faces the most pressure, so many of those were company operated, not franchise. >> kate rogers with all the latest news. and we will be sticking with other names that have had a rough year next hour the trade in cars, chips and copper coming up on "power lunch," which begins right now >> all right, thanks very much, kelly. we'll see you in a couple of seconds here welcome to "power lunch," i'm dominic chu in for tyler m mathisen this afternoon. investors gripped by recession fears at this hour, so how to invest as growth slows possibly and uncertainty ramps up a look at what's next for two battleground stops we're talking tesla and amazon and transportation secretary pete buttigieg is here to discuss fixes for the overall airline industry following a holiday weekend that saw thousands of delays and cancellations. but first a check on the markets, kelly, which are off

their lows of the session. >> they are, dom, and a break on the jet fuel front at least for the airlines let's run through everything else that's happening. we're about 300 points off the lows the nasdaq was down 216. it's currently up 55 it's the only major average in the green right now. and over in the bond market, major moves to report as well. the ten-year and two-year yields inverting. the ten-year, three-month yields i like to follow also following to almost one point from over two points earlier this year so on both fronts these yield curves have corrected sharply. crude making the biggest moves of the day breaking not only below $100 a barrel today but below 999 and now below 98 this could translate with what we're seeing in gasoline futures into a 30, 40, $0.50 cent drop in gasoline prices in the next several weeks. keep an eye on this space. it's not just oil, u.s. steel are also down about 6% today, and by more than 50% from their

recent highs, and these recent highs were only a couple of months ago as bespoke points out, these declines are even more extreme than what we saw with the hyper growth stocks beginning last november. just extraordinary price action for some of the materials, metals, commodity stocks jpmorgan, caterpillar, doeere, those are some of the names hitting 52-week lows what's already priced into the market now seems like kind of a lot. michael santoli down at the new york stock exchange with more. mike >> yeah, kelly, i was about to say a lot, maybe not enough, but certainly plenty has been priced in if you take a look at where the s&p 500 is, whether it's the compr compression in its valuation from the start of the year or here the year-over-year change, bespoke kind of put this chart together tracking the s&p's year-over-year change with the ism manufacturing index. obviously what it shows you is that the s&p at this level is already kind of discounting or at least would coincide with the conditions of her contraction in manufacturing, which would

suggest maybe that wouldn't be tremendously newsworthy to the market if we were to get there i think it's fair to say you put a lot of the evidence together, kelly, that we are discounting a stall speed economy, something that's a steep slowdown or a recession scare such as we got in 2018, early 2016, 2011, those times when it seemed like we were on the edge and it didn't quite get there. so that would suggest if you do get an outright recession, if you do have to hack away at those earnings forecasts, maybe we have more reckoning to do, but it's not as if it's starting are from a position where the market is already assuming things are good and growth is on a pretty good glide path one final point as many have noted, the average peak to trough decline in the s&p over the course of history during a recession is 30ish percent now, we would suggest with 22% loss already in the s&p, maybe that says more than halfway there. of course we all know market got cut in half twice since the year 2000 in bad recessions that had

exacerbating factors that's what the averages tell us anyway. >> all right, michael santoli, credit markets for sure is one of those things to watch we appreciate it let's continue tracking today's market slide markets are pivoting away from inflation worries, more towards economic recession and you might want to adjust your stock picks accordingly for that shift joining us now is mike vogel, cap trust chief investment off officer. you just heard mike santoli's report on kind of what we're seeing as what's priced in the market right now do you feel as though this is an environment where there is still a bit of that rotation happening to more defensive names as opposed to what we're seeing today, which is huge outperformance, by the way, in some of those names that were considered growth and perhaps higher valuation type stocks over the last several years. >> yeah, exactly right just take a look at what's happening. we've got a huge economic slowdown trade on today, and the nasdaq is up those are the things that aren't as economically sensitive.

