good tuesday morning i'm carl quintanilla with sara eisen on the floor of the new york stock exchange. coming up, a blindfolded fed the economics of a government shutdown and its impact on policy. plus, risk for retailers new data and a new call highlighting bearish activity from the street today. mortgage rates at a two decade high now. red fin's glenn kelman will join us to talk about housing. topping the tape this morning, no tech support amid higher rates that's what barclay's is looking at this morning. they say bonds are fairly priced, equities have not adjusted enough to the rise in yields let's bring in senior commentator, mike santoli. this is what we've been talking about all morning, another step up in rates and equities have a delayed reaction. >> agitated for sure once we got the breakout in yields above the prior higher,

that was the trigger point i pointed out last year the ten-year yield was up 10 or 11 basis points and the stock market was down 3% that shows you there was a little catch-up. i don't think tech is where we have to look at the epicenter. it's about can the economy handle rates it's about consumer cyclicals giving up their advantage. if you look back to the beginning of the quarter when we were at 3.8 on the ten-year treasury, we're now up to 4.5, the nasdaq 100 hasn't underperformed the rest of the market the rest of the market has also been suffering is under this pressure one of the reasons is, i think you have to differentiate. microsoft, we know what they're going to earn as far as the eye can see, roughly speaking. that gets discounted back when you worry about the yields it's not a big swing factor in terms of valuations. you're not just buying an annuity and comparing it to the yield. you're buying a profit stream that can go way up or way down relative to expectations. >> that's why conference season

was important and why earnings season will be important your point is, what? it's better to look at boeing and microsoft -- i'm sorry, mcdonald's >> i think those things are a little more -- not so much mcdonald's, but to me it's much more about are we going to pay 22 times or 25 times earnings for the nasdaq 100 it's much more about, is the economy going to be able to withstand what rates are throwing at it to me that's what the market is mostly struggling with right now. we have some interesting action today. you guys were talking about how nvidia and tesla are up today and you have some speculative no profit stuff up today. >> ark innovations. >> goldman sachs talking about coming into this week. it seems like lot of gamesmanship the market is in the process of getting oversold we are in the last phases of the weak seasonal period nobody wants to necessarily bet it's straight down from here, even as the market is fragile and yields keep us on our toes. >> we'll talk to jason furman

about shutdown risk for the economy out of washington. what's the risk for stocks around these type of events? >> i think in general we can look through it if it doesn't seem like it's yet another thing piled on, a lot of bad stuff we might be at one of those moments when it is going to be that situation where it seems like yet another thing i don't think that the interruption of services and the economic gdp effect is the thing to worry about if the markets get concerned there's some kind of an impasse about sustaining fiscal spending at this level -- >> that's what moody's warned on. >> that's probably not this month's business, but we'll see. i know people are worried about not having data for the next fed meeting. the decision is november 1st that would require a month-long shutdown we did it by 2013 and '96. different times for the economy. >> this would be a full shutdown as opposed to partials - >> we didn't get the data. >> mike, thanks. let's take a closer look at some major indices

we have the s&p breaking 4300 for the first time since may dow below the 200-day moving average on an intraday level that's a level it hasn't closed beneath since may 25th as our next guest points to historic opportunities right now, investors shifting from fear to greed, let's bring in richard bernstein. it's great to have you we've been talking about the strike we've been talking about a potential shutdown do you think the bearish arguments are more structural than some short-term events? >> carl, i think it's going to be difficult to figure out the extent of the strike or shutdown will be. you were talking about long-term interest rates going up and the issue that's having for the stock market and i think that is -- what people aren't thinking about is why are long-term rates going up i think the answer to that is the economy is proving to be stronger than people thought i mean, i last personally believe we shouldn't be talking

