show, d.l.o., d local is the name, carson block shorting it we reached out to the company for comment because he was alleging all kinds of stuff. we have not heard back as far as i know from dlo, dlocal. they are based in uruguay. so again, if and when they do give us a statement, we'll bring it to you. stock down 25% we'll see you tomorrow "power lunch" starts right now brian, thank you very much and welcome, everybody, to "power lunch." i'm tyler mathisen and here's what's ahead. we're going to look at the state of the consumer this hour. october retail sales were strong across the board the ceo of lowe's says he's not seeing a discretionary spending slowdown, not at all but target warns of a soft holiday quarter. this hour a deep dive into the american shopper meantime, shifting gears, advanced auto parts misses earnings expectations and says the outlook isn't much better either the the ceo will be here to talk

about the severity of the decline and whether an uncertain economy is to blame. morgan >> tyler, we're hearing more and more of that here's where the major indexes do stand at this hour. everything is lower. the dow is down about .2 of 1% 58 points right now. the s&p is 3958. it is down about 1/8 of 1% and the nasdaq is the big underperformer, down 1.5%. home builders are lower after sentiment in the seng'll flooem housing market fell to the lowest level in a decade builders are up against higher labor and material costs and also lower demand from buyers. and a few stocks that are hitting 52-week highs this afternoon, aflac and tjx which topped profit estimates and raise the its annual same-store sales forecast it's been a mixed picture for the retailers. >> thanks, morgan. that's where we begin, with the rather confusing state of the consumer as shoppers face decades-high inflation and a softening economy.

october's retail sales showing resilience, rising slightly more than expected. climbing 1.3% from the previous month. so that's good now, some of that spending went to lowe's, where the ceo says there are no signs of a consumer pullback estimates raising full-year guiding earnings forecast, everything looking good at lowe's looking up at lowe's but target, not so good. 50% profit drop. and they warned about the fourth quarter at target. we have full team coverage of the consumer, which powers about 70% of the economy steve liesman, diana olick, melissa repko. let's start with steve on those retail sales numbers take it away, sir. >> tyler, do you remember that consumer who was supposed to be suffering from higher interest rates, inflation, depleted savings from the pandemic and should by now be cutting their spending forget all about that. we had today absolutely stunning retail sales numbers, showing

spending not only higher than expected this month but upward revisions higher in the prior month as well. retail sales up 1.3 vs. an estimate of 1.2. that's not the big beat. look at the beat when you take out autos, 1.3 vs. 0.6 and the core retail sales number that's a huge beat because that 0.7 number feeds into gdp and causes people to revise higher their fourth quarter estimates you can see there the revision september upward as well looking at the details pretty much across the board, only a few negatives. autos we expected. gas station up 4.1 that's really interesting because consumers did all this spending while they spent more at the gas station non-store retailers up 1.2 that might have been helped by another amazon prime day furniture stores up too. diana olick's been saying that maybe the story here is people remodeling their homes, not buying new ones. one negative there, or one of the negatives, electronic appliances down. the consumer slowdown, who knows? maybe it's going to come next

month or the month after that. but forecasters still don't get why it hasn't happened yet and it raises the question if it's going to happen at all, tyler. >> thank you very much, steve. >> well, let's now get to diana and lowe's, which said that a slowing housing market isn't hurting its bottom line. diana. >> yeah, morgan, and the reason for that was a surprising willingness by consumers to spend even more on home improvement. it mirrored what home depot's cfo richard mcfail said yesterday. he he called it an improve in place mentality. and this morning lowe's ceo marvin ellison listed the three drivers behind it. first, massive amounts of home equity among current homeowners that they can use it to pay for all the remodeling the unprecedented run-up in home prices during the first years of the pan democratic, up over 40% in just two years, gave homeowners a collective $11 trillion in so-called tapable equity by the start of this year according to blockmate that's how much you can pull out

