the driver was andy green, october 15th, 1997 all those years ago. andy broke the land speed record in in the blackrock desert in nevada t was powered by two jet engines. i didn't think you could faster than 2 or 300 miles an hour because the car would take off. ashley: fastest speed on interstate. you can't do 763 on i-5 in california that is for sure. stuart: neil, it is yours. neil: stuart, i have a trivia question for you? stuart: yeah. neil: what is the difference between the blue origin flight and inflation? stuart: is this a trick question? i do not know, will you tell me the answer? neil: yes i am. stuart: go ahead. neil: blue origin came back down. see when i did there? came back down. basic cable.

i thought it was witty, i guess it was not. stuart: not bad. neil: like the capital of mozambique. stuart: do you have a show to do? neil: no. i would thought i would tell the little trivia questions for the next couple hours. thank you, my friend. stuart: see ya. neil: that is true. at least the blue origin is down in ten minutes. inflation the idea, it is a short-term transitory affair i think that is pretty much push to the kibosh, captain kirk getting a little emotional, he might have been looking at inflation in america might not suffer the same conclusion but will we'll be exploring inflation in this country. we've got it all over here. we've been hearing from you, have the best of your questions, some very, very good questions, have you covered it right now with edward lawrence at the white house, what they aim to do about it. william la jeunesse in port of long beach, california where they keep things going 24/7 to get on top of the supply chain problem.

madison alworth at stu leonard's in paramus, new jersey, how they're trying to curb inflation in your grocery store. we begin with edward lawrence at the white house. reporter: neil, in about an hour and 45 minutes president joe biden will meet with ceo's from up and down the supply chain. the white house announced they broker ad deal with the port of los angeles to run operations 24/7, 24 hours, seven days a week. a senior administration official telling me they are working with safe to expedite truck driver training programs in order to get more drivers on the road. that is a very long-term solution. we've been dealing the supply chain issue for most of the year. i asked the white house what took so long to get all the groups together. you said june the supply disruption task force was assembled. i'm curious why it took so long for the president to get together with the two port heads and shipping companies to figure

out what is wrong with the supply chain issue? >> i would say that the president has, the supply chain task force has been working around the clock for months and months now to address a range of different issues that we see in the supply chain. reporter: right now, they will be here at the white house. talking with people who represent truck drivers at the docks they say space might be limited if port operations rammed up, but there are not driver to take goods into the country. i asked pete buttigieg relaxing truck driving regulation. he said they're looking at that because they have to look at safety issue. drivers picking up in the middle of the night, make runs per truck less traffic. he could not give me time frame when it would be sorted out. a senior administration official said it will not be sorted out until the pandemic is over.

we're not talking about weeks or months or even quarters, neil. neil: edward lawrence at the white house, thank you very much. meantime a lot of people want to know what is happening at our ports where cargo ships are blacking up like planes at laguardia. a lot of times there are nothing on the cargo ships themselves, very few goods, even if you dough get it to the port there is nothing to take off the ships themselves. and that is a problem that might be manpower, woman power, however you want to define it, maybe by keeping the port open 24 hours a day seven days a week will change things. will it? william la jeunesse following all of that at the port of long beach in california. william? reporter: neil, you're right, l.a. long beach is the largest port in the united states. literally they will see 40% of all container traffic, shortest distance between here and china, takes two weeks. if you look offshore here you begin to see why this is at the epicenter of the supply chain

crisis. 60 boats are anchored offshore. they have to come in here to drop off the cargo. when keith pans over to the right you will see why there is this backup if you will, right? you got to be able to move those containers off those large ships but you need room to do it. if you look over to the right of there, all those containers are already full. so there is no room. one of the reasons there is no room because there is lack of trucks and truckers. big problem. they're not being able to get to the warehouses and to the retailers. so the white house is now saying they will add that third shift from 3:00 a.m. to 7:00 a.m. to try to reduce this backlog of containers. >> rise to the occasion. flex capacity in workforces to move cargo out. we're doing our part here at the port of los angeles. our partners in rail, truck, warehousing are lifting all they can at this point in time. reporter: so long beach tried doing the 24/7 about a month ago. they're was a lot problems. a lot of truckers said hey, you

know what? you got to show up with an empty cargo container to get a full one. they weren't crazy about that. getting on the road at 7:00. they weren't getting cooperation with the warehouses to drop it off. it frankly didn't work very well. there is shortage of drivers. they're getting old. some left during the pandemic. we went to a driving school yesterday. it is full. the companies say they are now offering bonuses. they will pay for your training but big problem is, they can't get permits because of backlog at dmv. >> even though the costs might be five or six weeks, they might be waiting to test out at dmv for another two months. reporter: neil what the white house is hoping enlisting walmart, home depot, ups, fedex if they're going to use that shift, hoot hours between 3:00 and 7:00 a.m., take 3,000 containers off every day, that will help reduce the backlog here. we'll see if it works.

neil: william la jeunesse, thank you very much for that. picture the problem in this way. americans on average are seeing pay increases averaging, averaging 5% year-over-year, not across the board but that is an average the pay increases in this country. here is the problem. the latest inflation report, inflation is averaging 5.4%. so you are still schellerring out more for goods and putting money in your wallet. madison alworth is seeing it up close and personal at a grocery store. madison. reporter: hey, neil, yeah, not good news when it come to inflation up 0.4% annually from this time last year to today, 5.4%. the two categories contributing the most to this problem, food and fuel. but not all food is contributing. certain categories contributing increase. the categories increased most over the past year. meat is one of our top

contributors. meat is up 12% annually. bacon up over 19% annually and fish and seafood up over 10% annually. but let's not talk about percents. talk dollars and sents to put this in perspective. looking at bacon like this, today it will cost you 7.99. last year, 5.99. a porthouse steak like this is on sale today for 10.99. last year you would have only paid 7.99. avocados, my favorite part of a salad, the price keeps going up. one avocado, 2.99. $3. last year, 1.99. we spoke to the president of stew leonard's, one thing with the increase. take a listen. >> we're in the middle of tsunami in food. not only seeing inflation in the food prices but all the disruptions in the supply chain. the big thing is labor.

we've had to raise your labor rates over 10% just to get the best people. reporter: so when you consider how much people are spending on food, fuel and shelter the average american family is spending $175 a month. that obviously adds up. so if you're looking to cut back there are some things you can do. in terms of meat the ground beef, that will be a lot less than obviously your delicious, amazing cuts. that is one way to cut back. when it comes to breakfast, milk stayed pretty stable but cereal is up over 50%, or 50 cents, excuse me. i hate to do this, neil, but bacon, bacon is just hitting your wallet super hard. if you can go without the bacon that is definitely a way to save a couple bucks. back to you. neil: also your healthy alternative. these salads which you speak, i heard of them, madison. keep me posted on that. madison alworth on all this in

paramus, you in jeers. my next guest knows it, ceo at mccormack, the big spice company. when they referring to inflation adding that to the spice of life. i don't think he takes that as a compliment. lawrence, you have difficulty dealing with this, people have huge demanned for your stuff but again at a higher cost? >> neil, thank you for having me on fox. first time i've been on your show. the topic of inflation and supply chain disruptions that you were just covering is one that applies across all industry and especially to a company like mccormack that is having tremendous growth. one of the things that is kind of missed through the pandemic news that some companies have done extremely well. you know, if you look back over the last two years, mccormick is up 20% on sales, operating

profit, earnings per share and all of that growth in the period of a lot of challenging supply issues. the recent challenge around logistics and so on, make it hard to keep up with demand. the demand for our flavor products has just been unprecedented. you think about people staying at home, cooking more from scratch. now they're all, everything is reopening. everyone kept the cooking skills. somebody in every house become as expert. restaurants are opening up on top of it. a lot of demand to meet in a challenging variety. neil: it seems your customers are paying higher price, they want the spices, they want the goodies, many have become quite the foodies last 18, 19 months at home but how long do you expect that to last? i always argue inflation lasts