about a landing. they should be talking about a takeoff. there's an increasing amount of data showing the economy is beginning to reaccelerate. if that's the case, long-term interest rates should be going up what you're finding is some of the more speculative or noneconomically sensitive stocks are having trouble with that environment right now. so, you know, i think this is actually more typical than people think the fed tends to raise rates when profits are accelerating. profits are actually look to accelerating in 2024, look to accelerate in 2024 the notion the fed could reverse course or somehow monetary conditions will get easier doesn't make a lot of sense to me. >> your former firm has a piece on what it would take to get the ten-year to 5. they say exactly that, it would take more conviction about reacceleration they don't really buy it you see the labor market getting

tighter in 24, right >> carl, the amazing thing is we all know the -- it went from 3.4 to 3.7, but everybody gets the point. we saw jobless claims ease off a little bit that was within the context, that minor cooling of the labor market was within the context of a profits recession in the united states. profits were down 10% to 15% if profits are up 10% to 15% in 2024, how in the world does the unemployment rate go up when corporate profits are up 10% or 15%? the odds are that corporate america is hiring people in that environment, which should tighten the labor market which is why historically one of the reasons you get profits revving up, the fed tends to tighten in that environment because the labor market is getting tighter and tighter. >> are you like in jamie dimon's camp, 7% rates we should start to think about >> as a former sell side strategist earlier in my career

carl was mentioning my former firm, i don't make pinpoint predeckses but the way to invest is to say are rates going to be higher or lower than people think? that's all you have to do. it's an over/under trade i would still be betting rates are going to be higher than people think which means multiples will be compressed, which means you can have your multiple compressed by the p in the pe going down or the e going up i would prefer the e going up, which brings you to more cyclical sectors. >> here's thing, though, richard, there's plenty of evidence the labor market is starting to cool down. we see it in the number of job openings yes, it's still tight and still strong but we're not seeing the same kind of nonfarm payroll numbers we were seeing in the prior years and a lot of people say that's a lagging indicator what we're starting to see is there's more pressure on the consumer the excess savings are starting to come down, especially at the lower end. we're seeing the confidence numbers get hit by higher gas

prices, inflation prices i would suggest there's more evidence for a slowing economy maybe not a recession than an accelerating one. >> you packed a lot into that question >> i had to take the other side of your argument. >> no, that's fine that's fine. but i think, look, there are leading coincidence of labor one is weekly initial jobless claims they just broke below, meaning they were stronger, they broke below their recent trend so, there you have it. you have the -- you've got gdp now, which is not a great forecaster i get that but it's pretty good at capturing trends that's right now close to 5% gdp for the current quarter. you have an increasing amount of leading indicator type data that is troughing not troughed not strong but troughing. i think that's what people aren't grabbing onto yet

one of the things i point out to people, our industry, the financial sector loves a soft landing. it's like nirvana for us i think you have a lot of people hoping we're going to have a soft landing i'm not sure the word landing is really right here. if these leading indicators continue to turn up. now, leading indicators can turn down, but they are leading indicators and i think that's why it's so important. >> indeed. it's really easy, actually, to build scenarios on either side, richard. we'll find out more as we get through this great to talk to you again thanks richard bernstein. president biden scheduled to join the united autoworkers union on the picture line in detroit in the next hour we'll take you there live. phil lebeau is on the ground with the latest. phil, as we await the president. >> he just boarded air force one. it's our understanding they're going to take off shortly. they'll be here noon, 12:30, whatever it is, and then begins

the show with president biden and the uaw here in town here's what we're expecting. he will be visiting with strikers at some point at an undisclosed location we do know there will be a camera, joined by uaw president shawn fain and the message has been clear what we've heard from the president before, we'll hear more of today, support for those picketing. let's be clear about this. the uaw has not endorsed joe biden for president. he would like that endorsement but the uaw has been a bit more standoffish when it comes to the president. they clearly are appreciative he's coming to town. they invited him to come here but they haven't said, yeah, joe biden is the man if anything, it's been a little more at an arm's length. by comparison, they are not, as an organization at the top, in favor of donald trump. rank and file i have herd supporters of donald trump but shawn fain said last week,