and. the age of the u.s. housing stock, about 40 years old, which is the oldest since world war ii and finally, high levels of personal disposable income it all drove housing remodeling. back to you. >> thank you very much, diana. and to target now, the outlier, which saw its shoppers retreat melissa repko, is this a matter of target misreading the customer or is it a matter of target being a leading indicator potentially of what's to come? what do you say? >> hi, tyler yes, a lot of target's troubles actually come down to its merchandise mix. a lot of what target sells is discretionary merchandise. and it's seeing a pullback particularly it was talking about how in the final weeks of october and into early november it's been seeing a slowdown. this may not be showing up yet in the numbers that steve referred to. those retail sales numbers it may just be the start of that pullback and target is known for sailing lot of items all across the board, in home and apparel only 20% of what it sells is

grocery vs. walmart, which reported well and did well it's a very big different percentage because with walmart about 56% of its overall annual revenue comes from grocery so a lot of those target runs that people think of when they think of that retailer are browsing the star and getting a lot of impulse buys. knows become the tougher sell in an environment where consumers are thinking more about sticking to the budget, buying what they need, not what they want >> you know, i'm going to kick off the cross-examination here morgan and i are going to jump in in just a minute. but steve, i'm going to start with you because i'm wondering where this burst of seeming confidence is coming from. is this potential liv a last hurrah for the american consumer, number one number two, is it that buyers are going out there and thinking well, i'm going to buy now before the prices go much higher i'm going to get it now because it may be 10% more in two months where's the confidence coming from

what's the explanation >> it could be that. that idea of buy now because things are going to be more expensive. tyler, could i just semantically correct your question? >> of course you can >> which is confidence itself, the confidence measures are bad. they're negative they're down and that makes it -- all the spending even more extraordinary. we think there's this connection between consumers lacking confidence or being not confident in the economy and yet they're spending as well >> they're spending like crazy whether they're confident or not. that's why i'm so suspect of polls. but be that as it may. go ahead >> one of the things that i think is worth noting, and maybe we haven't made enough of this i've tried to make a lot of this a lot of folks are employed. 3.7% unemployment. up .2 but still historically low. we focused on these polls and these surveys that show consumers are angry and upset and disappointed with the inflation numbers at the same time they have jobs.

and i don't know, tyler, but to me nothing drives spending like having a job and a paycheck. >> hmm i mean, it's a key point here, too, that part of what is fueling this spending is the fact that things are costing more and people are just having to pay more out of pocket, though right? and you're seeing that in some of the debt. the credit card debt numbers and those metrics are starting to come out as well melissa, i want to go back to you and just ask, if you look under the hood across the different retailers that have reported so far this week, there are these signs that higher inflation is having an impact, albeit maybe differently at different stores >> exactly, morgan walmart said yesterday that it's really getting its sales growth from the necessities, from grocery, not from diskregsry so in many ways walmart and target were consistent in saying hey, people are thinking twice before they buy things and the other dynamic they spoke about is that people are really waiting for the sale they're expecting the bargain. they're waiting for the bargain. and they're not going to buy

that full price item like they did a year ago so that's a very different dynamic going into the holidays and it is going to weigh on all retailers' profits >> dinah, if you had said to me ten days ago given where home builder sentiment is, given where housing is, that two of the leading retailers coming into this season right now would be lowe's and home depot, i would have thought you were crazy. >> yeah, so would i, tyler but it just came out this way because what we're seeing is again it's the stay-at-home mentality but it's also part of the getting back to normal mentality as well. if you looked at home depot, they saw a surprising amount of spending on halloween items. and i don't know about you but my neighborhood was completely on steroids this year. it's people wanting to get out again and be normal again. but beyond that, i asked the cfo of home depot yesterday, i said what about home flipping is down and a lot of general remodeling happens when people buy homes. it's a driver of home remodeling you buy the new house, you want to make it your own, you change the fixtures he said he wasn't seeing that at all in the numbers

