losses today, jay powell hinted that he hoped that they be modest, that they be light maybe. right now, the fed is only modeling for a 1 percentage point increase in unemployment. i suppose in hopes that people coming back into the labor force will keep that down, participation but that also means recession and it also means take a look at this chart, that once people start losing their jobs in mass, more than likely it won't stop at 1%. its only stopped at 1% once. only one-time. but here is the thing. i blame congress. not the fed. congress should demand that the fed create better tools, and of course, they should stop making their job harder. the spending is absolutely nuts so president biden wants to spend $1.6 billion to find out what happened to the ppp money. i'll tell you. it was stolen. stop spending our money. cheryl, that's how i feel. >> cheryl: we've talked about this in the morning charles all that stimulus spending led to

inflation and that was jay powell's big word today, and here we go with the market down almost 600 points. there you go. right? we'll be doing it again. i'll see you soon charles, thank you. well here is the market alert for you, and it's not a pretty one. stocks taking the plunge after federal reserve chairman jay powell unsheathed his talons during a monetary policy report to congress. we're down almost 600 and at 573 and the s&p is lower by 64 and the nasdaq is down by 152. the russel 2000 also getting hammered. well hello, everybody. i'm cheryl casone in your liz claman. we knew it was going to be exciting, and it is. the dow down more than 500 points after powell dashed any hopes of a 25 basis point hike at the march meeting. watch. >> core inflation is running at 4.7% on a 12 month basis. i think nothing about the data suggests we've tightened too

much and it suggests we still have work to do. >> according to the fed funds futures there's now only a 33% chance of a 25 basis point hike. it was the reverse before he spoke today. there's now nearly 70% chance we're going to get a half a point hike at the next meeting. those numbers are complete reversal from yesterday. there was a 30% chance of a 50 basis point hike. it's all changed. everything has changed. take a look at the two-year yield right now. it rocketed higher right around the moment that powell started speaking. now, it's trading around 5%. the 10-year yield also speaking when powell's testimony began, its retreated a little bit though as you can see right now the 10-year yield at 3.975% which is a gain of 1.2 basis points. now, the spread, here is where this gets interesting. the spread between the 10-year and two-year standing at more than 100 basis points. this is now created the most inverted yield curve since 1981.

powell warning, higher rates may not cause a significant labor market downturn, but elizabeth warren went after him on that one. we're going to talk about it. now, layoffs continue to hit the technology sector. we've got news out of meta today stock is up slightly. there are several reports right now that the tech giant is gearing up to cut thousands more jobs. now, this comes only a few months after meta cut 13% of its workforce, but the parent company facebook is far from the only tech company announcing layoffs. look at this. shares of australian software company, the ticker is "team" kind of ironic, stock is up right now as you see more than a quarter of a percent they plan to eliminate 500 jobs about 5% of their workforce. so, as the fed looks to keep hiking these rates, where can investors turn? let's get right to our floor show, joining me now, our trader s john corpena and scott

redler. it's great to have you both here and i'll tell you what, scott. this is a tough market when you're a day trader. very tough to navigate. >> you know, you really have to just adjust and take your trades because the market just keeps changing. i would say for the very active day trader, it's a decent market there are things to do but if you try and make anything more than just a day, day and a half trade, it can go against you just like that. last week, remember the market kind of reversed and had a three -day move where finally some of the bears felt bad about themselves and then mike wilson comes out what, yesterday saying hey, maybe we can go to 41.50 in the s&p cash and he is the biggest bear out there and all of a sudden yes the market reverses and then today, you get a very hawkish powell that then triggers us below yesterday 's low so at least we had downside follow through but how could you get really bearish right here because all of a sudden what happens on friday, you get a weaker than expected jobs report and they gap them up and keep doing this direction.

