the markets hanging in there quite well considering the highest inflation since i was a young pup. >> by the way, if anyone missed that earlier, that's the favorite trip down memory lane people sending in the first car experiences. >> why that contest in the driver's ed segment. >> thank you for watching "power lunch." >> "closing bell" right now. >> happy friday and welcome to "closing bell. i'm sara eisen at the new york stock exchange major averages higher today. the dow tracking for the a best week since march s&p and nasdaq for the best week since july i'm mike santoli in for wilfred frost. price index climbing 6.8% year over year, highest since the 1980s. tracking some big moves on earnings and pops for broadcom

and oracle and a new report on the firsthandful of omicron cases in america mostly mild with one hospitalization and no dearths. dow up about 100. >> coming up on today's show brian deese to talk about how the white house aims to tame inflation. plus the ceo of fintech giant klarna tells us how inflation concerns drive kcustomers to a buzzy payment option mike is tracking the market action and steve liesman with a look at the cpi number there what are you looking at? >> i would say a steady performance in the face of the cpi number, perhaps less bad than feared and opening pop in the shall have popped at this

familiar point we have lost maybe a third of that opening rally starting to get the look of this real like kind of a ceiling right now. it goes back to november 5 at this level and been a lot to go on along the way huge correction ongoing. meantime apple and microsoft up more than 2% net that's defensive and does help the indexes hold together that's what's happening altogether in terms of stocks to move on inflation expectations they had good runs this year but most finished six or seven months ago. real estate is strongest equal weighted basic tmaterials sector and then this is an etf of materials and pricing power stocks and just flattened out with the peak of that inflation

shock type action. real estate is a different story with a growing yield thesis behind the reits and real assets help you in an inflationary environment. on the sentiment side i think the most important thing that happened with the shakeout and c culminated is that it really did turn sentiment more sour and cautious that's a good thing to clean out some of that over optimism and positioning. this is the exposure of the tactical investment advisory type group a survey back down near the lows of 2021. this is the bulls in another survey of investor intelligence and suggests going into year end people are not assuming to get the rally tail winds through december even if they come anyway. >> to make sense of the reaction in the market to the inflationary print with a ton of

headlines and highest number since the early '80s, stocks are higher if this is a market concerned about faster interest rate hikes from the federal reserve you would probably see the opposite. >> if we weren't living with the possibilities -- >> priced in >> for the moment or maybe priced for a slightly higher than expected run. it did decelerate month over month. the core as expected the argument if we brace for something hotter still you didn't get it this time and hearing from the fed next week. >> steve liesman with a look at the cpi print. steve? >> the problem with the current inflation report not that it's high and rising but that it's widespread the answer to the question of what's going up, just about everything the gas in the tank, the heat in the home, the clothing on the

back and food on the plate it's all going up faster than we have seen in years but the big gains not the largest concern for economists 3.8% annual gain in services infl inflation. prices are rising at the fastest pace for those since 2008. for americans this is inflation that hits home because the biggest part of servicing is housing. 3.8% rate and more is to come. they work the way into the index and it could get worse because employers hike wages to attract workers and likely passing the costs along. all more to come perhaps. >> so i asked mike on the question about the market reaction, what does it mean for fed policy and what the market

is pricing in at this point? >> it's so interesting to me the question is interesting. embodies the answer. they've been come plaplacent ab the price hikes. i think the prints get worse if you ask me what's responsible for the turn about of powell last week i don't think it was so much this number and well anticipated. i think it's the numbers to come and the idea it is not going to give the appearance of declining for quite a while. >> thank you within that report we saw food inflation has gotten worse prices at the supermarket surging 6.4% up from 5.4% in october and sixth straight jump. meat among the biggest increases.

nearly every category from cereal to beverages. only dairy declined. ice cream a big part of that when will it peak? maybe soon according to krogers. >> inflation continued accelerate in the quarter. if you look at the last couple of weeks and looking over the next few weeks it looks like it's stabilizing where it is it is early to say that. we're using the data to understand what areas to pass some of those costs through and other areas where to retain it and our teams have done a great job of being able to manage costs so it gives us the capacity to not pass all those cost increases through >> we saw a big jump in food prices compared to last year but motto -- month to month the gain slowed and a sign that things may be starting to turn. also notable if you check food

prices away from home basically at restaurants they jumped 5.8%, high but not rising as much as grocery prices it's a dynamic to speak to the strong demand for eating and cooking at home. in the market it's played out with a divergence. the supermarkets up double digits for the year and booming results. the food manufacturers though they eat the high every cost of commodity and labor. so we are seeing more margin pressures there in conagra and campbells soup down for the year it is interesting today, mike, that's a reversal. consumer staples and the food stocks doing bet every maybe on the month to month moderation but the fact it's in the market.

>> exactly that costco move today in the stock is amazing talking about how they are not being able to -- willing to pass along most cost increases but the wage growth or the consumer tolerance for paying more and the ability to pay more seems like it is covering them for noh is a thin distinguish this inflation bout from the '70s. >> it is more affordable >> keeping pace. >> it is higher at this point and if it continues we start to see confidence decline. >> i think absolutely. everything wore talking about is if it continues. >> no within thought it would continue this long. >> after the break inflation now pay late every the cfo of klarna will tell us about the alternatives.

