlss 9.3. and on the headline at 1 or09.5, not only the lightest since february, it follows 113.8 we see interest rates continue to be the safe haven, not the dollar index this time around. morlgen, back to you >> thank you we are 30 minutes to the trading session. here are three big movers we're watching retailer, dollar tree. getting down graded to neutral at goldman sachs they're saying stock is too expensive.

shares down about 3% but up 25% on the year. plus, facebook parent, metta, told by a u.k. regulators gift sharing platform could harm social and advertisers metta dis greed. and biogen saying it could be less effective against the new omicron variant. meghas those headlines hi, meg. so, there's been fears that of course the omicron could effect the vaccines or how well the antibodies work. and they're noting there is no data yet showing this but modeling suggests there could be a hit to theactivity from the aerpt body cocktail on omicron

they expect further data on the antibodies in the next month >> actually, thought about a lot of -- even most of the variations that could occur and we have another antibody that's already started clinical testing. but we have probably the larjest collection in the world. we think we're going to be in this for a long, long time just like vaccines are going to have to adapt, we're going to have to adapt monkroenls and we have a large repertoire of them. >> that's a message we've been hearing from a lot of the companies. and they're working on updating the vaccines meanwhile, i also wanted to flag information pointed out by scott gottlieb from a story out of south africa by the app. looking at the characteristics of patients hospitalized or

infected with omicron in south africa specifically, 450 hospital admissions they say 87% of the folks are unvaccinated 13% vaccinated the health department overall noting very few vaccinated people are testing positive right now. perhaps suggesting there should be protection from the vaccines. but we're going to have to wait for moreitatau to confirm any of this >> david here. it's also an important day for merck and their antiviral will be reviewing it. what are the expectations that you're hearing from your reporting in terms of what the staff has said and when we might hear something >> so, the meeting is ongoing already. we're hearing from scientists this morning talking about how the drug works and safety and efficacy it's expected to go until 5:00,

when the committee is expected to vote. just before then on whether to recommend who should be authorized and looking at the fda documents that came out last week is they're in favor of clearing this they just want guidance on the appropriate patient populations. pregnant women, vaccinated verses unvaccinated. giveen the characteristics of the drug but we should have more throughout the course of the afternoon. >> thank you megtyrell. let's get to steve liesman on what to expect from powell and yellen both testifying shortly. >> yeah, markets dialing back on their expectations for fed rate hikes amid fears of the new virus variant. powell will say the outlook for inflation is more uncertain and

eris the that they could focus more on the pitenshal inflationary impacts and say greater concern fwhoutds virus can reduce the willingness to work in person. which could intensify supply chain disruptions. meaning the fed could decide to keep tapering or accelerate tapering in response to another wave the way city hears it, they increasingly view covid as a supply, rather than demand shock. and could imply more hawkish monetary policy. they continue to prices out the possibility of a springtime rate hike the probability dropped from 56%. the other world we used to live in now, it's just round 30%

and not priced until july or legalitier the key is the unknown of the new variant, of course and how the fed chair and other officials think they should react to a new wave or maybe this time focus on the inflation side and continuing to taper or speeding up the taper. >>ial rar take it, steve joining us now, schwab management,ing aual ar given the fact it is a mixed picture, the dow and s&p are lower. the dow is in the green this morning. what are you watching for? key comments or messages you expect to hear from chair powell today? >> it's -- thanks for having me today. clearly things change last week. and i think this new variant has changed the dynamic.

where we thought it was going to be very order, end of the year and i think the reaction function that we'll hear from powell, from yellen, from different countries and from everybody, including investors is what we're seeing in the uncertainty in the market today. the big difference between what we saw back in the summer with delta and what we actually see today with omicron has to do with the inflation picture we didn't talk much about is it back in the psalmer and we're thinking about everybody was concerned in 2022. was really about the headlining inflation we're going to see in the first part of the year and how everybody was going to react to that. when you put the big cloud of omicron in the middle, it creates a different dynamic we have observed in the way the market has reacted when we hear good news about 3u6 tenshal vaccines, we're seeing