he was seeing it more of just people staying in place because as we keep saying, tyler why would you trade a 2.7% mortgage rapt for a 7% rate and move to another house when you can stay in your house, use your home equity and remodel it? >> so i'm going to bring this back to the fed, steve, especially since mary daly, san francisco fed president, was on cnbc earlier and this came up in that conversation. >> yeah. the fed definitely wants to see things slowing, wants to see the consumer slowing i would make one point, morgan, very quickly, which is it could be inflation is driving consumers to buy but the numbers today, remember you had relatively tamer -- or tame october inflation so there were real or after inflation spending increases in these numbers. i think the fed could look at it two ways one is that they need to do more to tamp down demand in this economy. or two is that what they've done has not really created the

negative effects that they thought and they might be okay here and not -- and end up with a soft landing i think we can dream, can't we >> we can dream for sure okay thank you all to our all-star panel. >> pleasure. >> so how important is the consumer to the state of the market rally can they keep the economy afloat as the fed hikes rates let's bring in mike bailey, director of research with fbb capital partners mike, in terms of the soft landing, are you dreaming? >> no. i think there's certainly a chance of it i think right now investors are getting a taste of what a soft landing might feel like. interest rates are kind of moving sky high. despite that we're seeing massive, you know, growth out there. companies like lowe's, companies like home depot, et cetera they're feeling pretty good. the comment before about buying tons of halloween goods. if we're in the middle of a recession, are people going to dump their wallets out and buy halloween goods? that seems a little bit unusual. so i think we're getting a little bit of a taste of it.

i do think going a bit longer term there's going to be some more volatility. probably more rate hikes ahead probably a real recession. company earnings may start to take a bigger hit. so you can see a bit more volatility before things balance out. in the short term this feels pretty good in terms of investors watching companies do okay at this point in the cycle. >> so if you expect more volatility, what do you do right now? do you sit on the sidelines and sit on your hands and wait through it do you position yourself defensively? do you do something else >> we believe in time in the market if you want to try to be tactical and get in and get out quickly, you've got to make two good decisions that's tough for most people so we want to stk with the market we are generally going a bit more defensive we've been adding to staples, utilities, companies like that, starting to just tiptoe a little bit to some growthier companies, e-commerce, et cetera, starting to look interesting. i think we're not quite ready for the full-blown capitulation,

go complete risk on, not there quite yet. we'd like to see a little bit more pain frankly on earnings. i think that could drive a tipping point a little next spring but for the moment you do want to stay fully invested plenty of great companies out there whether it's a safe staple or even move up the risk ladder a little bit go with something like a lowe's or home depot. >> we had a day last week i think it was thursday where the markets just went crazy and it made the argument that if you try and get in and out of the market you're going to miss the best days and really handicap your return. i'm with you on the idea of staying fully invested you say earnings are likely in the early innings of a big move down how can stock prices move up if earnings are moving down >> it is a bit counterintuitive. what we focus on is history and what has happened in past cycles when things are looking terrible, there's a recession coming, earnings are blowing up. if you go back and look at some of those, interestingly, once earnings are really only halfway

through the pain stocks actually start to come back that is something we're looking through. one scenario we're kind of envisioning. if you anticipate there's a recession coming, things are ugly, let's say earnings are going to be down 20% peak to trough once you get halfway through that, there could be a very interesting buying opportunity >> you start looking over the next mountain, next hill and that's where the turn talks place. i know you have a couple of names i'd like to dance you through very quickly visa danaher and diageo. >> visa kind of an interesting inflation hedge. if inflation stays high. visa prices things in, nominal dollars. that's good for the company. if inflation goes low they can operate there. danaher, pretty compelling health care company. they're getting rid of the non-health care business they're going to bring in some more cash, more deals. stock trading at a discount. diageo, pretty interesting kind of safe defensive company. there is in long-term shift toward premium spirits

that's something you can own that growth rate and oh, by the way, it's trading at a iscount >> mike bailey, thank you very much he with appreciate your time today. >> thank you >> thank you all right. coming up, rypto's crisis of confidence the ceo of the crypto payment firm strike here to discuss the ftx fallout and what comes next as more firms pause their withdrawals. plus advanced auto parts on pace for its worst day since 2017 the ceo is here to discuss the company's disappointing quarter. downbeat guidance and how it's managing rising costs. when somebody comes out on a day like this, i give them props tom greco will be here of advance auto parts as we head to a break let's look at shares of restaurant brands highest level since september 2021 the company tapping former domino's ceo patrick doyle as executive chairman we'll be right back. which saved investors over $1.5 billion last year.

