>> all right >> uber. partnering with taxi services. i think this is the way to improve cash flow and be cash flow positive in the next couple quarters >> big stock >> i'm with pete in transocean >> all right thanks, guys have a great weekend i'll see you in overtime thank you, scott high, everybody. welcome to the request "the exchange". ahead this hour, for all the debate about different kinds of yield curves, there's a growing chorus the fed is behind the curve period former richmond fed president is in that camp he's here today with what he says the fed needs to do to get inflation under control. would he do a full one-point hike next meeting? >> how do you budget for dramatic swing in interest rates. the ten-year up to 2 .5% today we'll ask the cbo director who

is here in an exclusive. plus the u.s. strikes a gas deal with europe lng stocks on the move you saw eqt. how much is priced in and how much isn't we've got the names that stand to benefit the most. let's get to bob with the latest on these markets to kick things off today bob? >> and kelly, sort of flattish day. about even on the advanced decline line that's to be expected. we've moved 5 % on the s&p since the fed meeting last week. take a look at the stocks moving in the dow it tells the story on days where commodity stocks are up, the market tends to be pressure on it and that's true today. so chevron is up banks are up because bond yields are moving that's helping the overall market but you see industrials like caterpillar, tech like apple, home depot has not had a good run at all they the end to be flattish to the downside when the oil stocks are up the vix is well behaved. remember you crazy things were a couple weeks ago

the vix went from 21 to 37, back to 21. a complete round trip on the vix. this is a all-clear signal when it's in the low 20 to momentum traders to start buying. i think they've been a big part of the rally we've seen this week where are we right now for the markets? we've been in a trading range between 4300 to 4600 in the s&p. we're on the verge of breaking out here this is a near technical breakout the problem is the head winds. unfortunately, commodity prices don't look like they're going to drop any time soon the fed is not going to drop its hawkish stance i think there's significant head winds if we get toward 4600. i think guys, right now the market is given the benefit, the fed the benefit of the doubt they're going to be able to aggressively raise rates without derailing the economy. that's a neat hat trick. this just a huge range of outcome around interest rates and commodity prices i think it's going to put pressure on prices if we get over 4600.

back to you. >> we'll see if we get up there. 4515 bob, thank you we've had so many developments on the macro front it can be hard to keep up. it points to why forecasters keep upping their projections for fed rate hikes right now oh, up here, he says there we go. like citi now expecting four half point rate hikes this year. here's the data. let's start with the housing market sales are slowing pending home sales down this morning. new home sales fell for the second straight month. so, again, it's kind of a welcome development. although, kind of not at the same time. the real problem is that prices keep rising. the average new home price above 500$,000 for the first time ever that's clearly putting a dent on appetites and affordability. it's been hammers by inflation this morning it dropped below 60 this one is clearly in the bad camp and this happened as inflation expectations by consumers for the next year stated a

stubbornly high 5.4% and rising bond yields have flattened the ten-year, two-year, it's bad, but do we count it i don't know the fed's preferred measures based off of three-month bills have been steepening that's a good sign for an economy if growth accelerates from here and worsens inflationary pressures steepening curve, rising inflation expectations and a stock market like bob said this is taken all of this in stride does it give the green light for the fed to be even more hawkish? joining us now is former richmond fed president who is now a distinguished professor at vcu, virginia commonwealth university school of business. it's great to have you here today. as we see people on the street kind of raising their expectations dramatically, where duke the fed should be taking the fund rates from here >> they have to after the last meeting, week and a half ago

i think markets are coming to realize that as well and i think chairman powell recalibrated or tried to, the expectations in the speech the past monday. a key principal that has undermined successful monitoring policy for decades is that wihe inflation is high and you want to bring it down, you have to raise eninterest rates by more than inflation increased and in this instance, if you fail to do so, you have falling real interest rates and it introvieds even more stimulus to the economy which is not what you want at this point so they've got to get back to real interest rates around 0, and they probably need to go higher in this environment by the end of the year, that's going to mean interest rates above 4% >> wow >> whether they get there sooner or later, it remains to be seen. i think that's the kind of range we're going to need in order to

