we see more softening in the economy and people saying we have the second home, let's rerent out and other online, and the challenge is to beef up the inventory. >> maybe these homeowners will help seema, thank you very much for bringing that to us. our seema mody we'll trade the other vacation name that has analysts hiking their earnings outlooks coming up on "power lunch" which starts right now. ♪ ♪ good day, everyone welcome to "power lunch," i'm tyler matheson kelly will be along. companies are raising prices at a rapid pace and once they go up they will take a long time to come down if they ever do, the company investing in domestic production even as the sector

slows down the ceo will explain his strategy and outlook for the company. kelly? >> thank you, tyler. hi, everybody. let's get a quick check on the market picture the dow is up 157 points and we've cut the gains in half and it's still a half percent gain and the s&p up 0.4%. the nasdaq has turned lower after that monster session yesterday and a move from the recent lows that has put it up 20%. so we're seeing a pause here and the nasdaq is leading the way in the vein today it's the best performing dow stock after reporting that strong quarter last night and increased spending at its domestic theme parks looks better in contrast to six flag which is saw attendance drop by 22%. so a huge divergence there helping disney shine even more by comparison. also check out shares of arhaus, it's a furniture company, in case there was any doubt, tyler that segment remains intact.

>> kelly, thank you very much. we begin with the latest read on inflation. producer prices fell, yeah fell 5% in july another sign that price increases may be slowing more broadly, but there are some prices that may take a lot longer to come down, if ever it's so-called sticky inflation and we've seen chipotle hike prices numerous times and it helped fuel the same-store sales growth and disney said it's raising the price of its streaming service starting in december according to this chart, historically it takes longer for prices to come down in the services industries than in areas of the economy like manufacturing or agriculture joining us bill lee, milken chief economist. bill, welcome. good to have you with us. >> thank you for having me. >> where are prices likely to be stickiest? it's no surprise that once a wage goes up an employer will not cut my pay and that gets

embedded and fed through into higher prices, doesn't it? >> well, tyler, what we are seeing is that most of the price slack has becoming from what had been termed as transactional prices, energy, food, the kind of stuff where you buy and you sell because you have the supply and you have the current demand. >> prices. >> are based on longer term contracts and relationships so for example, a tenant has a one-year lease you and i have annual contract renewals and so a lot of things are -- once they go up they tend to stick and those sticky prices are starting to see faster and faster increases both in the employment cost index that was just released as well as other measures of core inflation that came out in the cpi. >> steve liesman is also here. steve, it would seem to me that there would be very little insensitive for a company to cut prices unless there is a fall in

demand unless there is a cut in demand, am i right on that >> i don't know if you were opening up the can of words and the concept of sticky prices and economics and this thing has been studied for decades and economists hate this idea because what they want is they want prices to adjust as quickly as the factors affecting prices adjust and they don't and it confounds them, the way that physics is confounded by the inability to put together -- what do you want to call it quantum physics and plutonium physics and there are a bunch of reasons why they don't work. one, the cost of repricing and the restaurants are doing the menus and things concern like market share and also competition. a whole bunch of reasons why, tyler, it -- these prices. they're reluctant to raise them and once they raise them, they're reluctant to bring them

down >> bill, is there a distinction to be made between the prices that have risen as a result of commodity input costs driving them up? in other words, energy, oil, food prices whether it's avocados, or beef or wheat or corn and other prices like -- like those for services or experiences? >> well, tyler, you're hinting at something that the fed fears most which is to say commodity prices, people worry do i have enough money and am i making enough in my paycheck and when they decide, my god, these prices are not only going up, they're accelerating so i go to my boss and say my salary is not keeping up and i have to have more increases and i want to get ahead of the price increases so that i get the real wage i'm supposed to get and that's the kind of fear that the fed has that we instigate the very

corrosive behavior that we saw in the '70s and '80s and it took volcker to crush expectations and right now we're not there, but the fear is that every time we have a blip in inflation expectation the fed will have to step on it even harder >> steve, vobviously gas prices have fallen dramatically and helped calm things down for the consumer, they're firming up lately and who knows where they go from here >> yeah. i mean, that's right those are commodity prices and they'll go up and down and there are a couple of concepts in economics that they call the rocket and feather phenomenon. prices go up like a rocket and fall like a feather. put yourself in the position of a gas station that has their 3 in the ground -- in the tanks, but let's say oil fell or gasoline prices fell to $2 it wants to sell that gasoline

