believe. >> farmer jim. >> wynn resorts, i told you about las vegas and steph told you about macao. >> with the las vegas sands buy. >> home depot, the under performance versus the home builders has been striking. >> another new buy i'll see you on "closing bell. dow is 257 "the exchange" is now. thanks welcome to "the exchange." i'm kelly evans. here's what's ahead today. the ipo market definitely opening back up but is the hype overdone savers value struggling to hold its opening price. our guests are split on what this means for the broader market we'll debate and look at how to position meet the new bed, bath and beyond, it's overstock.com which bought the digital assets and changing the name of its website to make that known the overstock joins us live with his strategy >> consumers may have $400 those

spend each month once student loan payments resume first, let's get the latest on the markets and noticed the nasdaq is lagging. >> it is and that technology is losing some of the steam, artificial intelligence may be losing a little bit of steam i'm going to tell you why in a second sentiment is a big part of the story. now the dow industrials up 0.75%. 250 points to the upside 34,104 4319 for the s&p 500 up 14 points to give you context around the trading range so far today at the highs of the session, we were up 22 points. down 5 down modestly at the lows, and the nasdaq composite on the session, underperforming the day. the nasdaq 13,580. where there is positivity in the marketplace is many of the financial institutions,

specifically banks a lot of that is sentiment driven around the fed stress tests. every bank passed. even if you are part of the big group of banks that are part of the stress tests the fact that banking system appears to be on the healthier side of things is pushing up many big banks. the top performers in the s&p 500, wells fargo up 4%, jpmorgan, bank of america, even regional banks like m&t up 2.5 to 3%. keep an eye on the financial institutions on the heels of the fed stress tests one thing that has been dragging on sentiment, earlier this morning in the premarket during worldwide exchange and "squawk box" we talked about the relative strength in shares of micron on a bullish earnings report after yesterday's close it was up 3 to 4% premarket. it is now down 3.5%. you can see through the opening bell and throughout the course of the day, hovering, demand for

the a.i. boom. china, the ban on certain products there, so kelly, micron may be one of those battleground stocks that showed positivity but is losing steam. a.i. not steamingly able to get that the in the green today. >> we have three ipos opening for the first time in a long time savers value village kodiak gas services and fidelis insurance are open now savers listed at 18 and opened to $24.77. kodiak opened below that and is still trading around $15.70. fidelis listed at 14, opened at 13.10 where we are now pretty rare to not see the stocks open above list price turn to bob pisani for more on the offerings and impact. >> here's the interesting point about this there's an obvious winner and you saw that what was going on there.

savers village value, retail/thrift space, the other two in different spaces. these are three companies in the $300 million they were trying to raise. fidelis is an insurance company. insurance has not traded great recently within the sector same with the gas business kodiak in the gas business, another sector that hasn't traded well. it suspect surprising they traded below their price talk. savers had an astonishing story. i did a story on this yesterday that ticked off a lot of big boxes. savers value is profitable, growing. thrift is cool young people love it and call it vintage. it's growing it's got an ecology angle. you heard about people throwing away food. people who throw away millions of pounds of clothes and they're in that business right now the college angle, a.i. angle, that's out there, data analytics help sort through the clothing

and price them right a recession angle, thrift is recession proof, but if there's a recession it could do better this ticked off a lot of boxes out there for various investors. i would say people who say well, two of the three actually priced below the price talk, isn't that a disappointment i don't feel that way. what happens here is this is a discovery process, an art, not a science, of actually pricing these. the important thing is that the deals got done maybe this will say to people who are trying to go ipo in the gas space the pricing has to come down or insurance the same thing. maybe a good sign for people in the retail space, for example, but these are specific stories the important thing to me is the ipo business is opening up i don't know if we can say reddit is necessarily going to come in the next, you know, few weeks necessarily but look at cava, it has done well that's a good sign for say panera bread that's been sitting out there for a while now. people talking about that as a