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bitcoin prices remain somewhat stable relative to how volatile this asset class can be so how does the industry regain the trust of investors let's ask someone on the inside. jack mauer's the ceo of strike great to have you on the show. the first thing i want to do is i do want to get your response to this ftx fallout and also whether strike in any form or fashion or yourself personally have any exposure to what we're seeing play out. >> no.

strike, myself, and bitcoin at large has nothing to do with sbf and ftx. i mean, it's nothing other than absolutely disgusting and malicious crime in the same way that someone can go hijack a car down the street from my house. that has nothing to do with bitcoin either unfortunately, it's just an extreme level of criminal activity, crime and fraud. however, the world is finally starting to realize that there's bitcoin and there's everything else the way i like to describe the crypto industry and blockchain is it's an arbitrage on the trend. bitcoin -- humanity really found its stride in inventing bitcoin. money's the most valuable market good we have in any market it's nucleus to a functioning society. and we made and engineered the best version of it and the fact that there are other cryptos that have been able to come along and take advantage of the pure desire and need for an invention and technological breakthrough like bitcoin and be able to sell

things like orange coin and pink sxoin ftx coin which are just vehicles to arbitrage this trend and commit violent levels of crime, it's sad and it's disgusting it's got to stop so it has nothing to do with bit koip if anything it should be a very expensive and painful lesson that there's bitcoin and there's everything else. the last thing i'll say is it doesn't shock me at all that ftx actually owned zero bitcoin. because if you want to commit fraud, if you want to commit crime, if you want to upsell and wash trade pictures of monkeys you don't use bitcoin. this is a well-engineered, freedom-fighting tool for our species and there's everything else it's got to stop so the arbitrage on this trend has been margin called and it's over and now people can see the difference between what is a well-engineered tool for humanity and what is ftx counterfeit coin >> you have strong opinions on this and i get that. and certainly many other bitcoin enthusiasts such as yourself have said very similar things on our programming over the past

week plus since we've seen the implosion of ftx i want to get into that because it sort of speaks to defi vs. centralized. but first the fact that you are seeing some contagion, at least in the broader cryptocurrency space right now, it's clearly a coming that's under way. you could argue it started before ftx it's continuing now. does it set back broader adoption of something like bitcoin because it's considered, for better or worse, part of this broader industry? >> sure. i mean, you could think of it two ways they had to get washed out, right? you had a criminal running rampant. they had to get caught so better catch them today than tomorrow so in that way we're making progress actual real value that's pushing humanity forward is being realized and those that were faking it are getting in trouble. that's a good thing. but no, i've always said the biggest cost to the arbitrage on the trend outside of the very obvious, and i don't want to dilute this, is just innocent people losing money, which is

absolutely terrible and awful. and they should not have been allowed to be subjected to that. but that aside is the cost of just human capital >> so you're saying unequivocally fried is a crook >> i don't -- i'm not sitting next to my lawyer. i don't know what claims i'm allowed to make. but you tell me, tyler what do you think? >> that's not for me to say. i'm the questioner here. >> i think the guy created funny money out of thin air, potentially washed it, borrowed against it with customer funds and lost it all. that's not legal >> okay, cool. well, not cool but you know what i'm saying thank you for your answer. >> sure. >> freedom-fighting tool for our species. that's highfalutin rhetoric. why do you say that? >> bitcoin gives everybody in the world property rights secured by mathematics i mean, bitcoin is the first monetary asset that we've been able to engineer with no natural issuer bitcoin has no liability relationship with anyone else. it is a guaranteed fixed protected monetary policy and

