inches. that's it. here is the blurb. they believe hair goes quicker in the summer due to increased exposure to uv rays, dietary changes, shift in hormones. >> yeah. there you go. stuart: you leave my hormones alone, sports fan. that was cool stuff. thank you very much indeed. thank you, neil. neil: you know hair salons, hair replacing rate is double some of these other numbers we're looking at. barbershop quoted price i think is about 20% year-over-year. that doesn't seem possible but i guess it is. stuart: neil, you had fun at my expense. i know i have very little hair. get on with my show. neil: i think you look fine. they didn't say anything about my toupee prices. there you go. inflation is front and center we're back at levels we haven't seen since ronald reagan was in

the white house. that was the diana and charles that big wedding that was then. lydia hu is at a grocery store taking a look at food prices. hillary vaughn how they will react and respond to these prices and grady trimble in chicago, job cuts, hiring slowdown as a result of what we're seeing with all of that. we begin with lydia. lydia? reporter: hi, there, neil. you know food prices are a major driver of the inflation that we're seeing reflected in today's cpi report. food at the grocery store is costing about 12.2% more now than it did just a year ago. we're seeing some sizable increases on some basic staples you see right here. eggs, up in price more than 33%. milk up more than 16%. not featured here, something i noted, butter, margerine up more than 26%. these trends, the president of

this grocery store says that they are changing consumer behavior. watch here. >> i think people are getting away from being brand loyal. customer says that i have to buy bounty. i have to buy hellman's mayonnaise. i think they're looking saying, what is the deal going on in that store today and should i try something else? reporter: now when we look at the month over month changes to food prices the increase in june is 1%. that is down from 1.2% in may but the food industry insiders we have spoken with don't see food prices coming down dramatically anytime soon because energy and labor costs remain high. in fact joe parisi the gentleman you heard from, he got a call this morning from his distributor for cold cuts, saying another price increase was on the way because of the prices of energy and labor that are needed to process the cold cuts and deliver them to the

store. we've been talking to shoppers here, neil, who tell us they definitely feel the pinch in their wallets from increased food prices. they're trying to adjust budgets. they're eating out less. frankly they say the food costs are just unavoidable. they have to eat. back to you, neil. neil: they have to. some you can spread far and bee between, eating not necessarily so. thank you, lydia. gas is one of the issues that has the nation's attention, up 60% year-over-year, even with the late dow back in prices here. the fact of the matter we're double where we were a year ago. hillary vaughn looking for relief in some of the oddest places. what do you have, hillary? reporter: neil, president biden is pushing congress to pass a federal gas tax holiday even though some top democrats in his own party insists it's a bad

idea. >> one of the things that the president will continue to call on is gas holiday tax, this 90-day suspension on the federal gas tax which we think is the only thing to do. there are pieces of legislation right now in the house, in congress that can be easily picked up and passed. so that's what the president is calling, calling for congress to do. reporter: even some economists say the gas tax holiday would cost a lot without cutting costs at the pump. the penn wharton budget model says suspending the federal gas tax 90 days as biden wants, would only save people at the most 14 bucks for three months but cost $6 billion in that same time period. some democrats say doing this could put president biden's biggest legislative in jeopardy. implementation of the bipartisan instruction instruction bill. chairman defazio saying this, although well-intentioned this

policy at best achieve only miniscule relief while blowing a 10 billion-dollar hole in the highway trust fund that would need to be filled if we want to fix crumbling bridges, address the spike in traffic he deaths, build a modern infrastructure system there is a push by democrats to give people cash for. the house bill would give people 100 bucks every month to blunt high prices that idea likely dead with democrats like senator joe manchin saying inflation numbers should mean a stop on government spending, saying quote, no matter what spending aspirations congress may have, it is clear to anyone that visits a grocery store or gas station we cannot add more fuel to the inflation fire. that puts another big piece of biden's agenda in jeopardy. the reconciliation package, skinny version of "build back better," up until now manchin has been negotiating in good faith but his statement from this morning about the

inflation number seems to indicate he may be second-guessing whether it is a good idea to get that done. neil: they can't afford to lose him. all bets are off after that. hillary vaughn, thank you very much. wake of higher prices, higher interest rates, no surprise companies are scaling back hiring. some like microsoft actually doing some job cutting. grady trimble in chicago with the fallout from all of that, grady. reporter: neil, it is clear big companies are bracing for an economic slowdown just as lydia reported, american consumers are tightening their purse strings. it seems like major businesses are doing the same. big tech companies and electric vehicle start-ups are cutting back on hiring and in some cases as you said, laying off employees. we'll start with google because alphabet, the parent company of google is the latest to react to what ceo sundar pichai called the uncertain global economic outlook.

it will slow the pace of hiring this year and all of next after adding 10,000 workers in the second quarter. pichai wrote a memo to employees, like all companies we're not immune to economic headwinds. we need to be more entrepreneurial, working with greater purpose, sharper focus than we've shown on sunnier days. microsoft announced it already cut a small number of workers. a leaked memo from facebook shows the company is looking to identify and weed out what they call coasters, low performers who are coasting through their jobs. then there is the ev pace. electric truck maker rivian will meet with employees friday to discuss potential layoffs and plans to suspend some of its programs. this comes after tesla is also giving the axe to around 230 employees. of course elon musk said he had a super bad feeling about the economy and that the economy needs to cut staff by about 10%.