>> i don't know the expectation s are already pretty weak. it's 203,000 jobs at the rate of 3.4% but remember we came in with that blowout 517,000. i'm thinking there's going to be a revision to january. i hope i'm wrong, but i think that's a possibility. that would certainly turn the market around because that would force jay powell and the fed to maybe cool their jets just a little bit, so we'll see. so john, let's talk about meta really quick. i mentioned that as we were introducing both of you. so they've got, there's i've seen about 11,000 could be the number for meta. that is a lot of jobs, and today , when jay powell was on the hill and of course most of the questions had nothing to do with fed policy, but she was going after him about job destruction, and i thought it was interesting, because of the numbers that we got in january. do you think the labor market turns? >> i think we're starting to see some of that, but you know, as the point you made in, came in on the january number. if we get a revision there

that's really going to rattle things in a market that's already rattled in this very short-term that's right here. the outlook forward continues for a lot of uncertainty and that translates into the tech sector, and other sectors that we have seen significant layoffs step-by-step and the not just only in tech. we're seeing it in disney, general motors, amazon. we've seen it across-the-board in some of these names here so that's just showing us that coming out of covid, high inflation, high interest rates, corporations are very concerned about what the outlook is moving forward. they are starting to pull their reigns in a little bit and that's something we're going to see translating into the market. we're seeing it now but once again we've seen a lot of volatility back and forth in this market. we could bounce right back up so to scott's point about traders and investors and is it intraday or multi-day hold, we're going to continue to see a lot of this volatility so just be on the look out for that. >> cheryl: scott, going into i

would say about two weeks ago, there was the thinking was is that the technology sector was still about 20% over-staffed. so this would kind of go in line with what we're seeing for meta but other companies, i think the fear now, is that they're over doing it with layoffs because look, we can say a recession is coming. we can bet that one is coming. it's going to be flat. it's going to be, you know, take your pick of the verbiage that describes the upcoming recession but if it's not as bad as we expect, companies are going to be hogtied because they aren't going to have the teams that they need to make money and the u.s. might get a little left behind. >> it's a tricky time. anyone whose kind of a fundamentalist, they are scratch ing their heads because they are like hey, rates have to keep rising. you have unemployment at 54-year lows. you have eight to 9 million jobs available. it's not like we're in a recession where in 2007-2008 there were 9 million people looking for. there's 9 million jobs available

so when powell is on the hill and trying to give him a hard time about raising rates because it's going to have 2 million people potentially come out of work, you're well-above the average as far as unemployment and you need that to come down in order to reduce demand to get inflation lower, you know? we can't have inflation and it can't continue to be sticky, so the markets in this spot where i think this is just the year of the range for investors. investors put your money in every single month. continue to do it. by 2025 probably an all-time high but for the next year, year and a half, the fed has to stay the course. corporate earnings are probably going to suffer. again we'll continue to see layoffs, but at some point the market will see layoffs as bad news, because then all of a sudden it's a third round and that's probably going to have a recession come and then look at the s&p multiples, and the narrative will keep shifting so actively, we're trying to stay on top of the narrative and the narrative right now is there was a ceiling in rates of like 5.4. it seems like it might go

towards six. if it goes towards six you would think the bears have the bull to bring the market lower and today is their day one and then probably waiting to see what the jobs report is on friday to figure out if they could try and bring things lower. which wouldn't be so bad. >> well listen, john, that's a good point that scott's making here that the bears are frustrated that the market hasn't fallen apart. last word. >> yeah, absolutely. we're seeing all of these different catalysts that should put that pressure on this market , but as soon as we start to trade down, you get below 3,900, we bounce right back up. vix gets to 23, they sell it gets down to 18 they buy it so we are just getting this cycle. we're going to be in this range for quite some time. >> cheryl: yeah, well that might be the word of the year, " range." john, scott redler, guys great to see you, thank you so much for joining me this afternoon as we kind of navigate this crazy market right now. >> thank you. >> cheryl: coming up next, could robots soon replace your

investment advisor? one company is using artificial intelligence to make smarter investment decisions. we're going to introduce you to the ceo in a fox business exclusive. and taking a look at the big board as we watch these markets right now as you can see we're down 557 off session lows. we'll see how the market shakes out. we've got about 50 minutes to go the "clayman countdown" coming right back. you'll always remember buying your first car. but the things that last a lifetime like happiness, love and confidence... you can't buy those. but you can invest in them. at t. rowe price, our strategic investing approach can help you build the future you imagine. (psst psst) ahhhh... with flonase, allergies don't have to be scary spraying flonase daily gives you long-lasting, non-drowsy relief. (psst psst)