when people say no to those price increases. we don't appear to be at that point yet. >> we haven't taken anything like the price increases you were just describing on some of those items and in a lot of way mccormick products are solution dealing with higher prices. when meat gets more expensive, our spices, seasoning a way to make a cheaper cut of meat taste as delicious as the expensive prime cut might have been. montreal steak seasoning can make a sirloin or chuck steak taste as delicious on the grill as a strip steak. >> what is really causing -- i can understand the coming, post the pandemic, we had an economy that was in park last year at this time. anything after that will lead to an uptick in demand and prices, i get that, but how does this supply chain disruption affect you? play that out for me. >> sure, we're seeing broad-based increases in costs

first of all. of course raw materials, package materials and especially transportation costs have really taken off in the second half of the year and that's inflation we're talking about. of course labor and energy now is up as well. transportation is the tightest aspect of that you know, for us, right now you know. our raw materials like pepper, vanilla aren't grown in the united states. they have to get here by ship. ocean freights are up tremendously. the congestion at the ports you were just talking about directly impacts us and we had to take extraordinary steps, like airfreighting things into the u.s. at tremendous cost and keeping extra stocks of inventory on hand in order to make sure that we can continue to supply cuts for consumers. it's a global issue. not just a u.s. issue.

40% of our sales are outside of the u.s. so the impact on global trade is a direct impact on us. neil: that's fascinating. and you're right, it does spill over into everything. best of luck with us. mccormick ceo. i see rational put spices on cheaper brands of meat to absorb that body blow and maybe it is working. a little footnote on the blue origin with william shatner. they had all of ten minutes of the flight. four of minutes into deep space, what we call deep space, 63 miles over the surface of the earth. we understand they weren't talking about the view. they were talking about these runaway prices after this.

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neil: i thought there was sound with that. i apologize.

anyway the second man blue origin flight from bezos, landing without a hitch, without a problem, a little more than a couple of months after he and three others did it. he had captain kirk and company doing it today. two onboard were paying customers. we're told they forked over 250 grand a piece for the pleasure. that works out to $25,000 a minute but who is counting. kelly o'grady following it all from van horn, texas. kelly? reporter: $25,000 a minute, what a stat, neil. it was quite a day in van horn, texas. blue origin had second spaceflight. william shatner made history going boldly where no 90-year-old man ever went before. shatner described what it came down when. once the vessel took off there was successful separation of the capsule and the booster. the capsule reached

347,000 feet, passing that karman line and the sonic boom everyone talks about happened about 7 minutes and 15 seconds. listen they told me to prepared for it but i was so caught by surprise. it returned to earth after ten minutes and 17 seconds. weightlessness, the astronauts experienced about four minutes. when shatner got out of the capsule he talked to bezos and he was visibly overwhelmed by the experience. take a listen. >> what you have given me is the most profound experience i -- i'm so filled with emotion about what just happened. i just, it is extraordinary, extraordinary. reporter: that is what we're going to remember about today, that raw emotion. as we all watched as viewers, everyone here, our eyes were glued to the sky, that understanding this was a historic moment and profound as

shatner said. blue origin has one more flight left in 2021 and a number of them slated for 2022. you know, this is the best advertisement that blue origin could have asked for, a successful flight, shatner's emotion and the comments. he suggested everyone should go to space but i can't help but ask, when will the average american be able to do that with that price you quoted, neil, of 250,000? neil: i love how they say it is going down. before you know it will be 199,999. we'll wait a little bit, a little bit. thank you very much, kelly owe grady. these four who launched into space today were there technically all of ten minutes for the entire flight, actually four minutes in space itself. compare that to my next guest, over four space shuttle missions, close to 54 days in space. i don't think tom jones keeps tracks of numbers but he could. he joins us right now, the

former astronaut. tom, now, you're an astronaut, a veteran of four incredible missions. you retired i think back what in 2001? >> that's right. neil: now these guys, jeff bezos was calling them astronauts for a few minutes. are they astronauts in your, in your terminology? >> sure. they're space travelers. that is really what the word astronaut means from the greek roots. neil: tom, tom, you are a hero, my friend and a modest one at that. you're an astronaut. these guys are great. i take nothing away. who can argue about captain kirk but i'm saying a few minutes in space with no control over everything versus you, you know, piloting space shuttles, that is a very big difference? >> private astronauts are the coming thing. there will always be professional astronauts required to be out there on the frontier doing lewis and clark stuff. we can make that distinction

verbally. find to call people who are space travelers, space travelers. neil: got it. you're a gentleman to the core. how do you feel about where this is going? already from some of the earliest reads we're getting the price of getting on these flights will go down and many get to travel for free as guests of whoever billionaire is hosting the flight. do you see this getting mainstream though? and i'm just wondering does it go on a concurrent track with other missions ultimately places like mars and beyond? >> sure. i think that there is going to be a continued evident to get people back to the moon in just the next five years that will be followed by trips to mars for the professional space agencies and the professional astronaut crews that will be a joint international effort that will go on even as the commercial efforts proceed to open up space to a wider audience. i think in a generation we'll see the cost of a trip like shatner's today to drop by a

factor of 10. it will come down to realm of a trip to ant an arctic can or galapagos, out of atmosphere travel to other destinations on the globe or stay up there for a week and enjoy the view and experience of free fall. neil: you followed all these billionaires from richard branson, elon musk, all have different ways getting up there. safe to say elon musk has the most experience and grandest flights and biggest rockets t was a few weeks ago he sent individual to circle the earth for a total of three days. the other two gentlemen don't have those rockets quite ready to go yet. is elon musk leading this private charge? >> sure. he has the best product if you will right now to sell the best experience because he can offer

an orbital trip to the international space station. you know there is a russian actress and director up there filming a movie on the space station right now. that was done privately. musk has regular astronaut transport for nasa to the space station but that will ship over to private hotels or space stations in the coming decade or so. so he has the inside track. blue origin who flew today with william shatner they have a big orbital rocket planned that will duplicate what spacex plans t will be a battle he will for the two entrepreneur who offers the best price point and operability to nasa and the space force. neil: tom, you're always a gentleman. you never say all the people who can pay right amount, be celebrities in their own right to fly in space. if it were me, i would say do you know what i went through to be an astronaut? but you never take the bait, my friend. thank you very, very much. tom jones, a genuine american hero. they are all heroes i take nothing away from they have done

today. you can't compare them to people like tom, you just can't. we have a lot more coming up including a chip shortage now hitting that iphone you just ordered, maybe by some weeks. maybe months. after this. ♪. ♪ ♪ there are beautiful ideas that remain in the dark. but with our new multi-cloud experience, you have the flexibility you need to unveil them to the world. ♪