on the flipside we saw in the latest jobs report that the u.s. economy added 372,000 jobs in june. amid all this talk and fear of a recession, but that was june. now we see these companies, they're preparing for worse days ahead. neil. neil: grady thank you for that, i think, grady trimble following that in chicago. we've been following the markets, the response to this far less dramatic earlier on we were down 500 points. the dow surrendering 171 points. the real action seems to be in the bond market and i say that in terms of people who are betting on what the federal reserve's next move will be in response to this very strong inflation report and betting right now among at least a third of them, you know, putting money down on this, so-called fed funds futures contracts is that later on this month, in a couple of weeks, when the federal reserve meets, it is going to possibly hike rates not 3/4 of a

point, but a full percentage point. a third of you know, perspective investors think will happen. more conventionally is likely 3/4 of a percent hike. betting gets to be in september, what will the fed do again, to be equally aggressive, another 3/4 of a percent hike. very few people are talking today about imminent reversal in policy and a cut in rates to deal with the impact on the economy of all of this. let's go to erin gibbs, the main street asset management cio. we have brendan daniels, exigercio. erin, what the fed does as soon as this meeting not a couple weeks from now, can you see them moving even more than 13 -- 4 of a point? >> it's possible. this last report was is surprise. may report was a surprise. the expectation was 50 basis points and they went to 75. so it is not impossible.

i think it probably unlikely. they probably want to get two 75 bps if they can slow down the economy before jumping into one. i think they have to be thinking about it. it is on the table. the bond market is certainly considering that. neil: you're quite right. this inverted yield curve, getting more for your money on a two year note than a 10-year note right now. i'm wondering, brandon, that usually presages a recession or slowdown at a minimum. where are you on this? >> yeah. i think what you're say something right. i think what erin said is right that there is certainly going to be an increase 3/4 of a point. everyone agrees that is in the cards. something like 95% probability that you're sitting with a 3/4 point increase. the problem we're trying to thread a needle, stifle

inflation, potentially curb wage inflation that has come through the stimulus and reduce demand, right? because right now you have what's called the demand pull that's also increasing inflation. i mean the demand pull comes from obviously the stimulus efforts and the amount of money that went into the m2 or went into our checking accounts as the, you know, u.s. federal government was trying to fight covid but i don't think that this bearishness lasts as long as we saw it last in 2007, 2008. i think this is a parking lot. because we're not holding money in assets that are valueless. the stock market and the these companies that are seeing major routs will recover, will see gains and so i don't think this lasts for multiple years.

i think that this is a recession i see impacts us for the next nine to 12 months. neil: another nine to 12 months where we are right now. erin, if he is right on that, it confirms sentiment numbers we're getting out of average folks. i know the federal reserve, certainly jer problem powell pays a good deal of attention to such confidence numbers or lack thereof as does the white house. this per perception americans he that inflation will be sticking and right now, i guess the reason the white house and fed worry about that, people start out asking acting out their fears and pessimism and start dialing back. do you see that happening? >> that is certainly a possibility per this self-fulfilling recession where people pull back, we end up with recession because people stop buying because of confidence. that is an important part and that is why the fed watches it. i think right now it is pretty

unlikely where we are from an employment standpoint, which is very different from in 2007, even when we're looking at forecasts we're still only expecting maybe unemployment to just cross over 4%. we're still over 4%. there are still 11 million job openings out there so though inflation is certainly hurting the way that you are getting at least everybody is employed or in their jobs out there. so i think as long as we keep this, these employment portion because obviously there is interest rates and employment and inflation and employment, as long as we keep that employment going we can avoid you know, a really deep, type of recession. neil: guys, i want to thank you both very, very much, keeping top on a number of events. the president as you probably heard is in israel now, probably going on to saudi arabia. just as comparison we started looking into inflation rates around the globe.

the president always said we're in a heap of inflationary trouble. we're better than most countries that unfortunately is simply not the case. in israel the inflation rate is averaging 4% w the cpi report today we're at 9.1% in saudi arabia where we'll be heading tomorrow, inflation at about 2.2%. stay with us. you're watching fox business. ♪

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♪. neil: all right, even though delta has had its share of problems and pilots having two-day walkouts, that sort of thing and some disappointing numbers it still predicts things are going to get better, it see as strong travel rebound to go well beyond this summer. nevertheless the stock under enormous pressure, selling off better than 6%. it is not alone. it is component of stocks that make up the dow transportation average. a lot of people proponents of so-called dow theory, sort of

like harbinger of things to come for the markets. the argument goes something like this, airlines doing well, truckers, car rental agencies, avis, c.h. robinson worldwide, rail giants csx, all a are moving, they're moving a lost goods. the inverse happens as well when business is down and they're not doing as well or the markets perceived as not doing as as well, seems to be the case with the transportation average sliding 1 1/2 points, by the way down 21% year-to-date. you maybe get the sense markets are telegraphing still more trouble to come. the dow theory does not always pan out as stated. we can say this of when the stocks are skidding, almost every recession happened, it was preceded by developments like that. we'll see. meantime taking a look at the battle between twitter and the world's richest man, this time twitter doing what everyone thought it would do, sue

elon musk walking away from the deal. where does that stand, susan? reporter: really tough accusations are in this lawsuit filing and twitter is accusing musk acting in bad faith, he really changed his mind only after he lost $100 billion if personal wealth because of the stock market selloff. but they say a deal is a signed deal. twitter says musk, like every party subject to delaware contract law, change his mind, trash the company, he destroy operations, destroy stockholder value and walk away. twitter chairman of the board holding elon musk to his contraction allegations. musk, dismissing the lawsuit. oh the irony. lol. musk terminated the deal on friday. he is accusing twitter not being truthful with the number of fake accounts on the platform and not providing him necessary data on

bots and spam. twitter's stock is up after falling 10% when musk walked away initially. legal experts twitter may have the upper hand in the lawsuit. >> this is a black eye for musk. it's a if i cast cofor twitter. now sharpening knives going in delaware court. where does it end up? possibilities he could ultimately end up owning twitter even though he doesn't want it. reporter: "game of thrones" according to dan ives. musk could be forced to buy the company for $44 billion. musk and twitter could possibly negotiate a lower price. musk could break up the billion dollar breakup fee, walk away, this is fairly low likelihood, neil, that he could get out of the billion dollar breakup fee. if you speak to the lawyers, i've been speaking to the legal experts elon musk has a pretty high bar to clear in this case. if you look in the filing he himself said he didn't even look through some of the spam and bot data twitter provided him. you wonder what kind of argument