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tell your doctor about an infection or symptoms... or if you've had a vaccine or plan to. tell your doctor if your crohn's disease symptoms... develop or worsen. serious allergic reactions may occur. watch me. >> cheryl: we are getting some breaking headlines out of morgan stanley's technology media and telecom conference happening right now. twitter ceo elon musk has just said it's possible for the platform to become the

biggest financial institution in the world. he also said he thinks twitter has a shot of becoming cash flow positive the next quarter. the little bluebird said it makes about $0.06 per hour of attention on twitter and raising that profit to $0.15 or higher with relevant advertising. musk also putting on the tesla ceo hat at the conference, and we can see a smaller vehicle from the ev leader, that is half the production cost of the model 3. remember analysts that cover tesla want to see a cheaper version of his cars. taking a look at the stock right now, tesla, that is down 2.25% of course twitter is no longer public. well, the chatgpt fascination continues, as salesforce owns slack just announced it's incorporating the chat bot in its application. slack users are going to be able to use chatgpt to formulate a response to their co-workers in seconds, as well as find answers about work projects or topics. now the feature is part of

salesforce's einstein gpt program which combines open ai tech with salesforce's own artificial intelligence. now, well ai seems to be the 2023 buzzword, artificial intelligence has actually been around for a while. take this thing. this is aieq. it's equbot. it's an etf that launched back in 2017 and the company manages 3 billion in assets, uses ibm's ai system watson to analyze 1 million data sources to guide investment decisions. co-founder and cio is here now in a fox business exclusive to walk us through how all of this works. you'll have to explain a lot here. good to see you, sir. >> good to see you as well, cheryl. >> explain how this particularly works with ai. >> yeah, so equobot is partner ed with ibm watson, mimicking an army of research

analysts and traders looking at all of the different signals structured so anything you can put in an excel sheet and unstructured, so the things like tweets, social media, industry reports, right? all of these and we're seeing more and more examples of these types of data sources impacting the markets so it's aggregating all of this to help us make better investment decisions, and as you mentioned, with chatgpt, the systems going to evolve and learn, and that's what we see happening with ai. we're just scratching the surface. >> cheryl: so it's interesting because i was looking at a recent survey from jpmorgan. they believe that 53% of institutional traders are going to, that they believe that machine learning or ai has the greatest influence on trading. so do you think that we're going to get an inflection point where ai replaces investment advisors? >> no, i don't think it's a replacement-type situation. i think that it's going to allow

advisors to be more productive. it's going to allow them to focus on other areas of growing their book of business, just as how we saw chatgpt being implemented in how we use the natural language processing from ibm watson, it's helping us to look at more information, so it's more pixels to the global market puzzle. so we see things as you mentioned is range-bound currently, but if things change, a tail risk event, an unforeseen job number, the systems going to capture all of that information, aggregate it up and help decide what are the stocks that have the best probability of market price appreciation. >> cheryl: what do you say to your critics? those that especially when it comes to chatgpt which has become a very hotly-debated technology. what do you say to the critics that say this is dangerous. it's not real. it's going to create misinformation. it's going to create mistakes and especially if you're talking about in the financial world, the investing world, that's a

risky question here because money is on the line, not just somebody's passing or not passing of the bar, or the mca t. how do you respond to that? >> yeah, again, it's a collaboration with humans and artificial intelligence tools. we're not letting everything go solely to the system, although most of the decisions are data- driven, right? so there's opportunities and it's machine learning, not machine knowing, so these are all opportunities for the systems to learn and these solutions to work out better for investors. >> cheryl: do you think we'll need more transparency? >> absolutely. ai is typically known in the financial industry as a black box but it's not. it's data science and using ibm watson we're able to help investors see that hey, why are these particular trades being made all the way down. is it the price moves, the technicals, the unstructured data, all of the sentiment so we can see what data signals are

helping us invest. >> cheryl: it's almost a little bit of a continuation of high speed trading. different way of looking at trading and it's not high speed, but it certainly is kind of bringing in that computer into how we make or don't make our investment decisions. chris natividad, thank you so much for being here, appreciate it. >> thank you. >> cheryl: well this thursday you want to tune into a special town hall on "making money" with charles payne. it's titled the future of work. that's at 2:00 p.m. eastern time and it's only right here on fox business. well, car buyers right now are facing high prices and even higher interest rates, but as the supply chain smooths out, will there soon be deals inside the nation's showrooms? we are going to ask the ceo of cars.com, as a fox business exclusive that's coming up next. taking a look at the markets as we go to break. we are coming off session lows down almost 600 points now we're down about 515 on the dow, s&p and nasdaq also lower.

