both we're going to see you very soon we'll have a fine check of the markets before we hand it over to "squawk on the street. nasdaq is moving high, s&p 500 up about ten points. make sure you join us tomorrow, guys "squawk on the street" begins right now. good thursday morning, welcome to "squawk on the street." i'm carl quintanilla t jim cramer has the morning off the premark has hardened a bit by the smallest -- those core was in line. ten-year 1.73, oil backs off lael brainard's confirmation hearing is coming up in the next hour the fed vie chair calling it the fed's most important task. plus were continues to track. president biden set to tap the

military to help hospitals with some early signs that the omicron wave could be easing and amc's ceo adam aron unloading more shows is he done selling and, quote, i am in? the year-on-year number will be dark and scary. 0.2 month on month for this china's ppi number just enough tantalizingly. no real worse expect ed. >> all the of that has filter into a market that's been getting ready for it for weeks and it's pricing more on the fed side i think that's the big takeaway. yesterday the s&p 500 -- and in those two months, the market has repriced what the fed is going

to do. no net damage testify headlines, a ton of kind of a purge at the lower reaches. >> so the fact that consensus has baked this in, does that mean -- b of a this morning suggested that value, because it's a thing, wants to make a comeback. >> yes, the impetus is very strong coming into the year for cyclical, for value to take the fore the look at the mercurial stocks, whatever you want to measure it by, it has been working. now, this also seems like it's coalescing into the consensus, that that should be the thing to do i kind of work those things in opposition to each other, it's plausible, makes sense, but on the other hand, it seems like people want it pretty bad. it feels more virtuous, doesn't it if you're a professional, you say it's going to be about fundamentals, about the kinds of things that are underowned, and

they tend to work in this type of environment it's hard to say there's a clear edge one way or the other. you did see a couple days, where it doesn't take much to rally a percent and a half in a day. >> energy and banks, right he's had performance he tends toward growthier and makes value cases for growth names, but nonetheless, energy and banks is sort of where you end up. >> i think you could also say quality within value he would be the type of investor who would be following i think also what's a large line, don't necessarily go to the junk that you're cheapest on don't go to the worst life insurance company in the market, but buy a business that's relatively valued. >> harker is out this morning, balance sheet could be begin

early 2023 in terms of a runoff. concerns that expectations could become unanchored, which is interesting. the five-year expectation barely above three. the market expectations are not really kind of off and running they're above where they were for the prior ten years. it looks like -- 3%, you know, higher than it was, but in terms of consumers, it's so hard to measure expectation. i think it's their way of saying we're going to do as much as we can do, to kind of rebuild the ability to respond down the road and get off an emergency setting, and we're going to use whatever rationale we have to get there. it's a tight labor market. it's almost done in terms of what they feel is low rates and balance sheet expansion can do >> that continues to be the main

concerns of business leaders, at least according to this latest survey even ahead of inflation, which obviously is a key concern covid, by the way, way down the list, at least here in this country. others it seems to be a greater concern, but worrying about where you find employees is job number one right now >> right the question is, can that be solved at the macro level? can the fed do anything to create the conditions where people spillback into the workforce and decide to take a lot of these open positions, or is that just a matter of covid, just a matter of, you know, immigration, something else besign -- >> look at the u.s. chamber of commerce yesterday, saying we need to double the rate of legal immigration. it's not just the fed. you have fiscal drag, wallet share moving back, the hopes of easing supply chain, and tightening policy.

shouldn't all those things be working in concert >> they should i think that's the headwind. that's the current that's kind of fighting you into this year i don't think that, you know, don't fight the fed became a cliche for no reason ultimately they'll get what they want if they want to slow things down, about never looser finance conditions so i get the upbeat case is there's room to go before it really starts to pinch in the meantime, you know, companies have a cushion with profit margins, and they've turned out their debt. not a lot of debt is going to reprice in a way that's going to hurt in the short term that seems to be the, you know, the hopeful case >> all right let's move on to the pandemic as well, of course, we did mention omicron briefly there. on the "today" show this morning, vice president kamala harris telling craig melvin she

estimates covid tests for all americans will go out next week. >> the 500 million tests that have been ordered, do we know when those are going out >> shortly they've been ordered i have to look at the current information. i think it will be by next week, but soon absolutely soon. it's a matter every urgency for us. >> this comes, as it appears this week, that case counts have crested, start to go decline in some of the earliest and hardest-hit states that doesn't necessarily mean that's going to extend across the country immediately, given the nature of the virus and how it spreads, and the slowdowns that come away with it, and continues concern about hospitalizations by what is milder, typical symptoms -- >> you wonder if the tests at

this point are more about -- once somebody has been tested positive, getting the green light to go back to work maybe that's the logjam that can guess loosened up. i don't think anybody is thinking it's a way to sidestep whatever wave is washing over the country. it is a real question, has the market been a little too sanguine about how quickly we're going to emerge out of this? i'm not saying we have been too sanguine, but it's arguable. some of the travel stuff has gotten hit pretty hard, in general. >> shortage of workers is the key for a lot of trying this morning. >> we talked about airlines this week delta today, of course, pretty good earnings daughter adjusted revenues, but again, having to push back that expectations for a full recovery, at least in domestic leisure. a great piece this morning in boston, looking at wastewater,

which has been used as a high-frequency metric to measure omicron cases, a quote from the epidemiologist at harvard, when i -- i literally punched the air and let out a hoot it was something i had been hoping for, just the exponential decline in wastewater data. >> exactly what people have wanted to see. >> i think it's more ratifies the way people have been thinking about this wave than it is fresh information that says, what a great sigh of relief, we can now all exhale so great to see. did we ever think that, you know, we would get to a point where a parade of fed officials would not even give like the lip service to the omicron wave in terms of saying how that might delay their, you know, their moves on rates with balance sheets i think that tells you where we got to -- >> but the market seems to be looking past it for some time. not just the fed, but

investments as well. >> only very targeted travel-related areas seem to have to absorb that hit. >> good news for massachusetts, maybe everybody can get back to school and college as soon as possible. >> it's not just a domestic story. there's reports of an outbreak in a chinese city. but actually bloomberg had a nice piece about how they're going to evolve from a zero tolerance policy to what's called dynamic clearing. if we move to that, that would have huge implications for trade and prices. >> china has been interesting. it has followed a policy that the rest of the world doesn't appear to be following the impact on the economy, not to mention obviously people's lives there has potential

significant. you do wonder if they have to take it is breaks offer to a certain extent, because -- so many other things. china has been interesting to watch. it has come up a number of times, the conversations i've had with asset managers who at least as a percent of growth, seems to be a very important one, and they are still willing to put the brakes on it entirely, to try to go zero covid, which in the current wave does not seem, a, possible, or perhaps not even recommended. >> the bear case for a little while has been zero covid possibility, plus the olympics, meaning they're going to air on the side of tight earl for whatever it's worth, the chinese stock market has been a great performer. it's coming off an incredibly depressed base emerging markets, the index we look at, you know, 55% china,

japan, and, you know, sam ssung basically. >> a fifth of the korean economy. >> yeah, yeah. if you look at the eef, that's where it is. >> that's what we used to think of as very important. >> we're going to watch this cap ex environment just mind-numbing numbers. >> when we come back, an outlook, we'll talk to an analyst, which includes a downgrade of one of the social media names. some action on bumble and match today, mattel, a lot more. look at the futures here, as we got cooler than expected