to the extent it can for $3 before it offers that $2 price that's available out there so that's part of the phenomenon another interesting factoid i've come across in the research and this is an xafrexample and thats coca-cola. it charged it for about a hundred years and the reason is because it was difficult for them to change the nickel that they put into the vending machine without doubling the price to the dime and that's just one of those examples and they call those transactional costs and nominal rigidity and whatever you want to do and billy knows this stuff better than i do. it's just one of the facts out there that make it difficult to ride ooh on it was like fall like a feather and when you think of what goes on with banking, borrowing cover thes go

up like a rocket, but deposits do not any in for anywhere year or something i spent skeeve an e pail one national average cpi or pp that we talk about suspect that an accurate measure of how infloilgz asian is helping people at different parts of the country you see what i'm saying here in other words, that the cost of living for a senior citizen on a fixed income and the inflation that that they feel may be very different than who owns their own house, may be very different than the inflation felt by a young renter the inflation felt by someone who drives a long way to work every day or by someone who is at the lower end of the income spectrum may be much higher than the inflation felt by the more affluent bill, am i on to something here

or not >> not only are you on to something, you're on to the latest trend which is to say covid has endured people going to the cities and looking for a cheaper place to rent. they go to boise, idaho or las vegas. it's going up by 19% and double-digit numbers and the places are going vacant, but the differences do show up, specially now, of rents and the equilibrium other sticky is pr prices steve, final thought >> the problem of the federal reserve in setting a single rate for the entire economy based upon a single number which is the average urban inflation number you are 100% right you do not want to be a young person renting a house right now

and/or living two hours from the place you commute to. >> right. >> because your cover thes are very different from someone who is living at home now and has a long term 30-year mortgage has put his or her kids through school and doesn't have that problem right now. you are by bill points, by geography, but the fed only has one for one opinion, the trb it gets flawed and we can see if it does a good job. >> i was thinking about this after i finished lamenting the yankees. >> bill lee, steve liesman, thank you very much. what does this mean for the fed and for the markets? our next guest says the central bank is making some key mistakes here to explain and tell us how to invest is david trainor

what are the mistakes, david welcome. >> i think they've been making the same mistake they've been making for the last couple of years. i'll simplify this think big picture. inflation has been going on and housing, stock market,es set ra and as it trades further down and the latter to food and oil and other goods, all we're doing is increasing the income inequality gap and the pain that we're putting on the working class while the rich get rich err is only going to make the fed's job harder as people feel more more, but the delays in your flights, for my brt i worry eye the price of stuff you can't

substitute away from whether it's health care, child care in some parts parts of education. once those prices go up because ever ljmor shortages and people often don't have a choice. they're kind of stuck in the squeeze that you're describing. >> right they've got no choice, but to demand higher wages, right that's something that the fed is not going to be able to dampen down once this inflation monster just continues to grow i think they keep turning a blind eye to these bigger inflationary and income inequality problems and it will come home to roost in a big and bad way. david, i think it's fashionable and vogue to say the fed was behind the curve, that they made a mistake, that they missed and that they missed on the whiffel ball i don't remember many market analysts, economists, swamis, i don't know what uyou were predicting in march of 2021 on

inflation, but most people -- most people were going along with the consensus view that it was going to be transitory and not as high as it is would you comment on that? >> yeah. you know, look, i don't know how long my crystal ball was working back then, tyler and i don't know if we've made as many comments around macro picture. it's not really our focus. the new construct is more on the underlying fundamentals of individual companies, but i do think no one can get around understanding the larger market context of investment decision making and one of those telltale signs are if us in just how seeing it's these some of these amazon bow stocks, and fewer high valuation and probably never have any pros feks of making any moment in a that that

