>> paypal. stock is down. the market is growing fast >> facebook, meta. eight times ebita. >> decidedly different market picture this hour than it was when we started. there it is. dow good for 461 "the exchange" is now. we are certainly seeing a turn around. thank you, scott hi, everybody. i'm kelly evans. ahead on "the exchange". a ban on russian oil crude is well down from the session highs of close to $130 a barrel we'll look at why analysts think the prices have to stay around the prices if not spike higher for quite some time. all this complicating things for the fed. we'll talk to the man who was one of the first to call for seven rate hikes this year plus an apple event about to kick off we're expecting to hear about a

lower cost iphone. is now the time to try to capitalize on pent up global demand we'll bring you the news let's start with dom and the big market numbers >> it's about a big reversal we've seen intraday. it could be because there are tensions easing perhaps. there could be speculation or realtime handicapping of what's happening on the ground. what we can tell you is the lows of the session, the dow is down 239 points at the lows of the session now we are up 500 near the highs of the session that gives you an idea of the range so far a 700-point range for the dow industrials today. the s&p 500 up 1.5%. similar percentage move to the dow. the nasdaq composite up 2% the outperformer 285 points to the up side. one of the places that you are seeing that sharper reversal, a sky high area of the market that reversed course throughout the course of the day. energy oil prices have come off the

highs. there's a ban of russian imports for oil. the energy sector spidered we saw the dip below for the highs of the session toward where we are right now energy not the only place for the reversal check out gold and wheat prices went lemon down. unwind happening check out end phase energy, solar edge, sun power, sun run they're all up massively today a lot of this is this notion that as oil prices continue to go higher, if this is a regime, if you will, of higher prices over the longer term, could there be more demand for those alternative energy types watch the solar names. they're surging in trading i'll point out if you look at a one-year chart, they're well off their highs for the year >> absolutely. dom, thank you very much crude oil prices surging toward the intraday highs

yesterday of $130 a barrel then taking a breather after the president officially announced a ban on russian oil imports here's what president biden said moments ago about how the u.s. plans to fill the gap. >> the united states produces far more oil domestically than all of the european countries combined in fact, we're a net exporter of energy so we can take this step when others cannot. my next guest says the only things that can bring prices down are removing sanctions or having a recession induced by demand destruction joining me is founder and president of the rapid end energy group and a former energy adviser to president george w. bush does demand destruction have to involve a recession? >> i'm afraid it does. you know, oil demand is the life blood of a modern economy. it's not a discretionary good. it's not movie tickets or cigars that we can just go without if they get pricey. so it's required for us to get to work. it's required for frack torys to

work these type of energy shocks are at the scene of every recession. and i'm afraid it might have to be the same way again. >> although, even the last big one in 2008 happened as the financial crisis was already in motion there were a lot of things that really pulled down the economy, and i wonder if this time is different because you have consumers with a lot more sort of pent up spending power gas prices are not anywhere near where they were in 2008 in real terms. and so are we necessarily going to see something that's 2% of household spending send the consumer into a recession? >> well, we're going to find out, i'm afraid. we may have to go to 3% or 4 % at rapid end we expect economic pain around $150 a barrel. as you know, we're coming out of covid. central banks are raising rates. we have a huge debt burden all kinds of uncertainty it's not like it's a smooth sailing economy that we're -- in which we're facing these kind of

energy price increases >> i know it isn't your job to make the policy response, but there has been some talk about how the u.s. has seen a tool for lowering our energy noosage. it was called stay at home during the worst of covid. the irony is nobody wants to do that again i'm curious what you think the message should be for americans facing sticker shock to use less or hey, get out there, we're reopening, everyone is excited to travel and drive and see people again it's a very difficult time for this to be coming to a head. >> it's a very difficult time. i'm glad i'm not in the white house right now. i was there after 9/11 there's really no good message at this point. wear a sweater, don't drive. that's not going to work america has to reopen after covid. what i think we have to do, the biden administration has to be more successful at convincing folks that they're not out to crater russian oil exports especially russia's the largest crude oil