they've also been crushed in a lot of ways, and so we're getting clearer rotation away from inflation worries and higher interest rate worries and into sort of economic recession worries. i think mike santoli had it exactly right. you know, how much has been discounted one thing about this potential recession, which frankly we don't even know how to define is that it's pretty anticipated, and usually the market doesn't get hammered when it anticipates things this much and so there's some cheap stocks out there, and i think a lot of it has been discounted. >> so if it has been, like you said, if a recession does come, you can't say that you weren't prepared for it, right because we've been talking about it now for about six months and even more so for the last three. if you talk about those stock picks, then, what are the places to be in is it strictly utilities and consumer staple stocks, or do you kind of still play the diversification game given the fact that there is an opportunity that may present itself in certain areas of the

market >> yeah, i think as we come into earnings season, it's more important to giver yourself some flexibility. that's sort of number one as we face the next three weeks or so. i think it's not like you can be dope slapped and say, wow, i didn't see a recession coming. we've been talking about it as you pointed out for a long time, and as a result, you know, i think some of the things that are recessionary are really inexpensive. there's lots and lots of names that are we're looking for a couple of things you know, at&t we liked because of the pricing power that they seem to have, evaluation discrepancy. they've got a long sort of runway ahead of them in order to deliver shareholder value. you know, lrcx is just a wonderful business that we've held for a long time, and have made a ton of money on, and we've been through many cycles this is not a tradeable name in my opinion this is a name you want to own as technology continues to advance across the globe and across the development of technology and then wells fargo is simply i think the cheapest bank out

there. part of the challenge of talking about individual stocks when the market is melting down as it's been this year, it feels a little bit like standing in the middle of a house that's falling down around you and saying, wow, these kitchen cabinets are beautiful, right it feels a little odd to be talking about stocks that are getting hit so much. there are some valuation opportunities and i think as we get more and more discussion around recession, i think it's going to be interesting to see what plays well. >> so what -- i mean, the idea of what plays well is absolutely in play right now for not just the treasury side of the fixed income market but credit as well i wonder in your mind whether or not you are seeing some signs. i mean, we know that the fed is going to commit to balance sheet reduction, to raising interest rates and whatnot, which should put pressure on fixed income markets. at the same time if a recessionary narrative just starts -- really does take hold, that does send a flight to safety towards the full faith and credit of the u.s. government at the same time. so what does a recession look like when it comes to treasury

yields in your mind? >> this is an incredible game of chicken we're seeing playing out, right we were at 340 or something on the ten-year a couple of weeks ago. a month or so ago. now we're at 280, wherever we are this afternoon and you know, this is the federal reserve having credibility. jay powell has been very clear in his earnestness about controlling inflation and not letting it ged at ahead of itse. as the recession continues to creep closer, it will be interesting to see the challenge with a recession here is we've never had an economic recession as defined by the nabr, right? their recession dating committee that's had really strong employment, and so we don't even quite know what it's going to look like this time around, with such strong employment, and yet, weak overall demand and production in the economy. so even defining a recession this time around is going to be odd, and i think the federal

reserve is simply going to say as long as we recover from the employment picture, we're going to keep the pressure on. >> tough waters for a financial adviser to navigate right now. thank you very much. we appreciate it >> thanks, dom. turning now to tesla, the shares are down more than 35% since the start of the year, and they're extending their slide today, although they've just perked up after the company reported a quarterly drop in deliveries for the first time in two years. our next guest is calling the pullback a generational buying opportunity citing a strong pipeline of future products. he trimmed his price target $100 today to 1,100 what prompted the trim, garrett? the numbers? >> yeah, thanks for having me. it's mainly expectations for lower valuation multiples across the auto manufacturer industry in this environment in which, you know, we're seeing increased odds of a recession. so it's just a lower target multiple our estimates for next year and

2024 actually didn't change at all. >> so it wasn't about the quarterly delivery figures >> it wasn't, and if you look at, you know, tesla shipped about 255,000 vehicles, that was up 27% year-over-year. if you look at the rest of the industry, on average, automakers sales declined by about 20% in the second quarter, so you know, tesla continues to outperform, and we think with the company in the process of ramping up their new factories in austin and berlin, the second half of the year is going to be a lot stronger in terms of their production and sales, so we remain very positive on the stock. >> sure, although maybe there's a difference between sort of positive for the long run and generational buying opportunity, and maybe there's not. could you make a case that tesla has now priced in much of the success it's going to have in the years to come already? >> yeah, we put this report out, and we looked at the long-term