instrument in order to function, any sort of scalable trade which has underpinned society, i grow bananas, you sell apples, tyler, we've got to find a way to exchange money is the nucleus of functioning human society. we've been able to break through in computer science and engineer the best version of that that is accessible to everyone and equitable for everyone no one has an advantage. there's no issuer. even sa toesh yif nakamono had to use energy to get his or her first bitcoins huge deal. huge advancement >> what does regulation now do to bitcoin given the fact there is now a bigger risk of a broader brush-stroke used by regulators given everything we're seeing play out in other areas of cryptocurrency? >> yeah, my take is either the s.e.c. or an agency like it has to stop existing and admit to the free market it's your responsibility but if they're going to say that we will help protect you they need to do that. and almost all of if not every single one of these assets that

isn't bitcoin is a security. it's very obvious. all these assets like ethereum were issued by a central party and sold i mean, guys like it's not rocket science that's not bitcoin there's the howie test and they have to start protecting investors and protecting the people and regulating the exchanges that list these things you cannot have flip-adoo backflip coin sitting next to tesla stock accessible to retail investors in the united states of america that's a fail. so you should either not exist at all or you need to properly regulate according to the law and the rules. but yeah, right now you can go on an app and you can see doge doggie coin and you can see tesla stock. that's not a good thing. >> so if bitcoin should not be regulated like a security but every other cryptocurrency should, what does the future of bitcoin look like? >> the future of bitcoin has no real relationship with regulation i think -- the s.e.c.'s come out and said bitcoin is very clearly

not a security it's absolutely decentralized. it has no actual issuer. you cannot stronghold and change ethereum went to proof of stake. they shot shot the industry in the knee all ethereum miners are gone, see you, don't care about you, no longer, out of nowhere. that's not how bitcoin works so i think with proper regulation and oversight institutional capital should theoretically have a huge interest in this asset because of the properties it retains and regulatory clarity is going to help bitcoin immensely but i don't think it relies on it it doesn't really matter what -- regulation is to protect and give proper disclosures to investors on how these things actually work. do you think anyone would have actually bought ftt token if there was a disclosure on what bankman-fraud was doing this whole time no so they protect and give disclosure forz securities bitcoin's not a security you don't have to disclose anything read the white paper there. boom you know everything you need to know i think it's going to help

enhance and help grow the speed of adoption. but i don't think it really matters too much it's more so the arbitrage on the trend. these tokens have nothing to do with bitcoin they don't share in any of the innovation and the one that's faster, it's better, it's good with kids, what are we talking about you don't think the best engineers in the world thought to make it faster? would you get in an airplane i engineered yesterday that's faster than a boeing probably not i don't know it's ridiculous. i'm frustrated clearly it's just a waste of my time i wish i was building tools for people all over the world to help their financial experience instead of having to explain that sam bankman-fried and his ftt token has nothing to do with proper innovation and pushing our species forward. it's just -- it's an unfortunate waste of human capital >> jack mallers, thank you for joining us >> you got it. >> i have a feeling that interview is going to live long on cnbc.com. >> probably.

for more on the crypto fallout from ftx, though, tomorrow on "squawk box" be sure to catch binance's ceo, c.z arguably the actor that started the domino collapse. that starts at 7:00 a.m. eastern tomorrow don't miss it. >> all right you want the moon, morgan? well, you just can't throw a lasso around it. so nasa threw a few billion at it instead the agency successfully launching its artemis 1 mission -- >> that's art right there. >> that is art >> nas a masterpiece >> good-looking right there. i tell you multiple failed attempts, but this one, we'll see. meanwhile, around 230,000 miles lower but still in the skies, airlines expecting a massive travel surge this holiday season those details when "power lunch" continues. right here

welcome back to "power lunch. i'm brian sullivan here's what's happening at this hour 22 los angeles county sheriff's recruits were struck by an suv while out on a training run. five are in critical condition officials say the vehicle veered across the road into oncoming traffic and hit the recruits police identified the driver as a 22-year-old man from a nearby suburb, but his name is being