possibility. remember, these things trade on sector relations the important thing is the deals got done and i think, kelly, july, you're going to see deals. normally july is deadville for ipos, i think you will see more deals come out. >> looks like shein may be the next big candidate and they've been trying to prepare people an give people verseas tour that backfired somewhat we can get into that later if they come to market this would be a sizable and significant offering. >> shein is sort of fast fashion in china it's sort of like the h&m of china. by the way, this is reportedly the way i understand confidential filing, it's not a public file. they have filed with the sec but the file is not visible to the public yet that's an important distinction. we don't know what is going on they will make a statement or it will leak out. so i think the implication for this, if it's correct, this is a

filing that we're seeing is probably a fall listing. i think there's some other things floating throughout oddity tech, for example, a big makeup, beauty company, they filed and i think they have a good chance of maybe going public in july the question the bigger names, the reddits and other big names. i'm not sure today's activity necessarily sends a huge signal to them. they may be looking for other signals how the tech market is doing, for example >> fair enough thank you very much. bob pisani tracking all the action today at the new york stock exchange so is the return of these ipos a bullish sign for the overall markets or over behind like the recent rally my next two guests have different takes on that. the cio of equities at federated and kumar, president of kumar. not a bull debate but may take on sheen a little bit. steve you're more constructive,

tell me why. >> we've been through an 18-month bear market already to a certain extent time is now on our side you look at this market and say it's very narrow, led by big cap tech or you can look at it and say it's going to broaden out. the broader market is trading at 16.5 times, not the 20 times that the cap weighted market is trading at the odds of a recession are declining and still there, but it's been waiting on that. inflation is coming off the boil maybe the fed is close to done you know, maybe this rocky landing is getting closer to the end and if that's the case, you know, the broader market's got stocks that are a little more cyclical, lot of small cap g.o.a.t. growth stocks lagging, financial, international and these are areas where you

can get a lot of stocks we light that are trading at, you know, low double digit, single digit it multiples with a pretty good recovery in them if we're going to get out of this what we've been calling a rocky landing, asynchronous recession sector by sector over the last 18 months time is on our side. the back half who knows. 24 is going to be better and 25 better than that and against those numbers, the market looks pretty good, actually. >> why don't you see it or maybe i'm going to assume you don't see it the same way. what are the risks and why don't you think time is on investors' side >> i don't go with the same view as steve expressed and the reasons are, first of all, look at history 2007 was a great year for ipos, especially tech stocks, nasdaq stocks, and we know what happened at the end of 2007 with

the recession beginning. so the ipo boom has never been a good leading indicator of what is in store for the equities second, you had equities and treasuries diverge in terms of what they're signaling for the market even though the equities have done extremely well on the other hand the bond market yield curve inverted and inversion increased further today as a result of the statements that gen jerome powel made indicating that he was going to increase interest rates seven times including twice this year i consider the recession as essentially having been postponed, not denied. >> right. >> that in turn means that that has yet to be incorporated in equities and that's typically the story that we have in history. the equities are late to the party. they do not recognize a

recession. treasuries, even in 2007-2008, signal the great recession long before equities did. equities were booming during the recession. >> even more impressive to me, steve, is the fact that yield curve inverted before the pandemic hit so one way or another it saw trouble coming. i'm not saying it forecasted that exactly what do you make of the inverted yield curve and today again we see historic levels. >> it's been inverted for a while, kelly we'll see. people have been talking about a recession forever. the tech sector is coming out of a recession. we've had a huge inventory correction that's now starting to pass. you know, the ipo market, i love you to death, but it's not booming right now. it's been literally the longest under performance of ipos i think at least in the 40 years i've been invested on. it's been virtually closed for