the market thinking about the cyclical world is more reasonable when we see things may not look as good, we're going to see the other side of things, together with inflation will put a very dark outlook for next year it is really a very uncertain time until we get a better sense of what really means omicron in the sense of the health crisis >> i want to bring joel from web bush securities as well. joel, given the fact it is a mixed picture, tech stocks moving higher and some of the so-called stay-at-home plays we've seen gyrations, giveen the headlines and where they've gone around this new covid-19 variant. is there a buying opportunity? or do you steer clear if you're an investor? >> you know, it's funny, we came in friday just a couple of days

ago and the carnage was real one of the worst draw downs we've seen in a long time and a lot of that had to do with thin attendance and liquidity for most of my conversations, bullish sentiment remains in tact for tech. we expect to see continued acceleration in pock tsz of the market, which continue to show signs of growing and that's the shift to the cloud, digital transformation, 5g high-performance computing and now you can throw metta verse. in terms of tech, you're not seeing the slow drn in any of the secular trends what jumps out at me though, there's very little risk appetite to bottom pick or go bargain hunting in pockets of the market that haven't worked whether that's higher multiple names in tech or software or

spac or thin tech space, which have gotten desinated this year, that's where we're see nothing vesters avoid the names that didn't work and stay with the horses that got you here >> i will say the wall of worry, the uncertainty around the new variant. you got stretched valuations, you've got earnings growth inflation that is not nearly as transitory as has been earlier predicted and you have a fed tightening how quickly it will tighten remains to we seen here. where does an investor put their money to work, as you look to, not only the final weeks of this year but 2022, giveline the question marks >> i think this is the part where we tend to advise clients and stay focussed on the long-term strategy despite the fact that we have gone through different faces in

different speeds, going from a very fast recession to incredibly quick recovery, going to expansion thinking about the deceleration of the economic cycle we are at right now, it points to the fact that we have to transition away from cyclicals into more high growth quality names where we think that's more the secular trend that will take us to the next phase of the cycle. when you put that into context, thinking of your own risk aversion and investment goals, clearly it's still the place to go, when you consider that relative to the yields you get in fixed income. when you think of the potential rate hikes going to next year, you compare ast classes. clearly you're still favoring equities relative to fixed income that being said, the rotation we're going to see in this period and the length of the roorientation is uncertain

omicron is goingfrom the cyclical component intomore of the deceleration, more traditional growth area we're seeing in the first part of the year our advice is take volatility opportunities, be smart about putensh ellooking at your tax harvesting options you may have at this time and a steady long-term position where you're thinking about risky assets. >> given this moment we're in, in the markets and i want names here, top buys, top sells. >> i think in mega cap land, stick with microsoft and alphabet because they possess the rare combination of strong growth, enormess scale and elevated moorjen and move to the semiconductors price action was fantastic we remain very bullish on the

foundry space. more so because it remains tight, pricing is going higher, which is going to support margins and if you want 5g, they report numbers later this week and my favorite name on cloud spending and 5g is mar strrks ell. >> joel and omar >> take care thank you. coming up after the break, we're going to talk to richard fisher as we wait for q and, tarks to begin with powell and yellen dow is well off the enoping lows and nasdaq's gone green.

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and right now we're offering no payments for 18 months. welcome back to "squack on the street." we're joined this morning by former dallas fed president, senior advisor and board member, richard fisher igate to have you have with us this morning i'm curious to know your thoughts about at least the prepared remarks of yesterday. there's a debate on whether his comments on the variant being a down side risk to demand are dovish, or the risks to supply are hawkish. >> i think it's too early to tell we're so completely uncertain about the nature of om isis, cron and what it represents. i think he just nulkted the unknown. there are no surprises there if you sume they will continue to taper on the $15 billion

level per month, that takes another 450 billion added to the balance sheet by the time they're done and i guess the real question is the speed with which they do it. will they accelerate or not to but there's nothing new in the testimony. go ahead >> you think thehearing is jus a push >> first of all, this is new they have to appear before the banking committee with such frequency right now that we didn't operate that way before under previous chairs and under previous senate rules. so, it's becoming a regular appearance i think the more drama will be whatever yellen has to answer in the q and a period and you should expect that, once again, elizabeth warren will seek some dramatic statement with regard to jay powell. >> okay. richard, it's morgan when we see testimonies like