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i'm so glad we did this. i'm so... ...glad we did this. [kid plays drums] life is for living. let's partner for all of it. i'm so glad we did this. edward jones >> cheryl: fox business alert for you right now. taking a look at your markets as you can see the dow is still down more than 500 points in the wake of jerome powell's testimony in front of the senate banking committee, where he talked about the fact that inflation, stronger than expected, and that they are going to have to get more aggressive on rates that has really hurt the market today. s&p down 59, nasdaq is down 144.

amazon getting a thumbs up from goldman sachs. the bank calls the e-commerce giant a top pick for 2023 saying the concerns over an amazon web services slowdown are overblown, and e-commerce margins look as though they will improve this year. netflix has cracked down on password sharing is leading to bullishness. loop capital says the streaming tv service should see sales get a small bump as the tax on extra charges for members to share their passwords. loop said its survey of users showed limiting the number of shared accounts increased average revenue per-user. there's amazon, and netflix, shares of ww international, formerly known as weight watcher s, gaining money, not pounds, after an announced deal to acquire telehealth firm sequence. this is going to help ww push into the anti-obesity drug

market. telehealth, they reach out to people to sell them ozempic and these other drugs to help these people lose weight that aren't diabetic. big controversy. ww also releasing fourth quarter results showing shrink ing revenue year-over-year and a net loss of $32.5 million. well, the justice department today soon to block jetblue airways $3.8 billion proposed takeover of budget carrier spirit airlines. they say the plan would eliminate the unique competition that spirit provides. spirit agreed to sell itself to jetblue last summer. the airlines disagree with the doj's decision to seek to block the proposed merger. we'll see if they decide to fight back. there's jetblue down almost 3%. spirit is up 4.5%. okay, take a look at rivian los ing charge after announcing monday it plans to sell $1.3 billion worth of bonds as weakening demand and higher costs hurt the ev maker. reuters reporting the capital

will help facilitate the launch of rivian's r 2 vehicles. rivian tumbled last week on a 2023 production forecast that was well-below analyst estimates , and a recall of more than 12, 700 vehicles. well, bad news for car buyers hoping to cut a deal. according to cox automotive's used value index which checks prices of used cars sold to dealerships previously owned auto prices in february saw the largest month-to-month gain since 2009. accelerating 4.3% from january, but still dropping 7% year-over-year, so kind of mixed signals across the auto market, but take a look at online car marketplace cars.com. its stock is jumping about 30% so far year-to-date, and the ceo is here, in a fox business exclusive to give us a window inside where the auto sector stands.

joining me now in a fox business exclusive, cars.com ceo alex better. thanks for being here. >> great to be here, thank you. >> cheryl: so i've really got to start with interest rates just because it's a day where we heard from jerome powell, interest rates is the topic. so i was looking at auto loan interest rates. a 60 month new auto loan is 6.3% and a 48-month new car 6.27%. 48-month used is 6.9% and 36- month used 6.58%. what does that tell you about what's happening out there right now, because this has to hurt the auto sector at some point. >> well, the only thing i would say on that while it's never a good report to hear about rising interest rates we've got a long way to go before you'll see an impact to the auto market if you go back to 2000 interest rates got as high as 9.6% and we still sold 17 million new cars that year, along with 40 million

used cars so the car is a very durable necessity in people's lives so it's never good for affordability but its got a long way to go before it'll dent the auto market. >> cheryl: and obviously used vehicles and new vehicles are a big part of the cpi report, that we cover every month on fox business, and what's interesting if you look at the cpi report in january, new car prices jumped 5.8%. is that the supply chain? >> well, you absolutely are sen the new and used car market. first and foremost, on cars.com, consumer demand remains very strong. our traffic was up 5% to start this year. we hit an all-time record high in january, and so we're seeing pent-up consumer demand, largely looking for the new cars that have been talked about for months, and they're finally starting to come back on dealer lots. you're certainly seeing domestic oem's leading the way whereas honda, nissan, toyota much slower to bring back new car volumes into the market. >> cheryl: i have to ask you