earnings potential of the company, and so tesla earned a little less than $7 a share last year they did $54 billion in revenue. we think by the end of this decade, their earnings could be north of $30 a share and revenue north of $300 billion, and so, you know, we view this 35% drop in the stock price as really a generational type opportunity, you know, similar to an apple or an amazon say a decade ago in terms of a company that's really disrupting their industry, and it's going to take a huge amount of market share over the next decade, and so, you know, we view this as a really good entry point for the long-term in the stock >> garrett, it's dom it's trading at 55, 56 times next year's anticipated earnings, even with the pullback, some would say that's still too much how would you counter that argument >> yeah, so we would say look at the -- where it's traded over

the last five or ten years on a forward p/e basis and the multiples are well north of 100 times. so it was actually trading at the lowest multiple that it's been trading at in a long time right here. >> but it's still, what did we say, 55 times forward earnings or what have you how are you valuing tesla, garrett, and what does it have to do for the next couple of years to justify the current price? >> yeah, we think they just need to continue to execute they have a price of pipeline, future products with the cyber truck and the semi coming next year followed by the roadster. we know their long-term goal is to grow their annual volumes from half a million vehicles sold in 2020 to more than 20 million vehicles in the year 2030, and so that's the long-term growth opportunity, and while the stock is down 35% year-to-date, it's been the best performing auto manufacturer equity by a wide margin so far this year, and so we just think they need to continue to execute

and innovate and the share price will grow along with their earnings over the long-term. >> that share price has already dropped 35% just year-to-date. garrett nelson, thank you very much, we appreciate it >> thank you. all right, coming up on the show, andy jassy's turbulent first year as amazon's ceo the bull and the bear case for that stock amazon coming up next. and shares of delta, united american, all falling about 20% over just the past month this as air travel hit a pandemic record. record over the weekend. transportation secretary pete buttigieg is here to talk about the delays, the cancellations and the chaos at our nation's airports. and check out shares of ro roblox, higher up by around 28% over the course of the last month, up 13% just today keep an eye on bucking the trend, blroblox we'll be back after this break bg

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welcome back, amazon shares bucking the trend, trading higher by about 2% on the day as ceo andy jassy wraps up a rocky first year marked by, what else, inflation, unionization efforts and of course over capacity as well during jassy's time at the helm, the stock is down about 36% underperforming the 13% drop for the overall s&p. so joining us now with the bull case for amazon is jason held ofsteen of opepenheimer.

he has an outperform rating and with the bear case for some balance here we have barton crockett, rosenblatt securities who has a hold rating on amazon and a $107 price target. jason, barton, thank you very much we will start, first of all, with jason he's going to make the case because this is a stock that is obviously on people's shopping list, if it goes down in value why does it belong there, and how high could it go, jason? >> sure, so this is a business of today that the market's basically valuing the retail business at zero or less than zero so when you take a look at the aws business, i think it's ironic, two internet/media analysts, you know, talking about this company when effectively 100% of the value today or most to have is actually the cloud business. so if you put 25 times next year's aws profit like ebit including depreciation and then you put ten times on advertising

this year, eight times next year eb ebitda, assuming a 65% margin, you're basically paying, you know, nothing for the retail business, nothing for prime, nothing for pay by prime so really, that is the opportunity, so unless you were a bear on aws long-term, you have to buy the stock. >> all right, so it's $175 and a 50% upside surprise there for the stock if it does come to fruition you've been on the right side maybe of this arguably speaking. you've been a little bit more negative on the stock here and the price action is has kind of validated that view. why does it keep going lower? >> okay. so look, i don't have some of the parts that jason has i think the multiples for cloud services companies are not what they were. you know, i think if you do a multiple that's more in keeping with where the peers are trading, you don't get all of the value in aws and you do need retail to work

i think that the issue with retail is that this is the company's legacy it's amazon's core, and it's not a growth story it's a day two story, which i know bezos has argued that that's deaf, but i think that's not. i think it's normal maturity, and for, you know, some number of quarters these guys have not been outperforming retail at large, and i think that there's a lot of reasons for that. one of them is that they've killed the weak links and the competitors are stronger and better in e-commerce and better in click and brick accommodations than amazon is right now, and i think the consumer's rotating away from where amazon is and retail sports services away from things if you have these guys growing like they have been for, you know, some period of time, the consensus revenue estimates are too high, and they're coming down, and i think that's difficult to make an outperformer argument for a high multiple stock like this when the revenues are at risk versus the sale side consensus. >> if i could follow up on that, i mean, i get the reasons why

