cooling gradually, but it really is different it wasn't supposed to be possible for job openings to decline as much as they have with our unemployment going up well, that's what we have seen there's no promises in this, but it just seems to me that it's possible that we can continue to have a cool in the labor market without the big increases in unemployment that have gone with many prior episodes. that would be against history. i fully appreciate that. that would be against the pattern, but i think that the situation in the labor market with so much excess demand, yet wages are actually -- have been moving down. wage increases have been moving down that's a good sign, down to more sustainable levels i think it's still possible. >> you know, ithink the indicate of avoiding a rescission is, in my view more

like that than having a recession, but i don't rule it out, either. >> the committee also noted in march that wage growth was still well above could you explain that >> sure. we look at a range suwaij measures, so you assume wages should be equal to productivity increases plus inflation so you can look at, you know, the employment compensation index, average hourly earnings, the atlanta tracker, and many others, and you can look at what they would have to run at over a long period of time there's a

feature of long expansions, where it. >> i would say what they will show is that, you know, if the -- if wages are running at 5%, 3% is closer to where they need to be. >> by the way, i think wages and prices tend to move together it's very hard to say what is causing what i have never said that wages are really the principal driver, but i don't think that's really right. >> you mentioned profit margins.

those have expanded -- did expand sharply during this inflation period >> so do you see expanded profit margins, and if so, would you expect them to narrow soon and contribute to reduced inflation in the coming months >> higher profits and margins are what happen when you have an imbalance between supply and demand we've been in a situation in many parts of the economy where supply has been fixed or not flexible enough. so to get, i think, as goods, pipelines have gotten, you know back to normal, so that we don't have the long waits and

shortages, that kind of thing, i think you will see inflation come down and you'll see corporate imaginens coming down as a result of a return of full competition, where there's enough supply to meeting demand. >> can you tell us something about your policy reaction is, your policy framework is going forward? are you looking at incoming data, are you going to be forecasting what you think is going to happened? are you ruling out the rate cuts that the market has priced in?

>> viof course, the whole idea s we're always looking at both, and of course it will be the obvious things, readings on inflation, readings on wages, on economic growth, on the labor market, and all of those many things i think a particular focus for us now over the past six, seven weeks now, and going forward, is going to be what's happening with credit tightening or small and medium-sized embanks tightening credit standards, and is that having an effect on loans, on lending. you know, so we can begin to assess how that fits in with month tar policy that would be an important thing. we'll be looking at everything again, i would just point out, we have raised rates by five percentages points, we are shrinking the balance sheet and

now we have credit conditions tightening not just in the normal way, but perhaps a bit more to what's happened. we have to factor all of that in and make our assessment of, you know, whether our policy stance is sufficiently restrictive. we have to do that in a world where policy works with long and variable legs. this is challenging, but, you know, we will make our best assessment >> reporter: what about the idea of rate cuts >> yeah. so we on the committee have a view that inflation is going to come down. now so quickly, and in that world, if the forecast is right, it would not be appropriate to cut rates. if we have a different forecast, and markets have been from time to time pricing in quite rapid reductions and inflation, you

know, we factor that in, but that's not or forecast the history of the last two years lab very much that inflation moves down particularly if you look at non-housing services, it really hasn't moved much, and it's quite stable so we think we'll have to -- demand will have to weaken a bit and labor -- may have to see progress there in that world, it wouldn't be appropriate for us to cut rates. >> reporter: courtney brown from axios. i'm curious how you view of role of he reverse facilities do you think it's contributing to the stress by making it more attractive for money market furchds to compete with banks for deposits did the committee discuss any changes to the structure of the facility do you see that being put on the

table in the future? thanks. >> we looked at that very carefully, as you would imagine. it's not contributing, we don't think. it moved dow jones and then back up to where it was where there were big demove flowing, which by the way, have really stabilized. what happened is institutional investors took their uninsured dep deposits, which bought paper from the home loan banks, things like that. over the course of maybe the last year, retail investors had been gradual, as they do in every tightening cycle, giving gradually -- such as cds and other things, including money market funds that's a gradual process that's quite natural and happens during a tightening cycle what was unusual was the institutional investors moving their own insured deposits