reduce inflation the way they forecasted >> what would you say to people who say we've heard hawkishness in the last cycle. it didn't pan out. why is it different this time around >> this time we've seen it a fiscal policy fuelled surge in spending and demand that met up with supply that was in many sectors in many fronts inelastic and unable to expand to meet that surge and demand. and that's a classic recipe for inflation. the fed monetized the debt that was issued to finance that spending and so we have basically a classic monetary demand stimulus driven inflation that wasn't true at the end of the last decade. we didn't have the supply constraints that we have now, and we didn't have demand that was suddenly surging to the degree that we saw last year >> yeah.

we had john taylor on the show about a week ago he said using his metric, we should be at about 5% for the funds rate you're saying you'd like to see us around 4% by the end of the year and interestingly, citi -- i'm sorry, is that -- you were saying for the funds rate, 4 % by the end of the year >> yeah. at least 4 i'm not going to disagree with john >> sydney this morning came out with a view for four half point rate hikes but a fed fund that's going to be -- i think they had 3.5 to 3.57 by the end of next year this is not wildly unrealistic that we could see a funds rate upwards of 3, close to 4 maybe even higher. i guess the real question is how quickly does the fed need to move >> that's a really good question i advocated a 50 basis point move at the last meeting i wasn't at the meeting, but before i thought it would have been wise to raise just 25 raises the question. and in every meeting you're going to beg the question of you know where you're going. why not get there now?

the classic reason for going slower gradual on rates is you're afraid you might have to reverse course the risk of that for the next several meetings seems minimal to me. >> and maybe that risk is smaller than the risk that they might have to do a powell -- i'm sorry, a volker-esque double dip in the future. it's not as if there's no tradeoffs from being a little behind the curve the tradeoff is they might have to be more aggressive later on if the inflation problem is wage-driven, how big a deal is it if we see readings upwards of 3% or 4% is that a disaster should they just let that happen >> hi don't think we should be afraid of rates that high. that's what it's going to take to get inflation down. it's clear given historical evidence on how these things go. the one thing the fed has going for it is that longer-term inflation expectations seem to be well behaved. people seem to believe inflation is going to get back to 2% but that's based so far on

basically what the fed said since it announced a target of 2 % in 2012. and as we all know, actions speak louder than words, and that's especially true when you get to monetary policy those things could deanchor if inflation continues add rates we've seen lately for too much longer. >> a quick final question. what would happen if they just hiked by a point at the next meeting? >> i think markets can withstand it the only issue is that they've conditioned markets to expect telegraphing the size of the move ahead of time so i doubt the fed would do this as a surprise. the question is does the fed signal a broader move like that? i doubt they would go from 25 to a full percentage point in one meeting, but you would expect them to feel the 50s for a while until they get where they feel

like they can be comfortable >> and they have to be encouraged by the market reaction we're up 8 % from the lows just a couple weeks ago jeffrey, it's been great to have you on today thanks for your time >> thank you virginia commonwealth university school of business. let's turn to the energy market will the head of the eu commission announcing a historic natural gas deal the agreeme -- the pippa is herh all the details. >> lng and energy stocks on the move at this hour after that announcement first, let's quickly put the numbers in context now, the plan calls for an additional 15 billion cubic meters of lng for europe this year and around 50 billion additional cubic meters by the end of the decade the u.s. is already sending a record amounts to europe last year it was 22 billion cubic meters according to the european commission. and that number is growing as

this chart from kep ler shows, we've seen a record amounts of lng head to europe this month, and the month is not even over but the u.s. is now at capacity. a secretary put it, we're exporting every molecule of lng that we can, and you can't just significantly ramp out put it takes years and billions of dollars to build but still, more lng exports will be felt across the value chain starting upstream, there's not gas producers like eqt, co-terra and range resources than there are the midstream companies that transport that gas, kinder morgan and the williams companies. looking downstream, the lng companies like cheniere. there's also tellurian lng requires specialized ships lng and golar have those vessels. >> pip la, what details do we