allocate, who in, will siphon it off. >> name some of those. you have to name some of those companies? what is an examel that has gone when you described, in other words, raised huge amount of capital. maybe it's going to enrich executives or money heaven. >> to the board of directors or the main investors rivian, freshpet, coin, robinhood, carvana, tesla, peloton. we just published a list of a bunch of the stocks -- tesla is a zombie? have they continued to make money? >> will they continue to make money? i don't know when it comes to zombie stocks, the amount of loss that could be incurred by the owners of the stock and its current level is devastating, i think, to folks, and i think when the unwind hits it's going to be really painful

across all of it >> did i hear you correctly? it sounded like you were ascribing some of the responsibility for the zombie companies and their ability to raise massive amounts of capital to the government or the fed is it really their fault or the capital markets? >> absolutely. >> explain to me highwow and why that is the case and why it isn't the greater fool putting money and getting sold that crap that explains it. >> tyler, i'm not going to argue that people should not be responsible for their investment decisions. ultimately, that's what it comes down to, but i think it's a little bit naive to say that, like, that most investors are willing to do that i mean, look at the craze we've seen with amc and gamestop it's clear that there's utter disregard for the value of money in a lot of ways and it's a gambling machine and the fed continues to dole out lots and

lots of money and money is cheap and risky and continues to sort of stoke the fires of speculation. yeah they play some role in that, and i think in some ways it's a distraction from getting back to the business of doing hard work and doing the things that are required to make a real living >> i see what you're saying, by making money easy and cheap it contributed and flowed into that stream where speculating -- i don't even want to call them investors or speculators decided to gamble with the free or low-price money. i get your point david, thank you as always good to see you. >> david trainer coming up, interesting conversation there ceo of on semi, the cia is down about 20% in the last month. the move higher plus the national average for gasoline rnd a their 21 dropped from from

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welcome back to "power lunch. i'm dominic chu. take a look at european farm a

specifically, glaxosmithkline, haleon and sanofi, that the companies could potentially face litigation over the marketing of a once-popular medication zantac due to concerns that they contain a carcinogen haleon by glaxosmithkline issued a statement saying it never marketed the drug and is not party to this particular litigation, nonetheless, all three stocks are off by roughly 10% or more in a week or so. so keep an eye on those european pharma names ty, i'll send things back over to you >> thank you very much, news to me about zantac. i think covid must have overshadowed that. i agree with you my same reaction >> i think i took one over the weekend that's probably three years old. >> i'm not big on checking the date >> otherwise you'd throw everything out all of the time >> i'm fine. gas prices falling below $4 a

gallon and according to the aaa the national average for a gallon of gas is $3.99 14 cents lower than a week ago 68 cents lower than a month ago and more than $2 lower than two months ago and is it sustainable? co-founder and global head of energy analysis with the oil price information service. tom, welcome is this because biden tapped the spr or what? >> oh, i think it'smultiple factors. he does deserve credit for this swoon from june 14th until now i think we're 58 days of down days, but you don't know if it's going to haunt us when the spr sales stop in october, but certainly it is one of the factors that has tempered crude price enthusiasm and we've also seen demand destruction.

demand is 8% to 10% below where it was a year ago and it's well below 2019 levels. so that together with refineries operating at 100% of capacity, has kind of cleared things up for a while, but i think they might need some zantac on the consumer side. [ laughter ] >> just be careful. >> just be kafrcareful for whatu wish the demand destruction is that people are driving less or they pulled back or what is it? >> a little bit of everything. first of all, commuting is not what it was in 2019 before the pandemic, and you know, there are some places now that are re-authorizing masks in the new york area, in california or whatever, so you know, the kind of post-pandemic low has eased a bit, but you know, the banks all get it wrong because they all say in order to

have demand destruction you need prices between 602 and 660 a gallon they don't realize the visceral response that people have to goes prices, to a certain extent it's a little bit irrational like perhaps the people on side of the issue is on guns and it's hard to model human buyhivior when it's not rationed >> he would moving tent prices is what -- i'm aware maybe i shouldn't take on a hundred-mile drive just to keep them quiet because that would feel wasteful right now, you know what i'm say? >> oh, no, no, no. how much demand destruction have we seen? >> i think it's probably about 8% or 9% and it's in the mid-teens when you compare it before the pandemic. i think we've seen about as much