and product exporter in the world. without these exports, as long as there's a fear and that's the issue here, is a fear that we're going to go and try and block all the exports, the economy is heading toward a recession so i don't know that we need messages for the american people so much as leadership in the white house. >> so let's run through the numbers for a second my understanding, there's about 6 million barrels a day of russian oil. sea born oil and exports and that sort of thing potentially at risk. this is just the u.s. move so how much needs to come online to replace those russian barrels right now and where's that going to come from >> right so really russia exports almost 8 million barrels a day. about 5 million barrels a day of crude oil and almost 3 million barrels a day of refined product. we have a 5 million barrel a day problem. a good chunk of that is starting to stop already. even though the biden administration doesn't want to see that happen. shippers, especially at the sea ports, they're not picking up the russian crew let's talk about offsets 5 million barrels a day is the problem.

inventories are low. we're not going to draw them down opec plus could probably drop half of that, but they're not doing that or doing it at a fast enough speed you sign an iran deal, maybe another million barrels a day in a few months that would help. venezuela, a couple few hundred thousand barrels a day if you ease sanctions the problem is you have a 5 million barrel a day risk and you don't have 5 million barrels a day to quickly bring onto offset that. that's why prices have to do their terrible work. and of course, consumption >> well-said, and as people have pointed out, china could help if they pick up the russian barrels, at least they won't be competing with the rest of the world with the remainder of the demand let me ask you the most politically loaded question but the most important one for u.s. consumers this what can be done to rapidly increase u.s. oil production, given the political realities of this administration? the other day in the journal,

there was a piece from a bunch of alaskans saying we want to do our part to help, but the permit process has been a nightmare the environmental review and so forth. keystone obviously we know what happened with that and now we face a need to get this going quickly are there any near-term things that can be done politically to get oil flowing? >> absolutely. the biden administration just needs to go to the obama/biden archives and pull up all the above all energies can be used, oil and gas being bridges to a clean fuel future. we need to rescind the keystone pipeline cancellation, welcome an open, new infrastructure permitting tell the iea to stop calling for a ban on new investment. for some reason the administration adopted an anti-oil and gas posture, even relatives of the obama/biden administration, we should be open to exports and not threaten to ban them. if we remove the aboveground risks and see investors and economics come back, you'll see the u.s. oil investor and worker

respond. you can bet on that. >> although, finally, before we go, i think it was goldman who ran the numbers recently because the economy is so tight and we're already doing what we can produce in the oil patch, they were saying oil, u.s. oil producers would have to increase their cap-ex by 45% from this year to next year in order to just pump an extra half a million barrels a day. so even if we saw sort of political appetite, how quickly could we realistically increase production >> i think you're looking at real increases probably next year when we talk to the shale oil clients, you can't find truck drivers, service operators even at these prices. let's be realistic, everything has to fall into place you're still talking about next year before you realize positive net production growth. we're going to do 700,000 warls a day this year. shale oil is going to come back, but to keep it going into the next year, that's what we're talking about, for that you need

these changes. >> a lot of challenges, bob. we appreciate you joining us today. thank you. >> thank you quick programming note catch our special cnbc program tonight at 6:00 eastern. oil shock hosted by brian sullivan that's tonight at 6:00 p.m. eastern. if we are going into a recession, it would be a strange one, says my next guest. that's because industrial activity still remains super strong joining me now is the chief investment strategist at wolf research also president and ceo of thornburg investment management. chris, make this point, because i understand why we all are concerned about the recession risk, but at the same time, this is a strong economy that to some extent can absorb the higher prices >> thank you for having me on. we're in an unusual period of time to not state the obvious. you have supply shortages throughout the economy, whether it's in housing, in awe toys, in