every fiber of our union is being poured into fighting the billionaire class and an economy that enriches people like donald trump at the expense of workers. as you take a look at how shares of the big three are trading today. keep in mind, you have a little over 18,000 uaw members currently on strike. uaw big three members currently on strike. that's about 12% of those who are with the uaw as part of gm, ford and stellantis. bottom line is this, guys. we knew this would be about politics that's what we'll see over the next couple of hours from joe biden. and then remember, tomorrow is when donald trump is going to be in this area not going to be with the uaw you know he's going to be courting the working class voters here in this state, which certainly includes many uaw members. guys, back to you. >> such a political hot potato now, michigan. phil, where are we on negotiations and what percentage raises are we talking about that are the sticking points now at this point >> to our knowledge, sara, they're still in that 20%, 21%

range. the uaw would love to get it up in that 40% range. they haven't publicly backed off of that. almost everybody we've discussed this with believes they ultimately are going to settle with the big three somewhere in that 24% to 26% area that's the expectation right now they're still in that 20%, 21% zone. >> what do american airline pilots get, 40% raise with 20% in the first year? we appreciate it, phil lebeau. be sure to tune in tonight for "last call." brian sullivan will be live from wayne, michigan, as well as the united autoworkers strike rolls on 7:00 p.m. eastern time right here on cnbc. coming up after the break, how a government shutdown might impact the fed's ability to steer the economy around a recession. plus, redfin ceo glenn kelman is with us. new home sales coming in at the weakest level since march.

we'll talk about all of that with him whe"sawonhe re" turns.k t has no idea she's sitting on a goldmine. well she doesn't know that if she owns a life insurance policy of $100,000 or more she can sell all or part of it to coventry for cash. even a term policy. even a term policy? even a term policy! find out if you're sitting on a goldmine. call coventry direct today at the number on your screen, or visit coventrydirect.com.

watch draftkings, upgraded at jpmorgan, ups the price target to 37 a share they say some sluggish share price performance since july is a reason to buy a stock that's already jumped 150% this year. it's been pretty much tracking the 50-day moving average for most of the year, but one timely call given we're in football season, sara. >> look at that year-to-date price action. we're just a few days away from a potential government shutdown the house is set to vote on four major spending bills today the senate is working on a stopgap bill to keep the government funded for 45 days. unclear the path forward with a shutdown looking more and more likely, the question becomes, how long it could last and what the impact would be. joining us now, former council of economic adviser chairman jason furman at post 9 what a treat great to see you. >> good to be here. >> is it your expectation we'll

have a shutdown? >> i think that's the most likely scenario. it's terrible. in june they all agreed on spending levels. i didn't think this would happen but here we are. >> now the question is how long it could last and how much damage could be done >> look, i think the one thing here is there's not a big existential disagreement among the vast majority of them as to what spending levels should be the president agrees both parties in the senate agree. the democrats in the house agree. i think the majority of house republicans agree as well. there is a solution here there's no reason it has to be but with them you never know. >> i wonder if the market is starting to get spooked. not so much about the economic impact about the shutdown but the fact we could get downgraded again. moody's warning it's the dysfunction that could potentially lead to another credit downgrade. >> yeah. look, i think the united states is good for its debt we're going to pay our debt back i don't blame people for taking a look at us, taking a look at this dysfunction by the way, we do have some big problems with our deficit.

a government shutdown is not the way to solve them. discretionary spending is not the way to solve them either they need to sit down at some point and have a real conversation it's hard to see where and how that's going to happen for now, they have a much, much easier job, keep the government running. >> i think it was jpmorgan earlier in the week that said the united states has lost its exceptional funding ability and i wonder if you think this broad picture is one -- explains what rates are doing beyond what's happening with prices around the country. >> look, i think most of the rate increase is the market increasingly believes what the fed has been saying for a while now, which is rates are going to stay higher for longer some of those recession fears rek receded. they're creeping back a little bit. i think most is the macro dynamic. certainly our fiscal situation can't be helping it's a vicious cycle, long term borrower, long term deficit