it doesn't seek to have had any effect overall on the overnight fac facility that is really there to help us keep rates where they're supposed to be, and it's serving that purpose very well >> reporter: can you just speak towards the impact of a default would mean for americans across the country, the markets and borrowing? >> i really don't think we should be talking about about a world in which the u.s. pays its bills. it just shouldn't be a thing i would say that we don't -- no one should assume that the fed can really protect the economy and the financial system, and our reputation globally from the damage that such an event might

inf inflict. >> in hi report, vice clair barr had a couple points, policy clang in 20109 to exempt the biggest banks from scrutiny. and also what he called a cultural shift towards less aggressive oversight do you sharing that view? what would it take to get the strong ever oversiding that you and he said would be necessary >> i didn't take part in creating the report, but i have read it, and i find it persuasive i would say it this way. a very large -- a largebank -- not a very large bank, but a

large bank failed quite suddenly and unexpectedly in a way that threatened to spread contagion into the financial system. i think the only thing that i'm really focused on is to understand what went wrong, what happened, and identify what we need to do to address that some of that is -- it may just have been technology evolves, but some of it may be our policies and supervisory and regu regulatory, whatever our job is to identify those things and implement them. i feel like i am accountable for doing everything i can to make sure that happens. >> reporter: chair powell are are we in the early stage or end stage of the banking turmoil

secondly, do you still have a bias to tighten rates? is that what the statement is saying >> i guess i would say it this way. there were three large banks from the very beginning that were the heart of the stress we saw in early march those have now all been resolved and all the depositors have been protected. i think the resolution and sale of first republic kind of draws a line under that period, is an important step for drawing a line of that period of stress. i think we are very focused on what's happening with credit availability, particularly with what you saw in the beige book and you will see in the s

sleuth more broughtly, we will continue to very carefully monitor what's going on in the banking system and factor that assessment into our decisions in an important way going forward. >> reporter: i just wondered if you had done in rereflection on user own actions during this crisis, leading up to it i think i've heard you say a couple times you deferred to the vice chair for supervision do you think that was the right way to go about this, and comments on that thank you. >> first, let me say, first of all, i've been chair of the board for five-plus years. i fully recognized we made some

mistakes, we learned new things, and we need to do better i thought the report was unflinching, and rightfully so, and i feel i'm personally accountable to do what i can to foster measures that will address the problems so, on the vice chair for supervision, you know, the place to start is the statutory role, which is quite unusual the vice chair, it says, shall deploy policy recommendations, develop policy recommendation, and shall oversee the supervision and regulation of such firms so this is congress establishing a four-year term for someone else on the board, not the chair, as vice chair of supervision, who really sets the agenda for supervision and regulation for the board of

governors. congress wanted that person to have political accountability for developing an agenda the way it has worked in practice for me, i've had a good working relationship i give my council my input privately. i have good conversations, try to contribute constructively i respect the authority that congress has deferred on that person, including working with vie chair barr and his predecessor. i think that's the way it's supposed to work i believe that's what the law requires but i wouldn't say it's a matter of complete deferens. it's more that i have a role in presenting my views and discussing, having an intelligent discussion about what's going on and why. that's my input. ultimately that person does get to set the agenda and take

things to the board of governor, and really has sole authority over supervision >> did you have any regrets? were there decisions you regret now, in light of what's happened >> i've had a few. sure who doesn't look back and think you could have done things differently, but honestly, you don't get to do that you control the control, as one of my great americanors used to said we figure out what the fixes are and implement them i think that vice chair barr's report is an excellent first step, but we have to follow through. >> did the possibility of pausing at this meeting come up at all how seriously was that