this, it's the intersection of policy and politics. president biden just renominated powell we're coming to midterms next year does he owe biden to be accommodative. a rising rate environment last year obviously has ramifications. >> i would argue the opposite. i have not spoken to jay powell about this but this is firmly my opinion. that the white house wanted to get brayner the job. they tested it on the hill and got negative feedback, including from some democrats. so, if i were powell, i would not feel i owe anything from the president and i need to conduct monetary policy with my independent thinking everybody knew the white wanted

to give this job to braynard he needs to do what's right. if i were chair and i'm not. so, there you have it. >> what is the path for monetary policy sn depending on what happens -- and i know there's a lot of question marks and unknowns we've seen the impact of previous variants and what it's done to economic growth and skiddishness where the labor marked is concerned and supply chain and inflation and the fact it hasn't been so transitory is the risk rising here? >> we'll have to see we have inflationary impulses. there's nothing monetary policy can do about the supply constraints. what it has to deal with are inflationary expectations. and the fact that we do have a

longer inflationary impulse than was originally expected. from the standpoint of building in expectations, the way businesses price what goes out the door to cost increases and what comes in the door once you build in mentality, you've got to offset that with monetary policy. and this is a very difficult decision that needs to be made but we know this we're going to continue the balance sheet. the market is discounting no change at present or less an amount of change and once i get that process done, we will probably see the beginning of rate increases. the market's already priced that in at the short end of the curve. it depends on how quickly they decide to taper the balance sheet and we'll get better insight after we have this meeting in december. >> while we're talking, the tape

has an item now, white house considering richard cord ray of vice chair of supervision. might remember, first direct orof the consumer protection bureau, currently over seeing student loans and education. what do you think the calculus is behind this particular role at the white house >> i think they have to satisfy the roprogressesivals and the pressure they're getting from that side of the democratic party. but whoever gets nominated, has to go through senate approve we'll just have to see what the response is on the hill. everyone of the people has to be confirmed by the united states senate if there is a call that they can get it through, i would imagine they would push him.

>> and finally, for every headline we see, today rirtds volkswagen and a couple from walmart yesterday. essentially garbage given the new uncertainty because of the variant? >> too early to tell again, we just learned about the variant last week. and they're saying it may not be as bad or may result in mild symptoms and we're going to have to wait and see. i'm happy we're responding quickly, even though there's an enormous amount of uncertainty we have 246 vaccinations and boosters now we'll have to wait and see what kind of effect this has. on the other hand t may be the beginning of correction on the

fact that seems seem to be priced for perfection. so, stay tuned as you always do. >> they always appreciate it when viewers do. >> i'm trying to sell your show. it's a great show, by the way. >> thank you >> bye >> we are going to take you live to the senate banking committee with powell and yellen right after this break don't go anywhere. you are first generation college student. (crowd cheering) stand up if you're a mother. if you are actively deployed, a veteran, or you're in a military family, please stand. the world in which we live equally distributes talent, but it doesn't equally distribute opportunity, and paths are not always the same. - i'm so proud of you dad. - [man] i will tell you this, southern new hampshire university can change the whole trajectory of your life. (uplifting music) use a single hr software? nope.

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we take you to senate banking where and, and, a has begun. >> the costs of almost everything else for most workers has been rising for years. you've said, secretary yellen, the bipartisan infrastructure bill and build back better will bring the cost down for most americans. could you explain that >> yes the build-back better plan

contains support for households to help address some of the most burdensome and most rapidly rising costs that they face. for example, the costof child care, which is virtually unaffordable for many american families there's subsidies for quality child care that will bring down the cost for the great majority of american families universal pre-k for three and four-year-olds and a tax credit. all of that will bring down the cost of child care and for families facing crushing burdens, for example, rental -- high rental costs in many areas, the additional money that they

get through the child tax credit will help them keep a roof over their family's heads and, as i ind indicated in my opening remarks, is already helping them put food on the table with respect to the costs of caring for the elderly, build back better contains support for those who were disabled and the elderly to get care in their homes. there are subsidies and increase in the pelgrant and money for education and for workforce training that will make that more affordable and reductions in the cost of prescription drugs. these are some of the most burdensome items in family budgets, ones that have risen more rapidly than the general