he has? if somebody may get the upper hand it might be elon musk. neil: it is interesting, when you waive due diligence then the onus isn't on the company, right, it's on you? reporter: right. i also spoke to those in silicon valley the discovery process may not be good for twitter as well. this bot scenario is not new. it has been around three, four years. nobody in silicon valley thinks the number is as low as 5%. in the discovery process, twitter did they know it was higher than 5%, when did they know? was it previous to this? that could not be a good scenario for twitter as well. neil: thank you very much, susan. let's go to matt whitaker, former trump administration acting attorney general. he knows what he is speaking about the legal issues i want to pontificate on. matt, help me with the delaware chancery court, it has a long and established record normally siding with the company that is shafted, not all the time but a

good many times where you make a deal. you commit to that deal. you just can't worm out of a deal. how do you see this going? >> yeah, neil, good to be with you today. well a lot of it boils down to contract law at the end of the day. the chancery court in delaware has the expertise. obviously many corporations are formed in delaware, one of the reasons is because of the well-developed corporate law but in this case you know, there are self things. as a lawyer usually you don't pay as much attention to the last section of the contract but in this case the specific performance question is going to be front and center in the contract. can twitter compel elon musk to buy it and ultimately i think the answer is probably yes. this court has compelled other purchasers to follow through with the transaction if their arguments of breach are not strong enough but in this case

you know there is an inside outside game going on, neil. there is both a pr campaign but ultimately it's the judge in the black robe that is going to decide who has the stronger argument, whether or not elon needs to pay the billion dollars or buy the company. and it will be a fascinating case to watch. i think this judge will be under a lot of public pressure because it is such a high-profile case. neil: it kind of ends at the delaware court, right, matt? this is one of those situations the ultimate arbiter on this, not for example, you go to the supreme court to make your pitch, right? >> yeah. this is a state court question. this is under delaware law. the contract will be interpreted, choice of law sex, another one of the things in the contract not a lot of attention is paid to. the choice of law is delaware, state law of delaware. ultimately you go to the delaware supreme court that will end there.

there is no federal review of this. neil: matt, you know both personalities very well. i don't know that you know elon musk. you worked for president trump. no loss of goodwill in any way between the former president and the world's richest man. they have both been going at each other. a lot of bad blood there. where and how did it start? >> yeah. i think it has been one of those things that has developed over time. the president had people like elon musk and zuckerberg and jack dorsey come to him when he was president, were very kind to him because of the position he occupied. since then a lot of those folks have turned on the president. he doesn't like that. you know prefers loyalty and folks that when they say one thing to his face they follow through, you know, behind his back. in this case i think elon has been very critical of donald trump. now elon musk also suggested that the left has moved so far away from where he stands that he is now comfortably in the

conservative wing of american politics and i say welcome. neil: very judiciously answered. i appreciate that. matt, thank you very much. good seeing you again. matt whitaker, former trump administration acting attorney general. some developments from across the pond i want to search with you in a search for a successor to boris johnson, soon to be former prime minister of great britain. right now the inside track seems to be going to ritchie sunak topping first round of monitories, conservative party if you will. he was chancellor of the exchequer equivalent of probably our treasury secretary. he was first prominent members of the johnson team to resign saying he lost confidence in his boss and his leadership of the party and the country. now he seems to have the edge in early voting. there are waves of this from what i understand but for now the guy who quit might soon be

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so you can - retire better. ♪. neil: all right. if you've been banking on a settlement to end this better than six-month long russia ukraine war well, just hold off on the party right now. ukraine is ruling out ceding any territory to russia to secure peace. the russians of course have been bragging about the fact they secure or their soldiers do fully a quarter of the country, some say up to a third if you include all regions east. so the idea was, leave vladmir putin with something so he can leave the country and say he has got a lot more of the country. the ukrainians not entertaining it. there was a separate poll out last week, nine out of 10

ukrainians agreed with that sentiment, there is going to be no land or ceded territory to russia to end this thing. it's not happening. all right. so we'll keep you posted on that. also keeping you posted on a china competition bill that had bipartisan support in washington but now there are some speed bumps along the way, maybe significant ones that could make this fall apart. let's get the latest from chad pergram on capitol hill. chad, what's going on here? reporter: neil, congress is stymied on this bill to make the u.s. become more competitive with china on computer chips and semiconductors. the house and senate okayed different bills months ago but there is an 'em pass as they try to -- impasse as they try to merge the bills. >> the conference is stuck and so it seems to me there are a couple of ways out of this

potentially. there is possibility of the house simply taking the senate bill and passing it. reporter: house democratic caucus chairman hakeem jeffries would not commit to the house passing a narrow bill which only addresses clips but he thinks there is progress behind the scenes. >> leader mcconnell often negotiates in public to try to increase leverage but i believe if you are talking to the individual members of the conference committee on both sides of the aisle, both sides of the capitol, they believe that progress continues forward. reporter: no bill means gm made 95,000 cars without computer chips. volkswagen is shipping cars which lack blind spot monitors. mcconnell is threatening to throw the bill if the democrats use filibuster exempt process to pass a lean version of "build back better." liberals are resigned to accept a modest bill. >> i mean progressives have been mugged by reality. they know that the margin is so

narrow, if they lose one democratic senator nothing will happen. they dramatically lowered their expectations in he have area, on guns, on abortion, and on budget matters so they're facing the political reality. they simply don't have the votes. reporter: democrats need the vote of senator joe manchin to advance the plan but the inflation report is a problem. in a statement manchin said anyone who shops knows, quote, we cannot add anymore fuel to this inflation fire. neil? neil: chad pergram, thank you very much for that. let's get the read from mississippi republican senator roger wicker on all of this. senator, always good seeing you sir. >> thank you, neil. neil: does this seem dead? this was a partisan measure, i don't know where you stood on it, looked like had a good chance of passage but to hear mitch mcconnell tell it, unlikely now. what do you think? >> well, let's make sure we understand there are two bills. one is the competition bill which we very much need so we can compete with china and asia