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weekend, that might sound family, talking about passengers getting on with their lives. adjusted revenue, 74% on a two-year stack from that time. susquehanna does up the stocks to positive today. >> they're going to trade on that incremental visibility toward better volumes. i don't know how you really value them anymore but they're treadic back to levels where they were, like november, december 2020. we're kind of rerunning that script, another reopening

dynamic, maybe firmer pricing. also this report on boeing today, and whether or not the max returns to service in china in the next few weeks, maybe maybe one more look here at futures. a lot more "squawk on the a lot more "squawk on the street but health insurance and aflac...is money. ♪ must be the money ♪ and i know how coach prime feels about money. " continues in a minute♪ now that is what this jacket needs. ♪ must be the money ♪ get help with the expenses health insurance doesn't cover. at aaflac.com get help with the expenses health insurance doesn't cover. today, business is a balancing act. you want your data to be protected and secured. and your customers want seamless and easy. with ibm, you can do both. your company can monitor threats across your clouds, address all those regulations,

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yeah... oh. don't worry i got it! become an agent of innovation with invesco qqq cow wen is out this morning with a bullish outlook great to see you again good morning >> everyone loves to wring their hands, but it sounds like it won't be a match

>> yeah, carl, a bit of mixed signals. the ad buyers were the most bullish they've been in ten years. including the -- a shift to digital, among other things, but tame they were fairly negative i know, calling out diminishing roi. about over 60% expect them to persist. so a bit negative on the changes on the platform it is, but overall, pretty bullish on spend.

>> it looks like snap is the center of attention today. you talk about the ios changes and the target goes down 30 bucks. >> yeah, just to reaccompany two years ago, january 2020, we upgraded snap at about $16 the reason we upgraded it at the time was over the prior three years, with you sea a direct response, so we upgraded 16, stock, you know does very well, and during the pandemic, it really helped then you get the ios changes and so, we think it will persist -- then you have tough comps, and it's not that

cheap so we moved to the sidelines. >> amazon from your survey results expected to become perhaps the third meaningful player when it comes to advertising alongside, of course, facebook and alphabet. what are your expectations there? how important will this business become for amazon? >> yeah, david we -- we have amazon going over the next five years, growing well over 20% annually the overall market we think is like in the low teens, so they had a huge year with the s. you

know, it wasn't -- didn't appreciate as much, but, yeah. amazon's business should be strong it was noted by the ad buyers as being the biggest prospect this year >> john, talk about tiktok you addressed it in the record kind of missing a big piece by not necessarily grabbing a piece of tiktok? >> yeah, yeah, for sure. amazon and tiktok were two big expected their gainers if you're starting a branding campaign 20% it was ahead of youtube. and instagram at 20% yeah, i agree surmissing the --

investors are missing out, but, no, it was set up really well across the board, and also, the ios changes, almost 30% of the buyers said they would shift budget, and where are you switching it to. google simp was number one tiktok, youtube and amazon across the board it shows up very well. >> look forward to digging into alphabet and twitter maybe next time, but a good road map for what the ad map may look like. good to see you. >> thank you all right. we are on track for a positive open let's take another look at futures. yesterday the s&p was up again the s&p up about ten points, to put it in the zone of yesterday's highs. industrials up about 102 at this point, nasdaq up

>> announcer: the opening bell is brought to you by - a big ipo to tell you about.

tpg, one of the names that certainly for those who covered m & a for as long as you have, we can go back to a long time ago, one of the big names. used to be sort of focused on the buyout business, so to speak for quite some time, founded in 1992, but over the last, let's call it ten years, certainly has being more of a growth investor. i don't want to call it early stage, but pre-public, taking significant stakes and the like, $109 billion in assets under management, about $59 billion is -- priced at 29.50. we'll see how the stock performs this morning mike, it's the last thing i can think of added to blackstone, which, of course, is many years ago, broadly speaking the largest by far, but some have different identities, whether it's carlisle or kkr, apollo,

which in many ways is an insurer these days but now we have tpg as well. it will be interesting to see how the stock performs >> definitely not strong for ipos it was strong for asset managers, they're down from a late-year peak, but they've had a great run. blackstone's market cap is bigger -- >> and bigger than city corporation. >> of course, it --, you sew, investors love the group and the dynamic. it's telling that blackstone with lower sales and half the revenues is the bigger market cap. there's a scarcity value of the quality managers >> tpg is timing the ipo with

major fund-raising on its part which certainly investors may see as a positive. it will give it potential momentum at it begins life as a public company. >> and the bank earnings begin tomorrow [ bell ringing ] >> there's the opening bet the big board as tbg is celebrating its ipo, the biggest of the year so far a lot of interest today in the banks. he read one take yesterday, mike, those in it are -- we're going to see how much it gets washed out. >> it's a fair assessment. there's been a tremendous number of kind of upside head space people thought it was happening -- they're not

starting from a particularly cheap valuation at this point. on their own terms, yeah, compared to the s&p valuations, they're up, but jpmorgan up 1.8 times book value, forward book value, and that's kind of as high as it's gotten. they trade 15 times this earnings, so a lot of things probably have to look good, or the numbers have to really be going up obviously hikes are a tailwind for banks. everyone wants the banks where they have a lot of leverage to higher rates the relief story might be over, so now it's about actual operating and credit experience. so it seems like -- though it's interesting, it's a catch-up move, so it seems like that's the gain which names have not been fully exploited. also, morgan stanley and goldman sachs very weak yesterday off jeffries earnings. they had a miss in the morning, so we'll see if that lasts more

than a day. >> wells fargo has been, by far, the greatest perform ever. it's a long way to go to recover anything in terms of its former glory. >> the bull case is that it has a long way to go the bull case is it's been undermanaged. >> i guess you could still say new management. >> yeah. charlie scharff has not been there for a while. it appears a lot these days. >> time flies in your own head. >> you're getting old, mike. that's how you know. >> we'll -- it's also about the curve to a large degree. if that doesn't go as well, you know, the whole model doesn't perform the way you think. between financials and energy we could do a show on just those two sectors. oil was shooting up today,

settling back a bit. nat gas has had a crazy 24 hours, mike, on the back of some wild westerly swings. >> a lot of excite about those names. it's one of those deals, where a lot of energy stocks, they look overbought, but in a good way. yesterday you have to ask if they need once again, the gears clicked in, it's been quite some time since the company versus -- take you back to certain, let's caught it end of 2019 last year

was quite a strong period for the stock. it does appear that there has been capital stronger performance. >> yeah, there's public money to pill the stocks up the question s. you know, it's not necessarily the case that they're doing a whole lot on the supply and cap ex side again, that's a bull case, more supply constrained market than it had been before therefore, you have the leverage for the price. kb homes up 10% this morning that's lead you to --

