north korean to help us fight back against the tyranny. that's it for us this week, i will back with more in-depth interviews in the wall street journal at large. thanks for joining ♪ ♪ ♪ ♪ ♪ ♪ >> welcome to baron's roundtable where we get behind the headlines and prepare for the week ahead. i'm jack otter, can democrats and republicans come together on biden's economic policies and what it will mean for the market if they do? libby will weigh in. later when it comes to self-driving cars, tesla isn't the only game in town. we have got the companies offering better opportunities for investors. but we begin as always with what we think are the 3 most

important things investors ought to be thinking about right now. the markets bail after the fed signaled it might turn off the money spiget sooner than expected and chairman powell worried about inflation? and crowds are back at six flags stocks. on the barron's roundtable. so, ben, commentators like you and i see 1 and a half percent fall in the dow one day, hey, it's nothing, normal volatility, happens all of the time but do you think this move might actually be meaningful than what we saw on friday? >> i don't know how to say it but does look like the fed is getting ready to start monetary tightening and that means the stock market could be set up for a correction. we know there's a lot of inflation out there and the fed at some point would have to do something but it wasn't supposed to be at this meeting.

the fed moved forecast for when it would hike interest rates and commentary that drove the coin home. the fed probably won't act until september and even then it's probably just going to start reducing its bond purchases, but the market isn't one to wait around and find out. we saw this week with the dow suffering worst decline since october 2020 in sectors like banking, industrials, materials getting hit very hard. jack: and the only fed move in calendar year 21 then would be a reduction in the amount of bond buying, we won't see rate hikes, we don't think until '22, '23 likely, right? >> that's right. it still looks like it'll be maybe a 2022, '23 event and maybe the markets are reading things wrong. we will hear from fed speakers, john williams and fed powell that will speak on tuesday and can walk back comments. it's hard to put back the genie

back into the bottle and if the fed is gearing up for tighter policy, it's just getting started. we are not talking bear markets but most begin with correction and there's no reason why that one would start too. jack: one more question for you, the tech stocks that did so well and we are expecting zero interest rates forever didn't get hit that hard this week, what's going on there? >> i think it's partially that they'd already been impacted by fed policy already. everyone knows that the economy has been running hot and now it's going to help the companies that were tied to -- benefited when the economy was pretty strong. and so these companies have been going sideways. the tech companies haven't been going anywhere. you look at apple and amazon, they've basically been going no place for the last six to nine months and that's where earnings going higher. their valuations have fallen already in response to what the fed would ultimately have to do. and so i think that that's part of the story here. is that because they never had the same kind of run-up, they didn't have to get hit as hard

either. jack: one the u.s. dollar, it's a huge move for a big stable currency. >> yeah, it's kind of interesting. whenever you see the fed move or signal a move, other parts of the market, it's like watching a machine in action. so, yeah, you see the dollar pick up and then what you see is gold tumble. why? because gold is brought up as inflation head. the fed says, hey, we are going to tamp down on inflation, there's really little reason to own gold. also you have to think that, you know, bonds are going -- investors will get some yield off of them at this point. so that does make bonds a little bit more attractive to investors. jack: what other areas have been affected as part of the gold machine? >> we saw oil take a hit, again the inflation worries but you also have to think, okay, we are recovering so maybe growth will come back there. industrials also took a hit. now you have to think about some

of the industrial companies, they are exporters, rising dollar is not good for them, but if the fed moves to slow down an overheating economy that's not the same as a slowing economy. you know, the fed just saying, hey, we have to put brakes a little bit. and we did see them sell off in the last two days but they can come back soon. jack: given the backdrop, what should investors do, what else is an option? treasury -- treasury inflation protection securities for those who don't know, bonds linked to inflation. sorry. go ahead. >> the other thing you want to look at is safer dividend plays. so kimberly clark and pfizer, highlighted by our colleague lauren strauss. yield above 3% and companies that traditionally have a history of maintaining or