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♪. neil: all right. inflation, it is real. what the problem is though how do you get through it? i always said that inflation ends as soon as you stop paying the higher prices and it doesn't look at least at this time that americans are going to stop buying things because well they are getting to be pricier things. we have larry kudlow joining us in the next hour. john catsimatidis big grocery

conglomerate owner, so far the customers seem to be paying. katrina campins on the real estate impact. housing is going through the roof, see what i did there, housing going through the roof? that's fine. dan geltrude by training notoriously cheap what he makes of environment. ed rensi, mcdonald's ceo, fast-food guys are finding ways to get around this but you will be surprised to find out how they're getting around it. a lot coming up in our inflation special in the next hour. meantime, taking a look at car repairs. they're getting pricey but the business is booming because a lot of people are hanging on to the cars they have because it is so hard to get new cars period. the latest with lydia hu. lydia? reporter: hi, kneel. neil. as you said it cars are getting expensive people are repairing existing ride to keep it on the road rather than invest to buy a

new car. the parking lot of great bear auto, body, totally full with cars waiting to get services. we're getting insight from the owner of this auto body shop. tell us what you're seeing in terms of your business? how businessry are you? what types of services are people requesting? >> we're super busy. we're replacing engines on people used to throw away but cars are so expensive they're trying to fix the car instead. reporter: they're trying to america it last. there are some hurdles right now because you're experiencing a crunch from the supply chain. what types of parts are hard to find? >> we have delay in parts. brakes for nissan, chevy malibu are not easy to get. we can't get rotors. we have two cars on the lift waiting for parts we had to take off of the lift because we waiting for parts we won't get until this afternoon or tomorrow. reporter: changing something

that would take an hour or two to overnight stay for the customers. labor also a challenge. you said three technicians walked in here looking for a job, hire them all on the spot? >> very true. it is gender neutral when it comes to auto repair. there is a great opportunity. we're also hiring. reporter: thank you sew much. you heard it from audra, neil, costs are going up. times are getting longer. while business is good here at the auto body shops, it is harder to get the job done. back to you. neil: you will pay for it. but people will fork over the bucks for that. thank you very, very much on that lydia hu. meantime, have you ordered any new apple iphones that are out? some of you, especially got into this a little bit late, you might be waiting for a while. now news out of apple it is delaying or cutting production could complicate things as we get closer and closer to christmas. susan li following all of that.

susan: iphone 13 hard to come by. you're waiting at least a month. neil: you are rubbing it in. susan: you get that first day. what do you say about me when i'm not here called dan geltrude cheap? oh, my. neil: i don't know whether you're cheap, dan is certainly is. he is accountant. susan: i'm frugal. neil: people are watching pennies. susan: you would imagine that a company as big as apple has a ton of money to spend. they do have a lot on the balance sheet but when you're so exacting and the world's largest company and even you are impacted by the global chip shortage that's a problem. however i should note that apple makes most, probably i would say most of the chips, almost 90% of the chips into their products right now. there are still high-end that they use some intels. that is not their chips, right? a-15, m-1s are fine. other chips made by texas instruments broadcom, sky worth, other apple suppliers are having a choke point taking place in

taiwan. this is 10 million units according to bloomberg reporting. apple has not confirmed this. is it necessarily new? we heard from the ceo in the springtime, ship shortage, not apple chips, but other suppliers will cut into production and handset availability in the quarter. that is why the stock isn't down more. they kind of anticipated it. they already forecast for this to happen. as i said to you tim cook is known as the maestro of the supply chain. they have virtually zero inventory of phones. because that fast supply chain, right? they can just make phones instantly. and there is no inventory which obviously cuts down on their costs. for a company like this so exacting, when you're waiting on parts from texas instruments and broadcom there might be -- neil: iphone orders denied other delayed? susan: delayed. neil: whatever sales don't materialize in the present or next quarter would be reflected after that.

so it is not after if there is mass cancellations frustrated people saying that's it. susan: right. only 10 million units. they expect it to sell 90 million of iphone 13s. as long as you get the phones before christmas, that is when you big sales happens for the new iphones by the way in case you want to reward me -- neil: you even made it. susan: got it early. it was great. fantastic screen. rhett any display. neil: a little defensive when i raised that. like dan geltrude. you -- susan: i'm willing to spend. i can open my wallet to spend on electronics. i'm willing to do that. neil: dan still working on the iphone 2. have to get him up to speed. you're the best. thank you very, very much, susan li on all of those developments and dan is coming back later to tell us exactly how someone who really watches what he spend was spend on a lot of stuff getting up, up and away. you probably heard right now you want to travel to canada, now to mexico, you can.

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and if you order it today, we will also include the action guide, "practical questions and answers for this present crisis". call or go online today for your free copy. (dramatic music) at vanguard, you're more than just an investor, you're an owner with access to financial advice, tools and a personalized plan that helps you build a future for those you love. vanguard. become an owner. neil: all right. this of course is, well, the blue origin rocket carrying of all people and some others william shatner of captain kirk fame. a picture-perfect landing t was a 10 minute flight and already are asking who will be on the next flight? captain kirk only stands to reason charlie gasparino gets the next request. >> i wonder if fox will let me

do it? do you think they would? neil: with the notoriety i think it reflects well on fox. they might want you up in space. plenty of viewers do. >> here is the thing, fox didn't let me do it i did it, fired me i would be internationally famous on my own, i wouldn't need fox, right? neil: briefly, briefly. >> go on msnbc or cnn. neil: good to know. >> we always go there. neil: we always go there. it is always dangerous. one of these days there will be a call. what you have got going down? >> i don't know. you asked me -- neil: charlie gasparino. >> you asked me what i got? neil: what do you have now? >> i got many things. what do you want? this is very famous thing at cnbc when dylan ratigan asked me at the height of the financial crisis, what do you got? i got mad, what do you want? went back and forth. nbc that was abbott and costello

on steroids. neil: there is no problem with abbott and costello. >> we do have a good story what is going on in terms of investigations on citadel securities. i don't think you know a lot. everybody talks about goldman sachs being big, blackrock being big, blackstone being huge. ken given's citadel securities is monster. worth 10 to $16 billion. put together a amazing firm. he is one of the biggest or maybe the biggest republican donors. we've been tracking his donations since, i would say the last 10 years, $100 million to republicans and republican causes. neil: wow. >> my producer if it is wrong it is all on her. only kidding. but she is good. neil: that is koch brothers good. >> he might be rivaling charles koch in terms of contributions to right leaning causes. what gop views source are telling me, operatives in washington there is movement

afoot by elizabeth warrens, by the gary genslers, essentially try to neuter his empire and essentially go after him because he is this big guy in terms of republican causes and -- neil: you don't think they would if he were on the other side? >> they're saying if you look at some inquiries going on right now, this whole notion payment for order flow is some sort of a scam, these things that his citadel does, it makes no sense. they will tell you other than it is ken griffin doing it. if you remember he went before congress and warren gave him a hard time on these things. gensler is now, gary gensler, sec chief is doing major inquiry to the meme stock stuff any conflicts of interest involving citadel's role in it. they buy the order flow from robinhood, right, so robinhood can charge zero commissions. gensler hate this is practice. i don't know why. it works. people trade cheaply on it.

he may outlaw the practice. neil: legal now. >> totally legal. not good research why it is bad for retail. it is still very -- in any event we're getting from people in washington they're saying this stuff that is going on is aimed at him and it is really interesting because he is, i mean if you think about it, jamie dimon, personally doesn't give any money. stove schwartzman give as few blix at blackstone. he is republican. neil: he spreads it out too. >> he spreads it out. this is pretty amazing. we tried to find any democratic donations. we couldn't find any the last 10 years. there is political element people are saying. by the way he is republican. he is a conservative. believes in low taxes. nothing wrong with that. this is, you promote those policies. you know, particularly in the face what is going on in washington right now which is quite the opposite. neil: yeah. >> this story is developing. we'll keep on it. i will be back to you. maybe report from space? neil: many have volunteered you.

thank you, my friend. you are the best. >> thank you. >> you don't have to be in orbit to achieve genius. >> do you think fox would fire me if i went up into space? neil: they would fire you for variety of other reasons. thank you, my friend. charlie gasparino is the best in the business, bar none. he has a good sense of humor. you need a good sense of humor to put up with what is going on with inflation. it is out of control. how much out of control we'll show you in our second hour. stay with us.