>> lennar with a 50% hike, cramer would be paying attention to these two names if he were here. >> obviously it's a group move at this point. you know, they trade lower when longer-term yields go up and mortgage rates get set higher. does a half person really move that much. it's been the shadow play. that's worked well under recently and then looking at over-valued, the top three, all in idaho.

we mentioned chips, and chips will definitely lead the way this morning the cap ex forecast for the year, 40 to 44 billion they call it a multiyear industry megatrend, trying to tamp down, i guess you could call it concerns their point, of course, is that their number of things the chips are going into, not thatted market is necessarily trying to be vigilantes and don't spend. it seems like that's what you're noted for. i know all the autocommentary is this year finally we have loosened up in semis it doesn't seem as if it's in the bag, so clearly that's

something that the market wants to see it's been tough to make that case that we're kind of headed for the glut. -- yet again >> jonas is calling it the mobile metaverse even when you do have to do the driving these days, the interface and your ability to actually deal with your car through all of the technology in there is becoming more and more

important. we all know that there are some companies that are very good at making cars, but not as good as actually having that consumer interface work well. there's another company that has a good job of doing that that's apple that's why we continually hear the questions about whether they would consider getting into the automobile business. and since it's -- looking at the screen, that that would be something they might be interested in. guys, i want to move from that to space virgin galactic is down a lot, getting close to the spac ipo price. this is one of the more successful spacs and we can go back over time mike was pressuring the stock this morning, it was the announcement of an issue of convertible senior notes, due in '27. obviously you do get some pressure when the convert arps get in there as well,

potentially, but it is notable that stock is down dramatically, as people recall, this was one of the more successful spacs out there. you have to look far and wide now. lucid -- many trading below their $10 issue price. before they have announced a deal, oftentimes even after they announced a deal, even after they closed the fed deal you can take a look. that's the only one trading above par of our various indices we have to track the spacs >> if you go back, what was virgin galactic supposed to be doing in terms of passengers revenue and cash flow in 2022. what they put out there as a spac conversion -- >> that, by the way is the biggest indictment there that's at 72 cents on the dollar

at this point. that's after the deal had closed that sort of is -- got to be concerning not to mention -- we haven't talked about it in a while, but there's hundreds and hundreds of spacs looking for deals. >> i even did here late last y year, and the microcaps that had been created finally, you know, tipped at least among the wreckage and you could make a decent deal but that takes time to sort that stuff out. >> adam aron, amc, and share sale, getting some attention they tweeted because in auction, at age 67, i would sell shares toward year end. all trading decisions out of my

hands. those sales are still finished i plan to invest more, i am in he says he's done selling shares >> he sold 625,000 no november, another 312,000 in december, and most recent sale most of the shares he said he's going to hold i don't believe have vested as of yesterday. he did transfer half a million shares he gifted to his adult children i mean, we talked for quite some time how could you not, if you were in his up to try to monetize the enormous gains fully unexpected from a company still dealing with the impact of the pandemic, despite the incredible success of the last spider-man movie mike, any valuations you wanted to use would not get you anywhere nearthe 11.6 million

market company >> it's not even clear that they've been a big pressure point. when out of that trade, and then you small the responses who trade --, it's coming, it's kind of fan fix -- >> the day has colored a bit by some upgrades. piper dwrup grade che good g today, we'll talk to dan rosenzweig later, i believe. and over the next couple years,

we expect -- driven by the erosion of social city in a, increase to mobile devices and growth in the number of singles. >> yeah. there was a -- there's a demographic story there, a bit of a delay on marriage, but they've really been cast as a reopening play as well you know, you're going to meet somebody in person in theory so it sort of works. again, it's like the airlines. they've had waves where the stock has gotten momentum, you know, 30% off the high for match, you know. they keep trying to cede the next mousetrap, you know, in terms of product extension so it does make sense. it is the time for a reiterating why you love the great glamour stocks, like the teslas and apples, to say here's your chance for the thing going to the moon last year bumble, to your point, the best day was its first day when it went public early last year.

>> right. >> it's been nothing but down since. blackstone-backed company, and reflective, as to a certain extent of what you were talking about. >> once that were coming public in particular to a certain extent seeing enormous first day pops. >> and they companies that were basically trading on total addressable market numbers it's a subscale competitor, and it seems like the new -- the new competitor that you could probably try and see if tucked capture market share quickly a lot of those in retail and in consumer products just, you know, look at the opening chart, you know, that kind of thing that was 2021, you know, type of business we're not really doing that anymore. >> no, not so far this year. you have the nats take aiming for tower straight wins. dow has gone green for the month. good morning, bob.

>> we have cyclicals, and tech is continues to rally. banks are at new highs take a look at the sectors semis are strong taiwan semi had a great report overall. new highs in applied materials banks are continues to hold up really well. the new high list is littered with super-regional banks. that's a little unusual going into earnings season, with a big outperformer for a long time banks at new highs, some of these uper-regional banks. of course, we'll start tomorrow with jpmorgan and wells fargo, but it's typical for banks to sell off a bit overall here, the big market theme has omicron is delaying, but not derailing. they were basically in line, but here's the headline, the one that matters omicron is expected to delay --

omicron delaying, not derailing, the recovery they admitted they've had staffing problems, disrupted travel, but he was quite positive that's why the market is holding up so well, the question is, how much more can we push this stuff. energy has had a tremendous run really since the end of 2021 that's been a big market leaders. banks have had a tremendous run as well. other cyclicals have been outperforming, and defensive sectors like healthcare, tech is only down 3 torres, and you've got to question how much more, so some of the megacap techs did well, so still not clear the important thing is we're entering earnings season now we're going to have a much more

normally 2022. for 2021, earnings up 21%. you'll see a long time before, 2022 will see much more historically normal returns on earnings. we keep noting 13% historic

operating margins. and she said either totally unrealistic. it is first one is analysts are not raising estimates as fast as they used to the fourth quarter of 2021, 22%, that's been flattish for a few months now they were raising the estimates very aggressively. about 20 companies reporting, they're beating by about 13% last year those 20 were beaten by 20% the amount of beats is still higher than normal, but the percentage of beats is

definitely lower than it was last year. carl, what i'm trying to say is we're moving back toward more historic averaging the mark keeps trying for the idea to beat -- we'll have to have an adjustment in the next few months back to you. >> bob, thanks so we're back close to 47.40 once again let's look at bonds. two-year still above 90 basis points, five-year 1.5, the ten-year 1.73. lael brainard, of course, on the hill in the coming hour. we'll be right back. at vanguard, you're more than just an investor,

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a reminder you can get in on the new cnbc investor club with cramer, sign up and find out more at cnbc.com/investing club or just use the qr code on the screen it takes you right there holding 4740 or so dow is up 122. green again for the month.