increasing dividends. >> jack, real quick, tell me good news about amusement parks this summer? >> i'm more gentle, bears kind of guy. but the stock has been scary too. underperformed over the past ten years but up more than 80% over the past year and barron's says there's upside here. new investment in technology and visit to the parks have blown away expectations. it's not park that people fly to and that's good at a time people are reluctant to fly. a lot of the visitors are one-time visitors. first of all, those people tend to buy a lot of concessions and second, you have an opportunity to sell them subscriptions for stable revenue and wall street likes to see. if you have a tolerance for risk, check out the stock. if you have a tolerance for being turned upside down after eating corn dogs and candy apples, you can check out the

subscription. i'm going to stick with the singing bears for now. >> we saw images of the roller coaster, that's about as close i want to come. one interesting thing about six flags, people don't get on airplanes to get there so they think the local traffic will be good. thanks a lot for that jack. coming up, the president biden reach a deal with republicans on nuclear? libby weighs in on that, competition with china and how all of it can affect the market. that's next. that's next. ♪ ♪ they said it couldn't be done but you managed to pack a record 1.1 trillion transistors into this chip whoo! yeah! oh, hi i invested in invesco qqq

a fund that invests in the innovators of the nasdaq 100 like you you don't have to be circuit design engineer to help push progress forward can i hold the chip? become an agent of innovation with invesco qqq

jack: with the g-7 summit behind him, president biden is back home to tackle the partisan divide in washington.

can he make headway on economic agenda? joining me now executive vice president and head of public policy libby cantrel. let's start with the headline of the moment which is the infrastructure bill, the negotiations going on with about 4 or 5 different parties. what's the most likely outcome and how do you think the market will respond? >> yeah, jack. it's a great question. there's a lot of noise right now, a lot of back and forth and i think our view is that in some ways this should be expected. remember that president biden has the most narrow majority in congress of any first-term democratic president since grover cleveland back in '84 and in some ways the reality of narrow majorities are setting in. expectation is there will be more back and forth, of course, president biden has now given a hard deadline for folks to come together for bipartisan compromise within the next week

or so and if they don't do that, then he will proceed with this more partisan process called reconciliation. so in terms of the fiscal impulse, certainly, you know, significant but nothing like the very material that we have seen in the last year. jack: sure, i have a policy-political question, i know that you're not hanging in the white house but super plugged in. why wouldn't joe biden get a prime time address and say to the american public, look, i like my plan better, but i promised the unity, i will deliver unity, no more kowtowing to the base. i will compromise with the republicans giving that the economy is running hot and the narrow majority, he needs independents, why not do that? >> that's part of his motivation. of course, he ran on a platform of unity, of coming -- returning to, you know, business as normal, working across the aisle, you know, compromising,

getting things done but working together and what we have seen so far from him is a more kind of democratic partisan approach with covid relief bill, $1.9 trillion bill that passed in march in a democratic basis. it's a great point. i think he needs the win in order to honor those promises that he made on the campaign trail, but even more importantly, he needs those moderate democrats to vote for his, you know, to vote for his legislation and they very much want a bipartisan win as well. senator manchin in the press but also senator sinema and other moderate senators on the democratic side also want a bipartisan win for both political reasons but also because they want to show the american people that, you know, that we are not still polarized that we can do hard things and

come together. i think this is why he has given so much time, right. it has taken several months, if you will, and he's giving it more time so i think that's part of the motivation here for sure. jack: yeah, seems like a no-brainer. let's -- pivot to this bill passed by the senate, what does the path look like and does it say anything about biden's china policy? >> i think it says a lot about the china policy, the competition act that passed recently at a very bipartisan vote, nearly 70 senators voted in favor. it has a lot of things but among other things fund domestic semiconductor investment here in the united states and obviously a big priority right you know specially because some of the semi-issues in terms of the supply chain that are causing prices to be distorted, but also