on semiconductor industry. there are a lot of companies that are prepared to open chips manufacturing in the united states if we can get this done. it is, it is not one of the more expensive proposals but it does involve national defense and some mandatory expenditure. i'm very much for that. what i'm worried about, i guess what i should be encouraged today based on senator manchin's statement, is that this massive one trillion dollar tax hike that the democrats are proposing to do outside of the filibuster is, is way too much with 9., 9% inflation. so to the extent that senator manchin has said this is not the time to add fuel to the fire i'm encouraging by that. i haven't spoken to him directly today you about that's good news this morning as far as i'm concerned. neil: right. you're referring to the consumer

price index figure for last month, running now at a 9.1% clip. it is staggering. it is interesting though, that republicans as you know, sir, were saying don't link any of this tax stuff, any of this spending stuff to just this competition measure but it looks like a you know democrats don't want to give up that fight. if this goes away, are you afraid that they will turn it around and republicans say we wanted to help you out, we wanted to give you a break and we wanted to ease up pricing pressures from china and the like but the republicans wouldn't let us? >> i don't worry about that strategy. let me say, i'm on the same page with senator mcconnell about this. we've been working for almost a year on this china competition bill to make us the masters of our own destiny when it comes to computer chips. now as we're approaching a

settlement on that, it turns out that the democrats want to use reconciliation again and put a one trillion dollar tax hike on the middle class and on job creators. and if that's their goal, to get us into a negotiation and almost get us there on chips and then put the rest of it on something that only takes 51 votes, i'm not, i'm not willing to play that game. neil: got it. senator, while i have you here, respected member of your party, washington in general, what you make of these january 6th committee hearings? there is back and forth about what the former president did and what he didn't do but there does seem to be some dent in his popularity with republicans not so much that his closest rival is 20 points behind him but that you know, fewer than half of republicans polled today want to see him try for the presidency again. does that surprise you?

>> well, i must say i haven't really been following that issue as much as i have the negotiations that i've been very much involved in on the china competition bill. it may be that some members of the house regret not participating in a balanced bipartisan inquiry. i mean basically it all has been one-sided. when there are no questions on cross-examination, usually you don't get a balanced view. neil: isn't that, isn't that really, isn't that kevin mccarthy's fault though, senator? but they, cheney and kinzinger, obviously they're not of, been very critical of the president but that mccarthy passed on an opportunity to get his people on there, even president trump had criticized him for that, after the fact i might point out. >> you have to ask him directly

about that you would have to ask him. i do know there are some republican members over there in house, a lot of them are friends of mine that wonder if maybe they should have had a group of republicans in the room asking the other side of questions and getting a balanced view. neil: but you don't think some of this dinging the president is seeing, former president is seeing in his support that maybe that is what is doing it? all these revelations coming to light from that january 6? >> i will let the pundits judge that. there is a lot of time left between now and this year's election, much less 2024. neil: don't you hate it when reporters ask about 2024. thank you, senator. always good seeing you, i appreciate it. >> thank you, neil. anytime. neil: we're getting interesting kind of signal from the world health organization echoing right now, echoing what dr. anthony fauci told me yesterday on "your world" on

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the problem the cia thinks he signed off on the murder of u.s. journalist, jamal khashoggi. because of all of that the president's team has created a plan for him not to shake hands with anyone during this trip, to avoid the prospect of an awkward photo-op when he gets to saudi arabia. listen. >> taking precautions. >> one of those precautions not shaking hands. >> we're trying to minimize, trying to minimize contact as much as possible where, where, we can and so that is what the focus is going be on this trip. reporter: well that didn't happen here in israel. immediately upon landing a line of first bumps by a handshake with benjamin netanyahu, former prime minister and current opposition leader at the holocaust memorial, biden broke protocol again to hold hands with some women. he really tossed the rule out the window with even more handshaking f they are a little

bit more strict with this apparent new policy when we get to saudi arabia we in fact will not know about it. the white house is not committing to any coverage of biden's meeting with the saudis. white house officials say there will be no press conference after that meeting. back to you, neil. neil: you are relentless. thank you very much, jacqui heinrich traveling with the president in israel. jerusalem her case in particular. we have a lot more coming up, including the inflationary spiraling out of control crisis. it is bad enough if you're trying to buy a home. it is getting to be even worse if you're homeless. we'll explore and explain after this. ♪. with my hectic life, you'd think retirement would be the last thing on my mind. thankfully, voya provides comprehensive solutions, and shows me how to get the most out of my workplace benefits. voya helps me feel like i got it all under control. voya. well planned. well invested. well protected.

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♪. neil: forget about whether rising rates, rising prices for homes are creating a housing crisis, what if you don't have a house at all or or homeless period? it is serious fallout. madison alworth is in new york. madison. reporter: hey, neil, what we're seeing a crisis within the homeless community, and for those who are first-time homeless. as inflation increases homelessness also increases and they're seeing it here at the bowery mission. more people show up week after

week at their door. and what is really concerning is when you look at these populations. they have seen a 27% increase in first-time homeless folks, meaning people who had never needed help before are now losing their homes and have nowhere to go. we've been here all morning. we actually met one of the residents lo is experiencing homelessness for the first time. raul, an uber driver lost his car in april. for the first time, this native new yorker found himself without work, with rising inflation driving prices higher. then, no home. >> gas, the food, you feel it, you feel it. i think there, in my case i was, i start to realize towards the end, right before i lost my vehicle, what do i -- i wasn't maybe keeping track i should have. maybe i should have let's. but gas, food, you know, diminishs the value of the dollar. that is what is happening here in the citying, everything here