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and easy this holiday season. welcome back inflation surging 6.8% in november joining us now is the co-founder and ceo of klarna a three-time cnbc disrupter 50 company.

sebastian, thank you for joining us today buy now pay later and klarna buying fast. consumers using this way to pay for things more and more but how does the general trend of rising prices and things being more expensive play into the demand for what you offer >> i think it does play in and not necessarily that surprised we have covid which basically for the majority of people meant additional funding from government in combination with saving money and now as they get back they're able to spend more and seeing prices go up it feels natural the shift is away from credit cards into debit cards and sometimes buy now pay late ir. if less people are using credit cards and use buy now pay later

it's healthy. >> it's certainly preferable i'm sure than paying high interest on these bigger balances but how's it any different from allowing consumers to pay more than they can immediately afford even if it's bet for them? how's that for you an interesting proposition? >> we don't charge interest and fees and putting pressure on the banking industry and happy and thrilled to see capital one a few days ago and i think that is finally waking banks up to not thinking about putting money in their pockets but consumers paying the fair price but looking at this our suggestion is don't use a credit card use debit cards as much as

possible it is a problem for you. what if i don't get the product? on a debit card that's the money back and spend it on something else credit in specific circumstances can make sense and solve problems but what type of credit or is it an installment product with $100 to pay off every second week and free of charge to the consumers there's higher ev online with a better alternatives to credit cards so that's a healthier mix. >> you hear about buy now pay later and talk about the stocks and so much action how's the competitive landscape unfold as you see growth especially in the u.s.

>> we are actually now in 21 in the u.s. close to 100 million globally. and the top 100 largest e con sites is 25 so i think we are doing really well and on a global basis it is paypal we're after. we are seeing the markets our share checkout is larger and i think it's a good opportunity and i hope that maybe some of the market price did decline on paper in the last few weeks and more people wake up to the fact they make serious in the u.s. market and so that's super exciting for us. >> double dig at paypal. >> i think a lot of investors even not let alone consumers aren't sure what distinguishes

your service and how it's processed why what the network looks like do you operate outside of the network processers what is your i guess bit of advantage within all that ecosystem that allows you to do what you do? >> great question. what we think is important to allow tons of different technologies to use us in europe we have a plastic card it is a debit card but we have a rail and what is interesting is integrating with the merchants and partners is buying on line today we get -- that's unheard of in the visa and mastercard world. the actual items and colors and sizes and when you go in to see

the purchase history you see the products track the products the quality of experience is so much higher and if you go into the banking app try to figure out what you spent your money on it's when consumers discover the things to see this is a very different offering we have integrated the users and replicating that means they have to integrate the existing partners to do that so that's what some people say is a serious moment. >> i have been reading about the product extensions web browsers and how i think you have enabled customers to be

able to use the klarna account anyway if that exists what is the value in the exclusive partnerships that you and some partners sign with an amazon >> i think look in the end what it is all about in my world is promote customer data validity the problem with the banking industry is they lock up the data and the competitiveness is to lock it up and not create value for the customers on the data that they decided to share with the company we want them to control the da the and decide who they share with it and allow them to share in a good way in their control and that's why integrations and working with partners to do more powerful things and other ways to allow them to get more value from the service

it is a very different approach about the customers share data and not make as money as the traditional tech industry. i don't think they were badly intended but didn't realize it how do we create value because you decided to share the value with us? >> what do you say to critics arguing that this trend skews younger? pops up all over tiktok and encourages them to take on personal debt? >> we have a critical responsibility to promote a product. we launched in u.s similar to how paypal works. that's important to promote to suggest to buy groceries use debit and also looking at the way we -- it's different. a big limit and spend it and then don't worry

pay it next month. we underwrite you for $100 check to see how the consumer uses that and might extheend toa higher amount. the losses are lower and we have more sustainable with a better product at heart that doesn't mean that we can't do more. experimenting with open banking to share the bank account data to us to understand to make better decisions to help them take the right decisions and we're learning as we go but i don't agree with the fact that the product we supply is much more healthy than the banking industry. >> thank you for joining us. >> thank you.

>> i think josh brown invests in klarna. >> a fave. >> a private company. more about spending, the consumer and inflation ahead with the head of saks and dri driving moderna lower today. down 6.3%. check out the top searched tickers on cnbc.com. peloton down again after a 11% slide yesterday. we'll hit that one and oracle comes to life. 16%. actually done really well this year we'll hit the movers in the market zone. we'll be right back.

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let's check in on the individual market movers shares of moderna falling today

after releasing early data around the mrna flu vaccine. protects against four strains and enclear if there's more protection compared to the current vaccine on the market. credit suisse downgrading peloton and cut the price target, slashed it to $50 from $112 saying the return of in-person fitness are headwinds for the company and getting social media buzz after the bike made the appearance in the premier of the "sex and the city" reboot and then the stock down almost 7% down 11% i won't fully give it away but one of the characters dies after doing a peloton ride in what is the worst product placements ever. >> oh no. >> at first it is a lot. they've been using peloton in

the pandemic. >> no mistaking what he was doing. >> gets off and has a heart attack to learn more about the investing club go online simeon published last night saying perhaps this is a sign they lose control of the brand ima image and hard to blame the company for that. >> they came back from a widely pan i attempt of brand image. brian dese has a take on the inflation print and the broader economy in america here's a check on bonds. yields mixed today 10-year pulling back for much of the session. currently 1.85%. moderate moves "closing bell" will be right back

time for a cnbc news update with rahel solomon. >> president biden wrapping up a two-day summit for democracy the u.s. is seeking a global effort to protect election integrity and counter misuse of technology by authoritarian

regimes. >> know how hard the work is that's going to be ahead of us but we also know we are up to the challenge because i've said before and as this gathering has demonstrated the democratic world is everywhere. autocracies can never extinguish the ember of liberty that burns around the world former denver broncos receiver demart us thomas was found dead in his home he retired in june and would have turned 34 on christmas day. the budget deficit is on the decline. totalled $356 billion for october november a big jump in revenues offset a smaller increase in spending back to you, sara.

