on how much people want in or out. >> yeah. we had quotes on friday for russian stocks out there and some obviously stale and probably trading at a discount we do know that these etfs are efficient to figure out the fair values. >> good to have you. we appreciate it "power lunch" starts right now ♪ welcome, everybody, to "power lunch." kelly will join me in a minute here's what's ahead. the west escalating the financial war against moscow russian banks cut off. the ruble plunging we'll dive into the financial fallout. new shortages, the war in ukraine disrupting supply chains for hard and soft commodities

causing steep rate increases we'll tell you what's happening in realtime this hour. kelly? >> thank you a quick check on market which is are negative and off the lows of the session. s&p and nasdaq has been positive dow was down 500 and now down 350 or 1%. oil prices higher. crude above $96 a barrel for wti. 5% rally just today. bond yields moving lower citigroup down almost 5% today the u.s. ratcheting up sanctions against russia as talks ended with no breakthrough kayla, what are we hearing >> reporter: president biden wrapped a nearly 90-minute call with western allies trying to calibrate a decision to place

the nuclear forces on high alert. the state department said they're analyzing and will not indulge in provocative rhetoric. talks between ukraine and russia as the belarusian meeting wrapped with a pledge to talk more he said he would stop residents if talks are on and there's eyewitness of bombardment in kyiv and karkhiv discussing sanctions today he had sharp words for the west as the kremlin acknowledged the sanctions are problematic. the white house for its part said that russia needs to feel more pain and we could learn more from the pentagon and the white house in an hour's time. >> thank you why what's putin's

next move? is there a chance of a negotiated solution? we're joined by two xperts, chris miller welcome back and andrew lossen is a foal low for europe, russian at the program for center for strategic and international studies. andrew, let me begin with you. you draw particular attention to the sanctions now put on russia's central bank. why do you think they will be so telling here and how will they affect the average russian >> these are really a tremendous step in terms of the western response and the seriousness that's shown to the threat that putin unleashed on the world and

ukraine itself russian central bank has significant foreign currency reserves but with sanctions from the united states and the european union the money that has the dollars and euros can't spend that so that means it's going to be very difficult for the central bank to support the ruble. we could look at bank runs and real significant economic affects in the days and weeks to come. >> does this effectively mean that russia's rainy day fund is untappable >> looking like a significant chunk of that fund is under thre threat russia has 20% in dollars. 30% in euros and going to be very difficult to find a way to use that and puts the economy under serious strain. >> chris, you understand putin

you wrote the book on putin-omics. how susceptible do you think they are to this pressure? putin must have known roughly what these sanctions were going to be, even before he launched this invasion. >> i think the russian leadership was expecting some sanctions but to be honest they're surprised by the severity of the sanctions imposed this morning by the u.s. and the eu the russian government spent past decade doing a program of sanction proofing the economy and the central feature of this was building up vast foreign exchange reserves and found out this morning none worked and sanction proof reserves are

sanctionable so i think it's a state of shock domestic blowback will be substantial and one thing purti has going for him if you are a russian that is unhappy you have no mechanism raising the voice on social media could end up with you in prison or facing legal charges and no mechanism for russians to express the discontent even though it's clear that the economy will be far worse than expected. >> let me ask you this i don't disagree with anything you said i think it's incredibly courageous of individuals that have taken to the streets or social media but if the life of the real people of russia deteriorates as a result of these sanctions what, chris, is the possibility that the ruling

elites around this autocrats and depending on the support of military, national security, intelligence, money people around him or her, what are the odds that that coalition begins to crack >> it does seem like that coalition is starting to crack i think you are right to think of the question is not what does the average russian think but the elite. >> exactly >> there's the military side and the first week of war is an absolute shambles or russia and bungled the military operation we have seen more fire power this morning against the ukrainian cities but the fact the war is going badly for russia is an embarrassment for putin. >> andrew, react to what chris said and to the point of whether