is expensive, everything. reporter: u.s. department much house health and human services have not updated homeless numbers since 2020. people walking around the city can he see visible signs of distress. when people are unable to get housing mental health help, it has impact on community as a whole. we're talking to one restaurateur waiting to open his restaurant. >> we're not opening this restaurant until crime and homelessness is at least somewhat in control. reporter: now, neil, the bowery mission relies heavily, entirely on donations and they fear that as inflation continues to rise, those donations will decrease. neil: all right. madison, thank you for that. madison alworth. meanwhile if you're in the market for a home, refinancing one you're already in, just looking to you know, at least buy physically a new home, you're going to have some tough

troubles here. let's go to pierre devos, managing partner. we've seen that when demand was high and supply was not nearly as high so it serves as a good reminder that you know, equation would be still problemtic to keep homes affordable. now with the slowdown you would think the math would be reversing pierre but it is not. what is going on? >> it definitely is not, neil. what you had a year ago, record high prices with interest rates at record lows making it more affordable for people to stomach rapid price appreciation. today you have both a perfect storm, maintaining record levels, interest rates more than doubling where as opposed to talking two to 3% interest rate last summer, you're talking 5.3 to 6% interest rate now. it is making it extraordinarily unaffordable for many to get into the housing market.

we're not even taking into consideration the inflation stats that came in this morning and the general cost of everything under the sun skyrocketed as of late. neil: this is interesting, the backdrop, pierre, maybe because of all the features you just outlined, homebuilders are trying to slash prices or get savings wherever they can, they're pulling back on spec home building and all of that and we're seeing construction pull back as buyers pull back. how bad does this get? >> i think it is worse before it gets better to be quite frank. i think what you're going to see, like right now i'm in new york city and our practice focuses predominantly on the new york city residential commercial real estate markets and the biggest glaring issue they're not creating more product. they are not enough apartments here. how did apartment rentals skyrocket as apartment purchases or sales? at some points rents have to

stop increasing. it is becoming unaffordable gore so many. rents are going up at significant levels. given that there is inability to purchase and require home for a majority of society right now. neil: it is interesting to your point rents are now accelerating at a four decade high. i think we're already at levels we have not seen a pace back to 1986. so i'm just wondering for those who are priced out of rentals, i mean there is only so much hiking in price that building owners, landlords can push through before they don't have any, any customers. how far away from that? >> you know, i think, i'm hoping we're there sooner rather than later because you know, this goes on, you know, where right now, you think about what we went through the last couple years. we had a massive relocations of everybody throughout the country based off of remote working, covid and you know, everything

that we experienced and you know, that's sort of coming to an end but if rents keep increasing at this rate you know, it is going, it could potentially spark another relocation, people having to leave areas near major cities due to affordability issues. you see it in new york. we had how many people, we have more people i feel like than we ever had before. if rents keep going this way, the people who came back, a lot may end up leaving all over again to low cost living areas. neil: i hope not. thank you, pierre debbas, to his point, mortgage applications are down 4% for the week, 18% from a year ago and big mortgages, those considered over half a million dollars or more are now shrinking at the fastest rate they have in 40 years. something about that 40 year figure, right? more after this. ♪

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neil: inflation worse than we thought, nothing transitory about it, more problematic than we thought, 9.1% year over year, 5.9% month over month. we are at highest level depending on where you pick your battle chewing the annual increase, the highest since november 1981 when ronald reagan was president, olivia

newton john's physical was the number one hit for 10 weeks straight if you have copied that since. mohamed ali had fought his last fight, lost in a unanimous decision, the greatest career had ended, that launched its first shuttle, ronald reagan appointed sandra day o'connor, raiders of the lost ark had debuted, all that then, coming back now with fears that it could get worse than it was so what happens? ashley webster is looking at it in the epicenter of this heated economic activity of the sunshine state. ashley: november event 1980 one. i had flares in my jeans and callers in my shirt. you mentioned olivia newton john and physical. there are worries the fed will get more physical with interest rates and crush demand and

cementing a recession. there is already increased talk that the fed could increase rates by 1% at its next meeting. 75 basis points for sure but the markets, aware the fed is behind the curve, major exchanges mostly recovered although the dow was down by a third of one%. even treasury yields have started to come back, the 10 year yield when people jumped into that earlier, has since retreated to 2.8%. inflation numbers are shocking. even if you take out high energy prices, the inflated cost of living is broad-based. compared to a year ago in june used car and truck prices up 7.1%. new car and truck prices up

11%, airline fares 44% with year over year, major appliances 7.5%, hotel and motel costs up 11. 5. we talked about rents, those are up 5.7% and going up as we speak. this does not include food prices which we know have gone through the roof, taken altogether the numbers dispel the narrative that inflation may be peaking. based on a variety of categories. it means a hit to the wallet. based on average hourly earnings, adjusted incomes fell 1% for the month down 3. 6% from a year ago so the more you look at it, the more you think the fed was trying to catch up and it has to take steps that can slow the economy down.

neil: you slow inflation but kill the economy. kelly o'grady is following one component that is crazy. gas prices increased 60% year-over-year and it is a situation that could be getting worse despite the degree we had over the last few weeks. >> good to see you. with stunning inflation numbers, hard not to think of how much gas prices are driving that. the energy agency saying we the oilyyyyd we ofasing i i int a r nvent ivent ithating thatg ec rea r a new a nepor r r that forec forand emanwi ease 2. 7 million barrels a day in 2,023 which require nations to come up with another 900,000 barrels a day above the levels,

it is protected to lag demand, the president is visiting saudi arabia to discuss increasing oil supply and domestic energy companies are questioning why the administration would rely on a country that pose a security and social risk when they could produce more at home. he didn't take them up on it and that is why i am in the middle of an oilfield. the ceo tells me they and the us could produce more policies and moves like this trip are damaging. >> i see promises broken and before companies most of whom are public all of whom have owners before they commit to investing large amounts of capital they are going to want assurances that once they spend it it will not be pooled on them. >> reporter: beyond the ability