prices over time and the bill will help families meet those burdensome expenditures >> thank you, madam secretary. chair powell, is it still your belief is that higher prices in certain sectors are chiefly costed by the upheaval we're experiencing and as it eases, so should inflationary pressure >> i would say it this way generally, the higher prices we're seeing are related to the supply and demand imbalances that can be traced directly to the pandemic and reopening of the economy. and it's the case they have spread much more broadly in the recent few months across the economy. and i think the risk of higher inflation has increased. >> thank you

the dollar -- this is a question for both of you. the dollar's control bide the american people. but stable coins are controlled by opaque technology companies over and over. we've seen tech firms put profit ahead of the public interest is it risky -- and start with you, madam secretary is it risky to let control fall into the hands of these companies? >> i believe that stable coins can result in some greater efficiencies in the payment system and contribute to more efficient payments and only if they're adequately regulated. they recently issued a report, indicating there are significant risks associated with the

currencies, risks to the payment system, risks of runs and risks related to the concentration of economic power and we have called upon congress to put in place the stable coins, a regulatory framework that would make them safe and protect consumers and put them on a level playing field with other providers of similar services, such as banks. >> do you agree with that? >> yes, i do >> thank you in closing out my time, i think it's important to look at a bit of historical perspectival as both of you have explained to me in the late '90s and early 2000s over the subprime mortgages were build as financial innovations they pushed a weakened safeguard

saying a cloud of legal uncertainty held over the derivatives market and their words could discourage innovation and growth and drive transactions off shore later the banking lobby argued regulating subprime mortgages would decrease borrower choice derivatives and subprime mortgages are key factors in the racrisis it looks again, again, again like they use the same arguments for stable coins and decentralized platforms today. we should be concerned about that and understand the historical parallels and listen to this very bipartisan panel. >> thank you, mr. chairman since the topic of the debt ceiling came out, let me remind

all of us of what we know very well the democratic colleagues could raise the debt limit all by him theselves, anytime they want and there's nothing republicans could do to stop them. the tools have been available to them all year long and republicans have offered to expedite the process there's only one reason that our democratic colleagues refuse to use reconciliation to raise the debt limit and that's because they have to spefify the amount of debt they want to lay on the people i think we should be very clear about what's going on here mr. powell, under the new flexible average inflation targeting, it remains at 2% and now on an average. and inprefered inflation metric is above 2% over the past five years and 3% in the past three

years and 4.1% over the last year and yet the fed has maintained an extraordinary emergency monetary stance. looks like this is a weakening of the fed's commitment to stable prices. i know you believe this is transitory life is transitory how long does inflation have to run above your target before the fed decides maybe it's not so transitory >> well, first of all, the test that we've articulated, clearly, i think has been met now you're absolutely right inflation has run above 2% for long enough that, if you look back a few years, it averages 2% it was not the case and was many years since we've had inflation at 2%.

i think the word transitory has different meanings to different people to some it's a sense of short lived. we use it to mean it won't leave a permanent mark in the form of high inflation i think it's a good time to retire that word and explain more cleek clearly what we mean. >> it still strikes me as extraordinary that the economy is past recovery we're in a full-blown expansion. we have record-high asset prices housing is leading the way where houses are unaffordable and yet the fed is going to purchase mortgage-backed securities and scheduled to continue to purchase more for months on end. i would strongly urge you to

reconsider the pace of the tapering secretary yellen, i want to follow up on the discussion of payment stable coins they were define sdwhd definition is, and i quote, those stable coins designed to maintain a stable currency and therefore have the potential to be used as a widespread means of payment, end quote that certainly covers every major stable coin that exists right now. what strikes me as perplexing is the president's working group is that all stable coins be required to be deposited by institutions only. but relative to a feat currency, they vary. others look like money market accounts still others look like something wholly new

why suggest that they all must be regulated the same way and treated as depository institutions >> they all have the potential to be used as a means of payment, regardless of how they are used at the outset when they're introduced and the structure that they aspouz and ad here to, which is that they have stable value relative to a fiat currency, that's really what depository institutions guarantee >> i would suggest we think this through. i think the different designs suggest there might be different regulatory approaches. pillar one of the biden administration's international tax agreement will be the most