>> thank you all the major averages holding strong today despite the hot inflation data let's bring in brian deese who joins us welcome back good to have you. >> happy to be here. >> so today's very hot reading 6.8% jump in prices undermines the administration's forecast that inflation and prices to return to normal next year do you stand by that >> prices are high and focused on that issue. we are focused on the month to month movement just we caompare to an economy in shutdown. and if you look under the headline about half is driven by energy and cars. both areas we have easing in the weeks since.

notably gas. natural gas prices down 25% from november so that is something to take note of but we are here focused on what to do to address the price issues that americans face by tackling the supply chain challenges and the ports and also by moving on the legislation in front of congress to do more to cut costs that families face than any legislation in modern american history. >> do you worry that this will set back that goal already republicans seize on the opportunity to say we don't need more spending injected into the economy right now something that joe manchin a democrat that you need is sympathetic to. >> if we were pumping the spending into the economy that would be a concern this is fully paid for and that means you think about it differently it is not going to add to demand

why what it will do is reduce costs of prescription drugs and child care central to budgets and also get more people to work increase labor supply by helping parents cover the cost of carincaring for an elderly parent. we still have more than a million and a half women who have left the labor force who haven't come back. investing in child and elder care gets people to work and if it's fully paid for we increase supply and not add to inflationary pressure and make a difference for this economy. >> granting those effects take place if this legislation passes and mod rate costs in a longer structural way for consumers i

don't know that anybody would say it would have an affect in a matter of months not as the law would be implemented and is that also by naming that as something that the white house can do is an admission that there isn't really terribly much the administration can do to restrain inflation unless it tamps down overall economic growth >> i would separate the immediate term from the medium term and making investments in the medium term would help we need more affordable housing supply in the u.s. that doesn't happen overnight but making the investments the more the benefits kick in. we are focused on energy prices and seen the president be focused on diplomatically working with allies and partners and domestically announcing the

release from the strategic petroleum reserve and contributed to gas prices come down and seeing the reductions at the pump. we are working with ports and brought the time of a container at the port down by almost half and there's things to do and focused on those and focused on those things that will help over time. >> cnbc has the all america survey this week 800 americans across the country, 3.5% margin of error, showed the approval for handling the economy went down. how problematic is that for you for an economy that's otherwise

doing really well? consumer has been booming. >> there's a lot of uncertainty and we understand that uncertainty about the virus and prices and that is affecting people and in their lives. i think what the american people want to see is action connected to the things that matter in their lives and if you look at public opinion research the elements of the build back better plan and the infrastructure plan we passed are very popular 6 in 10 americans say they want to see the initiatives in place and they want relief on the cost of prescription drugs and child care and the focus is on delivering on the issues that matter for americans as they think about whether to get back in the labor market and set up with child care and be able to afford insulin for a kid with

diabetes those are the issues that matter in practice and something that we can do about them right now. >> we have also seen since you mentioned the labor market and strange dynamics, 13 million americans quit the jobs between august and october how do you explain why that's happening and what it means ultimately for the millions unemployed and the growth in labor? >> we have historically strong labor market unemployment rate of 4.2%. we see more dynamism in the labor market the data signals a labor market that's dynamic and most of the people quitting the jobs to take new jobs, a better job, higher wages, creates more economic opportunity and seeing the number of applications for new small businesses up 30% from before the pandemic. that's the kind of dymamism to

see in a labor market coming back strongly and historic achievements and high prices and got to tackle and focus on that, as well. >> brian, thank you for your time today. >> thank you. bitcoin having a rough week and big wall street investors are bullish. later fda advisory committee member with a take on the omicron variant and what people should do this holiday season to stay safe. eally should be retired by now. wish i'd invested when i had the chance... to the moon! [thud] [clunk] ugh... unbelievable.

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near session highs on the

dow and s&p 500 but a name sinking is beyond meat following a report of a test of one of the products at taco bell. kate rogers has that story >> beyond meat shares falling today by 8% after bloomberg reported that taco bell canceled a test from beyond after the chain was dissatisfied with samples in october beyond would not comment to cnbc whether or not it is working on a product. but in a joint statement they said taco bell and beyond meat are thrilled to be working together to create a plant-based protein as cravible as the current products and can't provide additional details at this time but are very excited about what we have planned beyond added two tyson execs with experience to coo and chief supply chain officer roles to paren for big planned rollouts with yum brands, mcdonald's and

pepsi in 2022. back to you. >> it's been a rough ride for that stock off 50% in the last 12 months. thank you. when we come back, heading into the market zone why wall street is showing no love to southwest airlines and many more stories. the dow is actually at session highs right now up almost 200 points we'll be right back. growing up in a little red house, on the edge of a forest in norway, there were three things my family encouraged: kindness, honesty and hard work.