you feel a little bit less optimistic about this. let's take this and say from an operational standpoint, you take a look at the numbers. you scrutinize them on a daily basis. what needs to change, what would be those tea leaves where you start to say, hey, maybe this is trending in the right correction what would get me to be more constructive on the stock. what would you need to see first and foremost to make you feel better about amazon's story going forward? >> one thing that would help is if you were buying the stock at a lower multiple, which means the stock could be cheaper than it is here i have a neutral rating on the equity, so, you know, i do think there's a real business here that could be attractive you know, i think that expectations are too high. the fact that i'm a bear on a bull, bear debate speaks to the fact that everyone else on the street has a buy on it there needs to be a reset on expectations there needs to be a realization that the numbers need to be adjusted and i think that would help a lot i think retail, you know, it's a

great story historically, but i think there needs to be an acceptance of, you know, think trees don't grow out of the sun. there is a point where things start to normalize i think the numbers argue that we're approaching that heading into a recession with competitors stronger and online, and that needs to be in the cons consensus. >> jason, how strong is the amazon brand when it comes to its overall presence in retail we know it's big we were just about a week away from their marquee shopping event of every year, that amazon prime day, right a couple of days worth of specials that they have. how important is that retail story going to be for amazon if hypothetically we do enter the u.s. economy into that so-called recession? >> i think what's so hard for everyone looking at this is basically, you know, the ecommerce basically went from gaining, you know,150, 170 basis points a share, right? to kind of 4 to 500 basis points a share during covid, right? which was basically too much so we're still burning off the

covid hangover, right? so first of all, i think when you look at retail as an overall industry, you're just is starting to see kind of like going back to the normalization of online versus offline, and i think that's going to make just all e-commerce companies look better, particularly as we start to look at the back half, even if we do go into recession the second, i think when you look at this company nationally, yes, amazon did not gain any market share based on our data last year. their market share in the u.s. was about 40%, but in other countries such as germany, uk and japan, they gained share in all those countries last year. so, look, i think you have a whole bunch of complementing factors. i think when you also look at the valuation, the biggest driver of like the short-term movement and evaluation are the margin ecommerce, and so for the first time largely, you know, again, i don't know if it's just because it's andrew jassy or this would have happened if

bezos was still at the helm. you are seeing them actively proactively trying to tackle costs. i do agree with barton there is probably some risks to the actual street numbers, but the market is valuing your retail business at zero to negative >> all right, so the case being made there from jason, also barton crockett, the amazon bear over at rosenblatt gentlemen, have a great day. >> thank you ahead on -- here we go, kelly. that's you. >> i'll take it. >> no, no, no, this is all you >> ahead on "power lunch," more on this volatilie session. we are 400 points off the lows the nasdaq is now positive the chip stocks some of the biggest laggards plus, key stocks that are moving lower in today's three stock lunch, how about ford, hp, and freeport mcmcmoran are any of them buys

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welcome back to plu"power lunch. the nasdaq is holding up and the whole overall tone looks better than this morning. the chip stocks are helping, micron up 4% as investors try to figure out where we are in the

chip shortage. maybe the picture brightening there. kristina partsinevelos has the latest. >> it's a tale of two cities within the chip space. firstly you have weakening pc and hand set demand that we've talked about along with bloated inventory levels that are hurting memory and storage chip makers chips that are vital for electronics. micron, for example, is 55% exposed to that consumer end user market and actually guided lower into the next quarter as the ceo doesn't think things will improve until 2023. micron is on pace to snap a four-day losing streak, but still more than 30% off its one-year mark but 40% off year-to-date, and it's not just pc and hand sets there is further demand weakness in graphics chips. these are causing gpu prices to drop nvidia covers about 75% of the market in terms of market share, and then intel as a new entrant. so demand is weakening on one end, and that's reflected in the sma gtf.