know about the announcements where supplies have already -- there's been a scramble to secure them by the u.s what does this mean on top of what we're already seeing? >> well, that's the problem. the details right now are pretty light. and a lot of this has been driven by pricing dynamics we've seen record amounts of lng go to europe that's because of prices dynamics if prices surge in asia, it's going to asia. we don't have many details from the administration about what this will look like in practice, but longer-term signals will help secure funding for lng terminals. processes. >> ln zb the ticker for ch cheniere right? >> correct >> there's obvious beneficiaries here i wonder given everything they're doing on the semi conductor front right now, to pump in tens of billions of dollars, encourage production, could we see similar efforts toward building out lng terminals and who is poised to

p benefit from that kind of response >> yes there are names coming online, but it's complicated for the administration they've been pushing clean energy so right now we have this short-term crisis. and advocates on the green energy side say we can't overlook the long term goals in favor of the here and now. but in order to build the facilities, you need long-term guarantees if they're built now, they'll be operational in the future. the admin is sttrying to square the short-term versus long-term. >> pippa, thank you. really appreciate it i want to show you shares of devon. up nearly 20% since march 15th for. of jim's picks and thoughts, scan the qr code on your screen. also a quick programming note the ceo of chesapeake energy is

joining us on power lunch around 2 p.m. eastern with more on what the deal means for natural gas prices and supply. coming up, what impact will higher interest rates have on the budget the director of the cbo crunched the numbers and is here next with new data on the definite. plus how do you protect your portfolio from volatility? we'll speak to one investor with a simple mantra he says applies to every economic environment. as we head to break, let's get a quick check on markets the dow has lost the gains and turned negative by 20 points along with the s&p down five the nasdaq is down almost 1 %. we're back in a moment

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will click off the tvs and go away why don't you tell us first what kind of interest rates did you model in sneer how high will they go? >> it's a pleasure to be here. we looked at the top and the bottom of the blue chip forecast panel. that's -- think of that as the high end of reasonable and the low end of rbl and at the short end of the curve, at the three-month, there's maybe 60 or 70 basis point difference between those two, and obviously that gets bigger as you go out to the ten-year think of it as like a spread of two or 2 .5 percentage points on the interest rate. these are not extreme scenarios. these are higher and lower interest rates, but this is not the kind of scare -- hard landing scare scenario >> these are not 4 or 5% these are more say on the 3, 4% range that you're looking at okay let's get to it.

what happens to the deficit? is it a blowout? can we afford it >> it's interesting, because initially not a whole lot. right in with higher inflation and higher interest rates, typically go together. at first revenues go up. so spending goes up. so does revenues we've seen that. revenues for the treasury have been strong over the past year as inflation has been high and nominal wages and income growth has been strong. so initially, it's not a whole lot is the answer. the challenge is that as inflation and interest rates remain high, the treasury debt starts to turn over. we start replacing lower rate debt with higher rate debt and over the ten-year horizon cbo looks at it gets to meaningful impacts over a ten-year horizon >> so, for example, what happens to net interest payments as a percentage of gdp and the way people think about this is out of every dollar of spending, how

much is going in the worst case scenario, phil, toward interest payments >> right no, that's exactly the important way to look at it. the carrying costs, the full costs of the debt. and they can double as a share of gdp think of that as the burden relative to the size of the economy. those can double several percentage points of additional carrying costs of debt by the end of the ten-year window now, look, interest rates are still low by historic standards. so even an additional one or two or three percentage points of gdp going to interest service is not -- that is -- again, pretty modest relative to the overall size of the debt it's not a crisis. but the punchline is that by the end of ten years higher interest rates will really have a meaningful impact on the fiscal situation. >> and phil, it's kelly. maybe if i could put it this way. it would be to say higher