withheld novak djokovic will not be facing covid vaccination issues at next year's australian open the tennis star's been granted a visa to attend tournament. he missed this year's event because he was not vaccinated and was barred from enterpg the country until, get this, 2025. the australian government later reversed that decision and a third-year medical student having the experience of a lifetime david gibbs was on duty on his ob-gyn rotation when in walked a patient. his pregnant wife. she went into labor five days early. he got the call to deliver his own daughter that is adeline greeting the world. mother kelly called the entire day perfect. delivering your own daughter, happy and healthy. i'd say that's pretty perfect. >> that is a special delivery. >> that's a good story right there. thank you, brian all right. ahead on "power lunch" -- in need of replacement parts? i know i could use a few advance auto parts sinking, missing earnings big reversal from its strength

amid the record used car market. the ceo will join us next. plus, another name in the red, carnival cruise capitalizing on its recent performance by offering $1 billion in convertible debt. we're going to trade that name in three-stock lunch wow, we're crunching tons of polygons here! 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 back when i had a working circulatory system, you had to give your right arm to find great talent. but with upwork, there's highly skilled talent from all over the globe right at your fingertips. it's where businesses meet great remote talent and remote talent meets great opportunity.

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well, we've got less than 90 minutes left in the trading day and we want to get you caught up on the markets, the stocks, the bonds, the commodities and everything else. plus we'll talk to the ceo of advance auto parts as that stock falls 16% today. let's begin with a check on the markets. stocks lower but the dow down just fractionally. nasdaq the worst performer there. there you see it the dow off about .1 of 1% the s&p 500 down about 3/4, a little more than that, 4/5 of 1% and nasdaq down 1 1/2% the st. louis fed governor christopher waller speaking right now. let's get to steve liesman with some headlines on the fed's waller steve. >> yeah. federal reserve governor christopher waller saying he's comfortable considering a 50 basis point hike in december which he says is still, quote, a very significant tightening action but he sounds pretty hawkish when he says stuff like this he says it's possible the fed

does, quote, several 50 basis point increases and he expects, quote, increases in the federal funds rate into next year. note the plural there. and he he goes on to say "we still have a ways to go. economic growth slowed, he says, significantly in 2022. he says slowing growth is necessary to bring inflation down, and he sees tentative signs of a cooling in the labor market including moderation in wage growth. finally-e said that the recent cpi report was a significant moderation but he's not ready to take that too far. he says you can't read too much into one report. the fed governor tilting on the hawkish side, tyler. back to you. >> thank you very much, steve. let's turn to rick santelli for instant reaction to what you just heard from steve and fed governor waller. >> well, it's interesting because data dependent would imply that you want to wait and see how the data points look, see how the next cpi looks but to be picking these numbers for december, saying you're going to tighten half a percent, maybe two, to me seems awfully

aggressive considering the data may turn sour. especially on a day like today and i'll tell you why in a moment hey, 20-year bond auction. i gave it an a-minus they couldn't get enough of them look at a two-year and pay particularly close attention 8:30 eastern that's when basically we made the high we had a good r today. the r, retail sales was good but it marked the high yield instead of marching higher, which it would normally do if it was strong, and it all has to do with mr. waller and the federal reserve. look at a 10-year. very similar except one difference. yes, it spiked, but it kept moving lower as a matter of fact, if you put a two-day of 10s, you'll see why it sped up because it started trending under yesterday's 2 3/4% low which means we're on pace for a fresh six-week low yield close as evident by the october 1st chart. but here's why it gets interesting. the r for retail sales is meshing with the r investors are

thinking about today so you can talk about strong retail sales you can talk about the strong labor market but here's what investors are talking about today. that 2s to 10s is now the most inverted in four decades since 1982 at minus 66 basis points and it doesn't end there the real recession spread, three months to tens, is at minus 52 that's the most inverted in 15 1/2 years so no matter what the fed is going to ultimately do, if their goal is to slow the economy, investors are trading as though they're already quite successful tyler, back to you >> all right rick santelli, thanks for that instant analysis and the description of a yield curve that is as negative as it's been in decades oil closing for the day down nearly 2%. pippa stevens is at the commodities desk with the details. hi, pippa. >> hey, tyler. it is red across the board today in energy markets with chinese demand fears still hitting prices but a bullish inventory report is limiting the down side.