considered i'm wonder if you can give you color if there were initial concerns about raising rates again. so support for the 25 base-point rate increase was very strong across the board i would say there were a number of people -- and you'll see there in the minutes. i don't want to try to do the head count in real time, but people did talk about pausing, but not so much at this meeting. there's a sense that we're much closer to the end of this than to the beginning as i mentioned, if you add up all the tightening through various channels, we feel like we're getting close or maybe even there, but again, that's an ongoing assessment we'll be looking at those factors we listed and determine if there's more to do. >> i'm curious how you interpret that and the changes to the statement. is the bar higher now to raise

rates at the next meeting? would a strong jobs report be enough to push it again? >> i couldn't say. i think we have moved a long way fairly quickly i think we can afford to look at the data and make a careful assessment >> reporter: you mentioned a few times about the lessons you learned from the banking crisis, that you would learn the right lessons. what are those lessons >> well, i just would start with something that's change d, and that now neither to be reflected in some way now that we know

it's possible, i'm not aware of anybody thinking this could happen quite so quickly. you know, it would be up to vice chair barr to really take the lead in designing the ways to address that obviously we'll revisit. it's clear that we need to strengthen both supervision and regul regulations. >> can you be more specific on stress testing >> that's what vice chair barr's role really is, and he'll take the lead on though. >> thank you

that's fed chair jay powell, of course, after the decision to raise rates another 25 basis points, the tenth such move in a little more than a year, and maybe most importantly of all, the chair noncommittal whether it's ten and that's it he said a decision on a pause was not made today he did acknowledge the change in language, essentially substituting determining instead of anticipating. he called the system sound and resilient. he underscored -- as for stocks, there's your live picture there. we're at the lows of it is days. it's taken a bit of a moment for all of it to filter into the market stocks seemed to be moving lower on the comment that the fed chair made about ten minutes or so ago, where in their own

forecast, it is not for inflation to come down all that quickly. quote, in that world, said fed chair jay powell, he doesn't see rate cuts coming the market is telling a bit of a different story. we'll get into all of this with a panel, liszt sonders is here, and jeff gundlach is joins us liz ann sonders is here. and how would you assess the mac? the down is down about 180. >> the market obviously expected 25 basis points. i don't think that was a -- i think it's meaningful they removed the language of anticipating more hike i think it's likely more than not we'll get a pause.

where we're in the phase where we're high and we hold high. it's going to be different and probably long and protracted for stocks to digest that entirely the other difference i heard today is powell did say he saw the banking system as resilient and sound, he talked a lot about the strode that was presented in the last couple months >> there's something offsides there, the fact he would delay the banking system as i said he did, quote, sound and resilient. another quo, conditions have improve. we just had the third failure as soon as march. >> but the failure wasn't a surprise, much like svb. at the sort of fast and furious. this was maybe easier to foresee. i don't know that it was necessarily offsides, but i

think it's recognizing the fact of what they have done has both aseparational consequences, so what they wanted to do was slow demand, maybe cool the employment market a bit, but it has they collateral damage consequences they did not anticipate they have affected financial conditions i think there was an acknowledgement of that, too, which i would welcome frankly. we have to add all the of the math together, and if it's working the way you wanted it to or not, if it's working to slow the economy, i'm glad that he acknowledged it. >> i appreciate you being here right off the top. let's bring in jeffrey gundlach, he joins us exclusively as he did for every fed decision today. what's your reaction to the decision today >> well, it was very noncommittal i think the market really anticipated that the idea

they're not going to make a decision or a prediction or any inkline action about what's going to happen. it's completely consistent with the way the treasury market has been priced. i did think, lie steve liesmanman, it was a bit of a hawkish background tone to it. he sounds very resolute. he's certain that not stepping away at all from the 2% inflation commitment he's right to say that inflation has come down a lot and won't come down as quickly anymore in fact we believe that the low inflation print is probably going to be this year around 4% for the cpi. so that would -- that had imply that the fed is going to keep rates around the level they're at now, unless something goes wrong with the economy, which is certainly not a low probability outcome. we've had they bank failures --