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seeing from consumers. which games goldman sachs said will benefit most from the metta verse and newmask mandates in new york. >> first just a little over ten minutes to go in the trading day. we are in the "closing bell" market zone. we have charlie back and anik. welcome. we'll kick it off with the broader market dow on track for strong weekly gains. if we close around these levels that will be a rally despite data showing consumer prices rose year over year at the faster rate since 192 -- 1992 u.s. army and navy members get a -- >> ahead of the army-navy game tomorrow. >> this is the big call on inflation and we just see the numbers get hotter and hotter.

where do you think this goes >> a year ago when we started to talk about this it was lonely on inflation isle and starting to feel like miami south baeach it's like alcoholism at first it is fun but then the pain comes later this is the second manhattan phase of this. we're still feeling the positives of the massive money supply increase. had a positive effect on the economy, bringing unemployment down but we're going to start to feel the pain with much higher inflation. the fed giving up saying this is transitory we will have more inflation as wages start to tick up and had been relatively benign and tick up with commodity prices ticking up and going to be staring at not 8% inflation like we have

now but north of 4% for a couple years. >> i think how the inflation picture set up the 2022 investment view given that we have strong nominal growth corporate revenues projected to be above trend nenxt year. is that a risky set-up >> i think it is positive. it's hard to go down when interest rates rise. we have pent up demand for consumer products and for services and entertainment people want do go on vacation and not been able to i think we have a strong economy and the s&p is very expensive but value stocks are not expensive and can do well here even in the face of the increase in interest rates which is going to come. >> all right let's talk about broadcom and

oracle after strong earnings reports. josh >> firing on all cylinders guidance driven the note by acceleration and cloud strength and a new massive $10 billion buyback wh buyback. oracle also shooting higher beating estimates. deutsch bank takes it to a buy saying it's a premium multiple also at all-time highs on track for best day since march 2020 back to you. >> thank you charlie, oracle is one of the holdings done well. now trading roughly a market multiple does that start to get rich for you or can it trade to a

premium? >> it was more like 13 times earnings and the street did hate it people don't like larry ellison. some of it is personal there was a change in accounting from selling licenses to selling basically annual subscriptions and slowed the growth. now that's behind them and getting the kind of growth that a cloud company could get. i wish i was on yesterday to pound the table. i call it modestly attractive company. reasonably price stock. >> up 59% so this year one of the best performing stocks in the index. you don't want to talk specific stocks but how much of a weighting should investors have to technology as a whole and in that group semiconductors and

cloud and software companies. >> i think investors should be selective in the positioning and stickal the up every end of technology with pricing power. technology as a space that has been very limited in pricing power. not all technology is made the same i would suggest investors to stick with those that have real edge in that space and that's a very handful of stocks one of the things i would say is we have been constantly surprised about is expanding tam for those innovative companies and that tam is a function of edge computing, ai, so much in investment of where the computational processes are happening and the speed of the

comput computational processing is important. stick with the high end plays in technology. >> by the way apple is making a move up. nearing that $3 trillion mark. >> pushing the s&p to a new closing high not intraday high. >> it is a rough week for cryptocurrencies kate rooyenney with the details >> the bulk is coming from short term holders buying at the peak and seem to be throwing in the towel at the prices. these investors are newer to the market and bought in in the last few months and many cases smaller retail investors this is the price where they got in and the average cost bases of $53,000. according to glassnote and a short term holder showing the profitability of coins when

they're sold right now showing a lot more bitcoin being sold at a loss and these are the least profitable levels seen in six months. analysts say it appears to be the cohort reacting to significantly the events of last week guys >> thank you, kate a lot of investments in the first quarter losing steam hard to maintain enthusiasm for coinbase and gamestop. all pretty much on the slide with bitcoin. >> some people link it to bitcoin. >> a fever in spring. >> ark peaked in february. >> exactly shares of southwest sinking after being downgraded this comes on the heels of two

other downgrades yesterday both to hold those firms citing inflationary pressures. charlie, how do you read the calls? piling on or is southwest and other companies without the pricing power vulnerable >> i i wouldn't have said inflation is the main problem for southwest. the uncertainty of lockdowns and that's what's most susceptible with scares from the new variants i would look at the cost of jet fuel as a real risk here that has a potential to go high every and a tough time making money when the prices are high in general this is a business that's capital intensive and so fundamentally it tends to not do well in a higher interest rate environment. >> we have less than two minutes to go in the trading day seeing some intraday highs

a record close potentially here on the s&p 500 a lift into the close. >> yeah. market at the end of last friday got frisky there was no new wave of selling on the way we have clicked above 4700 on the s&p a couple times this week and not able to make head wway. look at the market positive advance decline line. not persuasive slightly more volume you mentioned the excuconsumer staples. on a two year basis. whatever the reasons, that looks like a breakout to a new high after like gone with a plateau there or a base for a while and see if that continues. volatility index below 19. fastest ever run below 20 showing more of a calm market.

more broadly that fever broken s&p 500 on track to gain 1% on the day. 4713 would be a new closing high [ bell ringing ] ♪ that will do it. a record close for the s&p 500 almost 4% gain for the week. welcome back to "closing bell. i'm sara eisen with mike santoli in for wilfred frost coming up this hour we'll discuss today's the hotter than expected inflation report and whether it could cut into consumer spending when we're joined by a guest. first is charlie and anik. both still with us you told us ahead of the

appearance that investors to buy the dips and paid off this week handsomely does that continue to be the strategy >> absolutely. there's no reason for vinvestor to stay out of the market at all. the u.s. economy is extremely strong we think that china turned the corner and inflation has peaked. many details in the inflation print this morning is still in our view back ward looking the week lisa that also shows that many of the scare stories of semis and indeed autos are already peaking so we are very close to if not already at the peak in our inflation estimates in our view. >> charlie, if you think as you have for a while that some of the biggest components of the indexes, the s&p 500, seem as if

they're overpriced or not counted on to go much higher from here and heading to a time to force the fed to be more aggressive how does the market able absorb that if that's what 2022 is going to be about? >> yeah. if you despine the overall market at the s&p then not well but there are lots of times that there are different parts of the market and i have a tough time being bullish on the s&p itch value stocks. oil stocks fertilizer stocks and do well in an inflationary environment trading at reasonable levels i have apache and pokckets of value. the s&p is technology dependent and looks expensive to me. >> it was a strong week for the major averages dow had the best week since