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♪. neil: all right. democrats still far apart on that big ol' spending plan right now. progressives saying they really don't want to budge much from the 3 1/2 trillion dollar figure. moderates say they better budge a lot more. but they're still at least a trillion or two apart. what is another trillion when adding it all up. chad pergram where it all stands right now. reporter: good afternoon, neil. cuts are essential if democrats will get anywhere with the original $3.5 trillion spending bill. what makes the cut and what is on the chopping block. >> but the fact is is that if there is fewer dollars to spend there are choices to be made. mostly we would be cutting back on years and something like

that. but those are decisions -- reporter: trimming the length in years for some programs is one way to save money. >> like the idea of that possibility that perhaps rather than looking at a 10-year allocation, that it could be something smaller which would reduce the amount of the overall package. i like the idea. reporter: one thing they're looking at is whether to make the child tax credit permanent. >> that is why you know, it is important for the progressives caucus. not one of our top priorities that we identified but we're supportive of it and we think it makes sense to extend it as long as the members will take. reporter: there are choices to be made. medicare expansion, free community college, housing programs, all are expensive. democratic west virginia senator joe manchin already shot down major expansions in health care. there is concern about the debt. and he and krysten sinema diverge when it comes to

environmental provisions. neil? neil: chad, thank you very, very much. a lot of people are looking at what they ultimately come up with, even if they come up with a lower spending package, is it really worth the paper it is written on, the calls for phasing out sooner than later. a good of goodies in the package you decide future congress under either party would get rid of those. you get to the heart of the debate. shana sissell, hal lambert. hal, i think some democrats, certainly progressives know that that's a way to get around this. whatever final figure they come up with, they quite realize that you might get a lower figure by sunsetting some of these programs but it is not as if that means they go away. the costs are still there. what do you think? >> right. that is just a gimmick. you know, they're saying well it will go from 10 years to five years, so we cut half the cost.

no they haven't. they are spending same amount in the same five years and kicking the can down the road as you said to another congress. it doesn't work. look, it is not going to work either. senator joe manchin has a number. his number, my understanding, i've talked to a lot of people about this is well below 3 1/2 trillion. closer to 2 trillion. there are real cuts if they get them close to being on board. you run into the problem where the house caucus for the democrats, the far left, they don't want any cuts. imagine trying to cut from 3 1/2 trillion to 2 trillion. that 1 1/2 trillion will come from programs they will be very upset about. they will lose house votes. they're in a real bind. i think it will be difficult for them to get something done potentially at all on this. neil: if that were the case, shana, what would the market reaction be? if this looks like it isn't going to happen at all, then what? >> i think the market is already sort of come to the conclusion that this is going to be a

smaller package if it happens at all. i'm not completely convinced the market was pricing in another huge stimulus. there has been quite a bit of volatility and a lot of other issues impacting the market. we've seen somewhat of a correction. when you just look at the fundamentals of the market, earnings season starts right around now. earnings there have been quite a bit of concerns. there are supply chain issues. those are focus that the market is on, is thinking about right now. what is going on in washington, once the debt ceiling issue is sort of resolved. i'm not sure the market actually cares that much right now. i think it might have a few months ago. at this point we lost hope there i will was major stimulus package. that is not necessarily a bad thing. neil: let me switch gears to another market concern even though they haven't really shown it yet in china. yet. forget about the threaten being activity around provocative talk and hundreds of sortie missions

over taiwan. the fact it is enjoying the biggest monthly surplus for the united states it ever has, in the latest month $42 billion more us buying goods from them than they are from us, is that a sleeper you know, issue to you right now hal? should you, do you worry about it? >> it helps china. gives them more dollars they're selling a lot of products. it is not surprising. we're their largest trading partner, sell consumer products effectively what they sell. massive stimulus from the federal government and the fed. not surprising it has gone up. another interesting thing neil, it is worse than it appears. what china buys from us is natural gas and coal, soybeans. we know what happened to the pricing of commodities. that has gone way up. that offset some surplus. in reality they're buying less than they were before only price of natural gas is narrative

some. it's a real problem. doesn't seem to be going away. we'll have more stimulus probably within the country. china will keep selling us products. neil: guys, thank you both, i apologize for the truncated nature of this. following some of the breaking news we're getting here as well as indications out of congress and chad pergram touched on it. the two sides are far apart. some progressives are saying we are not going to budge on that overall figure. some moderates say unless you do it isn't going to happen. the white house inserting itself in the middle of all of this, everything is on the line if we don't do something, including that bipartisan infrastructure plan. that too, tied to this is in doubt. by the way, the other issue? inflation. it is real, it is alive. now the administration is scrambling to get on top of it. good luck with that. the real problem with it after this. (vo) while you may not be running an architectural firm, tending hives of honeybees,

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we got this. life is for living. we got this. let's partner for all of it. edward jones ♪ ♪ neil: inflation is real. that is probably an understatement. welcome, everybody, i'm neil cavuto, and a special look at where we have found ourselves on something we thought we had overcome. there's a whole generation that doesn't remember the '70s with the exception of leisure suitses and bell bottoms. i do remember other aspects like long gas lines and the fears it could get out of control. i also remember cds that were yielding 18%. hard to conceive of.

but could it be happening again? a beleaguered president then trying to get on top of a problem that wouldn't go away, and now a beleaguered president -- also a democrat -- dealing with the same thing that he hopes goes away. so far no signs has happening. and we decided for the next hour cover all the bases, where it's happening, what they can do to possibly deal with it. and we've got you covered with some of the best and brightest names out there including our own larry kudlow are, the former are director of the national economic council under president trump, john cats knee d.c. as well, owner of a grocery store, katrina -- the real estate genius. she saw florida booming when we were, well, in the midsts of pandemic and everyone, everyone was doom and glooming. we've also got dan geltrude. he's an accountant by training,

notoriously cheap, but i say that in a good way because he's concerned washington doesn't share his feeling. also ed bradley, and he's here to tell you it's not going away. so it's a packed show. let's get right to it with larry kudlow the host, of course, of a wildly popular show at 4 p.m., "kudlow," and former economic big wig in the trump administration. good the see you. >> good to see you, neil. that's a good yet. everything we've seen is disappointing, including today's cpi report where there really concern. neil: where the trend has been as the uptick in crisis continues. >> yeah. 5.4% the last 12 months is not good. now, the consumer, personal consumer deflater which is a broader measure the fed uses, it's running a a point lore. but still, the trends are are

not good. and i was thinking how to make this as easy as possible to think about it. there's two sides to. one is what i call pandemic inflation, and those are the supply shortages. essentially, supply shortages, people slow to come back to work, those kinds of things. and that's not a policy issue, it's just you have a once in a 100-year event, and you turn the spigot off, and then you turn the spigot back on, it's a hard thing to do, very hard thing to do. and one good thing, i'm not a big fan of joe biden, but his conference today with fedex and walmart and jimmy hoffa and the teamsters is a very good thing, because the supply shortages, neil, the containers backed up in l.a. and long beach, that's becoming a national emergency, and i'm glad president biden is on it. so that's one-half of the story, the so-called temporary part. but one reason i'm beginning to turn more negative on the

outlook, i'm looking at the monetary part. the federal reserve keeps pumping up the nation's money supply. now, i understood that during the pandemic -- neil: right. >> -- we needed plenty of cash. but in the last six months or so, eight months, bank deposits, the fed's balance sheet, they're still pumping it in. they're giving us more money than we need -- neil: and we've gotten used to it, right? it's almost like for investors like a fix. >> yeah, it is a little wit. it's nice to have free money, the stock market loves free money. i'm getting worried about it, okay? i'm getting very concerned about it. and to a large extent, all of the spending and borrowing is being financed by fed very muchs. the fed has bought 57% of the new bonds issued by the treasury. that's a bit latin american style, neil -- neil: so draw back from that, rates can only go up. larry, knowing that you were

coming here, a lot of our viewers were filing left and right trying to get mails and videos to you. one we have is from david from texas. this is david. >> how can the inflation be tamed if the fed keeps on pumping money into the economy? neil: he raises a good point. how do you tame inflation when you keep adding money that compounds the problem? >> yep. david's a smart guy. that's my monitory in-- monetary inflation side, and that's creeping up. we are running so far ahead of normal cash -- there's so much money out there, i kind of like this story. the wall street traders will tell you the banks and the money funds and insurance companies are literally coming to the new york fed at night, we have more money than we know what to do with. and so the fed is doing these, they're called reverse repurchase agreements for five basis points, they'll take the money, and they'll give it, for five basis points, they'll give them a treasury bill.