18 months. okay we've had a few deals. i like the fact that there's now a sign of life out there but i wouldn't call it a boom pressing some kind of hype or ex exuberance everyone is worried. the world is forecasting a recession. you know, companies are sort of b battening down the hatchets when all the players in the chess game are making the same play, that's often the play that's not going to work. i would say we're ready for the recession, we price that in and we're starting to price in the potential for a better market and economy only six months out in 2024. >> certainly -- go ahead. >> yeah. i'm not suggesting that ipos are booming, but ipos did boom in 2007 and they gave the wrong signal. >> yeah. >> today what i'm saying is that as you have ipos coming back,

they come back because they thunk interest rate decreases are ending and interest rates are going to come down and the reason why ipos were low for the last 15, 16 months, was because of substantial increase in fed interest rate. if jerome powell is saying what he's going to act like he said in the last couple days, there are more rate increases that's going to put the kabash on ipos and why it's still a big signal. >> jerome powell is probably the world's worst forecaster of what the fed is going to do 12 months out. back in 2020, when people like us were screaming at him to raise rates, he was saying he was never going to hike again and, you know, rates are going to be at zero forever and 12 months later he embarked on 500 bpsz basis points of hikes. he's going to be data dependent and puts hikes in and going to

keep jawboning this thing as long as he can maybe he has a hike or two left. we think the cpi numbers next -- actually tomorrow the core cpi numbers should be getting closer to his range the jobs report next friday, kelly, is going to be pretty soft, even consensus has it at that level there's going to be reasons for him to say let's keep watching how this unfolds we've done a lot of hiking even if he hikes once or twice more, he's pretty close to the end of this hiking cycle. >> i have enjoyed this thorly. we have to do act two maybe after the payrolls report. happy to leave it there, but this is appreciated. >> thank you very much. >> call it kind of a bull-bear debate president biden speaking on the supreme court's decision today to end affirmative action in college admissions decisions. let's get to emily wilkins who has more detail. >> hello biden said -- came out today and

saying he strongly disagrees with the supreme court ruling that would effectively ban the ability for colleges to use race as a factor when considering which students to admit. here's a little bit more about what biden had to say. >> today, the court once again walked away from decades of precedent and make -- as a dissent has made clear the dissent states, quote, rolls back decades of precedent and momentous progress, end of quote. i agree with that statement. >> biden also urged companies to continue to work towards diversity in their workforces and among their employees, and he suggested that colleges should also continue to try to find diverse student bodies, potentially looking at the amount of adversity applicants had to face factoring that in. we've begun to see a response from some colleges harvard university one of the two universities that was listed in the lawsuit, has come out

with a statement saying they are going to be considering an essay where students and applicants could potentially talk about their personal experiences with race, something the judges' opinions leaves open as a way universities can look at diversity. >> it's interesting to go back to the 2003 decision where sandra day o'connor wrote these programs should no longer be needed by 2028 and says it doesn't conflict with that ruling what about the implications for the work place >> this could have massive implications we're talking about a group of highly selective elite universities who do use affirmative action to make sure that their student bodies are diverse. of course companies want students from those universities so this might change companies to have to rethink where do they go to recruit and look for potential employees. that kind of mindset needs to change both at the corporate level and university level. >> emily wilkins thank you

we appreciate your update. mortgage rates are jumping after the gdp revision diana olick has the latest read. another big round number again. >> i know, kelly bond yields surged after the higher revision on gdp as well as the big drop in jobless claims and mortgage rates followed the average rate on the 30-year fixed jumped 13 basis points crossing over 7% for the first time since the end of may. that according to mortgage news daily. mortgage rates follow the yield on the 10-year treasury. i note buyers seem to be getting used to the higher normal. mortgage applications to buy a home have been rising for three straight weeks new home sales surged higher than expected and while the report on existing homes showed a drop the realtors said that is about lack of supply, not about lack of demand. >> thank you dmin olick, 7% mortgage rates are back. a retail rebranding. overstock.com announcing it will relaunch as bed, bath & beyond

after buying their rivals ip jonathan johnson joins me now. >> apocalypse fed now. our guest is bearish on every fin tech stock we have those details ahead. as we go to break a look at markets with the dow up 234 points today the russell up 1.2%. while the nasdaq is down 6 points that's your trade for those saying the rally will broaden out. the 10-year yield 385. wow. the exchange back after this this is "the exchae"n cn bcng o you got this. let's go. gobble gobble. i've seen bigger legs on a turkey! rude. who are you? i'm an investor in a fund that helps advance innovative sports tech like this smart fitness mirror. i'm also mr. leg day...1989!