putin's support in the inner circle of the russian elites, military, national security or economic might melt away and he could lose some of the support that he initially might have had for going after and reclaiming ukraine? >> i think putin right now is looking the most vulnerable as he has in years. the fact is he's built a very personalized autocracy in russia every member of the russian elite has to report to him and when they look around and see the leader in charge of the system is engaging in behavior leading russia to economic suicide then of course there's going to be plenty of folks in those inner circle to wonder whether this is the man that

should be leading them there's going to have to be a change intactics on the ground as the russian advances run into stiff resistance they have to engage in confrontations that could lead to thousands or tens of thousands of civilian casualties and undermine support. >> i will squeeze in two more questions. what do you think the possibility is -- what does putin do next? if he is feeling cornered that this is not going well what is the risk that a potentially unstable individual does something truly outlandish, a nuclear explosion, does something? what do you think? >> i think the risks of a spiral, an escalation spiral is quite -- that is a severe risk

so the fact is russia had an escalate to de-escalate nuclear policy for a while and seeing this loose language of the nuclear readiness stature. >> thank you chris, andrew, thank you >> with that, the dow is at fresh session lows down 550. metals prices are higher following the invasion of ukraine and gold breaking out but also overbought. let's bring in renaissance macro research strategist jeff degraph. put gold in the context of movers in metals we know act palladium and the nickel and gold is more baecause of a fiction of sen tram bank buying. >> gold has started to break out. a lot of that breakout we think

is driven by the uncertainty of russia and ukraine and it was a healthy chart, a chart in need of a cat list to start to break it out and certainly that allocations to gold certainly we are in thecamp that it's safer than bitcoin we still see it that way the good news for the overall economy is that gold is underperforming the metals you talked about and gold outperforming the industrial metals where we are siraned about the stability of the financial system and the prospects of the economy going forward. >> what do you expect then for people thinking about having exposure to the other metals what would you say to them >> for metals, historically they're very cyclical and better to rent than own but for the last two years almost particularly with copper we have

seen the copper trend is very, very strong. but it's been leadership in terms of helping to give some insight into the prospects of global growth. what we see right now is copper trying to break out and the other industrial metals. late cycle but with the good news of the metals outperforming and the stocks and the sectors, the copper and steel sector outperforming the s&p and doesn't tend to happen at the end of the cycle we think late cycle and don't think the end of the cycle and good news. i get more concerned if gold started to outperform. that's a point to start to reassess what the real impact is on global growth and what the p prospects there going. >> the crisis is as bad as it is for the russian economy is

contained with the impact to the u.s. and we have a fed meeting two weeks away where does that leave them >> good question the overarching theme here is i want to be very careful because there's human tragedy involved but this doesn't have an impact on equity markets for a long time and we are in a tightening cycle and use copper and the industrial metals as a litmus test you expect them to do something to start to moderate the trends and the industrial metals and in energy and gold. >> that's the point with the tightening mistakes seeing the fed back off today the prices are -- this

environment generally moving higher basically for everything going on right now the fed is behind the curve. >> that's a risk yeah you could say if you look at cyclical names and the cyclical area of the market we have seen a shift there and consistent with 2018. what we have seen in the cycle but not yet the metals and important piece of this puzzle. >> that gives us the dashboard thank you. >> thank you. coming up, what's the risk of an all-out cyber war against russia former cto of crowdstrike is with us. find out what he says could happen next. plus, amid the volatility there's opportunity. veteran market strategy explaining small caps. major indexesn■lows.g

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welcome back to "power lunch. down 550 for the dow 1.4% drop for the s&p. nasdaq outperforming down .8%. take a look throughout the dow goldman sachs, p&g and nike big

decliners. nasdaq booking intuit, pepsi with exposure are the laggards. >> cyber stocks move higher today on the threat of a cyber war between the west and russia. next guest is an expert in cyber battlegrounds and watches putin closely. he is dmitri alperovitch, co-founder of crowdstrike. dmitri, thank you for joining us today. >> thank you. >> we seem so far not to have heard a great deal about cyber warfare as russia moves into ukraine. is that accurate am i expressing it correctly and if i am, why do you think that is the case >> so far russia has not used much cyber warfare capabilities in ukraine in part because they