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paycheck cannot deduct any home office or home office expenses that's because the 2017 tax changes suspended the deduction for employees, at least until 2025 but for self-employed workers, business owners or partnerships, they can take the deduction and benefits can be substantial. there are two rules that irs says that you need to fill for this deduction the first is the taxpayer needs to use that portion of the home exclusively for business and the home must be the taxpayer's principle place of business and it's all done by ratio if your office is let's say one tenth of your home by square footage and you pay $20,000 a year for your mortgage or rent you can write off $2,000 and also deduct one tenth's of the home's maintenance costs for repairs, property tax, insurance, all of it you can follow a simplified irs formula of $5 per square foot

for a maximum of $1500 this is yet another example of where it pays from a tax standpoint to be self-employed >> fascinating look at where we are given remote work and how it's evolving quickly. appreciate that. robert frank a break here dow up 135 we'll see what happens as the p 40ion goes on. s&47 don't go away. esg is responsible investing. who's responsible for building esg into your investments? at pgim, the pursuit is on for outperformance. as active investors, to outdeliver with customized strategies, integrating esg best practices into our investment decisions. as asset managers and fiduciaries, to outserve,

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good thursday morning. welcome to another hour of christian aid. i'm carl quintanilla with morgan brennan and david faber. markets here holding on to gains. nasdaq up 4 straight as whales inflation ppi runs light on the headline as the market looks for clues maybe we are in peak mode for pricing. >> we'll have to see 30 minutes into the trading session. three movers we are watching we're going to start with taiwan semiconductor, beating analyst forecasts and issuing an upbeat outlook amid surging demand for chips. the shares up 9.5% right now

shares of kb home are surging after topping earnings expectation the home builder issuing positive outlook for 2022 with pricing strength is expected to contribute to better than expected margins. those shares up 13%. delta airlines beating on both the top and bottom lines this morning. ceo ed bastion was on "squawk box" earlier today and discussed the company's latest booking data >> what we do see in the booking data presidents' day weekend forward looks robust our numbers and the bookings continue through this period people are ready to travel and ready to book their spring plans. they know omicron is not going to be a threat to them at that point and they want to get out and reunite with friends and family and the world and get on with their life. >> they're expecting a return to profitability as soon as march you can see shares of delta up about 4% right now, only up about 4% over the last year of trading as well, carl.

>> meantime morgan, as we said earlier, inflation rising at the fastest pace in decades as wholesale prices hit records here to break down what it means's goldman's strategy david cost good to see you again. >> nice to see you >> your note so far this year have telegraphed the risks you talked about for a while, rates, taxes, margins, cost inflation, but you're holding on to 5100, i think, for year end. maybe you can talk a bit about what gets us there in the face of all those risks >> sure. you are correct. we have a price target for the s&p 500 at the end of this year of 5,100 to put that in some context that would be driven entirely by earnings growth of roughly 8%. now we anticipate that bond yields will rise 2% at the end of this year, but that would be

offset by a decline in the risk premium as we get beyond the midterm elections, we get beyond questions about some policy uncertainty with regards to taxes, we are not anticipating that there will be tax form legislation, so as a result, it's really earnings that are likely to drive and lift the market higher. it has been an unbelievably busy start to this year and, in fact, it's as busy as it was in march of 2000 in terms of -- 2020 in terms of the number of incoming phone calls and focus because you've had higher bond yield, you've had questions about the duration, trade, if you will, and long-term growth, less profitable or low margin growth stocks, so lots of focus very intense couple weeks right now, but the general trajectory of the equity market is moving higher. >> do you expect the overall aggregate conversation, once we start to move into earnings

really tomorrow, to be one that is net comforting or net alarming >> it's an excellent question. i am focused very much on the margin profile for companies as we look into 2022. morgan just mentioned, you know, the airline companies as you pointed out tomorrow, you have the major financial institutions start to report and that's always the early part of earnings season and then rolls through the rest of the market and margins are such a critical part of the story because the economy n our anticipation, is going to be accelerating in terms of growth. it's not so much a top line story but rather, can companies maintain their margins it is a really remarkable statement to think about in 2021, last year, you had the delta variant, you had all these supply chain disruptions, you had companies focussing on issues involving employee retention and attracting employees, you had commodity

price spikes all these issues and companies still were able to raise margins to record high levels across pretty much the entire market. i'm forecasting for this year that margins are also going to be increasing by a relatively modest amount, about 40 basis points, but that is a critical story behind how you get to a higher level of earnings and that ultimately is what we're anticipating will take the market higher. in the next several weeks less a focus for investors in my opinion on the idea of rates and the fed policy and some of those changes, much more micro, much more idiosyncratic focused on individual stock stories >> so margin, that's what's in focus over the next couple weeks, david, but you have been writing a couple notes about just in general taking a step back heeshg the playbook we've seen historically for fed tightening cycles, what works throughout it, break some of that down by sector here

>> sure. so, morgan, the story is it actually gets a little complicated and messy because we have things about the fed hiking, which we're anticipating the first hike will take place in march and continue four hikes in total for this year that's a flattening of the yield curve, kind of a bare flattening of the curve we've had a huge move in long-term rates going from 25 basis points since the start of this year, which has been a depressant on the level of the overall market getting into the individual sectors, historically speaking, quality has tended to do less well, kind of coming in, and then better on the way out, to a fed hike the market is pretty much pricing, the market, in the fixed income market, anticipating this path of tightening that i just described, so we're focusing on where companies are able to kind of improve margins that's likely to be more in technology but i would emphasize

the more profitable end of the spectrum, more profitable growth companies there, the idea of financials tends to do particularly well, broadly speaking the banks on the other financial intermediaries do well when rates are rising and that is also part of our playbook if you will in terms of preference, in terms of stocks in those areas, and then the value sector is interesting, would be health care which has remained and remains today deeply under valued, relative to the market going back decades so that's sort of an area if i think about it as a playbook, a little bit of a prefer margins, margins absolutely in technology, therefore they have more flexibility around their operating business and then the broad theme of higher rates definitely supports financials >> yeah. david, one of the most important screens that you publish on a weekly basis are companies with high pricing power and they do include, j&j, nike, 3m, adobe