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welcome back shares of overstock.com jumping almost 20% today the company acquiring digital and intellectual property assets from bed, bath and beyond for about $21.5 million. the all cash deal includes the retailers website, domain names, trade marks, patents, customer database, loyalty program data and other assets overstock changing its website name to bed, bath & beyond in ka da and will make that change in the coming weeks joining me is the ceo. great to have you back.

>> thank you. >> why go aulgts way here? this is a big move is this just for a temporary period of time or now on do you need to change the corporate name to bed bath >> we'll be doing business as bed, bath & beyond it describes who we've become. we started out 20 plus years as a liquid dater and general merchandiser and now we're a home furnishings and a lot of name headwind with overstock customers who were confused with who we were and selling and suppliers that didn't want to sell if it was associated with liquidation. bed, bath & beyond really great, iconic brand, loyal customers and describes who we are so i think this is, we're taking a headwind and replacing it with a tailwind for real growth. >> i've been one of those confused customers furniture and things if it was overstock was it -- like there was -- but you still had 20 years of brand equity in

overstock.com. it's bit of a risk to trade that for bed, bath and beyond >> some risk we did a lot of research before we did this deal bed, bath & beyond brand is still strong mismanagement may have hurt the business prospects, but the brand is strong. the customers at bed, bath and beyond have an overlap with our customers and we'll do this transition slowly where the customer will come to the website come august and so will the bed, bath & beyond customer and over time we'll sunset the overstock feel. >> will they expect to get 20% off? >> we've been site sales and coupons. we're a high low retailer like bed, bath & beyond has been. initially as we probably spend a little bit more on marketing at the beginning of the transition, they can expect big coupons.

one thing that bed, bath & beyond customer will realize is, that our noncoupon price are really good and i think people will be very surprised at the deals at overstock and now bed, bath & beyond is able to offer and has been offering. >> seems like $21 million is a steal for such a storied vaunted widely recognized retail brand did you have real competition? >> there was some, but i think we came in with a bid that would prohibit or discourage bottom feeders from come in as they sometimes do in bankruptcy for us the brand meant something. it was more than the customer list because we had a name that we were ooger to figure out how to rebrand and we could spend hundreds of millions of dollars in years picking a new name or we could buy a name that people know and people love and, you know, when bed, bath was going out of business, there was a lot of cry on social media and here we are saving the brand. >> there is more to come in the

rebranding strategy? as we've seen with many direct to consumer i guess digital assets they've opened physical stores, is that something that would make sense or do you not >> we like our asset like business model we don't have physical stores. we're an internet company. we think what we're doing is combing a business model that works with an iconic brand. we think those two things together set us up for growth. it will differentiate us from the bed, bath that ran into troubles and ran out of business we think dwoek this better because of this asset like business model. >> is there any more digital asset acquisition? this is a period where we might see more retail choppiness in the post-pandemic world. is this kind of the big vision or is there going to even potentially be more to come? >> one of the things that our team has done so well is we've protected our pnl and balance sheet. we finished last quarter with