about sales trends because obviously, you've got everything on your site from a chevy to a ford and on and on to a tesla. what is the hottest brand right now that you're seeing sell and also, how big is the demand on your site for electric vehicles? >> well first of all, truck shoppers are always one of the biggest segments in the market and truck sales continue to be robust and strong i'd be remiss if i didn't talk about the strength in ev share, while it's still single-digit its been growing over 50% and so you're seeing this demand for ev's continue on the consumer market. this year alone, there's over 60 new models projected to launch in the united states with over half of those being ev or at least a hybrid vehicle, and so as supply comes into the market, we think this pent-up consumer demand is going to find what they are looking for despite the rising interest rates. unemployment is still relatively low. cars are a necessity, and so we see a very healthy market

particularly now with spring time and tax season, great car buying opportunities out there. >> cheryl: are people still buying american? >> absolutely. the new domestic products coming into the market are being rated extremely high, and a big difference between the domestic products and some of these new up-start ev sellers is they're being backed by a local dealer network and so when you buy an ev, you've got somebody local for service, support, and the overall ownership experience of the car. i think that's one of the reasons why it led to tesla reducing prices, they are seeing ev competition come into the dealer network that will come back and compete nor that volume. >> cheryl: the cheapest tesla is $40,000. so if someone is searching on your site, do you see a pattern where consumers start with a search and say they are looking at a $60,000 car, and then they realize because maybe because of interest rates or whatever the reason, that they start to kind of downsize that search on

the site? are you able to track that kind of thing? >> cheryl, what's so interesting and fascinating about this market is that the automotive industry is one of the few industries where the purchase funnel actually widens in the last mile. consumers get a ton of anxiety about brands, what to pay, and so the purchase funnel doesn't narrow at the end. it widens at the end, which is why marketplaces like cars.com are so important for their shopping journey, and so we see pent-up consumer demand, 86% of the people on cars.com have a very near term purchase horizon and they are using our technology to decide what to buy , what the to pay and where to buy it. >> well look i live in manhattan i'm in the 14% that was just very curious about the site so i was on there today i'll put myself in that camp. alex vetter, thank you very much for being here good to meet you, thank you. >> thank you, cheryl. >> cheryl: well, it is not just the auto markets. the housing market is struggling

with high rates but fox business is helping you find your "american dream home." my show is part of the real estate block each week on fbn prime. we're on every wednesday. we'll be on tomorrow night, 11 p.m. actually we'll do four back-to-backs at the beach, because it's still really cold in new york city and the east coast, and california. all right, china warning the new cold war could turn into a hot conflict of the world's two biggest economies can't find common ground. coming as the senate reveals plans to ban tiktok and another major import as targeted as the new huawei. we've got team coverage straight ahead and taking a look at the big board for you right now, we are still down more than 500 points but we have swung back almost 100 points. we've got about 27 minutes to go until the close. "clayman countdown" coming right back.

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>> cheryl: all around contain ment, and suppression. those are the words of chinese leader xi-jinping, accusing western countries led by the u.s. of stifeling chinese development over the last five years. his words echoed by the chinese minister of foreign affairs, who warned today his country and the u.s. are headed for " conflict and confrontation" over american policy. now, the cold war language is sending shivers down the spines of business titans jpmorgan jamie dimon says the biggest economic worries are ukraine and china, saying its relationship with the u.s. is at stake, and then there's this breaking news, want to take you right now live to capitol hill. there is senator mark warner. he is joined by actually a group of bipartisan senators on capitol hill right now.