u.s. stockpiles decreased by 5.4 million barrels last week against estimates of a 1.25 million barrel draw. now, distillate stockpiles, which includes diesel and heating oil, did rise last week. but inventory is still 15% below the five-year average and the iea warning this week about that tight diesel markets ahead of the february 5th deadline when the eu ban on russian products will go into effect. the paris-based agency saying competition for non-russian diesel barrels will be fierce. let's check on prices. wti down 1 1/3% at 85.76 with brent crude down 1% right around $93. and energy stocks are the worst performers today, with nat gas names eqt and cotera leading those declines tyler? >> pippa, thanks very much let's move on now to advance auto parts the stock the biggest laggard on the s&p. on pace for its worst day since 2017 after it missed earnings

estimates and lowered its full-year outlook. the company blaming higher expenses and currency headwinds. here for a "power lunch" exclusive tom greco, president and ceo of advanced auto parts mr. greco, welcome good to have you with us and we thank you very much for coming on on what is a tough day. it's easy to come on and talk when you've got puppy dogs and rose petals to throw around. not that we want to throw around any puppy dogs but the truth of the matter is it's tough to come on on a tough day. we appreciate it you said yourself that you are disappointed in your company's relative performance to your peers and that you're going to take measured steps to improve it, sales and performance. what are those steps and how fast will they gain traction >> well, first of all, thanks for having me on, tyler. this was adifficult day for th company, but i appreciate you giving us the opportunity to talk about it. we outlined our strategy about a year and a half ago to drive total shareholder return in that discussion with our

investors in april 2021 we said there were three key elements to the plan -- growing sales, expanding margins and returning excess cash back to our shareholders. and we had a terrific year in 2021 we were able to accomplish all three of those goals we finished in the top quartile. up until this quarter we had nine consecutive quarters of sales growth and margin expansion. so we're very pleased that we had a strong year last year. and our strategy hasn't changed. we entered this year with the same plan. we're going to finish the year with expanded margins. we're one of the very few retailers to accomplish that this year. we're going to return close to $900 million back to our shareholders but we're very disappointed in our relative top line performance, as you indicated. and that's what we're talking action on right now to address as we head into 2023 >> so what are some of those measured deliberate actions you referred to in your statement? what kinds of things are you going to do?

what can a shareholder, a customer grab on to today? >> sure. well, the big analysis that we did over the last several months to assess the underperformance was really rooted in inventory availability, which is so important for our business you've got to have the right part in the right place at the right time and we've been executing a strategy over the past several years to migrate our portfolio to own brands which carry a much higher margin rate than national brands and they're a differentiator for us. unfortunately, we had a couple of big categories that we have executed against where we haven't been able to get our on-hand rates to where they need to be. so we're making a big investment in the fourth quarter in inventory to shore that up and we've worked very collaboratively with our suppliers. these are suppliers that have -- literally all over the world that have helped us get this off the ground and they're very optimistic, as are we, that the actions we're taking will result in accelerated growth next year in

2023 >> ubs this morning downgraded your stock and says that it's losing share, looking at the comp it says given the the impact of inflation unit losses are much steeper suggesting it is losing customers at a rapid pace. this will be hard to reverse your reaction. >> we don't really see losing customers as the biggest issue right now, morgan. it's really about our average sales per customer usually, when an auto parts provider sells to a professional installer, they always choose from a number of different suppliers. so our opportunity is to make sure we drive more share of wallet really with our professional installers. it's less about losing customers. >> okay. tom greco, thanks for joining us >> thank you coming up, nasa successfully launching its massive moon rocket after three previous failed attempts, billions of dollars, more than i adecade's worth of work. we're going to discuss why they took this moonshot next.