$375 million in the bank it allowed us to play offense. we still have a strong, healthy balance sheet. we're going to be opportunistic in how we play offense making sure we do this transition to bed, bath & beyond do it right. there's operational hurdles. as long as we do that right we'll keep our eyes open and look for the next opportunity. >> quick final question what is demand like right now for home furnishings that category where we see strong home demand but the category a little bit more quiet. what's your read on demand >> the macro environment for our industry is still weak and we think it will be that way for a while. people are still excited to spend their money on experience, whether that's a concert or a trip that's still there. but that's what's created this opportunity for us and we think with this big new customer base that we're acquiring and using the welcome rewards loyalty program adding that to our club

o loyalty program, we think there's a lot to gain here and really create some good momentum. >> the flight delays get worse people might go back to redoing their houses or something. >> we can all hope so. >> thank you so much for joining us on a big day for your company. >> thank you. >> best of luck. what do i call it now bed, bath & beyond.com. >> let's go there. >> markets right now have the dow up off session highs 240 points was nearly 300 early nasdaq down a point. now let's get to show and tell where we show you a chart and tell the story and freyer was the chart we showed you. morgan stanley's adam jonas upgrading it to overweight with a $13 price target stock is at 9 today and believes they can show meaningful progress on milestones on battery production, shares are popping 19%. here's what ceo told us yesterday about their role in the future of energy

is. >> batteries need to be included absolutely everywhere in the energy transition. 75% of all the decarbonization efforts have to have batteries in them. it's making of waking up to the fact that batteries are the next oil. >> today's stock pop up 4.5% the highest level since march. for more head over to cnbc.com pro. over to contessa brewer. >> the nfl has suspended three players today indefinitely for violating the league's gambling policy the nfl says colts isiah rodgers, rashad berry and free agent demetrius taylor made bets on games last season and now they have to sit out until the end of the 2023 season and then at that point potition for reinstatement. a california task force presented a 300 page report making recommendation on enacting rep operations.

their extensive work makes suggestion house to compensate black people for the harms of slavery. lawmakers will use the recommendations to propose future bills and new york city fire officials say the flagship tiffany store on fifth avenue caught fire this morning ignited by a transformer malfunction. firefighters did not say how much damage was done inside, but nobody got hurt. the iconic store just reopened in april after renovations which had taken like three years the scaffolding, it's been there for so long. >> robert franken just brought us the images. thanks before we go we want to mention one more very notable story, nobel laureate economist harry markowitz passed away last week at the age of 95. most remembered for turning the way americans thought about investing on its head introducing the idea of diversification and became the basis for a modern portfolio theory fleshed out in his

dissertation in 1952 he earned his ph.d. from the university of chicago studying under another future laureate melton freeman that remains the way most advisors build portfolios for clients to this day and the way he came up with that theory is a surprising one here's his friend noted index investor mark hebner on that story. >> we was waiting to meet with his professor helping him decide what his ph.d. dissertation would be on, and he was sitting in the room with a stock broker. the stock broker actually is the one that suggested that maybe he applies what he learned in mathematics to the stock market. believe it or not nobody had done this. and so this is really the reason he gets this prize as he quantified these elements of risk, and he did so with what's called the standard deviation, which is really that's a little confusing, people roll their eyes when we talk about standard

deviation, but how much do returns deviate from their average. that's a quick way to think about it they do. they do a lot. >> now about 15 years after that dissertation came out he founded arbitrage management through his life he wrote or co-authored 15 books and was involved in the development of a programming language used in simulations and communications network and was the genesis of the gaming world we know today by the way, mark hebner thought insights about risk are still not fully incorporated into modern investing to learn more check out the website mark has created called harry mark cowitz interviews.com survived by four children, one step child, 13 grandchildren and more than a dozen great grandchildren. rest in peace. "the exchange" will be right back