significant tax change in 100 years. to implement it, everyone of our bilateral tax treaties would need to be modified. there is no historical precedent to bypass the senate process to implement pillar one yellen, i asked you to acknowledge that administration would need to come to the senate to implement pillar one. you responded treasury has yet to determine whether one will be needed or not. in my view and that of many of the colleagues, implementing pillar one would require modifications to the existing bilateral tax treaties and those must be approved by two-thirds of the senate. the executive branch cannot ignore the senate. on what is our constitutional ability. >> thank you, mr. chairman and thank secretary yellen for being our guest speaker at the

providence chamber of kmrgs last week and i learned something there. i always do when i'm with the secretary. she's the only person that has been chairman on of the economic advisors, kmarm of the federal reserve and chairman of the fed. and mr. powell, let me extend my congratulations to your reappointment. what is troubling is the labor participation rate has remained depressed. and until we get that we're going to have the complaint we receive the inability to get workers, etc.

the cause of the participation rate and how do we rectify that? >> the unemployment rate has dropped 6.5% and participation has moved sideways i think when unemployment insurance ran off and schools reopened and vaccination -- we all thought the would be a significant increase in the labor supply and it hasn't happened there's tremendous uncertainty and also linked to the ongoing pandemic people are reluctant to go back to work, reluctant to leave their caregiving responsibilities and go back to work, because they feel schools might be cleezi closing again ad things like that what i'm taking on board is it's going to take longer to get labor force participation back we we're not going right back to

the same economy really it's going to take -- often labor force participation is a lagging indicator and that's probably on track to have that happen and that means to get back to the kind of great labor market we had before the pandemic, we're going to need a long expangsz to get that, we're going to need price stability. and assess the risk of inflation is a major risk to getting back to such a labor market >> thank you so much madam secretary, let me thank you for the flexibility in the emerging rental program. bulk utility payments have been very helpful to rhode islanders. one area is very difficult and always seems difficult and that is the homeless population can you look at and try to

develop guidelines and how they use that for homelessness? >> that's an extremely important area we're very focussed on it and we'll be happy to work with you on it. what i can say is era funds can be used to provido-called housing stability services, a range of services to the homeless to help them find a stable shelter something that treasury did, a kind of flexibility that we built into our guidelines it redwyers to be eligible for assistance, a household has to

have a so-called rental obligation recognizing that would be challenging for families experiencing homelessness. we re-created an opportunity fo era grantees to provide individuals with a level of intent to pay a rental obligation so, with the letter of intent, that would make it easier for the homeless to be able to secure housing so, those are two forms of flex blts we think will help and we'd be glad to work with you to see if we can identify more. >> thank you and i'm communicating those provisions to local authorities would be helpful and a final point. this is with the home owner assistance fund. i know you're looking at the state plans.

if you could accelerate that to get the money out and if you know, a lot of the moratoriums on eviction are gone or going. and it would be helpful to get the money out. thank you. >> senator of idaho is recognized >> thank you, mr. chairman some appear to announce that unless [ inaudible ] the treasury faces imminent default. that's not how i've read your comments it would be helpful to clarify what your current projection is and run dangerously low of operating cash i also request treasury provide details of the cash projections to the finance committee and look forward to receiving those projections. >> let me clarify what i said.

what i indicated in my most reecent letter to congress is i have a high degree of confidence treasury will be able to finance the u.s. government through december 15th. but there would be scenarios in which treasury would not have sufficient funds to continue to finance the operations of the u.s. government beyond that date i would note that on december 15th, treasury will invest funds from the infrastructure bill and j that would be $218 billion of capacity when those funds are and government securities.

and i didn't say that there is no way that we can make it past december 15th. there's a range, an uncertainty about what our cash balance will be and resources right now there's uncertainty about where we'll be on december 15th and there are scenarios in which we can see it would not be possible to finance the government. that doesn't mean there aren't also scenarios in which we can we think it's important for congress to recognize that we may not be able to and therefore to raise the debt ceiling expeditiously. >> thank you for that clarification. chair powell, inflation hit 6.2%, which is the highest in more than three decades.