as, jack, as you point out, this is very much aimed at china. this is trying to sure up the competitiveness of the u.s., of our sort of domestic industries really as it relates to how we are competing with china. so for sure it also shows you that china is bipartisan issues on the hill and in washington in general. so this is -- again, in the continuation of the harder line that we saw from president trump and that president biden, tactics might be different but it's absolutely in terms of the strategy continuing what we saw under the trump administration. jack: great, so we are almost out of time but i have to ask you because you have an eye on washington, pimco known for bond, what's your view of inflation, is it a passing problem, is it persistent, what's going on there? >> yeah, i think we are very much in line with the fed here. we think that many of these

dynamics are temporary. albeit some of the numbers are certainly eye-popping high especially given the decades of low inflation that we have seen here in the u.s. but we don't view these as persistent phenomena, consumer depend is likely going to normalize after much of this fiscal stimulus wears off. and then many of the supply issues, whether it's semis or other supply chain issues are likely to normalize as well. a couple more months of elevated inflation but in terms of persistent inflation, 1970's inflation style where they get away from the fed, we just don't see it as of now. jack: i have lots more questions but we are out of time, libby cantrill, thank you so much. >> thanks so much. jack: coming up, tesla, the most recognizable name in self-driving cars but other ways to invest in autonomous vehicle technology. that's

one, two! one, two, three! only pay for what you need! with customized car insurance from liberty mutual! nothing rhymes with liberty mutual. only pay for what you need. ♪ liberty. liberty. liberty. liberty. ♪ obsession has many names. this is ours. the lexus is. all in on the sport sedan. lease the 2021 is 300 for $379 a month for 36 months. experience amazing at your lexus dealer.

(announcer) back pain hurts. you can spend thousandsths. and still not get relief. now there's aerotrainer by golo. you can stretch and strengthen your core, relieve back pain, and tone your entire body. (man) and you're stretching your lower back on there. there is no better feeling. (announcer) do planks for maximum core and total body conditioning. (woman) aerotrainer makes me want to work out. look at me. it works, 100%. (announcer) find out more at aerotrainer.com. that's aerotrainer.com.

jack: move over tesla, when it comes to self-driving cars you don't own the road. for instance in las vegas a rider can lift from airport in bmw using self-driving technology and other companies that offer better opportunities for investors than tesla. our colleague al wrote barron's cover on future of autonomous cars and he joins us now. thanks for coming in, al, i don't understand this. you're writing about technology and elon musk is not leaps and bounds ahead of everybody, that's techaracy. >> thanks for having me back. it is but elon i think has created autonomous vehicle

confusion. he's taking a particular path that's very different than anyone else in the industry. i think that his use of camera-only technology when the rest of the industry is using mix of sensors will limit tesla and the problem is i think there's a lot of expectation for him to deliver on autonomous vehicle promises by the end of the year. i think there could be 100 or $200 of stock market value in disappointment for tesla investors as the av rhetoric start to meet av reality. jack: he's not using radar and lidar, radar assisted like most of the other players are. that's interesting. we didn't even mention if apple should come out with a car that knocks another 100 billion in

tesla. >> tesla while having good technology might not be in the lead, it's also odd to say that traditional automaker la general motors would be in the lead. they bought a company called cruise in 2016. that's the basis of their autonomous vehicle technology. they're testing self-driving robo taxis in san francisco today. so from an automaker perspective general motors. >> al, where are you also seeing opportunities with av vehicles? >> so one of the reasons the story is timely, we have 6lidar companies that have become publicly traded companies, these are the sensors that enable self-driving. i think they are too new. i think the goals are too aggressive. i want look at aptive, global parts company, it is the leader in active and advanced safety, the kinds of thicks that become autonomous driving like lane