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sometimes the only thing standing between you and opportunity... ...is someone who can make the connection. at ice, we connect people to opportunity. welcome back to "the exchange." the federal reserve is set launch its instant payment service next month the u.s. is behind a lot of other countries when it comes to speeding up payments the uk, eu, south africa, a few of countries already using technology and the impending adoption here is expected to have a wide ranging impact on main and wall streets, especially on debit card usages. den is on set. welcome back aaron klein has beenstudying how the launch could close the inequality gap you think it's a big deal. let's discuss. >> it's great to be on 70% of people that go to check

cashers in america have bank accounts they're paying fees because basic banking takes too long and speeding up america's payment system is going to be a major driver to reduce overdraft fees, check cashing fees, late fees and give people more access to their own money faster >> again, walk us through what this change will look and feel like once it goes live in the next month. >> the sad thing it alone isn't going to be enough right now if you got a check or walked out of work with your paycheck thursday afternoon and went to deposit, it wouldn't be available until monday july 3rd. what happens the first of the month when you have money do what needs to happen is not only a faster payment system on the back end but regulations on the front end. the fed sis set to launch the system but not require its usage. that could portend to having

less impact than it ought to have. >> how and where do you think we'll see it show up first >> i think you're going to start to see some banks offer faster funds. the banks built their own real-time payment system years ago, right, but only some of the banks have joined and the federal reserve kind of chilled implementation by other banks promising to build this system four years ago look, it took most central banks one to two years to build this why it took us four, who knows but until banks -- i think the first thing you'll see is banks saying come get your money faster and whether they charge you for that or not, i don't know. some banks already offer that but charge but for it a little bit. hopefully more banks offer this to their customers. >> understood. finally, aaron, before we let you go, we started this on the point about inequality and you think the speed of payments alone is, you know, creating an unnecessary burden on lower income people. this could unwind that just

faster access to cash both on the receiving end and sending end? >> absolutely. look, every overdraft fee is paid by somebody who ran out of money in their bank account. many of the big banks have started and smaller banks lowering their overdraft fees and found that one of the things that does it the best is giving people access to their money faster the faster you can give people access to their money those living paycheck to paycheck the more of these fee, overdraft fees, check cashing, late fees they can avoid in which case it puts more money in their pocket. one final stat, one out of 12 americans spends $350 or more a year in overdraft fees just returning that is about the same as a 1% increase in real wages. >> we heard the president emphasize yesterday how he wants to see those go away and this would be one way of doing. let me turn back to dan for a look at the stock impact i can imagine why you would be bearish thinking a lot of them offer this as an innovation

we'll give you access to your funds sooner through a variety of techniques and now everyone will get access to that. >> exactly basically if you think about it, two ways to pay right now in america. debit and credit credit makes sense because you're taking risk the bank takes risks giving you the money. debit is expensive real-time payments the federal reserve is saying i'm going to build the rails that are going to offer this for free and those that's the disruption to debit. >> most of us experience debit cheaper than credit. run a credit card there's 3% debit there's no fee why is debit more expensive than what's coming? >> up until now there has been a regulation in 2012 reduced to debit fees to large banks of $10 million or more, but they kept a loophole to allow smaller banks

to charge 1.5, 2% for debit and mushroomed into this industry in which the finn tech universe is living off the unregulated interchange, you know, cash card is living off of that. >> explain that a little bit more. >> basically every time you swipe a debit card from a small -- that was issued by a small regional bank, right, then basically the merchant pays like 2% on that, so $100, it's $2 those $2 actually go or some of it goes to visa and mastercard, but a big part goes to the fin tech in charge of that. >> is it going to be a headwind for the banks? >> it's interesting. there's a very small number of banks like one of them is like sun bank or cross river bank, private banks, basically are running this vast majority i would say of these like unregulated interchange. the normal regional bank isn't

as exposed as these sort of i would call them like, you know, unregulated money center banks, how they operate right now. >> would you extend this thesis to the big fin tech players? i don't know who to throw in, paypal, stripe isn't public yet, visa why is this going to affect the major players in a major way >> i think visa is actually the most exposed right now we can trickle through because they have a product called visa direct think about the way an uber pays drivers right now they're pushing money because of a driver wants paid right away what visa can do is say we have new rails, why do we pay 2% interchange for something we can free for real time ground zero is visa direct 40% of the cash apps gross propt pr profit is instant deposits