don't need to. they have overwhelming advantage with ground forces, electronic warfare units on the border so i don't expect to see a lot in cyberspace in ukraine itself but worry about blowback on the west with the sanctions to place on russia to choke the economy as your guest prooefr sli said there's no way that russia won't take it lying down and will respond and cyber is a way to respond against us. >> you expect that where do you expect it which countries or all countries in the west taking action of sanctions and which industries what's most vulnerable >> i think definitely going to try to target europe very likely to try to divide this united alliance been remarkable to watch nato, including germany be aggressive to sanction russia and trying to impact the german population

with the energy sector already dependent on russian gas. might see in the united states now the sanctions gone into place on russia and the banks may see a response on the financial sector in cyberspace. >> what is an expectation that you think is ill founded piling into the sector, any words of caution >> i think the important thing to realize is even if we do have major cyber attacks they won't have a lasting effect. you can't take it down permanently. it is networks that can be rebuilt and in the most disruptive cases networks were rebuilt within days and will have an affect but fleeting. >> what does the west do how does it respond if it is hit by the cyber attacks that's the first part of the

question the second part is, if russia takes the kinds of moves against the west, against nato, are those acts of war that would require a proportionate response or something more? >> there's no doubt that we will have to respond if the attacks are launched against us. the problem is the response economically is limited because we have basically emptied the chamber on sanctions we have gone with very aggressive sanctions off the bat. we can do more on the energy side but beyond that we will be limited in what we can do to russia and might respond with cyber attacks on russia and the challenge is don't want atit fo at the cyber war with russia the one priority that the biden administration keeps repeating internally inside the white house and externally is don't

want a conflict with russia and that's going to be very critical to manage in the coming days. >> that's a very interesting point and i think a krcrucial o is to linger on a cyber competition or war could leave the boundaries of cyberspace or space and spill over into direct military as you said kinetic conflict you are an acute observer of mr. putin. lately people have been questioning whether putin has become unhinged. that's what mr. klapper of the cia said is that the real putin >> this is a guy that's used

polonium to do assassinations. taking crimea. he is a gambler and the 20 years it worked for him. it's paid often or not faced significant costs for it and the bets increasing and now bet everything on the conflict in ukraine. this is traditional putin and i do think he is a rational actor but the back is not to the wall. there will be a tremendous risk to him personally if this goes the wrong way in russia and will bet everything to make sure it doesn't happen. >> let's squeeze in one more we were talking about whether he can hold the people together, hold his inner circle together whether personal risk to him you think he will lose what does that losing look like? >> it all depends on ukraine they can crush the ukrainian

forces they have overwhelming advantages but it's looking unlikely that he can keep the population together and prevent a horrible insurgency that's going to sap russian strength so it can create domestic problems. i don't think there will be an uprising but it may very well come from a palace coup where the members of the military and the intelligence services decide they have had enough and personal well being is affected by the sanctions and time for the old man to go. >> appreciate it. >> thank you. still ahead, digital currency caughtin the middle o the con plikt. ukraine's government raising crypto denationings and the government is asking exchanges to block all russian accounts to get around sanctions the latest heading to break, celebrating black history featuring some

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welcome back i'm rahel solomon. school mask mandates are dropped in california, oregon and washington democratic governors making the announcement saying that the move is possible due to falling covid cases and hospitalizations new rules go into effect march 12th. turkey is restricting russian warships in the black sea with a treaty to do so after receiving a request from ukraine. he says he will not give up on

the relations with russia or ukraine. russia is banned from fifa and russia's central banks says that the moscow stock exchange will be halted for a second day and no stock or derivatives trading tomorrow. >> thank you a quick update on the markets off session lows dow 589. worst performing down 1.6% nasdaq which was green earlier is down 1% look at the defense names. out performance. the stocks are higher. lockheed up almost 5%. germany will increase the defense spending and will show you renewable energy group chevron has the stock up 40% chevron up 1% and the

acquisition impacting the other alternative energy names all rusising nicely 10% today. >> thank you. the latest sanctions from the u.s. hitting russian exposed firms sending the names and emerging markets lower we'll lay outy 6:■ o this.j■