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welcome back to "power

lunch. after three previous attempts, at 1:47 eastern time this morning nasa's mega moon rocket blasted off from kennedy space center >> three, two, one -- boosters and ignition. and lift-off of artemis 1. we rise together back to the moon and beyond. >> the historic launch ushering in a new era of american space exploration kicking off nasa's artemis program, 50 years after the final apollo moon landing. the uncrewed artemis 1 marks the debut of the agency's space launch system, the sls, which is now the most powerful rocket ever flown it launched the orion deep space capsule, which will now embark on a 25-day journey around the moon before splashing down in the pacific ocean. undergoing rigorous tests before astronauts climb on board, first in 2024. if all goes according to plan. and then again in 2025 to actually land on the lunar surface.

artemis is a major program for nasa, but it is also major for the space perspective. the agency's inspector general estimates $40 billion has been spent so far and that that will total $93 billion just to achief that 2025 landing. contractors include boeing, lockheed martin, northrop grumman, aerodyne jacobs, the will i goes on even spacex which just yesterday was awarded another lunar lander contract as part of artemis. even amazon and cisco have a lot riding on it >> one question. you said this is the most powerful rocket ever flown >> yes >> why do you need to fly the most powerful rocket ever flown on a space flight that is really comparatively a very short one >> so just to put it in perspective, saturn 5 which was the rocket that powered the apollo missions, 7.6 million pounds of thrust this one's 8.8 million pounds of

thrust it is about 16% more powerful. it's doing these moon missions over the coming years. but the ultimate goal here is to get to mars. >> and so this is sort of a test run of this powerful rocket. >> essentially it's a test run of the powerful rocket it's also the u.s. looking to go back to the moon, this time to stay on the moon, to colonize the moon, commercialize the moon and basically make potentially the moon a way staition, if you will, for further deep space exploration. >> fascinating stuff love to watch those things. >> so cool >> nothing like it >> i'm a little tired, though. i've been up since 1:00 a.m. >> watching. >> covering it >> oh, my gosh three storksz three s,hree movee trades three-stock lunch is back. we'll be right back. ff [announcer] and bret taylor! you excited to be here? this is going to be huge. [michael] i want my daughter to have a livable world.

[marquita] i just try to keep a [marquita] growth mindset. and the sky's the limit. [manish] you are capable [manish] of anything. [manish] the only limitation is [manish] in your mind. ooh, i hope you all are getting this.

not talking about the huge damage the other thing people don't realize, they closed down tell health they're not going to build as many warehouses an they're shutting down things like row w bottings to deliver things so i love the other stuff that's not getting the headlines on what they're cutting because we know a year from now, all these cuts, they're going to hit the bottom line in the form of more profits. so if you want to open a great company at an okay, reasonable price, here's your shot. >> what's okay and reasonable price when the forward pe's 86, lee? >> let's not get into that because amazon doesn't like to pay taxes. they're always going to take all these earnings they make and

reinvest into the future and i think that's hard for value investors to get our minds around at amazon >> thank you very much n. ha y up next, elon musk defends the payout that made him one of the richest men in the world more "power lunch," next

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delaware's business law court today over his 2018 tesla compensation package it was worth about $52 billion at the time. recent share price, irreconcilable i should say. a shareholder alleging musk has undue influence over the board musk arguing that he didn't dictate the terms of the compensation and was instead focused on running the company the world's wealthiest man also said he plans to name a new ceo of twitter to take his place he does have a full plate. >> he has a full plate i'd also just note in terms of the compensation packages we've seen from musk over the year, they've been somewhat outrageous and it really speaks to i think his ability to execute and operate at times when he puts his mind to it in different companies to do what a lot of

people think can't be done >> poetic justice. 52 billion with the payout what did he spend on twitter 44 billion a lot of that has been spent you could say. >> very good point >> all right morgan, good to be with you. >> great to be with you. >> thanks for watching "power lunch," everybody. what a busy day it's been. >> "closing bell" starts right now. stocks mostly lower here on wall street as investors weigh disappointing results from target against some upbeat economic data. welcome to "closing bell." take a look at where we stand right now. the dow's hanging on to a gain a little one s&p 500 down little more than half a percent three pogts of strength, utilities, consumer staples and healthcares. also seeing