still they're pushing for support of a nearly $2 trillion social spending package. and that number even accepts their budget gimmicks that could mean several trillion more in spending over the next ten years. much of that spending does much to amillierate the problems and will add fuel to the inflation fire i'm concerned the administration is not taking inflation threat seriously. and in the case energy prices, is enacting regulatory policies that they themselves think is a threat do you think inflation is a threat to the economy and how do you plan to address inflation? >> i think the threat of persistently higher inflation has grown. i think the baseline expectation is still, as i mentioned and

most forecasters, is that it will move closer to our target next year. but clearly the risk of more persistent inflation has risen what you've seen is the policy adapt and you'll see it continue to adapt we'll use our tools to make sure higher inflation does not become intrenched >> i noticed in your opening statement, you noted inflationary pressures will linger into well next year you stand by that? >> yes, i think we can now see certainly through the middle of next year, it's an expectation forecasting is not a perfect art, as you may have noticed into the middle of next year that's our expectation of course, what happened is the data's been pushed out repeatedly as supply side problems have not really improved >> and if congress were to pass

an additional 2 trillion plus in spendsing, mixed with a number of increases in taxes, would that add to inflationary pressures? >> senator, i'll just note we have a long-standing policy of not commenting on active legislation, as you're not surprised to hear. >> i suspected that. one last quick question. you've indicated there would be a report by the fed on its discussion paper relating to digital currencies and that's been delayed several times my question is when can we expect the fed report and are there reasons for the delay? >> i would think very soon certainly in coming weeks and the reason is they're just trying to get it right and find the time to get it right it's been a very busy time, as you all know >> thank you senator warren of virginia is recognized >> thank you, mr. chairman and good to see you, secretary

yellen and congratulations, chair powell, on your reappointment. i want to start with you, fed powell i actually think the fed's activities in the pandemic, whi could have been a complete economic meltdown. and while we did spend in excessive of $5 trillion both under president trump and president biden recovery from covid, i think history will treat those actions, certain areas excessive, but i think net/net from the historical perspective it will be well regarded both for the american economy and the world's economy. but i think, as you indicated chair powell, you know, i think we're seeing our economy come back we will differ on the bipartisan

infrastructure plan and maybe a bit of the build back better, but that's part of your job. but i have seen since your fmoc's november meeting that the fed signaled a shift announcing starting the move back from some of the very aggressive means you've used and announcing a tapering on the pace of bond purchases month by month as the economy continues to strengthen. i would like for you to get into that which factors most influence that decision for a gradual change in course and how long do you think it will take the fed to gradually wind down these purchases? >> so we actually haven't made a decision on that, but i would just say this, the most recent data particularly since the november fmoc meeting show elevated inflation pressures are rapid improvement in many labor market indicators without an accompanying addition of labor supply and also strong spending that really signals growth, significant growth in coming

months remember that every dollar of asset purchases actually adds accommodation to the economy, but at this point, the economy is very strong and inflationary pressures are high and it is therefore appropriate, in my view, to consider ramping up the taper of our asset purchases which we actually announced at the november meeting, perhaps a few months sooner. and i expect that we will discuss that at our upcoming meeting in a couple of weeks of course, between now and then we'll see another labor market report, another inflation report and also get a better sense of the new covid variant as well before that -- before we make that decision. >> let me drill down on that a little bit i mean, clearly i think i was surprised, you say you were surprised, most of us were surprised that coming back in september that we didn't see more folks re-enter the labor force. i believe that tapering and frankly accelerating it can kind

of serve as an insurance policy if we don't see this return and we see these potential overheating of the economy so i do hope that you will move more aggressively on this tapering i would like to touch again, you mentioned some of the new v variants with covid. what factors, we need to maintain some ability to move quickly and we obviously congress moved very quickly under president trump and secretary mnuchin, with the outset of covid. hopefully we won't have to come back to those kind of actions from this entity but with these new variants coming on board, how will -- what are the markers you're going to look at to determine how that might influence fed activity >> so at this point we're listening to the experts and looking at the same thing, i'm not one of those but i talk to those people and it's really about transmissibility, the