and oracle do they have something in common other than pricing power? are there other threads you can use to create a basket or a screen >> there are we create a basket and that's something that macro traders in particular look at, trade that, more micro stock picking, mutual funds, as a shopping list of some companies the characteristic that we're looking for that would carry across some of those companies are high and stable gross margins. the idea is these pressures that we just talked about that would be pressuring margins, the offset would be the ability of the business to be relatively stable that context as opposed to lower and variable margins more attune to the overall economy. that's a big area of focus number two, thinking about labor intensity and labor sensitivity. that is the source of the higher

rates. think about a discussion of the policy rates and what will happen to long-term rates, it's really a question what's the driver of that and the concern, if you will, from a policy maker's point of view is the unemployment rate is super low, that's a good thing from a societal point of view, but that is pushing up wages and some companies have a huge labor budget and that would be say 25 or 0% -- 30% of their sales are consumed by the labor budget that puts them having to raise wages and keep their employees other companies have higher margin structure and don't have the same labor intensity that, carl, i think is the two ways to think about it one, high and stable gross mars and the second relatively low share of wages and salaries as a share of their sales >> finally, david, the fact that we've been seeing the dollar weakening against other major currencies in days, how does it

shape this entire conversation >> so forecast of dollar euro at goldman is relatively stable around these levels, and 70% of the revenues of u.s. companies are domestic so it's important from a business for some companies but broadly speaking less of a risk in -- for most companies in the market right now. >> david, we'll let you get back to the phones because i know they have been ringing hard since the beginning of the year. great stuff as always. good to see you. >> okay. thanks very much, carl as we go to break take a look at the road map, including the president set to deliver an update on the white house response to the latest covid surge. when it happens we'll take you there live >> p/e firm tpg makes its market debut on the nasdaq at 2950 a share. we'll tell you what to expect from the year's first major initial public offering. >> virgin galactic shares are cratering today, down now about

60% over the last 12 months. we're going to tell you why when christ squawk on the street returns. .

at what point does the administration say the strategy isn't working and we're going to change strategies. six wrote that open letter urging the administration to change course, to change strategy is it time >> it is time for us to do what we have been doing and that time

is every day, every day it is time for us to agree that there are things an tools that are available to us to slow this thing down >> that was vice president harris on the tropic"today" ss show defending the administration's handling of the pandemic joining us two advisors, dr. rick bright from the rockefeller foundation and university vice provost of global initiatives and author of "which country has the world's best health care" dr. emanuel. gentlemen, thanks for being with us today given the fact that you did publish, you and your colleagues, a series of recommendations for the administration, you were so crucial to advising the administration in the early days and in the transition period, i do want to get both of your

responses and dr. emanuel the comments from the vice president the fact that it doesn't seem like at least from those comments, your recommendations are being implemented, publicly being discussed being implemented? >> i wouldn't agree with you first of all i think the administration had a great strategic plan in january 2021 and executed well and they're working every day 6:00 a.m. to midnight, trying to execute and we need a refresh of that strategic plan we don't need to throw it out. we need to revise it given the fact that virus has changed and the circumstances have changed and that's what we were suggesting i will tell you, they are listening and they are doing a lot regarding our recommendations. it is not true they're not listening. >> that's promising to hear. what are the recommendations and how quickly can they be implemented? >> absolutely. i agree with dr. emanuel and the vice president they have their hands full

there's a lot to take care of right now as the vice president said, we're in the middle of a surge and the administration's focused on getting all the tools needed to address the surge, getting more people into the health care system and to backup doctors and nurses and manage people hospitalized. in large smart the people dying are unvaccinated people, so we need to make sure we don't let up our efforts getting more people vaccinated. the other tools, think about how we're using our testing and the rapid antigen tests to reduce the spread of this virus think about the guidance that we're putting about n-95 masks and air filtration and ventilation and making sure that we're bringing the power of those tools to help slow the spread of this virus our suggestions to the administration are that keep doing the surge, but while you're doing the surge, let's start envisioning what it looks like as we come out of this surge. what tools we need to have in place to control this virus, be

aware of the next variant sooner than the last one and make sure that we have a wall up that when the next variant comes our way, we can contain this and won't have another whiplash panic happen in our country. >> dr. enan mule, you've said one guide is what we're willing to live with regarding the flu this is not the flu at this point. for the naitd i wonder is it, and should we still be focused, dr. emanuel, to try to get people vaccinated. it would seem a year in those who don't want to, won't. >> i don't agree with you. there are many of those people who haven't been vaccinated who are on the fence and recently work in montreal and quebec have shown that there are a variety of ways you can induce people to get vaccinated, especially people sitting on the fence. you got to be vaccinated to go to a liquor store, vaccinated to go to a marijuana dispensary, maybe even a financial penalty

if you don't get vaccinated. there are a variety of ways to induce people to get vaccinated. that's the first thing the second thing is, the country still at 1750 deaths per day and going up we've got to get below 300 or 250 deaths per day before we can begin to think about talking about a new normal we're nowhere near that level and one of the consequences is, you know, the vaccinated, they may be fine, but they're going to come into contact with people who are immunocompromised or young kids who can't get a vaccine so we've got to get the cumulative incidence, the level in the population down, before we can get into the new normal part is getting people vaccinated, wearing masks, better indoor ventilation. >> but at what point do people just grow frustrated with all of it and say, i'm not going to bother anymore worrying about

the unvaccinated and not going to change my behavior >> we are all frustrated with unvaccinated but we have to do our part to get people who are not anti-vaxxers but on the fence. the vast majority of 38% of americans who haven't been naitd some are young that can't be vaccinated but many are not anti-vaxxers they find it inconvenient, hesitant, we can do things to encourage them to get vaccinated and their children vaccinated. >> we can talk about vaccines, one piece of the puzzle, another key piece is therapeutics where there don't seem to be enough on the market or available or enough easy access for folks who need them in the middle of the omicron surge and talk about tests which have been so challenging to come by in recent weeks as well. how do those supplies ramp up quickly and how do those get into the hands of americans who need them much more quickly?