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or, ask how to get up to a $650 prepaid card. we want to get you caught up on the markets, stocks, bonds, commodities. which matters more to the markets right now? russia or the fed? let's begin with bob pisani at the new york stock exchange with stocks near session lows rounding out yet another very iffy month, bob. >> what matters is yields. bond yields are a major problem for the stock exchange clobbering financials right now. 1.85 on the 2-year look at citigroup. one example. $60 a while ago. goes to $70 and now back to $60.

banks, insurance companies having problems. commodity suner cycle. we have new highs all over the place. occidental, hess at 52-week highs and other commodity based stocks are at new highs. so freeport-mcmoran. cf, mosaic, a big company in the commodity space, material space at new highs seem to be selling consumer staples. seen weakness there for a while. pepsico at $161. straight down far few weeks. same with the other names. real weakness there. watch that 10-year yield moving that big financial complex. >> thank you, bob. eat gose to the bond market

where yields are falling because investors are buying them. what gives, rick >> yeah, no. buying high quality, high volume bunds or a treasuries and precious metals like gold. not buying the yen the way they once did in periods of uncertainty. looking at a one week of 10s see last couple of sessions that mid-180s right where we trade down a dozen base points is key and represents 20 basis points below the high yield close going all the way back pre-covid 2.04%. as you look at that year to date chart you can see we have turned with respect to yields in the other direction, on pace for the

lowest yield close 3 1/2 weeks. everybody wants to know how does this affect the fed? i say fed fund futures like sticking the arm out the window. not a precise science. down the road you go the more inaccurate it is but hire's what it says now. this year at 88.60, taken tightening off the table when they rally they take tightening off the table but if you look at next year at 23 it is hardly turned the corner at all. currently at 97.84 representing 216 basis points of tightening back to you. >> very interesting. thank you. and oil, the joint is jumping as the final trades are settling. pip? >> oil in the green with

contract back above $100 as of right now oil and gas are still flowing out of russia. saying that the country's energy supplies are very much at risk so far none of the sanctions targeted the energy industry directly giving vital role in the trade. companies decide it's too risky to buy russian oil check on prices. wti up at $95.36 today as high as $99.10. brent crude up 3.2 prts at $101.10. that contract does expire today. more actively traded contract up at $97.50. seeing companies selling russian assets shell saying it's ending a partnership with russia's state-owned gazprom following bp yesterday saying it's selling

the 20% stake. >> thank you. next guest focused on the market risk factors, russia and the fed. jonathan, welcome back why which is more important? the fed or the ukraine >> over the course of year it is going to be the fed and inflation. and the near term i think that the disruption and this jump up in the volatility and all that's going to be a big positive for the markets. and the very near term move is all about russia. >> do you want to wager a guess where why the market is selling off? because the peace talks or cease fire talks that nobody thought had a chance in truth didn't

succeed? >> yeah. on a day like today when the market is up 1% and down -- not 1 100% 100 basis points it is hard to make a guess on that i try to put a stake in the ground what is this likely to look like in six months or a year from now? i think bob was saying how hard to think in the future i think at the end of the year we see voluntarily tallty back down and valuations having recovered and the sense of angst feeling right now is behind us >> i remember the late and great jack vogel saying a motto to remember is don't just do something, sit there do you agree >> no. you want to be moreengaged if

you have a point of view in times of volatility. clients say i want to calm down before we get back in. when you invest with the vix at 31 you get large returns on arch and where do you make the biggest returns? value stocks over growth stocks. very clearly historically. make them in small cops over large caps and then in stocks in more risky assets so consumer staples and health care. they don't bounce the same way when you have a renormalization. if you jump in buy the right stocks and not safe in these periods because you will miss the nature of the miss. >> volatility can be a friend and particularly if you buy value and small caps in a nutshell --

>> 100%. that is the golub formula. depends on timing but when you have vix really high with geopolitical risk these are really great times to go in and exactly the sectors and groups you want to be playing in. >> you are free to change your mind tomorrow if you want. thank you. >> thank you. etfs tracking russia and emerging markets whacked amid the russian-ukrainiacolin nfct the russian-ukrainiacolin nfct we'll have a deeper look at th ♪ ♪ wow, we're crunching tons of polygons here! what's going on? where's regina? hi, i'm ladonna. i invest in invesco qqq, names after this okay... yeah... oh. don't worry i got it!