semi conductors from many other areas. at the same time, higher prices at the pump are starting to hit consumers. not only in the lower end side, but also in the higher end side apart from the wealth fact that lower stock prices does as well. the attritional indicator of -- we think it could stay strong and elevated as the supply chains work themselves out while consumer confidence and consumer spending takes a breather. >> yeah. believe me, we're going to see that play out. quickly before i move onto jason, what are the investment implications of what you're saying here? >> investment implications are you have to steer portfolio positioning into commodity, energy-related parts of the market which is not something that investors have done in quite some period of time. you have to go back to '07 or the big commodity bull cycle led by china previously and avoid

discretionary stocks and tech stocks which investors have come to love over the past 12 years i think that action is going to be in different parts of the market going forward a lot of investors aren't positioned that way. >> and saw a note this morning kind of pointing out how strong commodities have been. jason, your perspective is different at least in terms of the investing implications you like the big names like visa, jpmorgan how do you think people should be positioned right now? >> so it's obviously we're in an inflationary environment your prior guest talking about oil shortages indicated that even in that part of the market, they're seeing labor shortages will which will continue to drive up costs it typically happens in commodity cycles for us, we're leery of the affect of higher rates across markets. i would agree with chris that the tech sector might be more exposed to that from a sentiment standpoint, but ultimately,

we're interested in making sure we're investing in a stronger consumer so financials are good and jpmorgan is the name we're suggesting >> let's highlight you're investing in a stronger consumer in an environment where we're talking about $130 oil why doesn't that phase you more? >> well, you pointed out that actually the real cost of commodities for consumers is actually not at a terrifically high level to the point for me, i've been a fixed investor for a long time i look at the balance sheet and the consumer balance sheet looks good it's corporate and government balance sheets that are more challenged the consumer is entering the slowdown in a good place >> chris, do you want to respond especially as it relates to whether there are parts of the stock market that would do pretty well in this environment? >> you have to have a quality bias not invest in high leverage, lower quality companies. we think if we get out of this

stagflation geo political risk, that we're in, that regional banks and banks can do well. we're go back to the environment we were in a few weeks ago i agree with the points on that that financials look attractive here the outcome has become very bifurcated we're either going to have a recession or some resolution here >> or inflation, chris is that possible that this is still more of an inflationary problem than not >> well, we've been of the view we're in a stagflation environment. that's the outcome we're in the middle of a flairup, if you will we'll continue to see flairups over the course of time. if you think about what's happened over the last two weeks from an economic point of view, you have higher structural inflation along with the slower growth growth has to slow down. every dollar change in the price of gas at the pump is $150 billion annualized it comes out of consumers' pockets. i don't think there's enough excess savings for a lot of consumers to offset that if the

prices are sustained we have to have a quick resolution to the ukraine/russia conflict for i think us to avert a real strong slowdown here. >> and jason, a final word on that where do you see the consumer balance sheet started to come under strain >> today where the consumer is struggling is actually at the lower end of the income spectrum, especially where the consumption baskets more heavily with food and energy but by and large, ifyou're looking at bank earnings and the quality of the balance sheets, they're strong in the consumer sector while there is additional pressure, no doubt about it, it's kind of the cleanest dirty shirt in this environment. >> we'll leave it there. thank you both chris and jason with different approaches here to the investment landscape coming up, apple holding the first launch event this year holding it right now and they're expected to make a big bet on the global consumer we're going to bring you all the headlines from the ceo this hour including details on a brand new cheaper iphone that we're

expected to get. thread upshares with a rebound. they hit an all-time low earlier despite the company reporting a wider than expected loss giving disappointing guidance they have now turned around. we'll ask the ceo about the path to profitability and the impact of inflation. and let's take a quick check on markets dow is up 536. near session highs a 7 00 -point turn around. we're back in a moment (vo) verizon is going ultra! with 5g ultra wideband in many more cities. mindy! with up to 10x faster speeds, she can download a movie in minutes or a song in seconds. (mindy) yep! (vo) verizon is going ultra so you can do more. you can't buy love. happiness. or confidence. but you can invest in them. at t. rowe price our strategic investing approach