could be an overnight bill or a three-day bill. but there's 1.3 trillion of that going on every day. it's an incredible story -- neil: and it's propping this up, right? >> well, i'm just saying the question dave from texas asked and the most important question right now because these supply shortages, that'll eventually get worked out. don't ask me when, but eventually it will. we can open up containers, and we can get truck drivers, and we're going to have to pay them a good wage. not easy, but we can solve that. but the fed pumping out all cash constantly, week after week? m2's growing at 12 or 13 percent. we're well into this recovery -- neil: you're referring to money supply, it's a good baseline -- >> and that will increase inflation if it -- neil: it already is. there's another issue, too, that comes up, and that is the supply chain disruption, larry, and it prompted this question from kyle in massachusetts. take a look. >> hey, neil.

big concern of mine if is the microchip shortage. what is causing it and, like, at the root, where did it actually start s and how do we get to the end of it and when, and will those prices just continue to keep going up over time? neil: they've been going up. this is an interesting phenomenon. >> another good question. to some extent, look, i had wilbur ross on last night, former commerce secretary, just knows everything there is to know about semiconductors and chips, okay? so we walked through this. taiwan is producing big. so is south korea, samsung. taiwan manufacturing. i mean, they're fabulous semiconductors. the problem was, first, a9 bottleneck in some trading ports, vietnam being one of them, also china being another. vietnam may be more important, believe it or not. and second, coming from asia the

added ships, we only make 12% of the chips that we use, so we rely on the rest of the world -- neil: a lot of it asia, a lot of it china -- >> right. long beach and l.a.. neil: if it continues, that could compound the issue, right? >> the short answer is yes, and probably the long answer is yes. our relations with china deteriorate, the chinese have moved, neil, away from their market reforms and a very state-run, almost totalitarian political operation. which is crunching down the economy, they're attacking their banks, attacking their private sector -- neil: yeah, and they're resorting and going back to form on the brute stuff, right? the military. >> threatening taiwan. you know, taiwan is very important. if you're worried about chips, taiwan is huge. neil: you're right about that. >> and so is south korea. we're bringing them back here, okay? we're using some subsidies. not my favorite thing, but this is national security.

taiwan semiconductor manufacturing is coming to arizona, and the government will pony up some additional subsidies, but it's a problem. automobiles, i mean, these are not specialized chips, and that's why it goes back to long beach and l.a.. they're in containers, and you and i should just go out there and unpack the damn containers, okay? [laughter] neil: i know it's bad when they say they're running out of cargo ships. like these stores that want their own cargo ships -- >> what else came out at the biden meeting, i mean, the long shoremen really should be 24/7. neil: i was surprised they weren't. >> right. i had heard rumors they were closing shop at 3 p.m. in the afternoon. they should be paid for it, lord knows, lots and lots of overtime, but this is virtually a national emergency. neil: you're quite right about that. we have this question are from don in texas, larry, saying i've always thought of inflation as the tax the government doesn't

collect. is this a good way to view it? >> well, yeah. inflation is a tax. it takes away the purchasing power, or put it -- the money you have in your wallet or your pocketbook, literally the cash you have or in your checking account, is diminished. its value goes down by the rate of inflation going up. and so it is a tax. and you see it most clearly, i mean, we didn't get any relief particularly energy prices up 1.3%, all right? we can talk about that. but food up 5% year on year. food -- neil: none of that's abating. it gets worse. >> 8.5% annualized the last three months for food, 21.4% for energy. that's a tax. that's an inflation tax. was it john may gnarled keynes? -- maynard keynes? you knew him. neil: usually it starts with energy, correct? on your show you talk about that, it started in energy, go back to the biden days with

stopping the pipeline, but bottom line, it started with energy prices. others have followed suit, and they continue to. do you see that trend continuing? >> unfortunately. neil: yeah. >> unfortunately, i do. i mean, look, we were the world's number one producer at over 13 million barrels a day pre-pandemic -- neil: yeah. >> now we're down to 11 million barrels a day -- neil: and we're begging them to make up the difference in the production. >> crazy. and we're giving russia, you know, i mean, come on. neil: yeah. >> we could have -- gasoline's up a buck. i'm not saying it could have totally been avoided, but a lot of it could be avoid ised. and there's a story, i think it was then front page of the journal today, anyway, someplace in the paper these frackers don't, they don't want to make investments because they, these headwinds coming from washington. neil: can't blame them. guys, i want to skip to lee from alabama who had a good view on this low rate environment and

how long it could last. take a look. >> during this downturn in interest rates, almost record low interest rates, did the fed increase the maturity of bonds that we have outstanding? and the second question is, are we -- who's buying the bonds? neil: [inaudible] >> yeah. the duration. the answer is, yes, comma, but not enough, period. now, we had this -- i really persuaded trump, we should be selling 50-year bonds or 100-year -- neil: and they were kicking that around. >> right. neil: what's the benefit of that? you're locking into those low rates for a long time? >> exactly. say you have a 3% 30-year mortgage. right now the 10-year is, what, 1.60. lock it in for 50 years, man.

neil: they're only going up. you see rates going up a lot higher from here? because the normal fed funds at this point should be at 3 or 4% given this environment, right? >> yes, i think that's right. mom that would gdp -- nominal g e dp is growing at 10%. you haven't have a zero -- you can't have a zero fed funds rate. so, no, i don't like bonds. i think rates are going to go up. we have extended the maturity to a little over five years, all right9? in the treasury financing. steve mnuchin, my good friend who was treasury secretary, acknowledged 25 and 30-year maturities. we didn't get there. i wanted 50 or 100 years -- neil: interesting. >> trump wanted 100 years. you know, president trump, former businessman, he knew a lot about debt and borrowing. neil: right, right. >> i think, correct me if i'm wrong, japan has 50 or 100-year bonds, britain does concern. neil: they've had zero rates

forever. larry, so good to see you, my friend. a lot of people say you were the the calm in the trump administration storm. that's not disparaging the administration or saying that larry kudlow was problematic in that, quite the op to sit. he was very -- opposite. he was very reassuring to markets and to a lot of viewers who just want some sort of a calming experience. but you can accept on face value things are going to go higher, a lot higher. the question is how soon and by how much. if you take a look at the gas pump here, of course, you know what's going on. you're paying higher prices, and because we're so beholden to opec and opec-plus countries, it's going to go even higher still. stay with us. ♪ ♪ 0-60 in 3.5. ♪ baby you've got the key, shut up and drive ♪♪