demand destruction as we'll see. we're not, however, we surveyed 20,000 stations and actually what they pumped we're not seeing much of a rebound. maybe a half a percent or so >> really? demand is not coming back? >> in the next 90 days really pose problems on the supply side you've got a gauntlet. you've got hurricane season. you have president putin possibly pushing some mischief buttons and you still have problems with power and refineries have put off the maintenance that they normally would have in the second quarter and they would take the units for a pit stop in september, october and november. >> my life as a motivational speaker has ended, in other words. >> yeah, but the fact that demand is not rebounding more rapidly is very, very interesting. >> can i squeeze in one quick question, very fast answer nat gas. how high is it going to be this year here in the u.s.? >> i mean, it is an

extrapolation of exponential potential -- proportions we're seeing natural gas trade at the equivalent of $350 to $400 a barrel for oil, and i'm really worried about the diesel and jet fuel prices in the last 130 days of the year they're much higher. >> got to leave it there we'll have you back. you motivate me, man >> it is so uncomfortable to know what we're going into >> i know. no freight fright. while recession fears remain in the economy, demand for shipping will ease up we'll talk about that. plus crypto higher again today bitcoin, two-month high and black rock adding some exposure. we have those details next without ziprecruiter. they do the legwork and they get my job posting in front of the right candidates. i love invite to apply. i instantly see great candidates and i can invite them to apply.

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welcome back to "power lunch. black rock taking another step into crypto. this comes as bitcoin and ether are hitting two-month highs. kate rooney is here. kate >> crypto is getting news with macro news and industry-specific news, as well. first, blackrock, as you mentioned launching a private trust to track the price of

bitcoin, and this will be a direct competitor to blackrock the world's largest asset manager saying despite the downturn, we are still seeing substantial interests from some institutional clients. it comes a week after blackrock partnered with coin boy base to let clients and more institutional interest has been seen as a sign of legitimacy for the new asset class. then you have ether, the cryptocurrency tied to the ethereum network benefiting from progress from something called the merge to make e tthereum moe energy efficient this week developers successfully ran the last test a head of the final merge that's happening in a month or so some are still skeptical this goalpost was moved a few times in the past and you're seeing the optimism play out in options markets which have seen even higher volume than bitcoin options. bitcoin and e tther hitting, an

the cooler than expected inflation number and mining stocks are doing particularly well we have marathon digital c core scientific seeing double-digit gains and you have coinbase down about 9% today and then black rock is lower >> kate, thank you very much ahead on "power lunch. the chips and science act signed into law and this is good news for semis overshadowed by nvidia and micron's warnings. we'll talk to the onsemi ceo >> and seasoned to perfection. we'll take a look at stocks that are not only beating analyst earnings expectations, but ails improving in the three-stock lunch coming up.

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welcome back to "power lunch," everybody. you're watching shares is of a semi sector that have been on a wild ride. nvidia warning of a slowdown sending the stocks down this week, and on the other hand the government signing into law the massive chips act that could send billions into the sector. kristina partsinevelos joins us now and she has the ceo of onsemi at the company's new silicon facility in new hampshire for more on this

story. kristina >> thank you, kelly. you set it up really nicely because that's exactly how i want to start the conversation with hassan. we hear about the slowdown across the board, but companies like yours nxp semi say it doesn't affect us because our bread and butter are autos are you seeing cracks in that now? >> the auto segment is 67% of the revenue. it's solid we have a lot of long term supply agreements that have signed up with the customers that give us the visibility and the confidence for us to invest in facilities like where i am today. we have talked in the last call about softness in other markets and we've been proactive about that it's nothing to hike from. >> what do you mean by proactive? >> we started on the manufacturing side we reduced a little bit on the manufacturing intensity that goes into those markets and we shifted to the extent we can into the auto and industrial which we see strength. >> you mentioned the long term agreements and the ev revolution, i should say, and that's something that would probably happen in two to three years from now

are you expecting a worse situation especially for your labor and employees in the coming year or so? >> this is the confidence that we have. >> the confidence that you have, too. >> i have such confidence that i went on national tv and i said we're still hiring and investing because that's the investablity we have. if evs don't double year over year, they'll grow 90% that's how we grow is with the ev revolution, and more importantly, everything that fuels the ev that ecosystem where you have solar, you have charging and all of that is what we do. nobody can ignore the fact that evs are going to be a bigger percent of the cars on the road. this that's the case and we all believe it and i'm a big believer in that, we'll believe it >> the secretary of commerce is here and we did a nice ribbon cutting ceremony retroactively, you won't have a chips act because it's a dagger in the heart.