that's hit its lowest level today since november 2020, while the supply crunch persists on the other end within the auto sector union workers say the worldwide chip shortage would cut into its italian production by more than 200,000 vehicles per year, and gm said on friday that they have 95,000 cars in storage because of missing semi conductor parts. companies like st microelectronics, texas instruments and nsp all make chips for cars, but you can see that they too haven't fared too well this past year. >> that is still a factor here as well. >> certain companies like intel that are very vocal, but the latest, according to the nikkei right now is the taiwan semiconductors are actually thinking about pulling back some of their expansion into the united states. you can blame the chip stack or you can point out to the fact that just four weeks ago, taiwan semiconductors said things are getting really expensive here in the united states, much more expensive than we originally thought. nonetheless, global foundries,

global wafers, intel, are all flashing warning signs because of the chip. which needs to get passed by the august recess. >> clocks are ticking and huge projects are at stake. kristina, thank you very much. let's get out to frank holland now for a cnbc news update good afternoon, frank. >> good afternoon to you, dom. that stumble is contagious apparently in the uk the leader of the opposition labor party is saying it is clear that prime minister boris johnson's government is now collapsing the two senior members of johnson's cabinet, the country's finance and health ministers are resigned and now they're calling for johnson to accept down too in the latest o'after string of scandals johnson is forced to apologize for appointing a top conservative party official even after he had been told of the sexual assault allegations against him. >> in hindsight it was the wrong thing to do. i apologize to everybody who's

been badly affected by it, and i just want to make absolutely clear that there's no place in this government for anybody who is predatory or who abuses their position of power. and president biden ordering american flags to be flown at half-staff across the united states until sunset on friday to honor the victims of monday's july 4 parade shooting attack in illinois firefighters battled an intense blaze overnight in cleveland. they say it was started by young people throwing fireworks into a vacant house now despite all the flames you see right here, fortunately no one was hurt that's the very latest, kelly and dom, back over to you. >> frank holland, thank you very much for those headlines. coming up on the show, the ongoing call it flightmare, airlines struggling to meet demand, thousands of flights delayed or canceled. this weekend we'll speak to transportation secretary pete buttigieg in just a few minutes. as we head out to break here, check out what's happening with oil prices heading lower,

breaking now below that key $100 mark in today's session for u.s. benchmark food prices, energy names overall have now been hit with huge declines, the energy etfs, oil services names like halliburton, bigam nes like exxon mobil all lower. keep an eye on oil, we'll be right back rp what's going on? where's regina? hi, i'm ladonna. i invest in invesco qqq, a fund that gives me access to the nasdaq-100 innovations, like real time cgi. okay... yeah... oh. don't worry i got it! become an agent of innovation with invesco qqq hybrid work is here. it's there. it's everywhere. but for someone to be able to work from here, there has to be someone here making sure everything is safe. secure. consistent. so log in from here. or here. assured that someone is here

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. welcome back, everybody. less than 90 minutes left in the trading session today, the market's looking way better than it was this morning, but let's get fully caught up across stocks, bonds, commodities, and with transportation secretary pete buttigieg, starting with stocks where the dow still down more than 1%, but a 330 point drop is nothing like the 742 point crop we had at the lows earlier. the s&p down half a percent, still the nasdaq is up 1% right now, and it's some of the big names taking us higher, like meta, amazon, which we were just debating earlier, netflix, google, the original old school if you will, they're up in the range of almost 4% today, even with those recession fears creeping up. the discount retailers among the biggest gainers today, dollar tree, tjx, raw stores dollar tree up 4% what is leaning us lower united health the worst performer in the dow it's costing us about 120 points

right now with a more than 3% decline turning it negative year-to-date let's move to the bond market where we've seen dramatic moves. the yield on that ten-year below 2.8%, back above it by just a hair right now, but a huge drop from the highs of 3.5% we saw just about three weeks ago before that fed meeting where they hiked by 75 basis points very quick moves here. sharp move lower in the ten-year yield has also inverted it with the two-year as i throw a glance over to dom. a lot of people view this inversion as a warning sign. it's already inverted once this year in march and again in june. the ten-year three-month, which is another gauge, another way to look at it is also dropping back to about a point that one at least still in positive territory not positive is oil today, even as the market tone improves, we are not seeing that with commodities. oil not only below $100 a barrel, pippa, last check we were below 98. what gives >> yeah, kelly, that's right u.s. oil tumbling below $100 for the first time since may 11th,