interest rates are already either crowding out federal spending on other areas of the budget, or we're having to borrow more in order to keep that from happening. is that right? >> no, that's exactly right. and that becomes a rising challenge over time as more and more of the federal spending will be devoted to net interest payments and not availablefor all the other things that americans expect out of the federal government >> phil, did you model in q 2 or quantitative tightening, or you're taking the forecasts and going with it? i guess my question becomes -- and i know you can't speak about hypotheticals. you're censored from speaking about things that aren't law yet, but the idea that the fed will be shedding or no longer buying billions of assets every month of treasuries. is that something that's going to put upward pressure on rates and is that something you modelled into this, or if not,

is it something that's going to end up making the rate outlook worse than perhaps you modelled? >> okay. yeah, important questions. that is not in our -- in the exercise that we did only to the extent to which it was in the forecaster's thinking you know, roughly a month ago. now, it's going to be important. and if the fed accelerates the qt or interest rate hikes compared to what people thought a month ago. and it does seem to be on the minds of many people that would, again, have a more meaningful impact with higher interest rates feeding into interest payments. i mean, if people thought that qe mattered and i think it did, it helped housing market and helped support activity, then it should that qt matters as well and we'll look at that we haven't done it yet, but we will over time >> yeah. that was something we'll get later. phil, last question here

what happens to growth and job growth in higher interest rate environment? does it put downward pressure on growth growth and the job market >> you know, on the one hand it's got to. that's the purpose of the fed tightening is to remove monetary accommodation. on the other hand, we have a pretty strong economy right now. the labor market is -- the jobless claims, initial claims for ui, it's strong and tight. so from that perspective, having that a little bit of bite into the economy is probably a desirable thing. it's probably the aim of what the fed has in mind. >> phil, thank you so much for joining us come back and see us when we have some surpluses to talk about which i don't know, maybe a couple decades from now. >> thanks, steve >> kelly, back to you. >> you don't want to insult him, steve, we'll never see him again. >> i know.

i know bad call on that >> thank you for bringing that to us. still ahead, housing stocks are on pace for the worst week in two years we're going to look at what the latest numbers are telling us about housing and why the home improvement stocks aren't immune to the selloff but first, shares of berkshire hathaway hitting a new all-time high today they're flirting with their best quarter in over a decade and t not the only insurance name on the rise we'll look at the other stocks benefitting from the rotation lately as we head into break, look at the dow heat map about two to one gainers versus decliners even though the index is in the red. chevron, honey well, travelers, leading the way. we're back in a moment so, who's it going to be? tom? could be danny. guess it's on maggie.

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dow has given up a 234 point gain to turn negative. at the lows we were down 76. there's a lot for the markets to digest here with all the rate hike calls coming from from the street citi now going to four half point rate hikes others joining the fray. we're seeing pressure on the nasdaq in particular down 112. let's check the sectors for the week energy leading the way for the week up to almost 6.4 5% n materials and utilities leading the pack the chip stocks are poised to lead higher. next hour on power lunch we'll speak with the analysts coining the chip equivalent of the faang stocks, it's mango you don't want to miss that. lithium stocks that are not listed in china outperforming this month, two up 8 % while the lithium etf is down 4% because

of its exposure to the chinese listed names bed bath and beyond jumping after exploring options for bye bye baby call me for thoughts on that one. now let's get to a cnbc news update here's what's happening at this hour. in a saudi arabian city, an oil attack houthi rebels are claiming responsibility for a series of attacks including this one here. saudi officials say the fire has been brought under control crude oil prices spiked on the news and have not given up their gains. police have identified the 14-year-old who died after falling from a theme park ride in orlando, florida. tyrese samplsen was visiting with another family from missouri it happened at a free fall ride built as the tallest a look at the safety of the ride and other accidents as a theme park tonight at 7 eastern. and j.k. rowling pushing

back against vladimir putin. the russian president mentioned the author rouling tweeted that critiques of western cancel culture are possibly not best made by those currently slaughtering civilians for the crime of resistance or who jail and poison their critics. what do they call that, a snapback >> that's a very strong snapback, yes. still ahead, buy companies that make things you need or make your life easier. cvs in that category it's beaten the s&p handily since my next guest handled it he's back with teeorpis ghafter this