this is what i talked about in the aftermath of svb, scott, when ked talked about how rising interest rates are something that people aren't used to -- then going up and staying there for a protracted period of time. it would very different ramifications. and than certainly the case with these bank failures. these people ft. pulling mown out, because there's absolutely no reason to keep their money in you can get higher interest rates by the 500 basis-point interest rate increases. you can get bills at 5.2% for a couple months. the two-year treasury has fallen over 100 basis points i don't think this is the last chapter it harkins back to the

s & l crisis i don't see what's going to make it stop unless the fed is going to cut interest rates, which there's no inclination of cutting interest rates at the next meeting the bond market says there's not going to be any more rate hikes and that there's going to be cuts almost assurededly by the end of next year that recessionary odds are pretty darn high right now. the chairman was smart, saying we have 500 basis points of interest rates increases, credit contraction, quantitative tightening all of these things have led me to being relatively neutral to somewhat optimistic or tinged toward optimism. so i'm really turning more bearish at this point in time. i think the markets for risk assets are too complacent, given

this cocktail of higher about the rates, and credit contraction. certainly we should expect higher default rates and lower equality income securities as we move into the aren't of this year i'm strongly of the pin that they could go up in quantities and bond portfolios. , which has been this amaze egg barrier that we can't get through. we couldn't get through it today. if there's a recession we'll probably get through it. i'm toying with the idea this might be the last flight to quality rally that creates profits for treasury bonds i'm really worried about the deficit situation in the united states we're not in a recession yet, though it's growing only at 1.7, but we have a 7% definite session and we're not even in a recession yesterday. we'll have a big problem with

debt. >> was today a mistake should they have done nothing? >> i think they should have done nothing today, but i've heard a lot of commentators say, 25 basis points isn't going to major a huge difference. certainly there's always the extra that breaks of camel's back so, i just harkin back to what we talked about when the fed started raising interest rates they waited until the multiple 75 basis points. that was because the bond market was throwing a fit we probably wouldn't have had this regional banking problem to this magnitude if the fed had started raising rates more dramatically early on a 200 basis-point moving shire their first move

certainly there's lots of underwear securities that remain so i think today was on the margin, i guess i would call it a mistake, but i think the market was completely prepared for this exact press conference, this exact statement from the fed, it's extremely not committal, but i would suspect they won't raise interest rates again. >> there was a lot going in, even if the market was prepared, that they may in fact do nothing. hold on just a second. i want to bring in steve liesman just gout out of conference. you mentioned there's a crisis in the country, and i said to you after 3:00, you may be saying but the fed raised again anyone in fact that's what they did

powell saided situation improved, and while he was talking, i went back and looked. the kbw is down 30% over the past month $400 billion has left the banks system but to jeffrey's comments earlier powell put a more do muchish spin on it we're not anticipating, we're not sure, but we're looking to hike more. powell gave this impression that we may be done here. that was kind of the impression. let's listen to what powell actually said. there's a sense that we're, you

know, we're much closer to the end than the beginning as i mentioned, if you add up the tightening through various channels, we feel like, you know, we're getting close or maybe even there >> reporter: yeah, he's suggesting, scott, that maybe the funds rate is where they need it to be right now, given the situation of potential tightening down the road i want to bring jeffrey back in, too. the market did move when the fed chair said their own forecast doesn't call for inflation to come down all that quickly, and in the fed chair's words, quote -- in that world, i don't see rate cuts. we're at the lows of the days now. maybe the market doesn't like your commentary either, jeffrey,

that it's a bad time now for risk assets, and you're concerned about where we're going from here. look at the leading economic indicators they're diagnose connected for now. they say high-yield bond sprints should be much higher than they are now obviously with these bank failures, it's accelerating we should expect significant lower-quality bond defaults starting in the fourth quarter of this year when you have bonds defaulting,

or spreads widening on the lower tiers of credit, it's very difficult to make a case for equities obviously equities are junior in the capital structure to these bonds. if the bonds are suffering, the equities will have significant headwinds. last time we talked, scott, i thought the stock market was okay, it could go to 4200, 4300 or so on the s&p we can't seem to bust above that i think we've been sort of at this trading range for a sufficient length of time, my picks suspicion is we'll break to the down side because of this trieffect tao you that you just played that jay powell was alluding to. i think risk needs tore very carefully managed. >> after svb failed and we had you on, you know, when we were worried about who is up next