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welcome back to "the exchange". shares of apple up as the first launch event of the year is underway they're hyping up the new iphone se a similar design to the iphone 8 but is 5 g enabled steve is here with the headlines so far and what else we should expect >> that's right. it is the iphone se just as we expected two surprises here $429 that's a $30 price increase over the last iphone se a lot of people curious about how they would price it and go after the lower end of the market where they've been losing market share over the last two years. it's going to be interesting to

see if 5 g is enough to convince people to fork over that extra $30 over the last model. one other surprise, a deal with the major league baseball to air two exclusive baseball games every friday night on apple tv plus if you're a subscriber. that's a big first sports deal for apple. sports rights deal for apple that's interesting, too. >> that was long-rumored many even say long-expected, but today it is the case that for people who want to watch the certain games, i guess they could see them in the local market, but otherwise they have to have apple tv in order to stream them. >> and it's not just apple tv box. apple tv plus, the service is available in smart tvs, roku, amazon, you name it. it's going to be everywhere. if you have a device, you can watch it and stream it and subscribe. >> how important is the cheaper iphone for apple to have a hand set they think the global consumer will take them up on? >> it's super important, especially in emerging markets

even before now, the iphone se line has been expensive. it's going to be interesting to see if even increasing the price on it for whatever reason, whether it's margins or the 5g or, whatever, it will be interesting to see if people will go for that or if it's going to keep people from switching to android >> for now, thank you. steve, good to see you let's get more reaction from a fundamental research analyst it's good to have you. 429 is the price point is that high >> i guess it's an 8 % up lift i would argue it's not terribly different than the entire product launch the last six or nine months. they've been creeping up the asp. the 5g material is somewhat higher i suspect that is what's driving a lot of the decisions on their part but it's still going to be the most attractive entry point in the iphone line out there. >> what do you make of apple

stock down 7% over the past week but positive this afternoon? >> it's -- i think it's outperformed the bottom markets and the large cap tech as well the macro is volatile to say the least. what i would say is this was a normal year. if there is one of those years ever this would be the year you should be attracted and on apple because of a stream of new products that are going to come out. iphone 14 that comes out is kind to have tick of the tiktok cycle. it should be material. you have arvr by the end of the year and a sizable capital allocation update in the point as well. these are things generally you want to be more positive with apple. they're not. we think the stock continues to do well. and you should get good demand for the rest of the year >> they made a point of saying the iphone se will include 5g, but they're not sure it's moving

the needle for anybody at this point. >> you know, i have the latest greatest iphone. i'm not sure if i use 5g the way i should or what the functionality is i can download netflix faster, i guess. my kids get less irritated, but i think broadly, you're searching, we're all searching for the killer app that can drive iphone demand higher with the 5g upgrade cycle you haven't seen it yet, but that didn't preclude the reality that iphones are about four years old in the marketplace most consumers, the use has gone up dramatically through the pandemic that means anything that comes out 5g or not would have a lot of demand right now. >> your price target is 210. what are the biggest head winds for apple to reach that target is it rates? is it supply chain, global consumer weakness? at the time they're trying to target that? >> the biggest worry is macro

situation. and there's a result in having a recession if you may, and what happens to high-end consumer purchasing patterns throughout a recessionary environment that's one thing i worry about the second thing, and this is a multiple human factor is the regulatory environment right? big tech, apple in the cross hairs. what happens over there and the magnitude of that could impact the multiples. macro recession, high-end demand and regulatory environment >> so quickly, how excited do you get when they announce the ipad air with 5g how big a product is that for apple? >> you know, i think iphone se is an interesting product. 35 million units which could be worth $15 billion or $15 billion. it's revenue numbers the ipad, the macks are -- i

think in a different perspective. i think it's an interesting time to provide ipads and maces especially that has people realize the hardware is years old and outdated it. >> that is a great point i hadn't thought about that. the equipment has been sitting here idle. time for a refresh right? >> apple has all the new products >> how convenient. thank you so much for your time today. it's good to see you >> thank you still ahead, ev makers are feeling the pain at the plug thanks to a shortage of some key components like nickel right now. nickel suspended for training after jumping above $100,000 a ton. look at the chart. we'll have more on the impact there. he was the first to call for seven rate hikes before inflation got really hot since then a war added to the picture. is he sticked with his call? ethan harris, bank of america's global economist joins us coming