>> this is one area where i wish we would have done more sooner and leaned forward aggressively the risk to ramp up manufacturing of the antiviral drugs as they were in development so when we had this data they are safe and they do work, then we would have enough supply to use them same with the tests. we've known two years the important of testing, but yet we didn't ramp up those supplies and, in fact, we downgraded or turned down some of that production last summer when we were under estimating this virus and we thought it was coming to an end then, and it wasn't so what we're seeing the administration do now, that's what's important, how do we go forward, they are aggressively ramping up production of the therapeutics, the new antiviral drugs and they are ramping up production and availability of the rapid antigen tests. we need to inform people on how to use those tests effectively, to keep from spreading virus to other people if you're still infectious we need to link those rapid

antigen tests with our treatments we know those antiviral drugs are most effective when used early, so when you get a positive test and rapid antigen test it needs to trigger a medical consultation and supplies of that drug coming to you so you can take it as soon as possible. i know that sounds idealistic in the world we are in right now with limited supplies, so the government is going to have to triage those supplies to those at highest risk of dying and in the meantime do everything possible using the production act and other tools to ramp up production of those to use those to control this virus and get out of this pandemic. >> all right finally, dr. emanuel, i want to revisit something you said at the beginning of the conversation if the administration is listening and taking some of these recommendations seriously and implementing them, why go public with these? why publish them and speak to folks like the reporters at "the new york times" and urge this

new strategy so publicly >> well, first of all, it's not just the administration that has to understand the strategy everyone in the country has to understand the strategy going forward, has to envision what new normal looks like and what it's going to take us to get from this place to the new normal you know, it's not just the administration that has to be made aware of. we need more vaccines, people vaccinated we need to wear high quality masks. the administration has been trying to do it. the strategy is to get everyone not just everyone who is within the white house, but everyone in the country understanding the importance of those things so we can get to a new normal of living our normal lives with covid. that's the new normal. and that is something that requires everyone to participate in you know, from the start, people like rick bright and others have been saying, this is a community effort it's an infectious disease effort

we're not going to beat it each person acting alone. we're only going to beat it if we're acting as a nation >> i see hare you say that, dr. emanuel and i just -- i mean, we're two years in what in the world gives you the idea that suddenly everybody is going to get this message. what have you seen in terms of the wee hiver that would give you any hope of what would happen >> i do think people are different when things happen so you notice that when the surge happens, people actually change their behavior. they stop going out. they begin to get more vaccines, et cetera. educating them about how we can open up society, how it can become more comfortable you don't have to wear a mask all the time, is something i think people will respond to if stated clearly and we give them a direction and also, you know, a timeline here's what we're doing and what we need you to do.

i think president trump, former president trump, you know, probably helped the cause by acknowledging that getting a vaccine is important, getting a booster is important, and those people who are saying you don't need a vaccine, you don't need a booster, are gutless. >> yeah. well that administration also did develop the vaccines very, very quickly gentlemen. >> yes and excuse me, republicans -- >> we got to go. >> trying to persuade people not to get vaccinate ready undermining the country's efforts to get to a normal. >> yep thank you. we appreciate the conversation, gentlemen. thanks for joining us today. >> thank you. as we go to break take a look at boeing some reports that 737 max could resume service in china as soon as this month according to a bloomberg report china was the first of mane countrys to ground the plane in march of '09 shares up 3% don't miss another cnbc special, crypto night in america hosted by sara eisen at 6:00 p.m.

eastern time as we did take tick a leg lower, s&p now negative on the back of some mega cap tech we're back in a minute.

private equity firm tpg went public at $29.50 a share our leslie picker is following that closely leslie >> hey, david. tpg finally set to make its debut today after toying with the idea of going public for years. the asset price manager generating a billion for the company in china life insurance. the price values tpg at more than $9 billion. now, i just got off the phone with tpg's founder and executive chairman and ceo i asked them about their plans now that tpg is a public company, whether they will be expanding into new areas like their private equity since they've gone public. winklereed noted they see more opportunity in the areas they're currently in, namely growth impact and real estate, but he also expects some level of consolidation in the industry

and it's open to pursuing inorganic growth opportunities like acquisitions as well. the bulk of their traditional control oriented buyouts at this point the time with the sizable growth and impact investing arm as well. we also spoke about some of the macro factors affecting the industry which is kind of dragged down the private equity peers recently winklereed said the firm saw inflation pressure in the portfolio for a while as it relates to wages and raw material and actively returning capital to lps undergoing a number of monetizations and sales of portfolio companies they've been, as he calls it, forward leaning about anticipating the cycle a bit i think that can -- you can read between the tea leaves of where they think things go from here coulter said any disruption in the market given they don't have the sell on any given day creates opportunity. that's the publicly traded market there as for the ipo process in

general i liked how they described the deal to me as this back to the future ipo it's one more likely to attract traditional institutional investors than say the retail crowd like we saw in many deals in 2021, guys. >> yeah. leslie, you know, that's interesting. one of the last of the long-time private equity firms to go public, right. i mean, we've got apollo we have blackstone from '07, kkr and carlisle and we can go on from there why have they all gone public? what is the reason that they all have chosen to do so as opposed to staying private partnerships? >> it's a great question, david, and you kind of look at the whole landscape of the private equity world the ones that go public do have a much more diversified portfolio and ventured into other areas and have this kind of fundraising prowess that can make it so they can get those management fee levels higher in ordered to appeal to the public market, which, of course, likes to see the predictability from

the management fees as opposed to the performance fees which can be volatile. the ones who have stayed private are more of the kind of sector experts, most venture capital firms are private. you've got firms that maybe specialize in retail and consumer companies that have stayed private and others that focus maybe more on financials and other areas that have stayed private. the ones that are diversified that see a benefit here and have that benefit of kind of the public currency they can use to make acquisitions become bigger and kind of grow their business from here. >> leslie picker, thank you. it's time for our etf spotlight. today we are taking a look at the s&p aerospace and defense fund that is ticker xar, top holdings include mercury system, northrop grumman and boeing and virgin galactic the shares of the space tourism name are plummeting after the company announced plans to raise $500 million in debt, $427 million from converble senior

notes and $75 million option also expected to be granted to buyers now galactic intends to use the net proceeds to, quote, fundamental working capital, general and administrative matters to accelerate the development of its spacecraft fleet. that's where this money is going to go, expanding the spaceship and mothership fleet just in terms of a little bit of context here the company saying this morning, preliminary q4 precash flow is negative 65 to $70 million. better than earlier forecasts. and given the fact that it had a billion dollars on the balance sheet as of the last quarter, no previous debt, this is being seen as an opportunistic and intentional move to raise capital as it doubles down on growth, builds its next gen ships and continues to look to launch commercial service in q4 of this year. shares are down 15%, down over 60% over the last 12 mthons. we're going to take a quick we're going to take a quick break.