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welcome back the market is bracing for more aggressive rate hikes from the fed. the ten-year treasury yield climbing to 2 .5%. my next guest says the bull market is intact your verdict but the best entrat ji is to invest in products people need or make life easier. joining me is the chief investment officer of the edgar

company. why are you bullish in an area where we're talking about a lot of hikes coming? >> we're slightly bullish. we're not going to see a second half of 2020 type action, i don't believe, in the next couple years the fact is the economy is growing strongly, and even though the leadership seems to be changing from growth to value, but we do -- and this is the types of stocks. but we do see earnings growing, and i don't see anything that over the next six to ten months is likely to cause earnings to start declining. >> and i know you look at these fund fundamentals closely products people need, you talked about cvs last time. it's done well since then. is that a name you'd stick with in this environment? >> yes we will still hold it, but it is up strongly. we're not as high on it as we were back then, but that's a

good long-term >> met life is another one it's up decently near to date as well the insurance companies we mentioned a moment ago, the bu berkshires of the world are doing nicely do you think the environment will persist, and why is it that -- if you think the whole sector is a place to be so attractive >> yes the yield curve. and finally, it's a curve. even though many people are talking about flattening because they see the two-year not that much below the ten-year, but the key thing to remember is that qe has not stopped yet. so we don't know how high the ten and the 30-year will go. so i think financial companies are likely to really be able to take advantage of the environment where the 30-year is higher than their cost of capital. which is more likely to be between the six-month and two-year >> does that favor the insurance companies in particular, or would you be a fan of exposure to the big banks or the regional banks as well? >> i think banks first, but also

jurns companies. i think all of them are going get advantages from this environment. >> before i get to the last name you like in the health care space, where would you stay away from i don't see energy or a lot of technology where and why do you think there are parts of the market to steer clear of >> we're not staying clear of energy i'm not suggesting energy names simply because they have done so amazingly well between 2021 and this year. everyone is so excited about them now that we think they're good holes, but as for someone trying to put together a small port portfolio, we generally the end to go to more names that haven't performs as strongly >> what about technology energy has been -- but also pockets of more stability in big tech >> yeah. technology along with consumers

are discretionaries. areas where we're worried about. not the individual companies but the valuations they have done so well over the three-year period from 2019 through 2021, that the big issue is just how well will they hold up in any general price declining environment? >> fair enough all right, your final name i almost feel like we need a drum roll is pfizer. and pfizer, you know, normal times they'd go okay, pipeline pharma health care, but now can everything going on with covid, that's been a big driver for the stock. why do you like pfizer here? >> and if you remember, we liked f pfizer even before covid they've shown their ability to take advantage of whatever the environment is they are -- they deliver a product or service that we all need which is health care products and they've been an amazing

player this is a rich company, and by the way, it's got a tremendous dividend yield, 3% more than twice the s&p 500. >> is the dividend yield becoming a more and more important thing for you right now? >> yes as interest rates rise, then increasingly i think people holding equities are going to want to see some deals from the equities otherwise they'll have options finally. >> well-said randall, great to have you on today. it's good to see you again >> always good seeing you. >> randall eley with the edgar lomax company sn the insurance companies are not all created equally. we'll look at what's driving the gains, who is on top and what could cap gains for some of them the ceo of united health will be joining the healthy return summit next wednesday, march 30th the event marks the intersection of innovation and investment with the sharpest minds in health care. to register go to

cnbcevents.c cnbcevents.c cnbcevents cnbcevents.com/healthyreturns. we're back in a moment

welcome back check out the insurance stocks they have been quietly putting together some pretty strong gains this year. up another 1% today. let's get to contessa with an exchanger of what's behind this and why you might want to be picky within the group >> reporter: hi, kelly if you look at travelers, all-state, wr berkeley, up 18 or 19% this year alone. chub, aie, up more than 10%. why? these are defensive businesses problems like the war in ukraine or the russian sanctions really have little impact people in businesses the end to pay on insurance in spite of economic slowdown and these are stocks that are benefitting from a rotation out of growth and into value