you said the fed thought it had enough tools in the toolbox to fight edge flation and dial with the flare-ups. you said the fed can't have its cake and eat it, too you get the idea from the fed chair that they still think that they can, that they can deal with whatever issues come up, they think the bulk of the flames, if you will, have now subsided i think that jay powell was a lot more confident two press conferences ago than today he seemed tentative to me in terms of his conviction of where things were going. i thought it was, just to repeat, i thought it was interesting he said inflation will not come down maybe as quickless as before. the dot plots have the inflation raid going down to 3% or so. i don't think that's going to happened it sounded like jay powell isn't

so surian more, either commodities have been very poor for several consequence ifs look as goods inflation, it's right back down to pre-pandemic level. the services inflation is way up there, and so maybe that's why the declines aren't showing up, because they're showing up on the goods side of things. >> steve, you alluded to this in your question to the chair, the idea they have enough to deal with both. it's one of the reasons why going in, you noted this morning, the former presidents respectively of boston and dallas, suggested don't do anything you've got to really wait and see what the outcome of all of

this is, and the fed chair remains sort of resolute in this idea that they've got it, they can deal with it. >> first, i want to compliment jeffrey's viewing skills, and i also thought powell was a bit less confident with the banking turmoil, at least, of uncertainly magnitude, he kept talking about tight any effects, so i guess i would be more uncertainly, too, unless resolute or confident in that scenario the question is yes, scott, he still thinking he can run a separation principle, do monetary policy over here, and we can do supervisory, regulatory policy on the other hand we don't have to mix one up with the other.

certainly today, an extra quarter point did not help it made some of the marks there more underwater or more negative than they had been it didn't help what happened is ostensibly,ed credit problem the fed has just got worse. some people don't agree. so,every, let's look at this total. the fed chair himself said it open and over. we've done 500 basis points in a little more than a year. i remember the many conversations we had, where you suggested that the fed chair either paint or get off the ladder he put his paintbrush down and

they god a spray painted they sprayed the whole thing he was asked if they have any regrets, also in the context of the former stretreasury secretay saying -- he cleared hits throat and said who wouldn't have done things differently how would you assess what they have done here >> just to repeat, i think he raised rates too slowly. you're getting bike 37 basis points on bank accounts.

it's one of these things, before the global financial crisis, i was telling people don't buy commercial paper money funds everyone thought i was nuts. i'm not predicting a total collapse, but there's no reward. you have incremental credit risk and no reward. people leaving money in banking accounts that are earning half the interest rate or less, is nonsensical. so i believe there would be nur regional bank failures we saw some incredible bad action on western alliance, pacific west i think there's an issue that will continue to haunt the fed if they had only raised rates quicker, a year ago, and then we would have done a pause then and see what happens, i just think

they meat grinder of an approach that he use in raising rates sequentially, and finally getting much to this level, it's no longer ratified by the bond market at all. the two-year treasury is beround 4% that strongly sets there would be a catalyst that at least the led will cut rates they might cut them by as much as 75 basis points when you talk about money market funds, which are already offering justunder scores two people, there's competition for your money elsewhere, right >> that's right. that is the fundamental problem with risk assets you can get yields that are

double the dividend rate on the s&p 500 with zero risk you can -- there's zero reason to have half that interest rates in anything that has any semblance of rink to it. people talk about raising the insurance for deposits i saw elizabeth warren on your station, and i think she's right when she said it's already basically unlimited. we're just playing games here. it's just like the debt ceiling. we play this debt ceiling game all the time we've had the dead ceiling for 106 years. they have raised it 98 times what good is a debt ceiling that isn't a ceiling? what good is a cap on insurance that isn't really a cap when push comes to shove? that seems to be where we are. so things are changing i'm sensing a lot of change in the way rhetoric is happens. just look at the southern