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welcome back we have more breaking news on the russian oil ban. straight to kayla for the details. >> the white house holding a briefing to provide clarity on exactly how this russian energy ban is going to work in practice now that it has been made official a senior administration official just a few moments ago noting that this ban will apply to new imports of russian oil new contracts that are getting inked. and that the u.s. government will allow a 45-day winddown period for existing contracts or

shipments that are on the water. the administration officials said there are discussions on going with g-7 allies and allies outside about further actions that can be taken. not commenting on whether we can see another similar action out of japan as has been reported. the senior administration official also noting that there are still considerations for future reserve releases from emergency reserves in the u.s. and in other countries as a way to offset rising prices and no comment on exactly when we could see prices begin to recede again. >> all right kayla, thank you we'll have more on where the russian shipments are in a moment the markets are showing some nice turn around this afternoon which did coincide with oil coming off the boil after the president's announcement maybe a little bit of sell the fact news. and here the dow is up 359 points we're already about 200 points off the highs. let's get to bob at the new york stock exchange it's been tough keeping up with these markets, bob

>> yeah. and what -- there's two facts we know some kind of negotiations or discussions going on between the ukraine and russia they're vague. we don't know exactly what's going on, and we know the markets dramatically oversold. i want to show you the s&p 500 and what happened. we moved about 70 points right after noon eastern time. there were vague headlines out of the french press agency that said that zelenskyy was no locker encysting on ukrainian membership in nato he made this t comments to abc news the prior night, of course. it wasn't necessarily news, but there was some vague discussions about willingness to compromise on separatist-controlled areas the bottom line is we don't know exactly what's going on. there are negotiations what we do know is the market is dramatically oversold. look at that 70-point move we saw moving up and coming off the highs right now. elsewhere, if you look at the

stock market, even before these vague headlines, we were trying to rally take a look at the airlines. all of them new lows nmpl american including 52 -week lows if you look, we went from 13 to about 14 already prior to this move here, we saw the market trying to rally. this is dramatically oversold. we're at 52-week lows that move up helped overall for what we were doing also if you want to look at other stocks like boeing, another stock, 52-week low this morning was 172 at the low this morning here and there you see it. trying to rally here and then moving right up here already before this news, the market was so oversold, it was already trying to bounce without the news and then we saw a move up same thing in the opposite direction with the energy stocks the oil service names, oih, a big oil service company, schlumberger in that if you look at schlumberger, went from the opposite direction all up in the morning. all the oil service names up and

then when these vague reports came out, going from about 46 to $43. the point is we don't know exactly what's going on in terms of the negotiations but the market is so oversold that it will snap even on vague reports or reports that might have happened yesterday sometimes the markets aren't perfectly efficient. they go on whatever vague information they have and not all the information is equally distributed. sometimes people find out about something later that -- if enough people act on it, you get a move in the market >> a lot of those today. thank you. now a cnbc news pdate. here's what's happen agent this hour. d.c. model is temporarily closing all 850 mcdonald's mcdonald's has 62,000 employees in russia. ukraine efforts to evacuate civilians from the port city of mariupol are in jeopardy following reports of new

shelling they've been out water, heat and phone service for days how the ukrainians are fighting back and how western allies are ramping up their support. on the news tonight at 7:00 eastern. a top u.s. intelligence official telling congress russia underestimated the strength of ukraine's resistance the director of national intelligence estimates that the invasion has caused thousands of russian casualties he says putin is still determined, however, to dominate and control ukraine. and to minneapolis, teachers have gone on strike for better pay and smaller crass sizes. classes have been paused for some 29,000 students st. paul narrowly avoided a strike after a tentative deal was struck late last night >> thank you coming up, shares of thread up are trying to recover after a huge move lower on the back of weak earnings, disappointing revenue and profit margin pressure we'll speak with the ceo as the gh yrl are 40% off theeay hi that's ahead