march. s&p 500 and nasdaq saw their best week since early february let's bring in eric johnston who just moved just several days to a bullish view on equities eric, good to have you we spoke when you were cautious on the market. we saw the culmination of the pullback what's behind the bullish call at this point? >> sure. thank you for having me. we turned tactically bullish on monday we think we'll get a sharp rally. first thing is significant derisking going on in the market been going on across investor types and broadly across the marcht look at hedge fund expenditures. we see systematic funds reduce

exposure globally over the course of the last month and looked back and when we get this type of derisking our data suggests that this is very strong and very consistent over the course of the next month and then add on top of that the seasonal factors that people talk about a month ago and not been recently. we think that plays out and then lastly the fed event on wednesday is a clearing event for the market there's concern out there around it and think that's behind us will be the all-year sign to come in further and risk back on. >> now what would it take for you to essentially say it's not just a tactical call because sentiment is washed out or seasonal tailwinds here and say overall the market might be headed for a good year next year

>> not prepared to go that year and cautious on next year. overall returns next year will be muted and volatility will be high with a come by nation of factors where the fed is tightening throughout the year and at the same time i think likely the back half of the year there's concerns about the economy slowing down and that combination i think is going to be very, very hard for the market and i think overall valuations are fine and getting pretty close to full epsz if yields do finally back up and i would expect they would in the next six to nine months. >> anik, how does that square with the bullish view on equities the fed is set to be tightening and could be concerns with that of slower growth. >> i love -- >> anik?

yeah. >> i love the question takes buyers and sellers we have a market situation where i think the fed is proven to be extremely patient. you have demand and nominal growth likely to be strong and very likely for a year or several years out. china is a point that i think few people focus on, particularly in these kind of situations but china is a very important driver for global growth we think the negativity that china experienced this year is now coming to a pivot point to move into an expansion ary phase and less of a market than it's been for the reasons that the fed is going to be tightening but it is tightening extremely gradually and tightening in

response to a very strong demand outlook out there. i think the real debate has to be a debate about the length and strength of the economic cycle ahead of us wi think this is an instruct ral call of the demand coming to fruition pentd-up demand that's been building not just for a year or two but for ten years or so because decisions haven't been made for a very long time. >> what about the idea if you look back at history typically risk markets do okay into the first rate hike? credit markets -- you look across different asset classes, seem like good shape, spreads being relatively tight and does that not compensate for the hazards in a tightening cycle?

>> historically six months before the first hike the market did well and fairly consistent i think the fed easy policy that we have in this case is different from the easy policy historically think about what's gone on over 15 to 18 months adding 5 $trillion to the balance sheet and rates at zero removing that stimulus is a very dramatic move that we have never seen before and i think the speculation going on across asset classes not just equities but whether it's crypto orother assets out there as that's withdrawn will have an impact and not just the fed but that's a global phenomenon and going to be a headwind i don't think it's necessarily going to cause a crash in '22

but something that will be a stimulus that's removed in a pretty material way unlike we have seen before. >> savings are fading as that happens. so how does that add up for the value stocks that you are in that you track the economy so closely? >> i'm going to come back and say the economy can stand on its own. it could have stood on its own six months ago instead of this liquidity that the fed is pumping into the system. if we get past the delta and omicron strands we can do well there's power trains for cars and pent-up demand for cars. they will have a spectacular year next year people will go to knicks games and las vegas and entertainment

will have a great year even without fed help. >> eric, we'll leave the conversation there anik, thank you. >> thank you. >> charlie, before we let you go, we want to zoom in on a trade idea what are you going for >> this is yesterday it's oracle today i can't do that. i'll say apache. trading at five times earnings they just are signing a new contract with the egyptian government to expand in the middle east and a find off the coast of south america where hess produced so much oil and not a stock to trade at five ti

times earnings this is a company where if things go well this stock can double >> wow yeah it is kind of remarkable up 88% this year and trading at 5, 6 times earnings. charlie, great to talk to you. thank you. >> thank you. we are just getting started on the second hour of "closing bell." wells fargo securities chief economist discusses the inflation data to impact the fed's meeting next week. kseosa c on holiday shopping in the home stretch of the shopping season we'll be back in two minutes

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to build a future of unlimited possibilities. the s&p 500 finishing the week at a record closing high.

this comes despite consumer inflation in november soaring by 6.8% what could this latest inflation data mean for next week's fed meeting? joining us is jay bryson jay, good to see you today we've set this up as if the market's rising despite this hot inflation number but perhaps the market is saying it was more or less expected month to month and doesn't change what we expect the fed will be up to and messaging next week. >> yeah. i think that's right i think the market breathes a sigh of relief today it was on expectations and could have been a worse number, as well going into the fed meeting i think they accelerate the race of taper they pair it back. i think they take it to 15 and

7.5 next week. i think the market is priced for that >> and then, what about the jove all inflation trend? this statistical cli doesn't seem likely to moderate into -- maybe the next quarter of next year do we shrug that off do you think it will go back somewhere toward longer term trend? >> if you look at the year over year comps it is harder into the new year and should start to see the year over year rate come down what's interesting and what i think the market will react to is we continuing to get .7, .8 on the headline? if so then that year over year rate may recede somewhat but not a lot and going to be the

sequential rate going forward and we think the inflation rate surprises people next year the shelter component of the cpi is coming up and so i think inflation is going to surprise people to the upside next year. >> three rate hikes next year? that's where the market is >> we look for two you have to look at the fed is i think still very dovish. they're moving in the hawkish direction but i think they want to see the labor market get back to what they consider to be full employment and acknowledge we don't know where that is and i think they will be slow in starting to hike rates here but two, maybe three next year but rates clearly coming up but i don't think jamming on the