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welcome back i'm rahel solomon. here is your cnbc news update at this hour. president biden is sending federal medical teams to overburdened hospitals in six states to try to help them handle the surge in covid cases. he is scheduled to announce the move shortly the states are new york, new jersey, ohio, rhode island, michigan and new mexico. biden wants the government to buy 500 million additional covid tests. russia is threatening to send military assets to the western hemisphere if tensions over ukraine are not resolved. in a television appearance the official who led russia's delegation in monday's talks with the u.s. said that he would neither confirm nor exclude the possibility of russian military deployments in cuba and venezuela. moscow wants a guarantee that ukraine will never join nato the u.s. and allies reject that

demand. and novak djokovic hit balls today as the government decides whether it will deport him djokovic won a court decision to allow him to stay in australia even though he isn't vaccinated against covid and the government said that ruling was on procedural grounds, and its immigration minister could still have him sent home you're ups to date carl, back to you. >> rahel solomon we are monitoring the nomination hearing for president biden's pick for fed vice chair lael brainard who said fighting inflation is the fed's most important task live shot of the hearing right now. senator toomey joining us is former atlanta fed president dennis lockhard. we got through powell's hearing, dennis i wonder what you think the mission is for brainard? >> i think she will saythings very close to jay powell i don't think there's any reason why she would create some distance between herself and the chair. the consensus on the committee, i think, is pretty solid so i

would expect what powell said, you'll hear repeated in one way or another by lael brainard. >> some of the opening statements this morning kind of, i guess, for lack of a better word, taking brainard to task for an emphasis on climate policy at the fed, something that powell says will be a priority i wonder, at what point does the fed need more to defend that position >> well, i think you're making a good point probably the defense needs to be made, there's a lot of kind of what i would call sloppy thinking about this. all the fed has said if my reading, at least, is that they will factor climate effects into super vision and regulation policy not into monetary policy, per se this seems to have gotten muddled where people think interest rate policy is going to

be a function of the last hurricane, and that's simply not the case i think some clarification is called for >> that's interesting. as for the pace of policy itself, we've got parker, daly, bullard in the past 48 hours suggest suggesting march is the time or q4 of the year are you surprised of the consensus among some of the ranking fed officials? >> i'm really not surprised. you know, i think the data evidence is so strong that there isn't an inflation problem that needs to be addressed. the committee has tightened up and they've come around. i'll point out john williams speaks tomorrow at the council on foreign relations and it will be interesting to see if he signals anything particularly. my view, carl, is that it's hard for me to imagine why they would

not move in march. you know, i just think the stars have aligned for a first rate hike in march. >> so dennis, i mean, we can talk about rate hikes and the balance sheet, and i'm starting it see the notes circulate now about taper and this idea of tapering the taper much more quickly, potentially seeing something like that and in january even ahead of time given the fact that inflation is running so hot is that on the table too? >> the way i think about it, there is a small chance that they would come out of the meeting on the 25th and announce that they have simply finished the tapering process and i would say a nonzero but very unlikely chance they would go ahead and make a rate move given the

consensus that it clearly exists now, the problem is that would surprise markets and the public and could signal a certain degree of panic or alarm, so i think it's unlikely but could they taper faster, yes, they could announce that on the 25th, that it's done. >> as we await q&a, dennis, as far as this morning's tpi, sequentially a little bit light. last night china year on year ppi a little bit light those who are looking for hope in those sequential or -- i don't have time to finish the question i think we're going to get the president here thanks to you. dennis lockhard. >> you're welcome. good to be with you. >> good morning, everyone.

>> i want to begin by thanking the secretary of defense and our fema director for joining me today. we were joking earlier, not really joking, when you need something done call in the military and fema will make sure it gets done look, we're about to get a covid 19 briefing from the medical teams in arizona, michigan and new york they're part of a major deployment of our armed forces to help hospitals across the country manage the surge of the omicron virus. this surge has an impact on hospitals. like all health care workers they are heros, and i'm grateful for what they do before we begin i want to provide an update on our fight against covid-19 and announce new steps. first the update i know we're all frustrated as we enter this new year omicron variant is causing

record hospitalizations. i've been saying that as we remain in this pandemic, this is a pandemic of the unvaccinated i mean by this, right now, both vaccinated and unvaccinated people are testing positive, but what happens after that could not be more different. if vaccinated people test positive, they overwhelmingly have no symptoms at all or mild symptoms. if you're naunvaccinated, if th test positive, you are 17 times more likely to get hospitalized. as a result, they're crowding the hospitals leaving little room for anyone else who might have a heart attack or injury in an automobile accident or any injury at all. yes, the unvaccinated are dying from covid-19. but here's the deal. because we fully vaccinated nearly 210 million americans the majority of the country is safe from severe covid-19 consequences that's why even as the number of

cases among the vaccinated americans go up deaths are down from last winter for example, before the vaccination requirement -- excuse me, united airlines, was averaging one employee dying a week from covid-19 after implementing its requirement, it's led to 99% of its employees being vaccinated united had 3,600 employees test positive, but zero hospitalizations zero deaths in over eight weeks. as long as we have tens of millions of people who will not get vaccinated we're going to have full hospitals and needless deaths the s single most important thing is getting vaccinated if you're not vaccinated join the nearly 210 million american people who are vaccinated. if you are vaccinated, join the nearly 80 million americans who

have gotten the booster shot with the strongest protection possible vaccines are safe. they're free and they're widely available. so do it today please for your sake, the sake of your kids and the sake of the country. now, i don't like to, you know, outline the next steps we're taking against -- i like to outline the next steps we're taking on the omicron variant. vaccinations are obviously the most important thing we're doing, but they're not the only important thing. first, masking masking. masking is an important tool to control the spread of covid-19 and when you're indoors in public places you should wear the mask there are a lot -- you know, lots of different kinds of masks out there and the center for disease control and prevention, the cdc, says that wearing a well-fitting mask of any of them

is certainly better than not wearing a mask well fit over your nose. it's about one third, about one third of americans report they don't wear a mask at all as i've said in the last two years, please wear a mask. if you're in -- you know, i think it's part of your patriotic duty it's not that comfortable, it's a pain in the neck, but i've taken every action as i can as president to require people to wear masks in federal buildings, airplanes and trains they cross state lines i've made sure that our doctors and nurses and first responders have the masks they need never again are we going to have our nurses using homemaded masks and garbage bags over their clothing because they don't have the gowns. we have more than tripled our stockpile of the most protective specialized n-95 masks since coming into office this is going to make sure that

there will be an ample supply of health care workers and first responders we also have helped make sure that high-quality masks are widely available and ample supply -- >> that is the president offering really basics on combatting the epidemic pleading with the public on vaccines and reminding us they're free, widely available, safe, pleading on masks even though as he says they are a pain in the neck. he did reference some news regarding the military at the beginning of his remarks and we're still waiting for exactly what that might be. >> well, carl, in december, the white house announced that it had prepared 1,000 military personnel to be deployed across the country to hospitals as needed, and we have reached the point in this current wave where the white house has identified that need as severe and that's why you see the defense secretary there with the president as well. we are expecting an announcement