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welcome back a news alert on netflix. julia? >> netflix telling us their no plans to put the russia state-owned channels on the service saying quote given the current situation we have no plans to add this to the service. this was a netflix spokesperson r p we have no comment from netflix on what this could mean from

russia just to put it in context just over a year ago netflix introduced the service in russia with a russian language interface and also accepting payments in russian -- in the russian currency and sources say that netflix has fewer than 1 million subscribers in russia. this is the company taking a strong stance saying that they will not agree to start broadcasting that russian, potentially russian propaganda and would be obligated to do because of the size and scope as a streamer in the country and that deadline for that would be tomorrow so as oftomorrow netflix could be potentially required to broadcast some russian state-owned media channels. >> and they say they won't the moscow stock exchange closed today and tomorrow but the big russia etfs down more than 20%

let's go to seema mody for a look around the globe. >> it is ending the month down over 34% worst monthly performance since 2008 and pressuring nations like germany. stocks there closing down 7% russia only accounts for 3% of the broader emerging index and weighed on the market down 5%. domestic is a better trade in february stocks in the u.s. set to fall by 3% but still outperforming other global markets ubs says there's ways to play and limit exposure to russia with country based etfs. ewz tracking brazil but as we know with emerging markets it is

coming down to the outlook on rates and the dollar which has been bid up due to the ongoing geopolitical uncertainty factors to consider always looking at the markets. >> great point if the fed has to keep tightening and could move the dollar higher. thank you. what impact will global destabilization have on the already struggling supply chains one firm say it is war will lead to a steep increase in shipping rates on top of what we have already seentn@■l discuss that ■

new complications for the supply chain involving getting products through russian territory and air space. and the first half of last year, china shipped 300,000 containers by rail through russia to the eu now a lot of that product has to travel by sea. ocean shipping costs are rising. our next guest estimates there will be three to five times higher this year than last, and that would mean costs of 20 times higher than they were in 2019 glen kepkay is the general manager of a digital platform that tracks shipments around the globe in real time what's the latest literally as of this morning? >> what we're seeing is the market is extremely volatile

all of us watch news every single hour, but rates are increased up to three to five x what they were as of a few weeks ago. shipping costs go from china to europe can be upwards of $40,000 for a container right now. >> wow >> and that is a significant cost difference. it's about 5x what it was before if you compare it pre-covid times, what many of us were used to, it's up to 20x more. it's a very volatile market right now, and folks are scrambling to figure out how do they get product into europe right now. >> how is it affecting costs on the key routes coming into the west and east coast ports. >> right now, it has not impacted cost yet. other than fuel surcharge which we'll see increase significantly, especially as news continues to roll out about some of the russian oil firms. from a container cost, though, we do anticipate it's going to increase costs anywhere from about 20 to 40% in the transactional market

and that is mainly due to an already constrained ocean network, so it's been covered over the last six months what's been going on there, and we as supply chain operators have been struggling it's more fuel on the fire that we don't need right now. >> why will the costs ship goods from asia into europe go up so much what is it about the shipping lanes or the routes that either land based shipping or sea based shipping will take that will make it so much more expensive >> so there's two main reasons one is the eurasian rail line that goes from china to europe is going to more or less be cut off here, and so you're going to see -- >> why does it go through ukraine or why? why is it going to be cut off? >> it goes to russia and ultimately to poland so with more and more sanctions being levied, russia is kind of a no-touch zone for a lot of companies. and so we're going to see all