to supply more, the valves on a pump jack are regularly monitored to prevent leakage and additionally i look around the oilfield, methane gas is produced to avoid harmful emissions. a place like saudi arabia doesn't have to abide by the same standards. it not only creates more environmental for the earth as a whole but takes away investment from american jobs, industry and families. neil: kelly o'grady. let's get to edward lawrence in jerusalem. whether he addressed it, edward. >> reporter: the president has not talked publicly about the inflation report. he has an eye on that cpi

inflation report. 41 year highs, president biden walked off of air force one when the cpi report was released, the president taking a beast through the streets of jerusalem, up 60% year over year, he spoke on the ground in israel and did not mention inflation numbers but his trip for him as much about inflation as it is reconnecting with israel and saudi arabia, spending the administration is doing in israel including one billion dollars for missile defense system which he got a briefing on. >> president biden: the unshakable commitment to the united states including partnering with israel on the most cutting edge defense systems in the world. >> reporter: the president visited the holocaust memorial in jerusalem and met israeli

american survivors of the holocaust, the white house has not been able to articulate deliverables for this trip, it is -- what he's doing at the end of the week with the saudi king, opec increased production slowly. >> this brought agenda to talk about energy security with leaders of opec nations in the middle east as we discussed energy security on the trip to europe and the indo pacific and we will see what results come from that. that will be up to opec countries to determine. >> they are vague about specific deliverables as well as the saudi trip. neil: your passport is getting thicker and thicker.

edward lawrence, well-traveled human being. the international monetary fund, first managing director and besides older statistics, what is interesting is however it folks are feeling about this. black rock among many others, they are resigned to it, that can be good or bad things they are not dealing with happily but that can build into their psyche. they are convinced there's is into passing phenomena new act accordingly, cutting back on stuff. where do you see this going? >> they see policymakers living with the inflation we are now seeing so that is an investment thing. part of the problem is politicians don't understand what they are doing is driving inflation in the long run.

not clear they understand that and on both sides getting to your point on the expectation becoming embedded in the economy see this in the michigan survey and the federal reserve bank of new york one year inflation expectations and longer run expectation still above the fed's target and regular businesses and employees surveyed, ask for and receive or give higher wages. neil: the administration was queried on this telegraphing the number we would see this morning, didn't include drop in the price of gasoline even though it was a one month long event but if that is your argument, the self is, it factors out energy and food so where we are we on this inflation?

>> broad and getting broader. unlikely despite the white house's argument, the great increase, fed through in three weeks for cpi surveys were taken and broader inflation is harder to cool and broader as you pointed out food and energy. i have a father and sister who are both dentists and dental services were up 6 percentage points,. 9 percentage months month over month in june. they are not susceptible to a war in ukraine or some of these other things. you had a guest on talking about owners equivalent rent. these are things the fed is going to need to see cooling before they know their policies are feeding through into the economy and there is a reason to be concerned to.

the past 18 months, 5.4 of americans earning power has been eroded. three weeks people work for the day didn't get paid for. there living in a 5.4%, and people know something has shifted. they don't know for life is worse off. neil: they talk about 40-year highs, ronald reagan was president at the time. they had numbers like that. paul volcker is at the federal reserve aggressively raising interest rates one point at a time on many occasions. are we in for that again. >> last time i was asking for a

higher fomc rate hike to signal the markets that they were serious about this. they have the conviction to fight inflation, they need to brandish the knife, a clear need for 100 basis point hike. they can guide markets and not change the terminal rate, this would be more front loading. it will take more time for these conditions to feed through into the economy and slow price growth if that is their objective. going back to 40 years ago a lot happened in 40 years and a lot that was happening 40 years ago is not happening today, major forces, exploitation of new energy forces, stale economies picking up, to reverse as non-fed decisions,

decisions by other politicians are reversing and the disinflationary engine being removed from the economy, in the higher run in stable prices. neil: i hope you are wrong. great catching up with you. thank you for taking the time. the republican party, hoping to regain control of the house and senate. the house and senate could be a close call but also looking good and two years after that looking to the white house, good time to be almost any prominent republican especially if you are the governor of florida and especially if you are meeting with your top donors, whether donald trump runs or not after this.

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president follow the money or the guys with the money other candidates addressing the guys with the money. ron desantis is getting disproportionate attention in that regard, wooing donors as we speak, charlie gasparino on the significance of that the with or without donald trump in the race. charles: i know people, big bucks, they want to -- they think he is the next big one and they give money so they have a sit down with him and that is what is going on. interesting dance between the gop donor class and trump. i can't give you anything definitive. he is a small politician and incredibly careful in these meetings. he is being asked will you run? are you going to and being told, these folks, these rich

guys will support him. the best answer he gives, the most complete answer he gives comes in two words, stay tuned. every time he has been asked about this, he left his intentions open. he's not definitive. and the word stay tuned keep coming up even when asked will you run if donald trump runs. he's noncommittal when posing that question. there's a lot going on with donald trump, remains as you see the most popular republican presidential contender inside the party. he has a lot more problems in the general election, independents. he's facing issues with january 6th. let's game plan this a little bit. if he does announce he's going to run, he's also, a good

chance he will get indicted by merrick garland. i can't imagine blooge-talking to democrats about this, senior democrats, what are the chances merrick garland will indict donald trump and they say they think it is really high and the reason they think it is high is the party base wants him to be indicted and if he beats president biden in 2024 which there is more than a theoretical possibility the current president's handling of the economy it will come down on merrick garland why did you indict him? this will get harry and trying to way this is ron desantis. of the current president get indicted and he says he's going to run that may force desantis to run to say i am a viable alternative and you don't have this noise.