that cleveland clinic coney island hospital, rhode island hospital and three other hospitals are going to b receiving these military personnel to help them treat patients and just deal with the surge in patients that they are seeing in their hospitals at this time. we're also expecting the white house to announce in part of these remarks they're going to be procuring 500 million additional tests bringing the number to $1 billion tests that the federal government is procuring to help people be able to test, identify, isolate as needed, especially ahead of the february 9th enforcement deadline for businesses with more than 100 employees to begin either vaccinating or testing their employees on a mandatory basis. we've heard from a lot of businesses they can't get the tests to actually comply with that policy right now and the federal government is trying to put more resources behind the problem to see if they can help solve it in short order. david? >> kayla, thank you. kayla tausche. as omicron cases continue to

surge globally the tourism and hotel industries are certainly getting hit hard our next guest is cautiously optimistic about the future of travel especially in the luxury sector. he says guests continue to prefer a staycation rather than traveling abroad joining us to talk exclusively is christopher, the dorchester collection ceo christopher, good to have you with us. you know, what are you seeing in terms of your bookings right now and frankly, what gives you optimism given what we've seen so far in this obviously only a handful of days in 2022? >> thanks very much, david i think the end of 2020 was very strong for us up until december when the different restrictions came in. in fact, it was the best quarter we had had for rooms revenue for many, many years and so obviously the restrictions came in and we saw

cancellations, which was really, you know, all hotel companies experienced the same, except for the domestic tourism, so our hotels, the beverly hills hotel and the hotel bell air and the uk did well out of the staycations. as we go into 2021, the studies we've done and the way that our bookings are looking, is that the first quarter is going to be soft but that the leisure travel will start to return probably from may onwards. the tourism as a hole it's probably not likely to return to, you know, prepandemic levels until about 2024 >> okay. you know, but i -- so you're anticipating that there will be, once again, an increase in u.s.

to europe travel i would assume that's got to be an important component of what you're seeing or expecting when you talk about may, things getting stronger >> very much so. we're starting to see the restrictions being lifted here in france from monday for european travel, the u.s. the u.s. travel to europe is open. i think people just need to have some confidence that when they do travel, that they won't get so caught by last-minute implementation of regulations or restrictions so that they have to isolate and i think once people get more confident, the leisure travelers get more confident about it, they'll be more willing to travel there's a pent-up demand to travel and go to restaurants we're seeing that exist as caution at the moment.

we are optimistic that travel will return in a very positive way later on in the year >> yeah, christopher, we have been having these conversations about normal and the so-called new normal and what this looks like post-pandemic what does it look like at your hotels how do you think -- how do you think travel has been fundamentally changed if it has, in fact, been fundamentally changed now? >> our guests are still looking for that experience. and i think the dorchester collection, the hotels, the health and safety standards have always, prior to the pandemic, have been very evident and so, our guests are very loyal and very confident about the experience and the service that they will continue -- they have received during the pandemic and will continue to see in the future. and so, it's really business as

usual from that point of view. we apply the regulations as they pertain to the different countries. but, we're looking to open the hotel in dubai at the end of this year, which will open at the end of the year and going into refurbishment of the dorchester as from when just started. so we're very positive that it's all about the guest's experience and staying very true to your brand. i think that's what's absolutely key. >> you know, christopher, we just had a long discussion about how to bring the unvaccinated into the fold. we'rereminded of what macron said a few days ago about making life difficult for the unvaccinated, although he didn't put in those words and couple days later he refused to apologize for it. i wonder if you think that creates a drag on demand, possibly in europe

>> it possibly can i think again, people want to go out. they want to go to restaurants and i think slowly, you know, you'll see people getting vaccinated and life returning to normal, particularly we see that in the uk at the moment, life is already returning to normal. >> we appreciate you taking time with us. thank you. >> thank you very much thank you. coming up this morning on "techcheck," we're going to talk to chegg ceo, stock gets upgrade at piper shares have come down around 70% the last year. that's coming up in the next hour we'll take a quick break here as the s&p has taken a leg lower as well, 47.10

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the gains the economy has already made, even as the central bank prepares to start withdrawing its support. >> inflation is too high and working people around the country are concerned about how far their paychecks will go. our monetary policy is focussed on getting inflation back down to 2% while sustaining a recovery that includes everyone. this is our most important task. >> reporter: now committee chairman brown, democrat, credited brainard helping to lead the economy through the pandemic and said she's focussed on a worker-centered monetary policy but that is exactly why there's deep skepticism among some republicans. ranking member of the committee, pat toomey, has a laundry list of concerns about her nomination brought up her focus on climate, lone descents on easing some bank regulations and, of course, about inflation. >> the fed's recent actions failed to maintain price

stability. last year governor brainard repeatedly insists that inflation is transitory. we had nine consecutive months inflation has been more than two times the fed's 2% target. that make it clear that inflation is not transitory. >> reporter: now, it's still likely that brainard gets confirmed. several republicans voted for her as governor, but guys, it will be a tougher fight than it was for j. powell. >> so ylan, we have the nomination process or i guess we have the hearing process for the nomination for brainard today. how long before brainard and powell does it take to see those votes happen and then potentially instituted into these positions? also, do we have any guidance yet on the white house in terms of when some of those other positions that are open are going to get filled or at least nominated as well? >> yeah, we keep hearing on through the open fed positions is that could be any day now of course, we haven't heard anything just yet. but as far as when they might get a final vote on the floor for both powell and for

brainard, the first thing that has to happen they need to get voted out of committee once that happens then they can be scheduled for a floor vote and then we see when they officially get confirmed so, that time period could take a while, potentially as long as a couple months. we'll have to see what the schedule looks like. >> ylan, thank you ylan mui want to check in the last minute, we have shares of virgin galactic holdings. morgan, the stock is down 16%. you know the company very, very well obviously this is due as we said earlier to -- well, at least it would seem to be due to this convertible notes issue. perhaps some selling pressure from convertible bond traders as well there on the stock, but what about the fundamentals here what do we know, if anything, that's changed and/or why they need to raise this capital almost 500 million bucks >> what we know is they had a billion dollars on the balance sheet as of the end of the last gaurter. they didn't have previous debt the way the company is seeing this as an opportunity to raise more capital looking to double

down on growth, build the spaceship fleet and hopefully launch commercial service later this year. so this is really an opportunity to take care of what's still low interest rates, which of course, is something we have been talking about so much, david >> yeah. keep their costs of capital low. morgan, thank you. that will do it for us right here on "squawk on the street. "techcheck" starts now ♪ ♪ good thursday morning. welcome to "techcheck" i'm carl quintanilla with jon fortt and deirdre bosa today the nasdaq quickly moving lower here, down 1%. taiwan semi, managing to hold on, lifting the entire chip sector back to new heights at the open can you continue to bet on the winners or is it