that volume move to either ocean vessels or to air freight when it's critical product. we're going to see an already constrained ocean network that's shipping from both asia to europe and asia to the u.s. take on more volume, and it's not like there's vessels standing by so that's the first reason the second reason is kind of what i just touched on which is these ocean vessels are already at capacity. and to play the transactional pricing market in ocean freight is very expensive for companies. >> so finally, glenn, how quickly could this all be resolved or to put it differently, how long now might these costs pressures continue for an economy that was hoping we were seeing peak supply chain and inflation problems already >> so it's a good question i think fingers crossed for the safety of everyone in the world, especially ukraine, we hope this ends tonight but even if it were to end tonight, we're going to see a residual impact over the next two to four weeks at minimum

that's in part, as sanctions are put in place and companies are really trying to figure out right now how do i get product to other suppliers and manufacturers if i was impacted by this? but assuming this goes on for the next two to four weeks we'll see this carry on into the summer >> glenn, thanks for now we appreciate it >> all right, the crypto industry on high alert bitcoin and other digital currencies being floated as a way for russia to dodge sanctions. sanctions. we will discus - [announcer] bito, the first u.s. bitcoin-linked etf. "power lunch" returns.mj%■

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edward jones welcome back, everybody. quick news alert general molters saying it will suspend exports to russia until further notice the stock is down about 2% right now. gm remains a minor player in the russian market, but it has been growing. again, they will suspend exports to russia until further notice >> bitcoin is bouncing back strongly today up 8%, back above $40,000. and thecor crypto linked stocks such as coinbase also seeing big gains. but ininvasion of ukraine demonstrating the power and problems of cryptocurrencies let's bring in kate rooney now for more kate >> hi, tyler there's been a lot of discussion over crypto's possible role right now in eastern europe. in russia to help skirt sanctions and in ukraine as a

fund-raising method. russia, it might be harlder than it sounds to use crypto for dodging sanctions. liquidity is one big problem it's hard to find places to buy large amounts of bitcoin or any crypto cryptocurrency these markets are what are called thinly traded the bitcoin ruble pair maxes out at $200,000 per trade. that's even on the world's largest exchanges. the max transaction for bitcoin in u.s. dollars tends to be around $3.5 million. i'm told with those numbers, bitcoin really can't compensate for russia being locked out of s.w.i.f.t. at this point exchanges are the main place right now to get liquidity and sanctions likely take away that option there are black markets as well and lesser known cryptocurrencies but those tend to be even less liquid exchanges are also on high alert for sanctioned russian accounts and global exchanges are subject to the same anti-money laundering laws and rules as banks. no matter where a crypto transaction happens, it's also

traceable. data firms are among those tracking some of the big moves they say they haven't seen a large amount of crypto being moved from russia just yet the ukrainian government, meanwhile, is seeing another use case for crypto. there's been grassroots efforts to fund the military with bitcoin and ether. the government even tweeting out wallet addresses for direct crypto donations that's brought in about $12 million so far back to you guys >> let me ask you an oddball question, kate, if i might we had a cybersecurity person on earlier. are the people who operate crypto markets and crypto exchanges worried about being hacked, attacked >> absolutely. so that has been one of the possible outcomes here and we have seen that in the past in crypto exchanges have been vulnerable to hacks. they hend to also, cryptocurrency in general, has been used in a lot of ways for in some cases for cybersecurity attacks, individual wallets, definitely are at risk, so

there's definitely been more attention on that, but the ceos have been more focused on the idea of the regulatory side and making sure they're complying with sanctions and sanctioned accounts it's something cybersecurity is always an issue. >> thank you, kate kate rooney. >> thanks for watching "power lunch," everybody. >> "closing bell" starts right now. >> hello, and welcome, everyone, to "closing bell." i'm sara eisen stocks try to stage an early comeback but have since moved lower as investors digest the latest information out of ukraine. the dow down 400 points as we head into the final hour of trading. >> i'm mike santoli. let's look at what's driving the action fresh sanctions on russia. russia closed the market and the bank doubled a key interest rate at home, treasury yields are falling hard as investors move to safety and bonds. gold is higher as well while crypto gets a ma