there's a lot going on. it hasn't played out, desantis is not tipping his hands yet. an interesting situation. if trump doesn't run he becomes the front runner. neil: the number of people entertaining running whether the president does suit up again. >> it is this january 6th stuff. republicans don't care much about it but these elections are determined by independents and they don't like the way donald acted. i call him donald because i've known him for so long. i personally like him but in office was different from what you know as the man and that riot, there is a lot of hair on that dog. the other thing is there's more than a theoretical possibility

will get indicted and you have to factor that in. neil: in the meantime stepping back from what the former president does to what prospect of republican candidates do, that extends to the midterm elections this year and whether they capture more of the latino vote, we go to the initiative president, what do you think of that? we've seen a clear shift in latinos who used to be a fraction of the republican vote but over the years have gotten to be a strong plurality. could they ever be a majority? >> i could see it happening especially with such a strong bench in the republican party offering solutions to what is hurting them. a lot of a frustrations when it comes to latinos, the value of our paychecks is eroding in real time, millions of latinos

who got 3.5% and a salary increase on average are underwater because they -- the pain being inflated by inflation they are suffering by 9.1 inflation rate that has wiped out the 3.5% and to hear biden you think he has the midas touch when it comes to the economy, you have the midas touch, everything he touches increases to the price of gold. neil: it is not monolithic but how latinos are responding to the crisis at the border and whether they aligned themselves more traditionally with democrats who have a reputation of being soft on border issues versus republicans being very tough. >> it is a twofold

disappointment in the sense that the sense of loss of control, the maelstrom happening at the poorest border, we don't control who comes in anymore, putting up a welcome sign and the second part is biden has not delivered, democrats have not delivered on immigration reforms that would increase or allow legal access, farm workers, folks that are here, none of that has happened and when you pile on the urban crime where it feels the victims of crime are not getting the justice they deserve or feeling safe and the issue of immigration on top of that it is hurting the democrats but more the biden administration than the candidates themselves but it is anchoring them down.

neil: that could be an interesting voting block to concentrate on. not entirely a lock but overwhelmingly democrat, that might not be the case when the midterm elections get a hint of it, maybe a confirmation of it. concern about what is happening with inflation on the oil front whether we could see the disruptions we saw during the opec embargo period of the 1970s, one big energy agency is warning it could be worse. there is a reason for that after this. ♪♪ wow, we're crunching tons of polygons here!

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neil: it looks small and almost peaceful, tiny island south of india but a violent one. the president just agreed to flee the country. what is the latest? >> reporter: turmoil in sri lanka that has regional implications. thousands of protesters, as they clash with police as authorities fired tear gas, the -- a state of emergency. triggered by the departure of the embattled and apparently outgoing president, he, his family members and cronies accused of corruption, diverting chronic manic -- manage mismanagement and global

problems like the covid 19 pandemic and ukraine more lead to shortness of food, fuel, soaring inflation, bankruptcy, you name it, and lead to more spectacular scenes over the weekend, protesters ran to the president or palace and saw how the other half lives, the crown demanded the new government, supposedly a new president next week watching all of this, one of the biggest investors, china which covered the country's strategic location and india has a lot of time and picking up the economic slack. the us embassy in colombo is canceling services for the moment as a precaution and a lot of countries keeping watch, all the trouble, wondering where it goes. back to you. neil: great reporting.

normally if this were happening in a normal environment it would be rallying oil prices, a hint of disruption in our part of the world they don't want to see it but we are not seeing big follow-through, prices over one hundred dollars a barrel. growing concerns that it could slow things down and the economy not only here but everywhere, tim stewart, president of the oil and gas association, always a pleasure but this environment is not and i'm wondering what you see happening. a lot of people are looking at the inflation wondering how much longer we can pay higher prices. may be the market is deciding not very long because it anticipates very few will continue paying them. where are you on this? >> oil prices have come down and that will provide relief for consumers. the bad news is oil prices

usually happen in a recession and we are looking at 9% inflation in the global recession coming forward. this is the fourth selloff we've had in the last year and those selloffs have come between 7% and 20% on the price of oil but no infected in 9% inflation and that has a real impact on demand globally so we are watching this carefully. neil: the secret that doesn't get much press is you have been boosting production best you can in this environment, running 95% capacity right now but if you worry about that no matter how much more you might drill or take advantage of what you have it is not going to do much good and not going to do americans much good. >> i have had some interesting conversations with our producers, we hear talk about

record profits but we are paying record prices for everything from steel pipe to fracas and to fracking crews. it is having a real impact on our ability to do our job. we are drilling a lot of wealth but we can't find enough drivers with commercial driver's licenses to bring in the sand. we are having workforce issues like everybody else, 9% inflation rate has the impact on our ability to do our job. neil: gasoline prices are up 60%. the president has referred to this as a prudent price increase, we were running 25% to 30% before the first russian boots were anywhere near ukraine. what do you see happening?

>> it is one thing to have a selloff taking you 75 to 65. another to have a selloff it takes you from $120 a barrel to $95 a barrel. that inflationary run-up in the price of petrol, petroleum has long-term lasting impact not just for transportation but manufacturing and agriculture and we see short-term impact on transportation. our concern is the impact on long-term manufacturing and how they absorb energy cost and passing costs to the consumer. in short-term they take credit for $0.19 reduction for $0.19 reduction in gasoline prices they have to take response charles: the recession that brought along. it is a total package, can't have one without the other. neil: all right, putting this

in perspective why the markets are under pressure normally the federal reserve has to address inflation to get rates up where retail inflation is. that math if you want to get up to 9% you have to quadruple the bend -- where the fund is now to be a parody with that and that is unlikely so the other hope is the rate increases we've seen and will see as soon as another 3-quarter point rate hike, and another such hike in september that it will force a slow down and bring inflation down so you don't have to get to 8.1% but if it doesn't work, then you've got problems.