and today's big slide comes down to recession fears and concerns that that will curtail demand. the dollar also jumping today, which makes oil more expensive for foreign currency holders, and looking forward, analysts are split on crude's direction citi said today if there is a recession, brent could fall to 65 by the end of this year the firm said that while demand goes negative in only the worst global recessions, oil prices fall in all recessions goldman meantime reiterating its call for $140 brent this summer, so some drastically different views here let's check on prices. wti is down 8% at 99,.77. that is well off the lows of the day, which was 97.43 brent crude down 92%, and gasoline futures down more than 9%, which mean some relief at the pump and turning to energy stocks, which are the big loser today, every single component apart

from morgan now in bear market territory, apa, devon, and halliburton all down more than 30% from their recent highs less than one month ago, which really points to the speed with which investors have fled the sector, kelly. >> it's amazing, pippa, that move in gasoline futures you mentioned, $0.33 just today. we're talking about substantial declines that could be showing up at the pump in the next few weeks, right >> yeah, absolutely. there are a lot of moving parts here, and i'm hesitant to -- you know, to make any kind of prediction because of course a lot does depend on the direction of crude that is a huge drop for gasoline futures. the national average is up 4.80 right now. it's already down from that $5 mark we saw earlier in june, so hopefully some relief there for consumers as demand does start to come down a little bit. >> right, and as you are showing there, the flip side of the story for energy stocks, that is definitely for sure. pippa, thank you for now our pippa steven after the break our interview with transportation secretary

pete buttigieg following the s reellation of thousandmo flights this holiday weekend we'll be right back. stay with us on "power lunch." >> announcer: the bond report is brought to you by pimco, a global leader in active fixed income a plan with tax-smart investing strategies designed to help you keep more of what you earn. this is the planning effect.

all right, what we're showing you right now are some of the big gainers on the session so far in a down tape. i would point out as kelly has numerous times over the last hour plus or so right now, we were down significantly at the lows of the session, and we are now down only 250 points for the dow. if you look at the trade so far today, you look at roblox on the kind of virtual reality metaverse game development platform side of things up 13%, crocs on a weak kind of basis, you've kind of got a 10.5% gain, etsy up 10% as well, norwegian cruise lines probably more on that economically sensitive cyclical side of things. big moves in those names i know we have some big news coming with regard to economic cyclicality. >> one part of the economy trying to catch up to changing demand is air travel the industry has been hit by

labor shortages from air traffic controllers to pilots to baggage handlers, cancellations and delays piling up though they eased for this weekend daily airline cancellations were between 1 and 6% while delays were near 20% of all flights according to flight aware. what can be done to improve travel in this country joining us now is transportation secretary pete buttigieg mr. secretary, thanks for your time today what measures should we expect >> so we're going to do everything that we can to support passengers and consumers. i spoke to the airlines after the problems we saw with memorial day weekend and spoke to them again going into the july 4th weekend where we just saw some of the busiest travel days of the year the numbers appear to have improved relative to memorial day, but still seeing an elevated level of cancellations, and some stories we're hearing from passengers that are just unacceptable in terms of their consumer experience. so we're going to continue using

all of the authorities that are available to us as a department, and we're going to continue working on the air traffic control side to make sure that we're managing any assets that are under our control to get ahead of issues. for example, a few weeks ago in florida, we saw a real perfect storm, not just literally in terms of the weather, but there was a space launch going on at the same time as military operations, closing part of the air space, plus, air traffic control, staffing availability issues, and staffing shortages on the airline side. we're working to get ahead of those kinds of things going into the rest of the summer and the fall and seem to be seeing encouraging signs, but we can't let up. >> as we understand, even shortages at the faa, part of your administration or department are have contributed to those flight delays in florida that you were mentioning so what are you doing as an agency on that front to make sure that you're not falter in this process, and how many of senator sanders calls to action are being considered, things like requiring you to refund