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shares of threadup up almost 4% after they initially dropped on a wider than expected loss

and weak first quarter giend active buyers rose 36% from the priest year. joining me to discuss the results is the ceo of thredup along can courtney reagan, an active user. >> kelly ran through some of the stats about the stock, and on the call both you and the cfo took time to talk about the scrutiny younger companies get when it comes to capital allocation you went through your competitive advantages do you feel like your stock has been unfairly beaten up? >> yeah, thanks for having me. yeah, i think a little bit look, the business grew 68% in the fourth quarter continued to show growth on the key metrics. i think a little bit is investors making sure they understand the story over the next year. we told investors last quarter it was going to be a heavy investment in the first half of the year to continue to build out our mote i think some of that is

investors digesting that news, making sense of our remarks, and i think now you can see the rebound in the stock reflects investors get it and how it generates long-term profit profitability. >> if you could give us clarity on the consumer right now, are you experiencing strength? i don't know if you are experiencing any price increases overall? are you seeing any signs of a slowdown on the frontlines, what would you say about the u.s. consumer as gasoline prices spike >> yeah. look, it's rapidly changing environment. i think the consumer is softening. in a broader sense, but i also think you're dealing with stimulus from last march which consumers are lacking. everything is going up i think great businesses have to figure out what do they pass on to the consumer versus what are do they stomach in the near-term. i think we're having the conversations every day such we can build the most successful long-term business

that's what great companies do is figure out how to navigate difficult times. i think that's what we're doing. >> in the third quarter you talked about taking down your average pricing. we're now in a period of very high inflation overall in the economy. so where does that leave your pricing for the end consumer as you're trying to meet consumers' demands in the challenging environment? >> yeah, and i think that's the rub. we believe there's opportunity to carve out more share of customers in the near-term but there's also the reality that the prices have gone up even since that last call. so i think we're trying to figure out whether it's freight, logistics, labor, where is it you can pass on those costs to the consumer i live in california gas is headed to $6 a gallon it's tough out there i think there's going to be stability in the back half of the year we think about our business having stability in the back half of the year, around our economics. we have to get through the difficult time for the consumer. but we like the long-term macro

environment for resale broadly which is going to be growing rapidly. >> your end a losses are getting smaller. down 14% from down 28 % a year ago. but as you mentioned, investors are getting impatient. they want a path to profitability. you said you want to grow sustainable profits over time to get there. how long until there's no more losses and we're reporting profits? >> yeah. look, i don't think we're going to put a quarter on the board. i think the investments in the first half of the year will really generate leverage as you move into the back half of the year and into 2023 we noted on the call no new infrastructure investments until 2025 so if you think about it, we're going to be leveraging all the assets we've built over the last few years and this year over the next few years and so you should see pretty significant leverage from the business as you get into 2023. but, of course, we want to make sure the investments we're

making now drive those growth rates and profitability as we get into '23 and '24 and not get too caught in the near-term micro of investor sent that's where businesses go wrong. they make short-term decisions that ultimately impact the long-term opportunity. >> james, before we let you go, we know you acquired the european mix remix you have operations in bull geurra and i believe a team in ukraine. can you tell us what's going on with your european operations? >> yeah. my heart goes out. we have close to 50 tem mates in the ukraine. many have been able to leave some are still there that's a situation we're monitoring our business in bulgaria operates in nine countries in central and eastern europe we don't operate in ukraine from a selling and sourcing perspective. consumer sentiment is something we have to watch in those markets if this war continues. something we're keeping an eye on and most importantly, trying