means higher interest rates. >> do you think the administration gets some blame for the fact that, look, these programs aren't cheap. and they're all starting to hit. inflation reduction. they're going to require a lot of debt to be issued, the infrastructure act, the c.h.i.p.s. act, it's all coming. >> look, the main things that add to the deficit are infrastructure and c.h.i.p.s those are down on a bipartisan basis. everyone in washington bears some of the blame. i think these were good programs they were important to do. i wish all of it had been paid for. regardless, we can debate how we got here the most important thing is to do the easy thing now, from the government, and then sit down, have a conversation. that conversation should be about entitlements and taxes those are the two big pieces here, not this discretionary spending. >> but is this time different? is this a time where bond vigilantes should be worried about the u.s. it hasn't really mattered before the reserve currency, everyone wants our debt. >> look, i think they should be a little bit worried right now

and you're seeing some of that worry in bond markets. and there could be more of it. there's no reason long-term rates can't continue to go up from here. >> remind me of the debate right now regarding your view on the targetrget to something like a r 3% range but i'd do it in a hawkish way they have to emphasize inflation. they can't lose credibility. does that look like where they're headed right now probably not i think it's good to say what the best idea out there is. >> do you think that's gotten any traction >> if anything, it's gotten reverse traction as people have dug in on the opposite side. >> we'll see what they do. if they get inflation to 2.8, i don't think they're causing a recession from 2.8 to 2.0. i think the last mile is harder. i think everyone will calm down and relax if they see a 2 in

front of the inflation numbers. >> why do you think they should raise the target >> just blue sky gives you more room to handle recessions in a world of lower interest rates, if we ever go back into that world. i think you need to prepare for that world i think if you're deciding the target today, you would have picked 3 i think they can credibly make the switch if they get inflation under control. i do continue to be sort of a vigilant hawk and want them to be about getting that inflation under control because i don't think we're there yet. >> you think another rate hike for this year? >> i think another rate hike this year. i give sort of a slight edge to another one in the first half of next year. and that would probably be it. >> that's above consensus. >> it's a bit above consensus. labor market is pretty tight wage growth is still pretty high we've had a string of good luck that's starting to reverse itself on inflation, so i don't think we're there yet. >> jason, that was good to catch up with you and get some of your views. thank you for being here later on this hour, bank of

america slashing estimates on multiple retail names. on, you might have guessed, further credit risk, more on some of the stocks they say might be in trouble. >> plus, why aren't energy stocks keeping up with oil we'll get to that decoupling in two minutes. has no idea she's sitting on a goldmine. well she doesn't know that if she owns a life insurance policy of $100,000 or more she can sell all or part of it to coventry for cash. even a term policy. even a term policy? even a term policy! find out if you're sitting on a goldmine. call coventry direct today at the number on your screen, or visit coventrydirect.com.

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the nasdaq now down 6% since the beginning of the month apple has been the laggard on the dow all morning long. >> with tesla and nvidia bucking the trend. european markets low as all eyes stayed glue to the interest rate tech and autos leading the way lower. the ger manned ten-year bond yield hitting its highest level in 12 years, which is a reminder this is a global move. move in rates helping move the dollar to a new ten-month peak, having an impact on the japanese yen. japan's finance minister saying they are watching the currency moves with a high sense of urgency. as we've seen the dollar/yen go above that 1.48 level. 150 is seen as the danger zone where they might intervene sticking in asia, we are keeping a close eye on evergrande after disclosing late monday it failed

to pay the principle and interest on 4 billion yuan low concerns about what a default would look like and the ripple effects it could have across the economy. i want to mention the dollar it's starting to wreak havoc and we're getting to levels that's attracting the attention of finance ministers and central bankers in japan the dollar tracks yields we're seeing higher yields in the u.s., which makes sense. money chases yield and the fact is in better. shape economically than other places in the world, including europe it is the pain trade everyone thought the fed would be done raising interest rates that would be lower yields and weaker dollar. it's going the other way that's been the surprise of the second half. >> reuters has a piece on dollar strength today they quote a couple fx traders calling the dollar a steamroller. you can't get away from the stream of data that shows the united states is running roughshod over other economies look at the sterling