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images out of the uvalde school shooting, some family numbers not keen on its release, seeing it for themselves. >> reporter: there are mixed reactions how the surveillance video was released yesterday, video obtained by the austin american statesman newspaper, video that we want to warn you was disturbing. it shows the gunmen entering robb elementary school and firing his way in. what we are showing you is police response from a hallway camera. within 3 minutes three officers sharp, they take fire, crouch down and retreat. that was 11:27 a.m. . 12:50 is when the classroom door was breached and suspects killed. you see officers from multiple agencies armed with tactical

gear and they are waiting and waiting as we know some children dialed 911 from inside the classroom not knowing hope was on the other side of the wall. many were calling for the video's release. officials decided it would be done on sunday with a special community meeting, portions of the video would be redacted to protect the victims but it all showed up online prior to last night's city council meeting in the city's mayor was furious calling it a leak by the press as did some members of the community. others argue derringer was misdirected and should be aimed at the cops. >> anybody see them do a good job? just because they tried to go in, was that good enough for the people bleeding out? >> the director of texas gps said he was deeply saddened the video was released before the families have a chance to see it.

neil: a little more after this. riders! let your queries be known. yeah, hi. instead of letting passengers wrap their arms around us, could we put little handles on our jackets? -denied. -can you imagine? i want a new nickname. can you guys start calling me snake? no, bryan. -denied. -how about we all get quotes to see if we can save with america's number one motorcycle insurer? approved. cool! hey, if bryan's not gonna be snake, can i be snake? -all: no.

neil: this inflation started at the gasoline pump and quickly moved to your local neighborhood grocery store

where it still rages out of control. the latest from a new york city grocery store. >> reporter: today we are learning grocery store prices are up 12% over a year ago. i've been talking to shoppers at the store and they don't need me to tell them prices are up, they can tell for themselves. watch this. >> on my goodness, it bottle of water, large bottle of water, $0.35 a bottle, my deli meat over $2 for half a pound and prices are crazy. >> early in the pandemic it was a matter of neil prepping everything because you only went to the grocery store once every two weeks and now i should be meal prepping a lot to make everything stretch further. >> reporter: sizable price increases on basic staples, these are things found in every

american home, milk up 16%. something else, better and margarine up 26%. these price increases are changing consumer behavior. management has said shoppers are favoring cheaper brand, store brands, the storm worries about more customers leaving them and joining retail clubs like costco, they can find better bulk deals, and prices come down anytime soon, pepsico increased prices by 12% over the past three months and telling the financial times they might increase prices more through the rest of the year, including beverages, doritos, gatorade, not a good time for the grocery store prices that are already high. neil: let's gay -- raising

cain's delicious off the chart chicken and all, people love the stuff he makes but even they might have price pressure points. what are customers saying in response? >> lydia mentioned grocery store inflation, 8% for the industry, 7.5% of the surface we are in, the gas pump, grocery shopping, rent, everything going up. seeing the same thing. we had retail prices this year, we did that and don't like doing that. we made them every two to three years, the cost of pressure

that is expected and things get worse, margins that we operate in get impacted. neil: you might be surprised how well i know your menu that people can pick and choose, you can get a box combo, a sandwich combo. the pending on your hunger level or the thickness of your wallet there are ways to pivot from one price point to the other so what are your customers doing? >> it is hard for the focused menu. definitely see some shift around. early to tell but definitely seeing movement.

stuart: how diff different locales respond? are they tougher customers in some areas? how do you describe it? >> generally everyone is feeling feeling pressure on their wallet. there is not one part of the country that stands worse than the other. we are seeing the pressure, as i look at their information, a 6 to 8 point change in overall traffic in our business. neil: how you respond to people, you are very friendly, but i talked to a lot of restaurant and chain owners who say blocking them in is more than paying a generous wage. what are you doing? >> the jobs report says that, 379,000 jobs created, the job market remain strong, hard to get great crewmembers and not like they are taking home more.

they are spending gas prices, grocery and rent. we want to do the right thing by our crewmembers and never compromise our quality on food items so you raise the prices, that is all we can do and that is what we've seen but it is the same thing. neil: you have not cut corners. sometimes with one restaurant owner, who went to a lesser cut of meat, wasn't necessarily top of the line but he feared people would get wind of this and i might lose these customers. how do you balance them? >> we can't compromise on quality. chicken finger meals is what we stand for. our customers tolerance for that. we don't want compromise on that and compromise on -- we are one of the best places to work and have been for a long

time. we haven't cut any corners. the only thing that happens is we are making less on the razor thin margin that is usually very firm that dissipated over the last couple of months. neil: in your case, you were one of the earliest movers to that. that might help with the shortage of workers to find them and all that but what are most of your customers doing? what is going on? >> haven't seen a major shift on that. dining rooms remain dizzy, obviously through the pandemic, all that is backup almost fool par there and we are seeing a group of people going to online ordering as well.

for our brand, people like restaurants because they allow crewmembers. it is fun for them. we see that energy in restaurants. neil: you still have texas toast by the way. >> texas toast, we still have it. neil: getting hungry talking to you. nice to see you don't compromise things and with the rising price environment a little give and take but business goes on. thank you, good seeing you. >> take care. neil: prices are rocketing. to shrink inflation those who offer a wider and more diverse menu, pretty much something at all price points, a basket of 400 chicken fingers.

they don't have something like that. that's the issue for a lot of people to still go out, still eat maybe not as much but to find different price points and different food sets that can still address their hunger and their thinning wallet. that's what this whole thing is about. a game of chicken. ♪♪ ♪♪ we all need a rock we can rely on. to be strong. to overcome anything. ♪ ♪ . .

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neil: this is the number they're talking about, 9.1% retail inflation clip, now the highest since ronald reagan was president. could it go still ohioer? higher. charles payne now. charles: wall street says the number is so high it can't go higher. this is it at least what the markets are hoping. that is what we've been hoping for seven months. that is hell after guessing game. thank you, neil. this is making money. i'm charles payne. inflation continuing to found the experts. we're long past the notion high prices are the cure for high prices. will the fed have to drive the economy off of a cliff to end the scourge? we'll talk about it throughout the hour.