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♪ >> oh, my god, this is ridiculous! i can't believe it, it's the over $100 to fill my tank. >> prices are too high as it is, so it's not a good situation. and i don't understand why we have these prices going high. i don't understand. >> it's costing me $140 to fill up my truck, and it's just

taking me apart. neil: you know, it started, if you think about it, with energy prices, right? and gas prices that are now at multiyear highs and we're seeing it extend to what's happening at the grocery store. these are all businesses which my next guest is a dominant player, john cats my d.c., he has a good eye on everything that's going on. john, very good to see you. i wonder when people react the way they do, not happily, to these high prices how long they stick around. the experience we have with inflation is it's not transitory, it stays awhile. do you agree? >> i think it stays for a while, and it started with the first week that president biden was in office and he kills the pipeline. and he kills the keystone pipeline, and don't forget america, north america, canada,

united states has a hundred years' worth of oil. so under president trump we were producing 13.5 million barrels a day. what are we down to? 11.5, 12, something like that. and guess what? it was $40 a barrel, $45 a barrel. thousand it's $80 a barrel -- now it's $80 a barrel. neil: and you think it could have been, at least, you know, explore those solar, wind options, but everything. go all in. >> oh, absolutely. let's explore wind, let's explore solar -- neil: but you famously said don't kill -- >> don't kill america. look, we turned over because we went to 13.5 let's say to 12 or 11.5. 2 million barrels a day. we turned it over to the russians. neil: now we're begging them to increase production -- >> selling us an extra 840,000 barrels a day. the russians are selling to us. not at $40 or 50, at $80 a

barrel. 80! neil: are you surprised how quickly it spill over -- >> no, not surprised, because it's natural. when the white house says we're going to raise the taxes on the the rich, forget about the rich. they won't pay anyway. we're going to raise the taxes on corporations. well, guess what? when you raise the taxes on corporations, it flows downhill. they're going to raise the prices to the consumer. so when the consumer's paying a dollar more for skippy' nut butter or whatever -- peanut butter or whatever, it's because the manufacture in fear the that his costs are increasing, is charging more. you know why? they don't want to have a bad quarter. they don't -- neil: and so far they can pass it along, right? let me -- we've got a lot of questions. a lot of people knew you would be here. this is from tom in tampa on this phenomenon. take a look. >> i don't think there's ad good, logical reason as to why

things are going up. they're going up, and no one can explain why. gas would be a good one because we had it very under control for a long time, and all of a sudden gas just shot through the roof. i don't know why that happened. >> i'll tell tom why. gasoline are, when crude oil goes from from $40 to $80 a barrel and we're not getting -- we reduced, the united states reduced the production, and we're getting screwed up in canada with the pipeline situation not getting all our crude oil from canada, what happens? the price went up to $80 a barrel, ask is we're paying -- and we're paying putin, and we're paying opec $80 a barrel for the crude oil. neil: but why does it run up at the grocery store. >> okay. everything's delivered to the grocery stores by truck. everything -- all the manufacturers' price increases are increasing cost because of labor. they have to pay more for labor. there's not enough truck

drivers. they are paying more for truck drivers. etc., etc., etc. -- neil: and it just place blossoms. do you see it lasting a while? >> it's going to last a little while. maybe i would say at least til mid 2022. neil: wow. all right. this is from lindsay, new york city. wonders about this whole supply chain issue. take a look. >> hi, neil. this is lindsay from new york city. how are shipping restrictions due to covid going to affect inflation rate for the holiday season and buying gifts? thanks. >> well, it's going to increase the cost of getting gifts. a lot of it is the bought from asia. because of transportation from asia to the united states and also shortages -- neil: an area of the world where the covid issue is still a big issue.

>> covid is a big issue, but you know what else is a big issue? the california docks that are coming in. they're not fully open. now i understand today -- neil: 24/7. >> 24/7. it should have been that a month ago. neil: i wondered that too. i thought they were 24/7. i guess they're not. all right. this is from david in texas who wonders about china. >> what can be done without depending on china to get back to shipping -- how can we become more self-reliant without depending on other companies to have a supply of our own materials here. neil: we've discovered that china kind of owns all this stuff. >> well, they own all that stuff, and now the white house, they went and put their thumb down on general motors, their thumb down on ford, oh, we have to have electric cars by 2035. even though we have 100 years 'worth of oil. you know why asia is pushing electric cars? they have no oil. by the way, when ford and

general motors builds electric cars, they're buying 90% of their batteries from china. and guess what? neil: how did china get in this position where they dominate not only all the precious minerals and all that -- >> well, let me finish. china needs lithium for their9 batteries, they didn't have any. so what kid we do? we gave them afghanistan. that's where all the lithium is. now, how did china do that? china has no oil, so they had no -- they had to go to electric so they wouldn't be dependent on us. but now we're going to be dependent on them for batteries. i mean, that is dumber than doesn't and why are we -- dumber than dumb. and why are we doing this? i don't know why. putin is laughing, and guess what? the chinese are laughing at us too. neil: yeah. this is from marlene who writes

i still cannot believe that the prices at the dollar tree will go up. it was the only place that had not been impacted by inflation until now, so where do we go from here? >> it's going to go up. maybe it'll -- dollar tree will be 1.99 instead of .99. their costs are going up. i was with a large manufacturer of products last week for dinner, and certain products used to cost them clash 1800 a con -- $1800 a container to bring in from asia, they were asking $20,000. is that right? that's right. neil: wow. your customers at some of the high-end -- for those not familiar in the new york metropolitan area, they're the cream of the grocery crop. your customers will happily pay more. but i have always been of the view, and i was telling larry kudlow the, i don't know how you feel about this, john, but inflation can only when

customers stop paying those higher prices. they don't show any sign of that for the time being. >> well, the word inflation, i don't use it anymore. because -- neil: what do you call it? >> i call it a tax on the poor and a tax on the middle class. because when the corporations are taxed and they pass it down to the stores, guess what? we're going to raise the prices. it's either two choices, either raise the prices or go bankrupt -- neil: but your customers absorb it, right? [inaudible conversations] so your margins, you can afford it. what is it about your base that allows that? >> no, it's about all bases -- neil: no, because it's not happening -- it's happening with your stores, more power to you, but your customers so far are paying those higher prices. >> it's happening all over but you don't see it yet. you're going to see it -- neil: where they just say no more, stop. >> oh, if you don't want oreo

cookies anymore, yeah, you can buy brand x. i got a price increase from nabisco the other day, and the numbers said we're raising anywhere from 4-14%. neil: wow. >> so what are we going to do? neil: people have a cutoff figure in their held? i will stop paying when a package costs more than $50. [laughter] up until then i might stay with them. >> well, you're right, $50 -- [laughter] oreo cookies. i like them a great deal. neil: got it. by the way, mark turner on what's happening now with this inflationary environment particularly when it comes to the basic stuff we use all the time. take a look. >> -- inflation impact our domestic manufacturing for holiday -- [inaudible] associated industries. >> good question. what do you think? >> i didn't hear -- neil: this environment and the stuff we ship abroad, it's that much more expensive. that's a problem for us, right?

>> don't forget, the price of brent in europe is $82, 83 a barrel. neil: you're right. >> so it all flows downhill -- [inaudible conversations] exclusive news here. have you thought about that they're forcing the price of natural gas up, they're forcing the price of gasoline up so it'll make it more end acceptable to have a car with electricity? think about it. neil: so they're forcing this migration from traditional -- >> meanwhile, opec is making a ton of money. you know, somebody wanted to do a charitable thing with a opec nation yesterday, a rabbi was in my office yesterday, wants to do something charitable with an opec nation. i said, rabbi, i said last year they were getting -- opec's producing 10 million barrels a day at $40 a barrel. now they're producing 10 million

barrels a day at $80 a barrel. they need charity? [laughter] neil: you could profit off of -- >> no, we only make a differential. neil: okay. well, it's made you a multibillionaire -- >> give or take a billion. neil: yeah, yeah, please. >> i don't care about it. i go to work every day, i've always worked certain days a week -- neil: you have. >> and i still work seven days a week if you count the time on my if computer saturday and sunday. neil: i knew you when you were just a mere millionaire. look at at you, you've done okay. >> well, god bless america. neil: he works hard and still works hard. that's a good reminder, by the way, any profession. you can be smart, but there's no beating working your hiney off because it does pay off in a lot of cases. we talk about how everything is going the inflation route and it's getting worrisome, but we

are seeing at least if the you're a homeowner in a good way because it rocketed in value, we particularly see that in hot markets like florida. but there's a flip side. when you do sell is your home at a premium, you still have to buy another home that is also at a premium. that conundrum after this. ♪ oh, but ain't that america for you and me? ♪ ain't9 that america something to see, baby. ♪ ain't that america, home of the free -- ♪ yeah, little pink houses for you and me ♪♪ as someone who resembles someone else... i appreciate that liberty mutual knows everyone's unique. that's why they customize your car insurance, so you only pay for what you need. oh, yeah. that's the spot. only pay for what you need. ♪ liberty, liberty, liberty, liberty ♪