brakes either into next year. >> the market looking out suggesting the hiking cycle won't carry on far where rates end up ultimately it seems to speak to the unusual nature of this cycle seems accelerated in some respects a year and a half into the expansion. how does that play into the mix? what's growth going to look like next year? >> very, very unlikely to repeat the same sort of number next year at least 5.5% this year and i think closer to 4. keep in mind that's a very, very strong sort of number and should see deceleration going forward won't see swr the same stimulus. if the fed is hiking rates that generally slows the economy and expects next year will be decent and decelerating through the

year. >> what about consumer spending? when do you worry about consumer spending with the inflation rates and the consumer absorbs well >> i'm not concerned that about it the savings is still high. high single digits that still has room to come down to keep consumer spending going as well and when you look at it and 60% of consumer spending is done by the top 20% or so of the income distribution. it is the lower income distributions where i think are more stressed by inflation and so does consumer spending decelerate next year absolutely does it go in reverse? i don't think so in general we still have the high savings rate. consumer balance sheets are

strong >> so ultimately do you think the fed will succeed in getting control of inflation >> i think ultimately they will succeed but again as i said earlier i think people are surprised early next year how high the inflation rate is chairman powell retired the phrase transitory. i don't think we'll talk about transitory inflation anymore and i think they'll bring it down and next year maybe uncomfortable in terms of how high the inflation rate is. >> thank you for joining us. >> thank you. mark metrick on the outlook for holiday spending and later fda vaccine advisory committee panel member dr. levy

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all we can long we have been taking a closer look at the consumer with retail leaders today we check in on the luxury market joining us now mark metrick of saks last time you were on you said the consumer is booming. how sensitive is your consumer to these inflation rates which are now the highest rates since the early '80s >> i think if you just take inflation into two places. the price of goods we sell because of the price points they're at and the raw materials and labor inflation doesn't have too much of an impact on the cost of what we sell we are in the discretionary business and we have to be mindful if something in the life costs them more or everything is we have to watch it and not seen and really been out there for a

couple months and not seen a blip in the business related to it so i feel good. >> strong holiday season so far? >> oh yeah they came in -- it came in fast and hot. about 60% of consumers, we have the saks luxury pulse and 60% of consumers said they would shop prior to thanksgiving. a third in october for holiday and running very healthy increases. i would say we are probably going to be up 50% over last year's holiday on a two year stack 85% up the customer is here and shopping. >> it's interesting because as the holiday shopping season is dragged earlier it's not meant that people finish earlier they may still continue spending closer but i wonder how this

inflationary mind set how it manifests in terms of volumes discounts expected or offered or the percentage to sell at full price and how do you see it filter in? >> it's actually the percentage of full price business is up in the 5 to 700 basis point range again last year was good better than the year before if i look at how we sell in full price product versus two years ago 1500 basis points better less promotional environment why this is a different consumer and not seeing the pressure come to hold at this point. >> mark, you are a trend setter. as you split the business the e-commerce business and now pressure on macy's to do it and

then kohl's to do it something they will consider talk to us about why you think this is such a hot trend and why investors are pushing for it. >> i wish you stopped at you're a trendsetter. look right now and focused on the right thing to do for saks and where we want to be with the excuse consumered and how luxury moves into the future. i focus on saks. >> what can you do that you wouldn't do before >> it is really allowed us to focus on customer acquisition and reorient to keep the eyes on how we run the business to really go after growth and push the business like we couldn't before it is a new focus and a way to run the business and the

customer is the biggest one. >> a new potential valuation for the ipo. >> normally this is a valuation arbitrage type of a move in terms of how it changed, does it allow you to operate like a third party and have different relationships for suppliers? otherwise it might seem like a cosmetic change. >> when you run the business and running it long term value of the customer, instead of spending capital investing in the physical plants you spend on marketing, investing in the future of the customer it is really not cosmetic and both businesses, the stores are

performing exceptionally well with mindset and focus and if the consumer has a frictionless experience we both win. >> wanted to ask you about tourism. we finally saw the u.s. up the borders to international travel. has that led to an increase in the business you see the whole business >> it is early days and when everything started in early november, they see family for the first time in a while and certainly seeing uplift in the gateway markets around the u.s. so that's been another driver for the stores as we go into holiday and come into '22. >> what about categories what are you seeing with the most popular is anything changing going through the end of the year? >> i love talking about the go out and travel business.

people going to parties, going to events, on vacation and seeing a lot of that and self purchasing in the holiday and didn't see that last year. that's very good so it's a mix of everything and fashion. people fell in love with it more so in the pandemic and coming out of it even more so. >> mark, appreciate the update thank you. >> thank you have a good holiday. >> you too. >> thank you. the justice department opening a probe into short selling my hedge funds eamon javers has the details. >> bloomberg broke the story that justice department is looking into hedge funds particularly short sellers and the koex between research and the hedge fund themselves with a possible insider trading twist to this. the justice department won't comment but i talked to an

attorney what he told me is there's an investigation. he said that citron provides everything that the justice department asked for here and what doj is looking at is published for short selling hedge funds. is there a possibility of insider trading with reports paid for by the short selling firms and jumps ahead to short companies. what james told me is he believes citron will looked at and investigated and not find anything and justice department will not he said there's possible exposure for people disguising false statements as research and dressing up pump and dump schemes as research reports. he said ultimately if you deal

with research they're not oodsers and can't be inside every trading. they rely on public information so if you're compiling public information getting an advanced look at public information is not insider trading under the law. he is the attorney for citron said they'll be investigating entirely we don't know what it is they're looking for or the full scope of the investigation and on the ideas of hedge funds rng short selling, insider trading possibility. >> to be insider trading somebody has to have an understood duty to keep some material information private right? it wouldn't seem a third party research firm has that but in coordination with an investor that would know in

advance maybe that's a stock manipulation type of a scenario. of course could also happen on the long side and people touting stocks opposed to shorting. >> yeah. there's a first amendment question, too. do you have ability to publish research that you believe is accurate is there anybody's business to know about the timing of that? you cross into journalistic questions of gathering information that might be adverse to that stock. a lot of people involved know generally when a story might be coming from a big media organization and legal questions here that border on constitutionality and have to be sorted and may find out more in the days and weeks to come. >> a bit of a gray area. thank you. >> didn't andrew left of citron?