people pay 1.75% to send money to their bank accounts versus waiting two or three days that should be offered for free over time. >> the conspiraciry theorist now i know why it took four years to launch this, and it's not required and it could take years to roll out because there's so many interested in this not moving forward what happens if this takes a long time to reach scale >> water always finds the loest point and i think if fees come down, eventually there's innovation fin tech is going to thrive. it's going to change there's a lot of innovation around fin now, right. you cannot avoid how it's going to be at the end it might take a little bit of time, but i know how it's going to end. >> is there anyone you think is better to navigate this? >> the companies that don't make as much money off interchange are the best like affirm. >> not the name most people are hearing positivity about. >> correct

affirm doesn't make much money off interchange. they have debit plus their core business is making small time buy now pay later loans taking share from visa and mastercard sophie, they're a bank doing well, robinhood. they add real value, everyone else is just basically a tax on the consumer. >> that's interesting. illuminates it in a way i didn't appreciate before. thanks we always appreciate it. >> thanks. >> coming up, the ftc's fight against amazon set to ramp up. we'll have details next on the exchange

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welcome back the ftc is reportedly gearing up to file its biggest case yet against amazon that's the focus of today's tech check with deirdre bosa. about a percent decline in the shares today. >> yeah. which isn't nothing. if this is the ftc's big one against amazon it may have finally gotten investors' attention. you don't see big tech move much on regulatory news or pressure but this case targets amazon's

core e-commerce business and seen growth slow from the pandemic day surpassing 50% according to one study. if amazon is pressured to reduce that, that could hit the already thin margins and we know that growth is slowing at the profit end which is aws that could hurt the amazon thesis, though we have seen the company come back this year. >> we've heard so much career making cases to come here. at what point do investors get more concerned >> that's exactly what they're doing. questions about the ftc's len na khan's role in this published papers and gone into amazon's business before which amazon has said preclude hers from taking this on. she's determined there have been three cases before this one targeting different areas of the business, but again, this one targets the

core and that has really been sort of the question mark for investors that did so well during the pandemic. amazon built up a huge amount, doubled the warehouse capacity, had to pay for that since. but e-commerce the line that we thought would happen during the pandemic has returned to some somewhat normal. >> thanks. still ahead, this retailer shares are up 5% over the past month and they could have more room to run despite two potential student loan headwinds. we'll hear from the analyst behind the call. throughout june, cnbc is celebrating pride month sharing stories of corporate leaders here is goldman sachs partner michael broadberry. >> throughout my 20-year career some of my most rewarding experiences come from the fact that i'm an ally professional in the lbgt community in the firm parents or family members of gender nonconfirming or

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welcome back to "the exchange." the supreme court's decision on president biden's student debt relief program is expected to examine down tomorrow. now it's just as the pandemic moratorium on student loan repayments is poised to end and monthly loan payments will restart for 27 million americans according to key bank. the firm goes on to say the resumption will have implications for retailers joining me with the names at risk and the ones that could benefit is brad thomas, managing director at key bank capital markets alongside melissa.

welcome to you both. bradley, i'll start with you, and want to hear the beneficiaries first, because i'm curious who those might actually be >> kelly, just to be clear this is a net negative for the u.s. this is not a good thing that these payments are going to resume as we think about companies that are best positioned here, wal walmart stands out taking share in grocery with the double-digit growth outpacing the industry, e-commerce up 27% last quarter and they've got really compelling growth drivers in their marketplace initiative, advertising on the international front and as you look at it longer term, we think they're going to be a leader in automation and that illwill hel them, a lot of reasons to like walmart here. >> it's a little less exciting now that you say that's way. to think of walmart as a beneficiary as a pressure on the

consumer does make sense melissa, who are the names people think could be vulnerable >> really the ones selling discretionary merchandise. we're hearing a lot of those companies are under pressure american eagle has come up if you think about the retailers that cater to younger consumers who are going to be making these payments again, early in the career, figs is another name that sells scrubs. people might be splurging on higher end scrubs. the other companies are t.j. maxx that they sell clothes and clothes are something people can put off or not buy at all. >> bradley, what are some of your vulnerable names? >> on the vulnerable side we worry about target our credit card data has continued to show weakness over the last three weeks double down digits in our data we think that that mid-market approach that they've got really catering to a broad swath of americans puts them more at risk for their customers deciding to shop at walmart.