they are unveiling new legislation to address the threat posed by technology from foreign adversaries, particularly focusing on tiktok and i believe that's senator standing behind him and edward lawrence is live at the white house right now, so we're just now monitoring because they just unveiled this at the top of the hour. what are you hearing from your sources, lawmakers on how this bill that they are pushing forward, this warner bill, how could this affect u.s. china relations and business? reporter: how could it affect that remains to be seen and the chinese obviously don't like it. in fact during this news conference here, a number of the senators said that on tiktok , it was trending trying to do away with this legislation , so it was pushing a lot of content and one of the senators was saying that that might not be coincidence. so they are talking and very concerned about tiktok here. now this is as you see senator t hune, senator mark warner introduced this legislation with a number

of bipartisan senators both sides of the aisle that would give the executive branch the authority to regulate devices in apps and technology like tiktok that might be collecting personal data the chinese. the bill creates a rule-bound process that puts investigation into the commerce department for this , and to determine whether it goes against national security. now the bill, the latest in thio china president biden has waited for overwhelming pressure before he acts, so today, the chinese president as you said getting more vocal in his speech. president xi says the u.s. is encircled and suppressed china bringing severe challenges to the development of china by the united states, so the chinese foreign minister going further as you said so i wanted to know what the response is from the white house. listen to this. >> so with the more direct language from chinese president and the foreign minister, is there concern that the

administration line that they want competition over conflict is seen as weakness by the chinese? >> i'm not sure how it's seen as weakness when we are more competed to out-compete china and protect the national security under this president and because of the work that he's done. reporter: and no big changes in the policy from the white house, based on the actions going on and china again the white house press secretary making the point that the president wants dialogue. once that dialogue continues and wants competition, not conflict with the chinese, even though their language seems to have ratcheted up. back to you. >> cheryl: i think you're saying we're impeding their development. reporter: yes. >> cheryl: i would use the word we're impeding the theft of our technology. reporter: right and that's what they are concerned about. obviously the chinese, you know, the fbi director says they are opening 1,000 investigations a month into the chinese stealing technology from universities and other businesses in the u.s. , so clearly, they're concerned that pipeline might be shut off. >> cheryl: i think they flew a

balloon over the united states. good lord, edward lawrence, thank you for that live report we appreciate it. meanwhile, tiktok may not be the only chinese national security problem. a new threat may be hanging high over american shipping ports. national security officials now warning chinese-made cranes could be a potential trojan horse to snoop on what materials are being shipped in and out of the country. let's go live to kelly o'grady. she's at the port in wilmington, california with more on the growing chinese crane concerns. is this , i guess, kelly, are we supposed to call this the new huawei now? reporter: yeah, cheryl. i mean, i think that's the fear, right? this is the next chinese spy threat that's hiding in plain sight, so i want to give you a sense of what these look like. i mean, they are pretty big. they are hard to miss, so these cranes are used to transport the containers that you see there from the ship to the shore and the concern is that those that are made by a chinese

manufacturing company called zpm c are being used to spy on us, so reportedly some national security and pentagon officials have gone so far as you said to compare those cranes to a trojan horse. while inexpensive they contain sophisticated sensors that can register and track containers prompting concerns china could capture information about material being shipped in or out of the country to support u.s. military operations, so the market share context zpmc cranes are imports all over the world and the company controls around 70% of the global market and sells its equipment to more than 100 countries and normally they come fully assembled. you can see in that video that's a zpmc crane being brought into the port of l.a. but operated remotely through chinese software and a design industry executives tell me could make it possible for beijing to siphon intelligence or worse disrupt our supply chain. so a ccp spokesperson said that claim is entirely paranoia and

meant to mislead the american public. yesterday the white house punted questions on the crane concerns as well. >> the cranes don't have any comment on that specific reporting. i would refer you to the department of transportation and the department of defense who have been tasked with congress to study this particular issue. reporter: but some are playing offense with proposed legislation to ban purchasing the chinese cranes. representative jiminez telling fox business "communist china monopolized the industry and i'll continue to spearhead efforts to decouple beijing and incentivize the near shoring of our strategic manufacturing capabilities" so cheryl, of course that would make things more american-made, release some of that chinese spy threat but also cost a lot more. i'll send it back to you. >> wage inflation we call it, kelly o'grady live report for us , thank you very much, kelly. all right, well, a ruling in the sec versus ripple lawsuit

expected anytime now. we are talking to xrp proponent john deeton closely involved with the case alongside charlie gasparino that's coming up next. take a look at the big board again markets are selling off, jay powell delivering rough news today. rates probably going to go higher. markets looking for a 50 basis point hike at the next meeting. that is a difference than what we had this morning. "clayman countdown" coming right back. you'll always remember buying your first car. but the things that last a lifetime like happiness, love and confidence... you can't buy those. but you can invest in them. at t. rowe price, our strategic investing approach can help you build the future you imagine. when aspen dental told me that my dentures were ready, i was so excited. i love the confidence. i love that i can blast this beautiful smile