to keep our folks safe in the ukraine. that's where my head is at >> wow james, thanks for joining us we appreciate it >> thanks for having me. >> ceo of thredup. >> up next, a senior white house official clarifying the ban on russian oil imports saying whatever is on the way to the u.s. right now won't be impacted we have the details. where the ships are and what it means for the buyers of this crude. that's next. welcome to ameriprise. i'm sam morrison, my brother max recommended you. so my best friend sophie says you've been a huge help. at ameriprise financial, more than 9 out of 10 of our clients are likely to recommend us. our neighbors the garcia's, love working with you. because the advice we give is personalized. hey john reese, jr. how's your father doing? to help reach your goals with confidence. my sister told me so much about you. that's why it's more than advice worth listening to. it's advice worth talking about. ameriprise financial.

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vessels that are on the water. two are anchored i find out one is being discharged the fuel is being unloaded at the phillips 66 area over in new york city. >> in new york city? >> yes, in new york harbor >> so we can take the tankers, consumers will be using them but then begins the process of winding down and getting off of these barrels. who are the buyers of these imports? >> sure. >> sorry, their exports, our imports. >> bpf energy. they have two tankers. one anchored off of philadelphia well over a week there's another product coming in in a week or two, and then valero has a tanker coming in. >> and what does it mean for all the importers now -- how do they respond? >> you know, that's the billion dollar question. it's like do you want this oil i mean, we have seen the outcry and call for bans.

so while yes, they are able to bring the product in, do they really want to >> right exactly. if they think there's another way to get the supply, what are they -- that's the million dollar question for the whole market and everyone is watching the vessels. i read a note about chinese demand being able to take the russian barrels. they said even if we redirect the shipments from russia east to china, that's the equivalent of taking 90 million barrels out of the market. because there's a time lag it takes longer to go that way than the normal way. there's going to be a lot of disruption from all of this. >> definitely. if they did an immediate ban, it would have been a massive shock to our market because these are in-coming teus they need and the only thing is these vessels, if they want to, if the companies wanted to sell this oil, because they own it either you take it or you sell it and if they sell it, it's going to be at a massive discount. >> and maybe that's why ail oil is behaving better the details of this.

it's not effective today they have a 45-day working period >> exactly so it doesn't -- it's not great for the overall supply, but it's not an immediate shock >> all right glad you're here thank you so much. still ahead, the wild spike in nickel prices this week could have a big impact on the cost of electric vehicles. how much pain could be at the plug that's next. don't go anywhere. (eric) i got the new galaxy s22 ultra on verizon 5g ultra wideband. (agent) wow! (eric) it's got amazing video on a crazy fast network. i can film whatever i want. (vo) premium video on a network up to 10 times faster. now in many more cities. buy the galaxy s22 ultra on verizon and get the s22 plus.

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welcome back nickel nickel hitting a historic high today that could have a huge impact on electric vehicles. phil >> chart of the day. take a look at nickel because this chart says it all in terms of what we have seen they stopped trading in london why? we saw a 75% jump yesterday. they said stop, we're not going to trade this because it's getting too whacky nickel is so important for the development of ev battery cells as well as packs so when you look at the demand that is expected in terms of electric vehicles, the global

sales, this is just one forecast here by some estimates, it will be 42% of the global sales potentially by 2030. but that's if you have the supply that's there. this raises the question for automakers like general motors, which has the hummer ev in production deliveries have begun. this is just one of several evs gm will be rolling out over the next several years the question is do you have the resources for things like nickel this morning, we talked to mary barra and we put the question to her point-blank. are you confident you will have all the nickel you need to build all the evs you plan on building here's what she had to say >> that's our focus. to make sure we're secured to achieve the ev plan that we have, which is a pretty aggressive rollout and a complete portfolio of electric vehicles because that's what customers have told us they want >> we pressed her on this. she said we have the contracts we will be ready to make the evs