six-month lows >> the disaster liz trust budget the problem is that's a headwind for the u.s. economy and for the global economy, whenever you see currencies at extreme levels we're keeping an eye on it very hard to intervene if you're the japanese unilaterally. it usually doesn't work. >> yeah, we'll keep an eye on that. a couple hours into trading, dow is down 300 plus let's get post to post with bob pisani. >> whatever happened to sell rosh hashanah, buy yom kippur. you were talking about amazon and alphabet, but the software names -- smile, anthony. here's oracle. oracle had earnings earlier in the month and they weren't well received we were 126 earlier in the month. 104. earnings aren't going to save anybody. most of these software names have been moving down.

service now, here's another good example. they didn't have earnings but service now was $605 a couple months ago this was a market leader now 541. it's taken a couple of months for that to happen one thing i find concerning is the leadership groups is energy with oil up $90. we've seen refiners doing well oil service names doing really well, but not in the last valero, 110 to 150 as the names went through the roof. in the last few days it's been looking very toppy, even with oil still holding up in that $90 range. we've been talking about higher rates and what it means for utilities and what it means for real estate investor trust the reits have been acting horribly midamerica is one of several

reits, big apartment reit at 52-week low. we have to get -- forget about the government shutdown. yes, it matters. student loan repayments resuming yes, they all matter the thing that matters the most is getting a handle around the interest rates they have to figure out how to top out. going towards 5% on the ten-year, boy, there was notes out this morning playing out that scenario. you don't want to see that we're just going to move lower at that point. we need more stability in rates. that's the number one issue for stocks right now guys, back to you. >> don't seem to be getting that at the moment. bob, thank you bob just spoke about energy stocks crude oil has been well outperforming energy stocks. pippa stevens looking for the reason for that decoupling. >> energy stocks are up 10%, but oil itself gaining near 30%. so, this divergence is thanks in part to the shape of the futures curve, according to third bridges' peter income naturally. spot prices above futures

prices, we aren't seeing earnings estimates revised there are still a lot of unknowns, especially on the supply side. saudi arabia has signaled it will keep a floor under prices but they could reverse that at any point. while u.s. majors have kept production levels steady, we could see the private players come back into the market in a big way. and so all of that can deter generalist investors, especially after energy stocks outperformed for the last two years still the group's valuation at 11.7 times forward earnings is cheaper than the 20-year average of 15.2 times. energy is also cheaper than the overall s&p, which trades at 18.1 times forward earnings. looking ahead, analysts say to focus on companies with specific catalysts. so, goldman pointed to names like chevron, phillips 66 and baker hughes jpmorgan also favoring bakers hughes due to its exposure to lng with exxon and marathon oil other top picks. carl, back to you. >> pippa, thank you for that

got a bull call on domino's catching the street's attention today. we'll discuss why one analyst says the stock can run up to mebahetrt""squawk on t see cos ck eats each year. that rate is increasing as more and more businesses move to the cloud. - so, the question is... - cyber attack! as cyber criminals expand their toolkit, we must expand as well. we need to rethink... next level moments, need the next level network. [speaker continues in the background] the network with 24/7 built-in security. chip? at&t business.

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a lot of focus on the consumer costco will be an important read as it reports earnings after the bell the stock outperforming the market this year it's up about 22%. courtney reagan with us on more on what we can look for -- never mind we'll talk to courtney in a minute. let's get a news update with s i silvana. the president's son is accusing rudy giuliani and another attorney of misusing his personal computer data he's seeking more than $75,000 in damages this is the latest in a string of lawsuits brought by the younger biden against his gop critics.