passengers for flights that are delayed for more than an hour? >> so first of all, just to be very clear, air traffic control staffing issues do not explain the majority of the delays and cancellations we've been seeing. but when there is an issue, and as an after shock from covid, we have seen some impacts on staffing we're working proactively and engaging the airlines to make sure that we're collaborating on that a number of issues that we have seen appear to be related to the phenomenon of airlines letting airline pilots or sometimes even pushing pilots into early retirement, and i think that's a source of frustration for the public because, of course, lots of taxpayer money went to these airlines, precisely in order to keep people on the job in order to keep those airlines running in a resilient way, so when the demand came back they would be ready to respond. these are the kinds of issues that we're monitoring. you mentioned the letter from senator sanders, i gave him a call we've talked about some of his

ideas. haven't seen all of the math come back on some of those proposals. what i will say is we do have a lot of authorities for ensuring that passengers are protected. as a matter of fact, earlier, we issued the largest ever fines against airlines that failed to provide prompt refunds for passengers that they're entitled to, and we're going to continue making sure that the rules are followed and look to expand our tool kit whenever that's appropriate. >> secretary buttigieg, it's dom here i wonder, there's no doubt in anyone's mind right now that this nation has been under a tremendous amount of stress from an infrastructure and economic standpoint over the last year, two years plus now we've seen it on the energy infrastructure side with regard to soaring fuel costs and availability there and we're seeing it here now with travel, not just in the air but other parts as well. do you feel as though your administration, the biden administration is not taking a look at some of the medium to longer term kind of i guess

contingency plans that our nation may need to adjust or make given the stresses that we've seen in things like energy and transportation, given these stresses now, can they do anything differently could you folks do anything differently to make sure that this doesn't happen in the coming months, quarters, and years? >> well, that's exactly right. look, there are immediate steps available to us when we're dealing with immediate issues that have been thrust upon us, whether we're talking about some of the problems with container shipping that were happening and affecting our supply chains or whether we're talking about elevated levels of airline cancellations and delays but what we've got to do is make the system more resilient because we don't know what the next shock to the system is going to be. we only know that the better our infrastructure is, the better we'll be poised to absorb it stay tuned for announcements very soon from my department on improvements that we're supporting for airport terminals, for example they're going to help them become more sustainable and more efficient. this is exactly why we made the

case for the bipartisan infrastructure law to begin with, whether we're talking about ports or airports or just roads, bridges, and rails. you know, we have been paying the price for the decades of under investment, and we've got to work those long-term issues, even while we're acting more tactically and more immediately. the issues we're seeing this month, this quarter, this year. >> you know, more efficient terminal sounds great, but i think people hoping efficient to mean to move through as well as energy efficient and all the rest of it there's been some question about going back to i believe the obama administration when they have regulations for how long pilots and flight attendants can fly before they literally need to leave the aircraft, pack their bags and go home i don't know what the term is for this can you allow for a temporary reprieve, let's say, in these kinds of regulations that might help airlines meet their schedules better for the time being? >> so i'm going to look at every

option except any option that would compromise safety, and those are the discussions we're having in the department when there are ways to update our regulations or our practices or our operations, we're always assessing that what we're not going to do is consider any move that might feel good in the short-term but would undermine the safety of our air travel system. traveling by air is pretty much the safest way to get around, period, and that didn't just happen on its own. it took a lot of hard work to get it that way. it takes a lot of hard work to keep it that way, and that is the bedrock commitment of the faa, i believe, fundamentally that safety mission is the main reason my department exists in the first place. >> and mr. secretary, before we let you go, is there anything that you're looking at right now from a transportation standpoint that gives you any indication about the state of our current economy and what are those factors, and if so, are any of them pointing to a recession >> look, what we're seeing right now, whether it's on the cargo

side or passengers is signs that there's increased demand that people have a lot of money in their pockets and are spending it on things like goods that they're ordering in, which is why we have such pressure on our shifting systems or vacations and travel, which is why we're seeing demand way ahead of where the airline sector thought it would be by the summer of 2022 that's a good thing, but we're also, of course, seeing these very, very challenging pressures on prices, whether we're talking about energy, whether we're talking about goods, whether we're talking about shipping, and it's that interaction of those two things high demand, which is great news, but really challenged for the supply side to keep up with that that's put us in an economic situation that continues to be really tough to manage the president has made clear his top economic priority is keeping prices under control and fighting inflation we're using all of the tools available to us to do that, but if you just consider the magnitude of the shock that the pandemic created, we're going to