that we have already targeted. the reason this is coming up is because we've heard from adam jonas yesterday and from other analysts today and almost all say the same thing, which is i'm not sure where the auto industry is going to get all the nickel it's talking about somebody is going to be left holding the bag or not necessarily holding the bag, but they're going to have to bring down their estimates they'll have to say, well, we thought we were going to build a million evs. turns out we're only going to build 500,000. >> also analogous, but the market in general. it's never been a demand problem. it's a supply problem. it was chips it still is. it was batteries and other components and this is just adding to that situation and adding to consumers possibly willingness and desire to buy. they're going to have to move heaven and earth to get these vehicles produced. >> it's going to be a lumpy uptake >> it's just, the latest, they must be losing their minds every time they turn around,

it's something else. and now this now nickel, right? who would have thought this six months ago phil, thank you very much. come up, the fed meeting kicks off one week from today. the first on the treat to up their target is sticking to that despite the ukraine war. evan harris on the fed's dilemma, next. look, your cousin dared me. i had no choice. my cousin is twelve. this is your captain speaking... 'cause they're like... captain's chairs? to be fair, i did say heads up. to be fair, you're sleeping on the couch. hey mercedes, change lighting to baby blue. i think you're actually more annoying back there. get up here. the mercedes-benz gls. perfect bliss wherever you sit. i'm gonna grab the handle now. if you wake up thinking about the market and want to make the right moves fast... get decision tech from fidelity. [ cellphone vibrates ] you'll get proactive alerts for market events

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we're just a week away from the next fed meeting and my next guest was one of the first to call for seven rate hikes and he's sticking with it despite the ongoing uncertainty. joining me now is ethan harris from bank of america securities. great to see you again so many people are saying let's just dial it back to four or five just to be safe what would you say to that >> the fed's a bit behind the curve here they need to get moving.

remember, an oil shock really doesn't help the fed out, it kind of creates a rock and hard place. i think the market's too focused on the growth picture and are not paying enough attention to the fact there's really a serious inflation problem. >> i think people are also looking to the financial markets going the stocks are down, vix are up and this is rarely the set up they like to start tightening into. >> the thing about waiting is you could have made an argument the fed should have started hiking last fall and now they've finally agreed and are setting the markets up for a steady guide of rate hikes.

they're not trying to hurt the economy and one hike isn't going to hurt the economy. it's about a process of getting back to normal putting the rate at a plys, we should already be on that path now. >> our guest earlier this hour said given what's happened with the oil price, he thinks a recession and demand structure are kind of the only ways to rebalance that market. what would your response be to that >> i disagree. this is a serious shock for the u.s. it hits an economy that's got strong momentum. a lot of savings in the household sector at least for middle and upper income families to handle the higher prices. it is tough on low income families, no question about it but there's a pretty strong economy here i don't think this is a big enough shock to cause a recession. i think we would need kind of a worse case scenario with major, major shock to the oil markets to start talking about a

recession. >> that means that actually it would take a lot higher oil price for demand destruction to set in right? that's why people are still worried about a continued move higher what about those who say 2008 sent us into recession this pattern always plays out. >> yeah, if you go back in history, you have to think about all the events that were goeing on at the time the 2008 experience is called the great financial crisis for a good reason. what caused the recession was primarily the collapsing credit markets, the banking system, and the housing market oil was kind of an add on to that certainly it added additional pressure my view would be is that if it were just higher oil prices and not all those other problems, we probably would have coasted through that period with weak growth i don't think that moves that oil always creates recessions. they usually require a

combination of factors and oil's just one of them >> ethan harris, thank you for your time. sticking to your call. appreciate the explanation thanks for joining us today. ethan harris with bank of america and as we go out, let's get a check on the markets the dow was up as much 500 points earlier this hour only up 43 "power lunch" starts right now >> what is going on? that's what we're going to try and figure out this hour on "power lunch," everybody welcome. i'm tyler mathisen another volatile session 500 points now 32 points on the dow a new energy world order president biden says the u.s. will ban russian oil imports crude prices are moving higher a veteran commodity analyst will outline the risks to the energy market and if u.s. production can keep up with demand we'll take a look at that. and energy industry player, the