russian commander that uk claimed its military killed appeared on the russian state division today he was shown making a remote appearance at a defense leader's meeting. nbc news has not verified when or where the footage was reported he was killed along with 33 other officers in a missile attack last week on the headquarters of russia's black sea fleet. and hollywood writers came to a tentative agreement now they may be swapping places with video game actors and motion capture actors on the picket line. the sag-aftra union says these workers overwhelmingly voted to authorize a strike last night and will begin contract talks with gaming companies today. carl, back to you. >> thanks so much. consumer credit catching our attention this morning it's been a rough summer for consumers with credit card balances surpassing the $1 trillion mark for the first time since july

the average credit card interest rate surpassing 20% in may versus 14.2% in february b of a cut their targets for kohl's and nordstrom courtney reagan is watching this as well. >> this is a really interesting report it does have to make a decent number of assumptions. we don't really have the details into these credit card arrangements that the retailers have with the card issuers more or less, the report is saying, look, delinquencies are more likely to turn into chargeoffs as you see consumers continue to grapple with rising costs all over the place, unable to pay these credit card bills. and nordstrom and kohl's will be most at risk to see this credit card revenue fall. it's very interesting, this report details, and i'm going to read this because i want to make sure this number is correct, bank of america's estimating in fiscal year 2022 the income that department stores earned from

their credit card partnerships made up 62% of ebit, well above the prior peak in 2019 at 46%. considerably above that historical average of 24% of ebit from credit card income macy's talked about this in the last earnings. generally this is not an area a lot of the retailers dive into talking about their credit card income or the structure of those arrangements if things are getting worse, if consumers aren't paying their bills and delinquencies turn into chargeoffs, bank of america is putting together their analysis and saying that kohl's and nordstrom will be most at risk to see that credit card revenue decline. as a result, it is going to hurt both earnings and then ultimately the stock price they're lowering their price targets for both of those names. >> what are we seeing, reminder, on the delinquencies it's elevated but nothing abnormal. >> it's elevated remember, of course, in 2020 delinquencies were way down

because we weren't spending and we had more cash it's starting to trend up from what we had seen before the pandemic because you have to throw those numbers out the window of course, the interest rates are much higher. if they can't pay them at all, then it becomes a chargeoff. another wrinkle is there is some legislation being proposed saying, actually you have to limit the amount that you can charge for a late fee. the credit card analyst does expect this decision about this legislation could come in october. it won't be enacted until next year that makes it even more complicated because that's an additional piece of the revenue these retailers get is that late fee. if that's capped, that lowers that as well >> yesterday was the jeffries survey about student loans today it's b of a on cards remarkable courtney reagan. another note grabbing our attention is oppenheimer saying it's time to grab a slice of domino's raising the target to $450

they say same store strength can help the business. joining us to break down that call is our restaurants and small business correspondent, kate rogers. >> good morning. you saw the stock trading around $380 they're raising this to $450 oppenheimer talking about domino's being a revival story that could impact same store sales and calling it one of the most promising self-help cycles. you mentioned relaunching loyalty. domino's at 77 million loyalty members. it's making it easier to earn points this is reverse trend where you have to spend a little more. it's harder to earn points or get free items i believe with domino's you can get a free pizza after just two orders and you can use the points on more items that will incentivize purchases. having a loyalty only option works well take a look at sector for brands

like chipotle and starbucks, another one with huge success driving a lot of sales that's certainly a smart thing to do there. >> so, what's the bear case on domino's everyone was so bullish that the delivery and the technology was so far ahead of everyone and then that story kind of collapsed. what are the two sides >> certainly, sara a lot of things you mentioned with the tech and the delivery have long been so strong domino's had been struggling to bring in delivery drivers. it does have this upcoming partnership with uber eats domino had long held out on the aggregators. struggled with getting the delivery drivers in. that delivery business being a little softer because consumers are considering more where they spend money and inflation has been a challenge there i think the answer to the question there is can they bring the drivers in to fulfill these orders although it does have this partnership coming up with uber eats, launching in four markets in the fall and nationwide by the end of 2023, the franchisees will fulfill the orders.