keeping assist, adaptive cruise control. they are totally agnostic to who wins the av wars. they'll supply anyone. they have a good business and i think that there's a leader for years to come. >> hey, al. tell me about the timeline here. how long until i can realize my long-time dream of sleeping alone in my car only on purpose and while it's moving and safely? >> i figured -- hi, jack, i thought that would be a question that you might like to ask. i would say 2030. you're not going to be in your passenger car in the backseat sleeping while it takes you somewhere for a while but they'll be many steps along the way. maybe in 7 years you'll be in a car that will take you to work without you having to pay attention. maybe in 4 years, you'll be on the highway texting and driving without getting a ticket and even before then, you can travel

to cities like i did, las vegas, take a trip from the airport to a hotel, an autonomous cab and you can go to san francisco and phoenix and take the autonomous robo taxis already. jack: al, i'm afraid we do have to leave it there as we are out of time. we didn't have time to mention waymo. thanks very much for that, i look forward reading the rest of the story. up next roundtable members give investment ideas for the coming weeks. stay right there. ♪ did you know that geico's whole 15 minutes thing... that came from me. really. my first idea was “in one quarter of an hour, your savings will tower... over you. figuratively speaking." but that's not catchy, is it? that's not going to swim about in your brain. so i thought, what about... 15 minutes. 15 percent.

serendipity. 15 minutes could save you 15% or more on car insurance. serendipity. ♪ ♪ ♪ ♪ ♪ ♪ hey google, turn up the heat. ♪ ♪ ♪ [laugh] dad i got a job! i'm moving out. [laugh] dream sequence ending no! in three, no! two, keep packing! one.

do you struggle with occasional nerve aches in your hands or feet? try nervivenerve relief from the world's #1 selling nerve care company. nervive contains alpha lipoic acid to relieve occasional nerve aches, weakness and discomfort. try nervivenerve relief. two out of three guys experience hair loss by the age 35. kind of scary. that's why i use keeps. keeps offers clinically proven treatment, and the sooner you start the more hair you can keep. get started for $1 a day at keeps.com. use a single hr software? nope. we use 11. eleven. why do an expense report from your phone when you can do it from a machine that jams? i just emailed my wife's social security number to the entire company instead of hr, so... please come back. how hard is your business software working for you? with paycom, employees enter and manage their own hr data in one easy-to-use software.

visit paycom.com for a free demo. hon? first off, we love each other... jack: jack, you never fail today

surprise me. one day that you're chain is not big enough and you have to get a bigger chain saw and this week focus on handbags. jack: you know me, someone with a rock-solid fashion game. this week i spoke with some people that even know more on the subject. we talked about fashion anxiety as people get out there in the summer and return to work and what it means for investors. jp morgan says clothing sales could rise 21% this year and the margins could be strong. i spoke with the ceo of start-up called ditch fit, it's already more than half valuables gap. she say she's seeing big growth in rompers, jump suits, that's right, i said rompers. he said that two of his topics are the handbag companies, tapestry and capri, big growth in e-commerce, not great for clothing companies because they would rather see you shop in stores but if you're selling

handbags, they are pricey enough to absorb shipping costs and people don't return handbags because they got the sizing wrong. perfect for e-commerce. jack: i heard nothing that you said after the word rompers but the tapestry and capri charts are impressive. i will start with you. >> okay. no rompers for me, but taking a look at chevron, we did see oil sell off, longer-term outlook for the sector is good and oil going 80 a barrel plus dividend yield. jack: 5%, i think. ben, what do you have for us. >> fedex. this was a pick from al root in august. dropped about 9% during the past month. we've got hit after ups had some disappointing guidance out there and now with the market falling but demand is still growing, margins are increasing and looks interesting heading into

earnings next week. jack: you should have listened to al. if not, listen to ben. great ideas. thank you, happy father's day. check out edition of barrons.com, don't forget to follow us on twitter. that's all for us. we will see you next week on dr. michael youssef: blessed father's day. i cannot help, every time we think of father's day, i think of our heavenly father. i tell people all the time, don't ever make the mistake of comparing the heavenly father with earthly fathers. there is no comparison. good or bad, you cannot compare him. he is the most loving, generous, gracious, heavenly father, and he loves you, god bless.