>> we invested because of the business what the chips act did is added it to our confidence we weren't waiting and we want to double down here on what we do in order to leverage a lot of that market that i've been talking about, but this is want it we've doubled our investment year over year so we'll keep investing, we crossed that mile stoeven and we'll partis patty in the chips a act. soems like they'll start giving out subsidies, so is this an incentive to build a manufacturing hub or another venue in the united states >> yes, we're growing. the question is where? that's the key. >> you know where. >> i know. [ laughter ] >> let's talk about hiring for a second because i don't think we addressed this that much this is a silicon carbide hub, right? this is not easy stuff

you need all different types of technical skills are you struggling to find the staff? >> it's tough to find staff and we're hiring a lot across in order to rafrm up that facility. so when you think about it, there are challenges we love challenges those are just problems we need to solve we partner with the local community and we partner with the veterans affairs we train, we're onboard and we employ and that's what we need to do when we leverage this community and when we started our next building just next door to our first site. >> last question because it is so topical and it's the chips act. five years, right? you're spreading that money and yesterday global wafers were the latest company you have a list of companies promising to spend billions of dollars in the united states so for a company like onsemi, what does that mean for you? are you thinking this will not move the needle too much we'll just about about our business >> look, everything will move the needle and everything was historic i had the pleasure of

participate in it, and i will never forget it, but you have to differentiate between the companies out there is we're already doing it we didn't wait we're doing it what this will do is it will continue to do it and that's where i differentiate between on semi, and i have plans in the ground i have plans that are hiring people i have plans that are outputting that's what we do at onsemi and i will continue to do it >> i love that throw out those powerpoints. thank you very much, hassan. tyler, back over to you. >> up next, the freight and shipping industry showing signs of strength amid macro economic fears. we'll discuss that and more next as we await toatrney general merrick garland who will be speaking soon.

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medicare supplement plans also let you see any doctor. any specialist. anywhere in the u.s. who accepts medicare patients. take charge of your health care today. consider adding this. call unitedhealthcare today about an aarp medicare supplement plan. >> welcome back, everybody, to "power lunch." the dow transports index higher today and up about 15% over the past month the latest sector data telling us a lot about the state of the economy, and frank holland is here with a look at the risk of a freight recession. mr. holland? >> hi there, tyler

it doesn't look like we're in any danger of a freight recession right now because trucking stocks are simply outperforming today on better than expected ppi and yesterday on better than expected cpi. take a look here they boomed despite recession concerns and despite a shift from goods to services these are stocks that we haven't talked about a lot this is the company that bought ups' freight business up a quarter to date. j.b. hunt, a big player at the west coast ports up more than 20%. freight and more retailers and customers are moving their retailers to the contract market with higher-paying deals and on the way for the market earlier on the way to 2022 a lot of concerns with the freight recession because spot rates were falling and guess what? they're still down and they remain double pre-pandemic rates and fuel surcharges have contributed to major trucking revenues and we've talked about

"p "power lunch" before, a bit of arbitrage there. looking for insight into the freight market and the e-commerce market, check out the peak surcharges for customers. they started on labor day, a month later, they nearly doubled to $655 a package and freight demand is increasing and e-commerce is spending the biggest year over year increase in july, outpacing january right over here, i might be blocking it and january is boosted by returns and continued holiday spending and e-commerce requires three times the inventory and warehousing space. what you're seeing here is a big tailwind for the transports. >> go ahead. i would point out, this is a huge development it was one of the most worrisome signs for the economy and the the market and this is a very important turnaround >> the thing is that there was some misperception about the stock market