we need to know the drivers will be there to make that happen and see if the public interest is there to order domino's on that platform and if that all works out. >> kate, thank you kate rogers, interesting call. the ftc could file an antitrust case against amazon as soon as today. the impacts, if any, coming up next plus, don't forget, delivering alpha two days away, september 28th in new york city. investors and leaders will provide insights to help you balance risk with return you can use this qr code on the screen or just go to cnbcevents.com/deliveringalpha we're back in a minute it's gonna be sweet! what? i'm 12 hours short. - have a fun weekend. - ♪ unnecessary action hero! unnecessary. ♪ - was that necessary? - no. neither is a blown weekend. with paycom, employees do their own payroll so you can fix problems before they become problems. - hmm! get paycom and make the unnecessary, unnecessary.

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the ftc expected to file that year's long investigation into amazon's online marketplace as soon as today, according to reports. the culmination of chair lena khan's long history with the company. deirdre bosa is digging into

that. >> khan badly needs a win. as we await that ftc antitrust lawsuit against amazon, the agency and her own credibility are at stake lena khan made her name in high school where they argued the existing antitrust framework didn't properly account for the rise she came in determined to hold big tech accountable when we look back at the deals amazon has done during her tenure at the head of the federal trade commission, this is not a small list. it has made the prime ecosystem stronger and more entrenched, exactly what she's been trying to fight there was mgm, an acquisition which she didn't fight then there was irobot and one medical that gave amazon a foothold in health care. that closed without challenge by khan and the agency.

in fact, three of amazon's five largest acquisitions, they have been done while khan has been in charge and then all the investments in generative a.i on the right side the of your screen, hugging face, up to $4 billion for minority stake in anthropic. these are more creative ways for amazon to bypass regulators. they give them an edge and can create dominance on the platform shift, building on amazon's already number one position in cloud. bigger and stronger is the message here that brings us to the next showdown, which may prove the most important the ftc's lawsuit is expected to target amazon's flywheel, the crown jewel of the business model that keeps it large, that gives it its scale and importance it encompasses everything from logistics to third-party sellers to booming advertising business. this one really could be make or break for the ftc or amazon depending on the outcome it could break up amazon's different businesses or embolden the company to do more deals

it could be the final blow to lena khan's credibility or give her the teeth to take on more battles against big tech as we know very well by now, though, this is will not happen all at once. these battles drag out over months and even years. the impact may take even longer to disconcern, ala microsoft in the '90s, guys >> yeah. and i guess part of the back story is interesting, too, deirdre. amazon tried to have her recused. a judge turned that down but there's a history here with this company from lena khan. >> right it goes back to her yale law school days. she has sort of had her eye on amazon and a lot of it rests on that prime flywheel. this is the way amazon works that's why it's able to be in so many different businesses. the e-commerce side isn't very profitable but they have cloud that is profitable and pays for all these other acquisitions and things they're trying to do. it's been so interesting to see when we look back at what the company has accomplished

even when they sort of had a target on their back from lena khan they've actually done bigger deals than ever. and that could prove interesting in the upcoming lawsuit. we'll have to see how it's laid out, what it take aim at but everything revolves around prime. >> and how they define market share will be interesting, too thank you, deirdre deirdre bosa up next, the ceo of redfin on home buyers getting cold feet more than 15% of pending sales were canceled last month as mortgage rates continue to sit near a two decade high a quick check on the markets. dow, s&p are near session lows the s&p is losing further ground, down 1.25% right now every sector is weaker it's hardest hit now is utilities, down 2% communication shortervices down 1.5% apple, microsoft, amazon and alphabet weighing heaviest on 'lbeignaaq wel rht back.