border we talk about we're not going to do anything, and now we're putting troops down there. that's pretty radical, but people aren't agreeing when people can start agreeing on solutions, it's sort of a positive thing the next one that will be coming is there will be a serious debate about these entitlement programs we have to address them. it's absolutely critical that we address these entitlement programs by restructuring them i know it's the third rail of politics, nobody wants to talk about it, but it must happen, and it must happen in the next few years. we're going to get there, this is the fourth turning, neil howl, the great demographer, i think he has a book called "the fourth turning is here." he predicted the gold financial crisis basically about 15 years ago. it's about to get interesting. to strap in and risk manage very carefully. >> in light of all of that, what

would you buy today if things are, in your words, turning the way you see them >> i think you need the long-term bond exposures, because we could one of no significant flight to quality. it allows you to own some areas of the market that are high yields, but observable risks that make those yields so high i like thing in the messen areas, so commercial mortgage-backed security, you know, they break out in hives when you mention that, because everybody nods of the problems, but these things are somewhat priced in. if you go not to the lowest steps of the capital structure,

you did go ahead years that are compelling so i like that i still believe the dollar is going down it's been fails for some time now, as the fell shoos cutting interest rates i've owned europe for quite some time it's doing very well, beating the u.s. by a fair amount now over the past several quarters i'm starting to warm up on emerging market equities in asia ex-china and in parts of south america. this is nontraditional investing, but we're in a bit of nontraditional areas i would say anything out below a double b or single b, anyway i would say single b and higher in junk bonds almost exclusive

ly. >> are you buying gold >> i bought gold at 1800 it looks lie a triple top for me i think gold is going to ultimately break out to the up side as the dollar takes its next leg down. i have a core holding in gold at this time. >> i so much appreciate it >> we'll do it again, yes, sir. >> i look forward to that. that's jeffrey gundlach. let's bring in liz ann sonders, get her rear action. >> noose to see you, of course >> well, i think avoiding the

entire u.s. market may not make a lot of sense, but i think you have to be way up in quality where you saw speculative juices kick back in i think this is an environment where you want to stay factor foc focused. i think that's the way to navigate versus the get in/get out, which i don't think either of those are investing strategies. >> but you're at a cocktail company, and liz ann is like, why because stocks at all? i'm getting even more bank for ply buck and i can just sleep at night.

>> well, it depends on the goals of the verier. on the long-term investor is looking to -- probably will want equity exposure. i think this is an environment within the equity exposure, up tore quality focused, and also apply the disciplines around diverseification. >> do you think the fed was hawkish today? how would you kavgtize what he said and what they did >> well, i think probably the important thing is what poult did not say, which i think is appropriate. he did not reinforce what the market expected, which is rate cuts starting in short order

a still tight labor market without serious deterioration being witnessed either in the economy or specifically employment how that is as the fed assesses the effects of what they have already done, but this nothing of all else equal, that there's some justification for a pivot, i think the fed is dealing with a bit of a credibility issue i think you would really, really test that credibility if they said, now they're throwing everything else. i think the only way the fed pivots to rate cuts, not just pauses, is we either get more significant deterioration, specifically the labor market, or the banking system travails

turn into much more of a systemic crisis. absent those two or some combination, take the fed at their word, the inkline action, even at the terminal rate, they're going to stay there a while. the fed chair, i thought it was interesting where he used those words, sound and resilient, that conditions have broadly improved to many people, it would be, i don't know the opposite. >> well, i guess it depends on whether those comments were tied to what powell and others on the fomc saw in their advance look of the sluz record next week.