piper sandler analyst predicts the next quarter is still going to be a good one with limited natural catastrophes that prices for commercial insurance, and we've seen this over the last few years, they keep rising. that contributes to expanding margins. kpw points out underwriting results into improved and last year's profitability is reported rather conservatively. so this cost of litigation, lumber, labor, that's predictable. he likes aig, american financial group and access and wells fargo's alise green span writes she likes the up side on arch capital and the hartford, but he's leery about auto insurers, because of expensive repair and replacement costs. the rates are rising but it's not keeping up with how much the ininsurers are spending on the cost of claims

she points out rising gas prices might suppress the number of miles given and that typically drives down accident >> that's interesting. maybe the auto insurers are riskier. i hear people complaining about what they're paying for autos. the fact that some are losing money, could that push people to startups, the well-funded but not profitable startups in auto shurns that could chip away market share >> let's talk about root which came on with a big splash. what we've seen from them this year is that they've cut 20% of their work force, and they've downsized on their real estate because the costs they're paying out in auto insurance claims has become so owns you where some of the up start insurers do have an advantage, especially those that go directly to consumers, they figured out the tech so they can bypass a lot of other expenses where brokers and agents are concerned, and certainly on

processing claims, they've got a springline function and they're forcing the big guys to innovate and really become agile. it doesn't always mean they have a great outlook for what's to come they're under the same cost pressures as well. >> absolutely. it's fascinating contessa, most of the rest of the industry putting together a nice year. a news alert on starbucks. let's get to kate rogers what are the details, kate kelly, a second store now in mesa, arizona has voted to unionize with starbucks workers united the votes were 11 in favor, three against the union. this is the eighth store out of nine in three different states that has voted yes on unionizing so the union for the most part has been really winning and moving ahead here. more than 150 stores across the country have filed petitions with the nlrb. the starbucks hometown of seattle just got the first unionized store a few days ago all of this top of mind for

howard shuttle as he comes in for kevin johnson as new ceo this is a fight that will continue we should note starbucks does have to negotiate contracts in good faith with the stores neither party has to agree to a contract while it is symbolic and important that the union continues to win, the contract is the big thing they have their eyes on. starbucks down 25% since the first union vote >> that was the date i was curious about. april 4th is one howard comes back in. are you saying the votes mean the unionizing hasn't happened yet until the contracts change over >> they've organized they are a union, but they have to go back and forth over the contract they have to negotiate in good faith. they don't necessarily have to come to an agreement if workers that have unionized lose faith in the union after a year, they can also move to decertify it it's important and symbolic that they are organizing and winning the union drivers, but the democrat is the next big hurdle?

>> yes, always the big contract fights that's true. kate, thank you very much. still ahead, not even the safety plays are immune to market volatility. muny bonds with record outflows this week. we'll talk about what's behind the selling and what it tells us about market appetite. that's next. what if you were a global bank who wanted to supercharge your audit system? so you tap ibm to un-silo your data. and start crunching a year's worth of transactions against thousands of compliance controls with the help of ai. now you're making smarter decisions faster. operating costs are lower. and everyone from your auditors to your bankers feels like a million bucks. let's create smarter ways of putting your data to work. ibm. let's create

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or, ask how to get up to an $800 prepaid card. welcome back the largest muny bond fund, the mub, seeing the biggest daily outflow ever earlier this week they lost about $275 million my next guest attributes the selling to a few factors including fed speak and inflation. joining me now is james camp, managing director of strategic income at eagle asset management do you welcome these kinds of opportunities or are you getting more nervous about how much the fed might be hiking here >> it's actually quite an exciting period to look at this kind of volatility in the treasury market and in the outflows from the future wall fund passive complex as we speak, we're looking on a friday afternoon at offerings in