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you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire >> we've been looking to buy a houo that's a big expense we've been kind of putting off. >> houses have astronomically just grown. and so -- and prices have gone incredibly up. that shouldn't be that high. >> just that's a lot. i don't know how younger people actually, like, buy houses and function. very difficult. >> i actually am remodeling a home right now, and prices on windows and how long we have to wait for everything or to come in, it's so much more drastic

than it was two years ago when we remodeled a different home, so it is extremely frustrating. neil: it is now, and a lot of people know it full well right now. but what if you were to be seeing all of this a year ago or 18 months before now? a lot of people would think you're crazy or on something or both, right? and a lot of people had that reaction to katrina when she was talking about the real estate market and the boom to come, certainly in hot markets like florida. but back then, katrina, if memory serves me right, those markets weren't remotely hot at all. what did you see then that a lot of people think is now on steroids now? >> well, neil, when i came on your show then, you know, in the midst of the pandemic, what i've always known about real estate is that it's a great hedge against inflation. but i also noticed that people were giving more importance to the home. you know, people were at home so much is, people were around their children, they needed a home office. so i began to hear more and more that people wanted more space

and all of a sudden in my mind something just clicked, and i just knew that real estate was going to be the driver that really helped us out of the, quote-unquote, recession that we were going to hit. and i remember -- neil: in the end, katrina, you still think there's some ways to go? >> well, you know, right now it's slowed down a little bit. not very much is. but what's happening, yeah, what's happening now is that people are definitely taking advantage of the fact that it's a strong the market. they're selling, but then they have nowhere to go. so that's actually causing rent prices to skyrocket. rents were up 9.2% in july. so many times when i sell people's home they say, okay, i'm going to rent for a little while, and i show them the rentals on the market, and all of a sudden they say is, wait a second, it's more expensive to rent than it is to buy, so we go right back into the buying mode. and you're experiencing this really across the board. as someone just mentioned at the beginning of the segment, home construction has become more and more expensive, and the lag time

has become more and more expensive which also means existing homes are are more valuable, the prices are going up. neil: a lot of people knew you were coming and had a lot of questions, including thea from florida, as a matter of fact. >> why is mortgages going up and not down? and why is it -- people say it's a seller's market. or it's a buyer's market, i'm not sure. but why is these mortgages keep going up? neil: assume he's talking about mortgage rates, but what do you say? >> well, first of all, it's definitely a seller's market. the norm is six months of inventory, and we definitely have is less than that. there's very little inventory, there's a lot of buyers that are not only looking for primary homes, but are also looking to buy investment properties because real estate has generally been a great hedge against inflation. a lot of times appreciation, you know, helps during inflation times. so the appreciation that you get when you're renting a property.

also the expenses can be passed on to your tenant. so that's why rental properties are doing extremely well. also building multi-family is more expensive, so current rental properties go up in value. mortgage rates are fluctuating a little bit. the fed's language has caused rates to go up a little bit, and many economists have predicted rates will go up in 2022, maybe up to 4%. neil: all right, the treasury has been buying and the fed directly buying a lot of treasury securities, mortgage-backed securities as well. the they buy fewer of them going forward, the supply and demand equation favors the rates going up. but, you know, there are hot markets right now, katrina, and then not so hot markets or markets that might be deemed underpriced. a good question from tom this buffalo. >> what cities do you think will be best for property investment in the future?

i'm thinking of becoming a property investor myself and would love some insights. neil: what do you have for him? >> well, kudos to you for buying property and starting now. there are various different cities which are doing well. i think the number one thing to look into is job growth, population growth and affordability. those are the three factors, i should say, when looking to buy in a particular area. as the old saying goes location, location, location, so cities like texas, for instance, are doing very well, north carolina, florida, new jersey. you have ohio doing well, chicago. so it's important to look at the demographics in the overall cities as people are migrating back to work and looking at the population growth as well. and remember also that a lot of the younger generation are going back to the cities, getting back to work, and they're rent aring as to opposed to buying because prices are so high. neil: katrina, we've got a lot of questions for all our guests on the supply chain and its impact even in real estate. this next guest kind of puts it

together, ray in boca raton. >> my question is considering we are seeing inflation become less transitory and more of a norm from factors such as supply chain disruption, do you see supply chain for building materials and products used in everyday lives normalizing anytime soon? and if so, when? neil: what do you think? >> you know, the bad news is, neil, that the supply chain issues that we're experiencing are much more persistent than anybody initially realized. the worse news is there are so many different factors as many of your guests have stated, so predicting a strait forward fix is -- straightforward fix is difficult. we're beginning to understand the overall story ask how it came to be. there's transportation, there's labor and there's energy. you know, transportation, china, for instance, during covid a lot of the ports were either closed or running at limited capacity. and the increase of durable goods or the increase, i'm sorry, on the demand of durable goods has skyrocketed making the

cost of containers go up and really -- we just can't keep up with the supply. what you're experiencing now in the home market. so if you're looking to order a bed, for instance, or looking to order a couch, things are taking much longer. also labor. there's a huge labor shortage here. so even workers to take things off containers or people to drive truck ares to be able to deliver goods, we're experiencing a shortage. and many times that's because the government is providing so many incentives and benefits not to work. another thing to consider is energy, and energy's much more deeper rooted, but it's really important to have energy in order to create these goods and services. and many -- it's also very important to note that many of the goods and services, for instance, in the united states need international traded components to be able to deliver those goods and services to us. neil: that's right. >> so many people that are buying homes from me now are so concerned, it's not furnished, when am i going to get furniture?

i'm going to be sleeping on, you know, a mattress on the floor for three months because it's going to take that long to get a bed. it's definitely affected florida as well. neil: katrina, i want to bring my buddy dan geltrude into this, an accountant by training. and i joke with him that he's very, very cheap, but i mean that in a good way because he looks for alternatives around these inflationary pressures. dan, they're harder to find these days though, right? >> yeah, they certainly are, neil, because everything literally is going up. so any place you look, and a lot of what we've been talking about here is trying to time things. and that's very difficult whether you're talking about the real estate market or whether you're talking about the stock market to try to time what's going to happen next, very, very difficult. so i think overall anybody and an investor in any type of market really has to look at the long-term investment because trends will come and go --

neil: dan, what is long term to you? >> long term for me -- >> real estate. [laughter] >> longer than a year. neil: okay. my age is breakfast next week. i want, dan, you to respond. this is joseph from florida, of course, katrina's neck of the woods, on just where all of this is going. >> hi, neil. question for you. what centrals should retirees take with their investments with the raging inflation that's taking place and expected to take place over the next few years? neil: in other words, all of that runup could be compromised if this runup gains traction. what do you tell him, dan? >> well, look, i go back to when you're looking at inflation, the concept here is that prices are going to continue to go up. we need to be very careful that when you are investing in something that has a fixed

return, you are technically losing money in an inflationary period because everything or is going up this price. however, your earnings on investments are in the going up. so where do people go? people want to go into equities in the stock market, but i'm going to tell you this, neil, what we need to be careful about in this inflation is how the fed reacts with the possibility of raising interest rates. because if we start to go down that path, i think it's going to have a very negative impact on the stock market. so now you could have equities coming down in value, and now people are really stuck in a tough situation for investing. neil: katrina, what does that mean for real estate if that happens? >> well, you know, interest rates go up, i think it's definitely going to slow down the market, i think more inventory will come on the market. to his question too, i've just seen that most people have accumulated a lot of their

wealth through their real estate. i just realize it proves time and time again to be able to hedge against inflation with rents, as i mentioned. the expenses can be passed on to the tenant, and rent prices are continuing go up. couple with what dan's saying, i think also investing in reality is a very smart move towards retirement. neil: dan, this is a question for you. a lot of people want to shield themselves from this inflationary spiral. you can buy protection for that. fred from colorado has this question for you. >> with the cost of the goods and services we use every day seeming to go up almost weekly along with the fact that the fed has told us inflation may be here a bit longer than they expected, would you think that treasury inflation-protected securities, better known as pips, would be a good investment at this time? neil: what do you think, dan?