ability of the existing vaccines to address any new variant and it's about the severity of the disease once it is contracted. we don't know -- i think we're going to know -- what i'm told by experts is that we'll know quite a bit about those answers within about a month we'll know something, though, within a week or ten days. then and only then can we make an assessment of what the impact would be on the economy. as i pointed out in my testimony, for now it's a risk it's not -- it's a risk to the baseline it's not really baked into our forecast >> right i'm done with my last 20 seconds not get away without at least raising an issue i raise with secretary yellen and chairman powell i've raised with you the very smart action that took place again under president trump on investment in cfis and minority depositatory institutions and i want to thank chairman brown and so many others including secretary mnuchin we made that investment

and secretary yellen you're implementing that. we have take a break from the eset program tier 1 capital institutions and hit low and moderate income individuals. i guess with this demand exceeding the amount of money we had, what else can we do to sure up these institutions and press both of you. maybe you can take this partially for the record since i have gone own look at security of cfi debt to increase liquidity of these institutions but if you briefly recognizing i have gone over answer that i would appreciate it. thank you, mr. chairman. >> well, we would be glad to work with you to discuss possibilities there. i think that the infusion of funds into cdfis and mdis, it's historic it's going to make a tremendous difference to their ability to support businesses, particularly

in minority areas. we've seen huge takeup of the ecip funds that have been provided it's $4 billion over subscribed. we're working through applications and we'll try to make decisions on investments shortly, but it certainly shows that it's a program that has the potential to make an enormous difference to this lending we would be happy to work with you to find ways to make it yet more effective. >> i'm way over time could you just say yes, you'll work with me, too, chair powell, that would be great. >> yes, i'll work with you, too. >> senator rounds from south dakota is recognized for five minutes. >> thank you, mr. chairman first of all, chairman powell, congratulations on your renomination i do look forward to supporting your nomination. i think you've provided stability during a very challenging time secretary yellen, it's good to

see you once again and i thank you for your service to our country in september, when you were before this committee, i asked you when you would say enough is enough when it comes to our debt and deficit. you acknowledged that debt becomes an issue when it exceeds 100% of gdp, a level we have already hit as you know. but, said also that since the cost of servicing our debt has been negative due to a long stretch of low rates, our debt has been less burdensome however, due to skyrocketing inflation, i think it's just a matter of time before we exit this very low interest rate environment. do you think secretary yellen, do you think it's finally time to start sounding some alarm bells with regard to the financing of our national debt >> well, i wouldn't want to sound alarm bells. i think that we are in a sustainable debt path, but president biden was very clear

when he proposed the build back better plan that it should be fully financed as the infrastructure bill was. and thatis what cbo found that the fiscal plans that the biden administration have put forth in infrastructure and build back better will not worsen the debt or deficit path and indeed by the end -- >> all right that is both treasury secretary janet yellen and fed chairman jerome powell testifying in front of senate banking committee. some arguably hawkish commentary coming from the fed chair there as well saying that it's good time to retire the word transitory when it comes to inflation. we're at session lows for stocks and seeing a spike in yields for the two-year and the three-year treasury note. we're going to bring in steve

liesman to wrap some of the latest headlines we're getting steve? >> the spike in the two-year is directly related to comments by fed chair powell that the his belief the federal reserve should consider wrapping up the taper a few months early the idea going along with others as well that have been said by other fed officials they should consider a faster pace of tarp powell himself now for the first time, as far as i can tell, joining in with others and not causing the two-year yield to spike. it goes along with my interpretation of his comments in his testimony that they were indeed hawkish and more concerned about inflation that perhaps he thinks the right response to another wave of this virus, a new variant may be not to ease policy but to take away the stimulus a little bit sooner given the fed flexibility to fight inflation. david? >> and steve, real quick, what was your take on his saying maybe it's time to retire the word transitory? >> yeah. he's been sort of moving away from the word transitory for

quite a while now. he has said several times that inflation will linger long into next year, at least well into next year and that it will be easing off some time next year but he hasn't been using the word transitory as much anymore. and now i think he's officially burying it and erecting a tombstone, david. >> steve, thank you. steve liesman. well, with the market at its lows that will do it for us on "squawk on the street. let's send it over to "techcheck" which starts now ♪ ♪ so easy to watch but so hard to say, good morning and happy tuesday. welcome to "techcheck. i'm jon fortt with carl quintanilla and deirdre bosa day two of cloud week is a big