municipal finance cheaper than a couple days ago. we're going through the first quarter with the worst quarter we've had since 1994 there's a lot of trepidation in clients and advisers i speak to. the baby boomers are in the 60, 65 demographic they remember 1969 and gas prices and there's an extrapolation going on and a little bit of concern, but we can calm the fears down and look for opportunities. >> although, you know, it's funny. if you go back to the turn of the year, there was some pressure on muni bonds, but it didn't seem like that big of a deal now when people are casually talking about four-point rate hikes or 3%, the entire space has to reprice for that. >> this is a different conversation, but the fed has to do a catchup here. they have to do it for the inflation reasons which are more menacing than they believe

they have to do it for political reasons. this is a regressive tax on most american consumers and they may be behind we can argue whether that's the case, but they're going to be aggressive and front loaded and they're probably going to be a couple hikes most of the curve that we invesn has already moved so there's good opportunities and probably at maximum levels of unsettledness if you will. >> we thought we might have been there a couple weeks or a month ago. so can you be sort of opportunistic as a holder of muni bond? is there a place to feel comfortable with the yields they offer me >> you have to look at the form of which you own the asset in real bond form and an asset allocation you should be legging into the levels.

in our multi asset income class we have understood performed the broad equity income space and as we look at that performance disparity we start to readjust so this is an opportunity to reallocate and looking at the 10 to 15-year municipal area. we're getting the tags benefits for free. >> yes these are specific but you like vft revenue bonds, electric. local geos and higher population areas. texas, florida, colorado what other details would you add? >> i think you hit the highlights there but i would also just remind people post-covid in an irony the credit is in better shape both

from equity markets and the pension areas with trouble housing market which you have spoken about revenue and migration patterns matter when we know the financials this is not a market struggling because of credit but rate moves and flow of funds and both we think settle out significantly if back half of to 22. >> the 10 to 15-year horizon >> yeah. the relative values are so cheap very few people willing to take that duration risk and offset that with shorter term in the portfolio for an intermediate exposure >> all right again these are dicey times for all fixed income investors

thank you. >> thank you. market alert for you as we watch the price of oil move higher baker hughes reported for the record 20th month addition the oil and gas rig count is as an early gauge rise to the highest level of march 2020. wti crude around $112 a barrel. coming up the spring housing season off to a disappointing season as rates rise and the housing related stocks crushed this week. this name, the worst performer in the i-shares construction etf is next on "the exchange."

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welcome back pending home sales a leading gauge of existing home sales droning in february. the home builders sinking on the data diana olick is here with the impact. >> i want to start with just some quick breaking news on mortgage rates the average on the 30-year ficked took a huge jump to 4.95%. just bumping up at 5%. 164 basis points higher than a year ago even before this higher rates hitting sales. for february, dropped over 4% month to month and down 5% from a year ago a fourth straight month of decline. these sales numbers are based on

signed contracts so that's people shopping in february as rates took off why the average started to rise at the start of january and hitting the buyers hard the median monthly mortgage payment is well over 20% higher than a year ago. not good news for the homebuilders in the heart of the spring season. itb down 25% year to date, including home depot, lowe's and s sherwin williams people take out loans to do renovations. most people wouldn't want to trade up to a higher rate for a cashout refi because that is significantly pricier. not great news going into the weekend. >> i have to say i'm almost

stunned. i knew we were at 4.5% on the mortgage rate but 4.95 without points we are at 5% mortgage rate right now? >> very close to it. saying 4.5% that was monday. >> oh my gosh. >> it's the worst week for mortgage rates since taper tantrum in 2013 if we remember that. >> the worst -- you know, i know people trying to buy a house right now eand can't. it makes you wonder if even a 5% mortgage rate is going to meaningfully change the trajectory of the housing market i don't know. >> i think it absolutely will and already has. we are seeing economists revise the predirkss lower and found that out on tuesday and moving

quickly. >> wow thank you. we wanted to show you the mystery stock. floor & decor. it is definitely not just the homebidders. i'll see you on "power lunch" which starts right now i think we had their ceo on "power lunch" a week or ten days ago. welcome to "power lunch. we got a big hour ahead. the chesapeake energy ceo is with us. not within of those guys don't get excited there. not one of those guys but talking to him about the natural gas deal the goal there is to reduce europe's dependence on russia. a mammoth task move over,