continue seeing those shock waves reverberate through our economy, i think, for quite some time. >> all right, mr. secretary, pete buttigieg, thank you so much for your time today thanks for joining us. we really appreciate it here on "power lunch." >> thanks for having me on >> and again, dom, you mentioned the airlines there, earlier retiring pilots is one possible culprit in this whole endeavor and we'll see if the industry has a response. >> you talk about prime costs for airlines, it is fuel costs and labor costs. the two big ones that you have to worry about so again, the secretary pointed it out it's a tough one on either side of it. >> absolutely. after the break, the technical take on three big movers three-stock lunch is next.

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welcome back to "power lunch. time for three-stock lunch today we are taking a technical look at the three big movers of the day. we've got ford which it a 52-week low on disappointing sales, hp inc. on a downgrade to neutral and freeport-mcmoran so here's carter worth, founder and ceo of worth charting to break it all down. let's start it all off with

what's happening with ford. >> sure, hi, dom well, it's a classic instance and you can see it on the chart here if you can over time, just don't buy stocks in downtrends hard to do, we all wanti to. ford had a great run from its covid low. hit a high of 26 and it's been more than cut in half, down some 60%. why can't it go lower? it can there's the uptrend. it's a downtrend now i would just resist the temp takes to buy. >> a different story to hp >> in the case of hp the yuch trend is intact. this sell-off leaves is down we've touched the well defined trend line as opposed to ford which broken trend i think you play for a bounce. >> so that's the hp side of things kelly, you and i were talking about this before the show

if you were for the better part of this year in anything commodity-related, metals included, that was dollar denominated in any way, you were having a boom. so let's talk about freeport-mcmoran is this a case where this is a pull back worth buying because it's pulled back 30 some percent just in the course of a year-to-date period? >> it's very similar to ford, the nature of a cyclical asset i think it was $5 on its covid low, hit 52 and now has been cut in half at 27. i think the principles can apply. one can always try to avoid buying stocks in downtrends. it can always get worse. that's why they call them value traps. >> carter worth, thank you very much have a nice day, sir. >> you bet thanks. and still bullish the dollar and speaking of which, up next, the currency toconundrum. we'll break it down. don't go anywhere.

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all right. so, kelly, for this last block of the show, i thought we'd bring it full circle and that's diverging talk about what story is winning out so we decided to look through the lens of etfs this is the s&p 500 etf, the spider, down 20% year to date. we put it along side the russell 2000 etf the gap hasn't actually been

that far apart between the two just in the last month or so it touched a little more closer together but it's starting to widen out a little bit this kind of tells you that story of whether recession is the bigger narrative or the strength of the dollar if it was the strength of the dollar, multi-nationals might, yes, underperform on the russell 2000 which has less dollar exposure. >> you're saying this is so tight that you think it's more a pure recession. >> right now the large caps are winning out, just slightly but still it means that maybe the recession narrative is a little more prevalent than the strong dollar narrative. the dollar index is a key one, as we talk about this notion of a 20-year high of the dollar versus the euro. >> 106 year to date. to see carter worth still saying this is an uptrend after extended it's become is striking >> so we talk about companies that have a lot of exposure to

revenue outside the u.s. could have problems with a strong dollar some of the names we always talk about end up being names like mcdonald's and nike overall. so it would be something to take a look at. >> canadian pacific? >> no, it should have been colgate. i think there was a typo in there. >> that would never happen around here. thanks for watching "power lunch. dom, thanks for being here. >> "closing bell" starts right now. stocks making a big comeback what's leading the way here's something we haven't said too often, it's the nasdaq and beaten-down tech stocks. the most important hour of trading starts now welcome to "closing bell." i'm sara eisen here's where we stand in the market right now the nasdaq composite has turned green, up 1.2% or so the s&p 500 only down a third of 1% at the lows it was down 83 points so you can see it's been a strong recovery. the dow is still down about a percent. the cyclical groups getting hurt the hardest into