it is a big part of the transports and a big partof trucking, but traditionally, historically and people went to the spot market to get relief and to get more capacity and now it's shifting back to the norm >> three bucks up to six bucks a package in surcharge on fedex on everything i send through fedex? >> that's the second tier. the first one is $3.45, not you, though big retail customers >> the walmarts -- >> exactly >> best buys. >> ups and fedex has similar things in place. ups calls it better, not bigger. better revenue quality and so the ideais that they don't wan to take every package. they want to take the best packages and the higher margin packages and one with the surcharges. >> big numbers >> thank you very much, frank holland. we want to get you caught up on some of these moves in the stock market the nasdaq turned negative, and the s&p is biarely hanging on te

gains and bob pisani is at the new york stock exchange. >> we are fading going into the close and remember, we've had an enormous rally, 15% since the bottom on june 16th. i want to show you what's going on and we had positive stocks and consumer discretionary and that's now reversed and they're now down and those were big market leaders energy which was flattish at the open as we see oil moving into the low 90s. retail has held up fairly well, though let me show you a couple of other things that are moving rid now. a couple of consumer names are continuing to hold up. it's not just tech stocks. tapestry's been moving, nike, best buy, and even reits have been doing well and simon properties are doing well and metal stocks that have been struggling in a couple of weeks prior to now, and freeport mcmorran and the biggest copper producer in the world and i want to show you how broad the rally

has become and the technologies and i've been talking about cathie woods arc innovation and it is above the recent 52-week low and that was in the middle of june and more than that, small caps, russell 2000 and different group entirely and also 20% above the 52-week low frank was talking about dow stocks and trucking stocks, it, too, was 20% off of the lows it hit mid-june some sectors that had a rough time in april, may and june have bounced back nicely. consumer discretionary which is retailers and homebuilders and automotive companies in addition to tesla also bouncing nicely and technology, of course, that's a big participant and even bank stocks with a completely different area about 20% off of the high. the bottom line, kelly, the rally is broadening out. >> thank you very much, bob pisani let's turn to the oil market which is the center of a lot of when we've been talking about.

we're seeing gains as a result, pippa stephens, as a result of the bullishness in the stock market and we don't like it when it extends here and it spoils the better inflation that everyone else is discussing. >> on the national average where it fell below $4 we are seeing oil prices on the move with brent trading back above $100 we did get new data from the international energy agency which now expects demand growth of 2.1 million barrels per day this year. that is higher than prior estimates and much of that is because of soaring oil used for power generation and gas to oil switching. this, of course, as european natural gas futures stay above 200 euros per megawatt hour. a reminder that that's roughly per btu and power prices in france and germany hitting records and now france is no longer europe's top power exporter amid issues with the

country's nuclear fleet. had the's check on prices and at 9436 brent crude right around 9960 and natural gas, kelly, surging another 9.5% >> yikes thank you very much, pippa stephens, i think. coming up, are the companies beating expectations worth buying into now in we will discuss thathe wn three stock lunch comes your way next.

welcome back, everybody. it's time for our three-stock lunch. today we're toasting to the champions of earnings season we are highlighting stocks that are bucking the trend and boosting their profit margins by five percentage points from the same time last year. the list including expedia, occidental and midcore great to see you, quint. let's start with expedia. >> yeah, expedia is a tough one because this is a stock that i would traditionally really get behind from a fundamental perspective. the stock is cheap, selling 11 times forward earnings and now they're set to grow those by 35%. they have a tailwind in the travel and leisure area that i like quite a bit

the problem that i have with the name that keeps it off my list is the balance sheet the stock has a debt-to-equity arab ratio of 4-1 if you're in the name, enjoy the ride, but i think you need to be very careful we would be a seller of strength in this. >> let's talk about oxy petr petroleum. this stock felt to me like a walking dead but it has been anything but do you think it can keep it up >> well, this is also a difficult one for me because i'm going to go against warren buffett and say oxy is a sell. this is very difficult for me because i definitely would follow his lead in most names. but the reality here, tyler, is this name is just not that attractive if you can look at it once over, you'd say this stock is cheap,