>> stopped shorting. the irony is that short sellers in general had a rough time. there's high impact shorts sometimes with sketchy companies with a real strong stock reaction. goldman sachs is out with a list of top metaverse plays. one may surprise you details later on "closing bell."

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welcome back time for a cnbc news update with kelly evans. >> at this hour, moments ago the prosecution rested the case in the sex abuse trial of maxwell after two weeks of testimony that included four accusers who described their encounters the trial is moving faster than expected. six more subpoenas by the congressional panel investigating the january 6 riots on capitol hill and now targeting people it believed financed the rallies.

international human rights day in the philippines on the news we'll look at what might have caused the tragic truck accident that killed 55 migrants in mexico join me tonight at 7:00 eastern. over in denver snow after a very long wait. it is the latest first snow for the city three weeks later than the record in 1934 the national weather service said weather patterns are extending mega droughts in the west i'm waiting for dog photos from my sister. she sends them when the dog is in the snow for the first time. >> maybe this weekend. mike, when the fed begins to hike rates something to consider. >> we talk about the inflation for the fed outlook.

the table is already set based on the job market performing for a while. this from b of a showing the fed labor indicator in blue. above the line is tighter labor conditions crossing above zero typically the fed is hiking. that's this line here. cross above zero not happening yet. right? we are way above zero here and the fed is still at the zero line obviously the fed said it wants a higher threshold before starting the hike and why it is the inflation question seems to be the swing factor how durable it is and talking about the treasury yield curve this is back 20 years with a short peak if this is the peak for this cycle and already starting to curve over and what happens when the fed is understood to be in tightening mode and going to probably

restraint longer term inflation and you want to see it get down to zero because that usually means the fed's gone too far and probably cutting rates before too long >> read on the economy really. >> exactly. fda advisory committee member dr. levy with us with reaction to the report on the first batch of omicron cases in america. plus disney is hoping the remake of "west side story" to rule at the box office this weekend. tadeils later on "closing bell." today, your customers want it all. you have to deal with higher expectations and you have to lower wait times. with ibm, you can do both.

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♪ i would just fly, fly away ♪ welcome back goldman sachs out with a new note on the metaverse. bracing for a shift in the industry that could impact investor trends. goldman highlighting meta platforms, that's facebook, exposed saying decentralized activity could be hallmarks of the gaming and media landscape going forward. obviously, facebook changing the name very heavy handed way saying this is the future and wall street i guess has to consider a new investing trend but nobody can define it. they talk about web 3.0.

crypto people refer to other issues of web 3.0. >> basically it is a love letter to facebook or meta. they expect them to be the long term secular winner well positioned to capitalize on the next wave and computing and spending they will spend $10 billion on this. >> they will it would be a trick with the incumbent in web 2.0 social media platforms be the winner in the next one. >> likes snap and roblox up next, new york governor with a mask mandate amid the latest covid surge. what it could mean for business when "closing bell" comes right back

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new york governor imposing a statewide mask mandate for any venues that don't have a vaccine requirement in place but some positive news on the omicron front from the cdc reporting an early look at the impact of a small sample of those already infected finding most had mild symptoms joining us is dr. ofer levy.

director of precision vooempbs program at boston children's hospital welcome. >> always a pleasure >> so a few weeks ago the market took a nosedive on concerns about the severity and trance missability of omicron and how likely it was to evade the vaccine. since then the news is better and the market rallied back to a record high. is that the right take here? should we feel calmer about this >> it never helps to panic and we have to stay vigilant right now we know that omicron is in the united states. and it's spreading pretty easily how severe it is we don't know yet. you cited the cdc report but that was 40 to 50 paitient so ys it was mild in that small sample no deaths. happy to hear that and welcome that but the sample size is

small and the coming weeks will be telling. >> other positive news is the vaccine makers have come out and pfizer said three shots is protective against the omicron variant and now they work on a specific vaccine for omicron will we need that? >> it is unclear whether we need a specific vaccine for omicron we need real world effectiveness data those with two or three doses of an mrna vaccine. how do they fatre with omicron and takes some weeks to read out and will drive the decision process, i believe. >> doctor, there's so much focus along the way about the messaging about vaccines and what works, what doesn't what might be a deterrent. an idea to be requiring more of

them as we go along with variants do you think that the message is conveyed that they always help even if they're not perfect? >> it is a challenging situation. week by week, day by day we get new information. about the variants and the vaccines in general the vaccines held up well in preventing the most severe outcomes and including hospitalization and death. that's what matters most and now gathering the data with omicron. the jury is out but within reason the messaging is trying to stay on track but it is bewildering. health care providers trying to catch up with the information. you can imagine for the layperson how bewildering it is.