i think that's the way to think about an economy >> is definitely still ahead of us , when you suggests these sort of things are not a moment in t time. >> where it happened in a really quick moment, and first

republic it's the third since march, if you look at the kre and regional banks, today they're okay. yet was anything but. >> well, that's the risk they're saying nothing to see here, i'm paraphrasing, but not warning in advance of who shunt into the finance crisis. there are differences, though, relative to them we have a more highly capitalized financial system that's less indexed. it's not akin to what happened in system down with it, but just because it's not a mirror of what happened in 2008, doesn't

mean the economic implications are still ahead of us. quite frankly, this not happening in a moment of time has been a descriptor for this entire cycle related to the pandemic the way we have seen weakness roll through the economy, why it's been a rolling recession on the good side first, housing, housing relate d is the inflatin and disinflation has rolled through the various inflation metrics it is just a unique cycle. it is not the clarity of signals that you on which get. >> putting you on the spot, my last question.

was this it? ten and they're done >> um, probably, but i think they'll stay in pause mode for a an extended period of time, absent the wheels really falling off. so pause, but not pivot. >> no cuts this year >> well, again there could be, but not all under the conditions that exist today there could be cuts, but it would be because of more serious economic pain or more serious stress in the banking system absent those, pause. >> great having you, as a little we'll see you soon we're not in the market zone, by the way, cnbc senior markets commentator mike santoli is with us to break down the crucial moments. sofi's liz young is back with you's well 34r santoli, i would love year take >> first of all, relatively muted response shows you it was more or less in the lane of what

is expect ed powell could note let us off the treadmill, still wonder what is the dominant force going ahead. i think baseline simple is now they're on pause, but they didn't commit to it. they didn't set a threshold for what would lead them to the next move being a hike. i think that's understandable that we get this concerned of -- i would be surprised if the fed didn't give it slough "a fed is done" rally. it feels like that's what we're geared up for i don't think the market in aggregate appreciated

powell saying the basics are fine and we don't think we need to worry about that. >> which is why i've been highlig highlighting it some way may how do you declare something is resilient with jamie dimon picking up the pieces? >> i don't think it's tone deaf, but sort of doesn't show he's bending over backward to soothe the market in this regard. when the toddler falls on the play ground, the parent immediate lid says you're okay the toddler is probably okay, but he has a skinned need and is barred the toddler now wants to say soothed, now told you're okay. >> what's your take, liz

>> i think longer day the treasuries probably have some room to ruly but, look, i think what we are looking at now is this argument. they say -- because then they have to admit that. if you look at their indications of a recession, the near term forward spread, it's like a 90% chance of recession he said make staff expects a recession, so they're still not fully admitting it he does not like surprises, and he values flexibility. i think they're done, but i don't think it's a good thing from here on out

even if we get a rally, to mike's point, in tomorrow or the next couple days, the market doesn't seen the real stret until after they're done and right after they cut would you urge people to fade it >> i would. >> i would continue to urge people to face it. you have to watch the times of this, though earnings season has better than expected the economic data continued to weaken we still have inflation as an issue. i don't think that a really here is warranted in the long term. main jay possible or what have you, but tick cook maybe don't forget with apple in "overtime" tomorrow, it's so representative of the mega cap

trade. it's the last of the big mega cap symptoms to report you're not going back to the lows. >> no. apple, market capital-wise is equivalent to the russell 2000 on the other hand, it kind of does the matter. i've obvious said that i don't think apple is an economic bellwether it's much more of a measure of people's willingness to say, fine, let me go with the safe, predictable trade. a market that's overly dependent on apple specifically, when apple outperforms a lot, it's not the one you wish for.

>>e. >> of stat is nod three -- we're talking about hundreds of economists. >> the point is we don't know. we could be looking at june, with the dot plot has raised higher we really are in a zone of, look, we're not going to get an all clear. what's been priced in in turns of flattening out of the earnings that to me matters more. if there's a deviation, it's likely in the way of a banking

accidents, and they usually come five to six months after the last hike. what an interesting day we've had. fed raises by another 25 interesting points the question remains, is that the last hike? market trying to make sense of it dow will go out with a near 270-point loss to "overtime" with morgan and jon. >> getting closer, maybe even there, stocks closing lower when powell said maybe. the act is just getting started. coming up this hour, we get the first reaction from. er counsel of of economic advisers, jason furman, and alan blinder. >> plus more earnings coming your way let's begin with the fed