it's got a current multiple of six. but they're set to see a decline in earnings next year and ultimately their balance sheet is not that great. you're not getting paid that much most of these stocks have a healthy dividend for example, chevron, great balance sheet. this is less than 1% so i think that if you like the oil theme and you think that there's upside in petroleum that many analysts do, i think there's better names out there so occidental is a sell for me as well. >> well, let's move on and see if our last name here can get you in a different kind of mood. let's see, it's nucor, the steel maker. quint, what do you do with it? >> okay, this checks all the boxes for me this one is cheap, selling six times earnings, significantly improved balance sheet we had a pretty severe commodity sell-off over the last couple of weeks. those are now rebounding

the stock is up 45% from the july lows. so i'm not so sure you run out and chase this name here at all. but i think that this is a theme that's continuing. and again, the fundamentals here are very attractive. the technical setup is strong. so this one is a buy on all metrics for us, but i would wait for a little pullback, which i suspect happens in the coming weeks and you pick it up on weakness. >> quint, thanks so much good to have you here today. quint tatro. head to cnbc.com/pro for more stk ck up next, trends in back-to-school spending. oh, my goodness. we'll be right back. ne o no interest, the fees... it was just take, take, take. so i broke up with bad banking and moved to sofi checking and savings. now i get higher interest, pay no account fees, and get my paycheck two days early. break up with bad banking. get 1.80% interest, pay no account fees, and get your paycheck up to two days early. download the sofi app and earn up to $300

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rated the number one hiring site. try it for free at ziprecruiter.com welcome back to "power lunch. that time of year again, yes, back to school dom chu is here with a look at how spending is stacking up, hey, dom. >> it's thematically the same as we've said before about a lot of the spending picture the thing we want to keep an eye on is whether it's getting back towards pre-pandemic levels. the data that we have is courtesy of bank of america institute. they got a lot of insights in addition to being one of the biggest banks in america they can see spending patterns with respect to credit card spend, debit card spend, that kind of thing. they have taken a look at spending for back-to-school season from june through the summer the blue line is pre-pandemic in 2019 the orange line maybe not surprisingly is 2021, last year

for school and the green line, that's the one that's interesting here. what it shows is that this year, spending is on a pace to eclipse what we saw pre-pandemic there could be a number of reasons for that, say bank of america says it could be fears of inflation or supply chain issues where people are trying to find deals and spending money when they can. so people are spending more in the early months to get the stuff that they need, backpacks, binders, if people even use those sorts of things anymore, and look at that compared to years past one of the things they're also pointing to is the number of tax holidays that we often see this time of year many states, including my home state of connecticut right now, have tax holidays during the summer so that people can go and buy certain goods, clothing, accessories, consumer electronics, that sort of thing, without having to pay tax on them right now the earliest and longest of all of those states is florida it went from july 25th all the

way to august 7th. but right now in addition to all the other states who have concluded their tax holidays, you've still got illinois, massachusetts, maryland and connecticut that are either ongoing or have sales tax holidays for sure. most common exempt items are clothing, footwear, supplies and computers. so this could be that big catalyst for spending. back-to-schoole is a call to action the whole point is what's interesting here in addition to the normalization of school efforts, right, you also have this idea that maybe the spending picture gets a little more muddied because people are paying more for things because of inflation we've been talking so much about supply chain issues. if you can find it, just take it, right? just get it right now. but the caveat there, guys, is that that might lead to that draw forward effect. people have spent all their money in june and july getting all this stuff. >> and not that it's a new

phenomenon but i have to think back-to-school is more expensive on its face because it's not just binders and notebooks, it's laptops and chromebooks. >> how many of those were bought, though, two years ago already? >> a lot a lot. dom, thanks. >> you got it, guys. >> thank you, everybody, for watching "power lunch. >> "closing bell" starts right now. another cooler than expected inflation print helping boost sentiment today but stocks have come well off their highs, currently sitting near the lows of the day welcome, everyone, to "closing bell." i'm sara eisen the s&p 500 is actually little changed. you have tech underperforming, reversing that earlier rally we saw. you also have some notable strength in groups like energy, financials, materials, industrials and utilities. communication services also barely higher at this hour thanks to disney and some of the other media names rallying like warner discovery, cox