>> we got a glimpse in the survey showing president biden's handling of the coronavirus approval rating fell 48% disapproval. 46% approval how do you rate the administration's handling at this point of where we are in the i think the administration has done a solid job in trying to follow the science. there was a little bump on the road when fda felt that the white house may have gotten a little bit ahead of fda on some statements before fda met. and as you know, that led to some unhappiness by some senior fda officials. that was well reported so it hasn't been perfect, but i do think that by and large, the science is being respected, and let's see what the data tell us. we're heading into the winter months respiratory viruses tend to be worse. people gather indoors. you know, people gather with

loved ones for holidays as they should but as we gather, especially in indoor spaces, viruses spread more easily. so we just have to bear in mind how to gather safely we should conduct our activities they're important to us and who we are as a nation, observe our religion, all of that, but we should do it safely and follow local health guidance. i think what the governor of new york did makes good sense. >> how do you think about the role of rapid tests? i mean there's been a lot of back-and-forth about the fact that they're not as available or inexpensive here as they are in some parts of the world. i know the white house spokeswoman says that's because some places don't have fda approval so are there hurdles standing in the way of something that could be helpful on the rapid test front? >> all the testing is important. it's important that we deploy tests that are certified by fda because it's a matter of sensitivity and specificity. in other words, it's harmful if we have false negatives, in other words, somebody is positive but we fail to detect

it it's also harmful if somebody is labeled positive when they're not. so we want to be using the right kinds of tests i think testing has expanded in addition to that, we need good surveillance. the united kingdom does surveillance at four times the per capita rate that the united states does. so we've stepped up our surveillance, in other words, taking positive swabs and then testing them for the sequence to know which variant that should also be targeted on travelers coming into airports, breakthrough infections. the uk and israel are leaders with this. the u.s. is still playing catchup. >> so, dr. levy, a real scare over omicron that still continues, and you sound pretty cautious of it. when will we be at a point, if ever, where we don't have to worry about every single mutation, and how likely is it we could see a vaccine-resistant one? >> you know, i think we need to get back to a scenario where this is manageable, that we invest in the public health

infrastructure, surveillance, antivirals and vaccines to protect our population and the global population. this is really a global problem, and that's been undervalued and hasn't been addressed sufficiently but that we manage to move on with our lives while instituting these measures and so we need to reach a new balance because basically this pandemic now is endemic in the u.s. it's basically settling into a pattern of a winter virus that's worse in the winter when we gather indoors, and so, you know, we want to keep an eye on which variants are arising but we don't want to get into a pattern where every new variant is making major headlines and sending people into a panic. that's not productive, and it's often not true but in this case, there is a new variant that's spreading rapidly, and so we do have to keep an eye on it. >> dr. levy, thanks for being with us on a friday. we appreciate it. >> always a pleasure have a good weekend. >> you too after the break, disney's

remake of "west side story" hitting theaters this weekend and the company is betting on a big box office win we'll break down the film's cost and estimates for the weekend. that's next.

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disney's "west side story" hitting theaters this weekend. julia bourse ten here with the box office expectations. julia. >> well, steven spielberg's long delayed "west side story" remake drawing rave reviews but the film, which cost an estimated $100 million to make, is expected to open with between $10 million and $15 million in the box office in the u.s. this weekend. that is far below the $71 million opening of marvel's eternals "west side story" is targeting an older audience, which typically does not rush out to theaters it's a different kind of film. but disney is hoping positive word of mouth and award season buzz with the golden globe nominations coming out monday will drive the film over the long run, over the holidays. it will be at least 45 days before the film is available on disney+. guys >> yeah, julia obviously a remake of a 60-year-old film as beloved as it is, it's difficult to figure

out the equation here. was this always going to be the plan, the 45-day window? so this was never going to be kind of a way to feed disney+ -- or hulu rather >> this is the kind of film that steven spielberg will want people to see on the big screen. the reviews say that it's spectacularly beautiful and great to watch on a big screen, which is how the critics all watched it, right? but i think this is one of those things where pre-pandemic, there would have been a 90-day window before it was available on disney+. so the pandemic did force all the studios, including disney, to think about shortening those windows. but this is not the kind of film like eternals, which by the way cost many times more than what it cost to make this movie it's not the kind of film where teenagers and 20 somethings rush out to see it. >> julia, thank you. >> even though it is about

teenagers and 20-somethings. >> true. >> we'll see if it has any resonance at all. >> but it's older people who love the songs here's something else to look forward to. an exclusive interview with morgan stanley ceo james gorman on the outlook for banks, interest rates, and the economy. that exclusive interview is happening here on "closing bell," 3:00 p.m. eastern time monday mike, you know, here we are after a really strong week, the best since february for the s&p. a 4% gain for the dow, so clearly things got oversold on all the omicron concerns, but we're going into a fed week. >> which may hold things in check. yes, it's been an impressive round trip, the fact that we went down this 5% and right back up but again back to levels we kind of got to in early november. so maybe some hesitation there, a little churn under the surface of the market. but it's really hard to argue with the net effect, which is 25% up for the year in the s&p 500. maybe the fed is kind of

something that slows things down a little bit if we don't get anything unexpected, but we'll see. nobody has repealed the season bullish effects, not yet. >> it's so broad every sector finished the week higher, and the top two were technology and energy, which doesn't usually happen together. >> right so a little bit diverse in how we got here. >> thanks for being with us today. that's going to do it for "closing bell. have a good weekend, everyone. "fast money" begins now. sq live from the nasdaq marketsite overlooking new york's city's time square. this is "fast money. welcome, everybody tonight's trader lineup, tim seymour, steve grasso, nadine tu turman getting myself a double dose of pete today tonight on fast, call it inflation-proofing your portfolio. the chart master has three ways to play these insane rising prices we'll tell you what they are and how to trade them. plus, revving up