we also think this continues to put pressure on best buy and big lots other names where the customers are already avoiding those retailers to some extent right now. >> that's what i think is interesting is that to point melissa's point about american eagle, abercrombie is doing better target has issues, obviously, after pride month, if you scan the retailers that are more vulnerable anyway, does this give them another headwind versus some of those that seem to be executing well right now and can kind of weather this >> that's exactly right. you know, in a few cases we feel like we're getting through the pandemic unwind headwind finally getting behind us. but as we layer in this $400 a month payment we think many americans will be facing come september of this year, it looks like a continuation of some of the pressure on discretionary spending that's going to unfold as we head into the all-important holiday season. >> you have ollie's and five

below in some ways those are discretionary but a lower price point. you have that kind of spontaneous fun but not at a high level do you think most retailers are somehow preparing for this what could they do >> it's hard to know because this decision came really it's a one-two punch. we heard about the moratorium ending after the retail earnings cycle did so analysts didn't get the opportunity to ask retailers about it we heard from darden they are expecting a little bit of an effect but said a lot of their restaurant customers are actually making 100k or higher and might be more willing to keep going to olive garden and companies like that. we vice president gotten an insight into retailers they're under pressure to walmart and brad's point about that i spoke to borrowers who were saying what they were playing to do if once the payments start again and if their forgiveness does not happen and one told me, i'm going to start shopping for more of my produce and meat at walmart again and i've been

shopping more at places like farmers markets that have a higher price tag. >> interesting just to disentangle this, we've been emphasizing the $400 a month coming either way. the question tomorrow morning is whether the supreme court is it 20,000 or 10,000 biden is proposing to forgive lower income consumer. who would be sensitive to that ruling >> it's a great question, kelly. you know, i think it would be the lower income, more sensitive if this forgiveness goes through. but make no mistake, even if the supreme court allows the forgiveness to go through, there will still be student debt out there, and it still will be a net negative on the consumer as the payments resume. >> absolutely. >> and the distinction with the 20 thuz is whether or not you had pell grant, 10,000 if you don't have pell grants or 10,000 if you do. dependent on your income background that might be a difference. >> even the forgiveness if it is upheld tomorrow would extend only up to incomes, maybe in the

1, 150 kind of range. >> yes the lower 100,000s and so that will be an influence as well the question is really how much balance will the average borrower end up with after the decision tomorrow and what will it mean they're having 300, $400 a month and they're spending on experiences again. weighing things like going to a concert, on a plane, and again, like brad mentioned it's happening just in time for the holiday season >> this isn't your coverage but do you think the services even the gym memberships could that be more at risk than what you cover? >> absolutely. we think this is the effect of a broad loss of america. 60% of american adults have attended some or all of college, about 10% of adults have exposure to student loans and are in forbearance right now this is broad based. one other name i did want to flag on the positive side

ollie's bargain outlet near term, maybe a net negative but they've been a beneficiary of all the disruption out there from manufacturers and retailers. you flagged a bed, bath & beyond bankruptcy on the show, ollie's right now you could find a lot of clearance products from bed, bath and beyond. ollie's is selling for lower prices than bed bath used to sell it for. we think they will be a beneficiary of the disruption you're seeing in retail. >> i know where i'm going this weekend. july 4th stuff i need to load up thank you so much. bradley thomas key bank and melissa. that does it for "the exchange." "power lunch" is nt.ex jon fortt is in for ty i'll see him on the other side of this break.

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