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welcome back when it comes to the health of the housing market, our next guest has an eye on a couple key metrics that you should be watching including rising home prices, record low inventories, and high mortgage rates, which are driving a decline and leading some home buyers to cancel transactions completely joining us is red fin ceo, glenn kellman. welcome. good to see you. >> thanks for having me. >> we know the high mortgage rates are wreaking havoc they're a disaster how big of a disaster is it

right now? >> well, a slow building disaster so i don't think it feels more apapocoliptic. we need to catch a break from the federal reserve. >> is it having the desired effect on prices, on rents given it's also coming up against the backdrop of super low inventories? >> that is the problem, so it has depressed employment but hasn't hurt prices prices go up in a down turn like 2008 they don't want to sell but foreclosure is imminent. we've had a soft landing, the rest of the economy is doing well people are not in economic dire straights. with a 3% mortgage, there's no

way they're going to put it on the market we've had an upturn in prices. and that means the sales volume will last a long, long time. >> we've had some in the reality business suggest ongoing demographic trends, marriages, going to college, even dying means the industry will churn through the rate levels, which we dealt with a couple decades ago. i wonder if you think that's too goldilocks >> it goes between 4 million and 6 million. during the pandemic it went nearly 7 million it's never gone below 4 since we've been tracking it and the population is 10% larger than the last time we hit the low in 2008 we are now at the most basic level where shelter is a human need the only people moving are the ones who absolutely have to, and

there are people relocating because they're called back to work or they get a divorce or there's a death in the family. those are the only reasons people are moving. i wouldn't call that a goldilocks scenario. i would call that rock bottom. that's where we are right now. the only relief is it can't go much lower we haven't seen 3.5 million, 3.7 million homes sold across the united states since we've been tracking the number. 4 million is about as low as it can go >> glenn, how are you thinking about and planning business around 2024? is it a recovery year for real estate are you making moves in anticipation around hiring agents or more downbeat? >> when rambo was asked, rambo, how would you live and he says, day by day. that's how we're planning this business you can't look three, six, nine months out what we fate now is 7.5%

mortgages, we're living in the now and if things get better that will all be upside in the business >> how is your business dealing with the changing rate environment? can you be profitable, make money in a down market like this >> we can, we just have to reduce our costs what we've done is cut noncore businesses, laid off some people, which i still feel ashamed about, but it's put us in a position as we take market share we can build a profitable business there's no free lunch here we have to take someone else's lunch to grow because we are in a shrinking market we feel poised to take significant share over the next six to nine months >> you mentioned people getting called back to work and being forced to list i did notice data where i think you said one in ten sellers is listing because they were called back to work any sense of how large that number might get

>> i think it's not going to get much larger than that. we've seen people called back from texas and florida to west coast markets and back to the northeast. i don't think the trend will suddenly reverse more people are moving to lower tax places, commuting to work from greater distances i don't think you'll see the exodus back to boston and new york some people are coming back but it will be at a slow rate. >> thanks for keeping it real. >> the rambo image i won't forget >> day by day. >> glenn kelman of redfin. wall street is buzzing about, what else, a spike in travis kelce jerseys and another example of the taylor swift powerful economy as rumors swirl with the relationship with the tight end. kelce's jersey was one of the

top five on sunday with sales surging more than 400% do not underestimate the swifties as if the nfl couldn't be any bigger, layer on taylor swift, boom >> he added more instagram users than when they won the super bowl i think has the top telling jersey the other thing what she was wearing, new balance >> i thought you were going to say she was in chiefs' colors. >> i know you love that stuff. >> that is the hottest room around nike reports earnings. the fact they were showing her reaction more than the plays on the field. >> and his touchdown on that reaction was not the most

interesting touchdown he's ever had. >> she loved it and we love that >> the dow down 309, on an intraday basis >> and the talk is all about higher for longer, getting the message from the fed and this continued step-up in rates whether it's worries about the deficit, the economy. >> the judge is back at post 9 let's get to "the half." carl, thanks very much welcome to "the halftime report." i'm scott wapner we're going to get to the sell-off in stocks with the investment committee in a most first to eamon javers. he is in washington. he has breaking news for us right now on amazon and the ftc. eamon what do we know? >> reporter: the federal trade commission filed an antitrust lawsuit against amazon this morning alleging the tech company has used interlocking, quote, anti-competitive and unfair strategies to illegally maintain monopolypower, joined