>> yeah. actually, pips are exactly design for this. how they work, neil, is basically you're buying this investment, you're buying these bonds, and what happens is as the cpi raises as inflation goes up, you actually have your investment rate or your interest rate, rather, adjust so you actually get more money to keep up with inflation. so it is a really good hedge on investment. however, however, that doesn't mean that you should simply go into those pip investments and say, okay, now i'm protected. it should be part of your investment strategy. neil: super quick, guys -- dan, i'll is ask you first -- the experience we had in the '70s with runaway inflation and all of that, do you see that happening again? >> i don't see it happening, neil, to the extent that we experienced in the '70s,

before my time. i know that was right in your younger years -- neil: that's fine. [laughter] >> but for me, i think that -- [laughter] i think that we're heading in that direction. are we going to see 18% interest rates? that i don't see, neil. neil did i ever tell you the story my wife and i got our first mortgage at 13.5%? oh, i kid, about a thousand times. katrina, you're so young, your perspective on whether we could revisit that '70s experience. >> well, i don't think -- i agree with dan, i don't think it'll get to that point, and i do remember, neil, you telling me the story of you and your wife having 13%. my parents did as well. i think we're spoiled when we say interest rates are are going to go up to 4%. you know, money's still relatively cheap, and we're really blessed to have interest rates so low for such a long period of time. so will it affect the real estate market? yes, of course things will slow

down, but things cannot continue at this pace forever. neil: because i was worried that dan might break out the leisure suit, and then all bets are off. thank you both very much. now something that shows the evidence of inflation right when you're going through the drive-through, what you're paying for when you're going through the drive-through. ed renzi after this. ♪ ♪ cheeseburger in paradise ♪♪

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materials. >> they keep on bringing up the prices, the only common sense is to bring up wages of all sorts. >> i just wonder why it's so expensive like living in a shoe box. neil: well, it starts with what you do when you fill up when you're driving, right? and then it continues when you go through the drive-through. it's particularly there that prices have been rocketing and so far, so far a lot of customers are saying, all right, we'll absorb this because we love our fast food. ed renzi is the former mcdonald's usa ceo. he is, like, the yoda of the fast food industry. not at all overweight, but he gets it, understands what's going on there. e., it's remarkable to me -- ed, it's remarkable to me to see all these post-pandemic problems notwithstanding for fast food still out there even with the jump in prices. what do you make of it? >> well, it's a pretty simple thing. in the quick service restaurant industry, it's a convenience and it's a basic commodity of need

for time-compressedded people, so they're going to have to do what they need to survive. although we are seeing a dramatic mix in product shift, more value orientation in our menu selection, things of that nature. restauranteurs are entrepreneurs by nature, and they're making adjustments as they go along to remain profitable. you know, i grew up in the '70s, stay rted work -- i started working for mcdonald's in 1965. i lived through stagflation in new jersey where gasoline lines were out on the street, the police were guarding the traffic flow. i lived through that, and it feels exactly like that right now. neil: yeah. i lived through that myself, my friend. then the question becomes how does it gain traction so fast. a good question in that regard from jonathan in michigan, and i want you to listen to this. >> why does produce and poultry, things of that nature in the grocery store, cost more now, and why is it limited all of a

sudden? neil: why is that, ed? >> well, the cost of production of green, leafy vegetables and that type of thing hasn't changed. in fact, costs have gone up a little bit because the supply of water in the western areas where a great amount of produce is produced. then you've got a huge issue of transportation. when biden got elected back in january before he was -- november before he was even inaugurated, he said he was going to shut down the pipeline and disrupt the oil industry. that means nothing but increases in prices of transportation. so cost of getting goods across the united states has gone up very, very quickly. the price of fuel is going crazy. even on cargo ships, the price of bunker seed to fire those boilers and keep those things moving has gone up. that's immediate, it's right now. and it's reflected in the price of the products when they

finally get to your kitchen table or into a restaurant. neil: that's a very good point, especially if one of those products is your life blood. the festival owner in new york city has a question on this very issue. take a look. >> my question is what is going on with the price of coffee? is it the beans? is it the cost of goods? is it the labor? is it government regulation? and more importantly, am i going to have to raise the price of the cavuto espresso martin think? neil: say it ain't so. what's going on there? >> well, the biggest single reason we've had a disruption in the coffee bean industry and cost is the weather in brazil. brazil is the largest coffee bean producer in the world. there are specialty coffees coming out of colombia that aren't quite so bad. but when there's a shortage, demand goes up, and that mean the price is going to follow. and i hope it's going to abate soon, but you still have the transportation problem because those coffee beans have got to

get from brazil, colombia to the united states. and, you know, i don't know how many containers are sitting out on the ocean right now full of coffee that can't get unloaded. and the cost of getting it here is going up. so i don't think it's going to abate anytime soon. it's tragic because coffee is really an enjoyable luxury that feels like a necessity, and it's going to deteriorate over time cost wise. neil: yeah. and it's not only the products you buy, sometimes it's the pressures that are created as a result. a good starting-off point for peter in new york city who wants to ask you this -- >> [inaudible] i have a big problem with the labor. ask and my question is when is -- [inaudible] people gonna come back to work? because no one's going to work right now. neil: yeah. with all the incentives and big pay boosts, no one's responding. what's going on? >> well, unfortunately, our

federal government and a lot of state governments because of the pandemic and lockdown have rewarded people to stay home. and they do. you know, i can tell you about single mothers particularly that i've talked to that they're getting childcare subsidies to stay at home, and her importantly, they're doing all this home schooling. and when you're a single mother, you don't have many options. neil: right. >> that a takes a very large part of the population out of the work force temporarily, i hope. but restauranteurs are starting to react as are grocery stores can ask and everybody else. i can tell you the manpower in restaurants, quick service restaurants, has gone from 65 employees in the 1980s down to 30 and 35, head for 15. the use of digital the system ises and video -- systems and video, artificial intelligence is eliminating people like crazy. efficiencies in the kitchen, cooking and production is changing. so this labor thing is a

nightmare right now, and filling jobs is unbelievably hard. neil: yeah. and 4.5 million americans just quit the work force. it's wild. very, very quickly, my friend, your sense of how long all this inflation, these spikes last. >> well, you tell me when we're going to get an energy policy that makes more sense than what we have right now. the fact that we're begging opec to produce more oil, the canadians are building a pipeline all the way to the west coast from canada to ship oil out of the central provinces to china. china's buying whatever they can get their hands on. we're selling natural gas to china, and we can't use it here in our own country. it's the most insane federal policy i've ever seen in my life. it just doesn't make any sense. and if this keeps up, i think we've got four more years of this nonsense. neil: we'll keep an eye on it. ed renzi.

he presciently saw this coming. so again, deal with this inflation because it's going to be around a while. always avoid the consensus which says anything is transitory or short-lived, but in the end, we all get through it. that'll do it here. . .

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as a fiduciary, i promise to put your interests first, always. charles schwab is proud to support the independent financial advisors who are passionately dedicated to helping people achieve their financial goals. visit findyourindependentadvisor.com charles: good afternoon, i'm charles payne. this is "making money." breaking right now, after free-falling out of the gate the stage is set. i think closing rally could be ultimate buy signal. i have the best money managers and market pros to share their thoughts. inflation comes in hotter than expected. while one fed official calls transitory a dirty word. microcap stocks, rally for the ages. will it continue? more importantly how do you find