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stay in the home and life you've built for years to come. call... to receive $1000 off your kohler® walk-in bath. and take advantage of our low monthly payment financing. ♪. cheryl: it has been more than two years since the securities & exchange commission filed its lawsuit against crypto company ripple for selling unregistered securities. now after a lengthy battle a district judge may be close to announcing a decision. the outcome of which will impact the entire crypto industry. joining me now is lawyer john deaton who is closely involved in the case and our own charlie gasparino. you two have had many conversations on air. >> battles. you're still with us? i mean in terms of the case? >> yes. >> explain, you're on the side of the ripple shareholders, right? you're advising ripple, do i --

>> no. i'm for the xrp holders. >> i'm sorry, yes. >> individual retail holders. we have 75,000 plus. >> i will get a lot of crap. >> that's okay. >> amicus, i filed a motion to intervene. the judge said you we'll not let you become a defendant with 730,000 people. you are amicus curiae. >> they filed motion. >> they lost. >> you're still here. >> we got a victory last night. >> the victory last night the judge said, you can have these expert witnesses, sec can have these expert witnesses but what he really did was saying off the checklist is the expert witness decision. the next decision could be summary judgment, correct? which means she might rule from the bench either in favor of ripple or the sec? >> absolutely, charlie. the, this was a dauber motion.

ripple has 10 expert witnesses and the sec has five. both sides challenged their experts saying they should be excluded. the victory we got have was an expert sec was offering would testify what gdp holders thought in their head when they purchased xrp they never interviewed one shareholder in his entire career. >> has esp. >> he served as 3 million-dollar contract from the sec to serve as a witness. the judge excluded that part of his testimony he will not be allowed. to your point though some people believed that the decision on dauren better motions, expert witnesses could come down simultaneously with the summary judgment motion. so i tweeted out yesterday i wouldn't be surprises if we get a decision within a day or couple days. >> let's be real clear, if the sec wins, they hold ripple liable for selling xrp which was an unregistered security, big thing, that means just about

every crypto, except for maybe bitcoin, maybe even bitcoin, is, could be considered a security, correct? >> well, i mean gensler has come out and said bitcoin is the only one he is comfortable saying he is commodity. i think you can take bitcoin off the table for that. >> say the sec wins this given what happened with sam bankman-fried it will be hard for a judge to basically side on the, you know in crypto's favor, does it have a ripple effect through the industry in a sense how does that make coinbase, means coinbase, binance brokered unregistered securities? are they kind of on the hook. >> it will be a huge presidential value if sec wins. if you look at xrp, it was created in 2012. it was the third largest cryptocurrency in the world when the sec sued ripple. it was traded charlie, cheryl,

for seven 1/2 years around the nights and the world openly and fairly without any interaction from the sec. then the sec comes in seven 1/2 years later, after it was declared convertible virtual currency by the fincen and declared by fsoc as virtual currency, by the government accountability office as a virtual currency use losing a decentralized platform, after all that the sec comes in after all those years. >> they still have a strong hand. if they win, that ripples throughout the industry. >> that is what i was getting at -- >> do you think they are going to win? >> no i think the sec is going to lose. that doesn't mean ripple will get an outright win either. i think sec will lose at summary judgment because of the theory they went with. charlie, normally if you go after a promoter, on this particular day you made unregistered securities offer or sell, that particular

transaction was a security and investment contract and now they're saying all sales of xrp, token itself is security. that's the problem. cheryl: john, this is why all eyes are on the case, why twitter blows up every time you come on the show, just to point out, guys. >> i think sec will win. i tell you it will be a bad day for crypto. >> bet dinner on that? >> steak. >> you got it. cheryl: can i come? john deaton, good to he sue again. >> thanks for having me. cheryl: keep us posted. it is fascinating to listen to talk the case. closing bell three minutes to go. markets sell off thank you, fed chair jay powell, his remarks during testimony to congress sending the bulls in retreat, obviously talking about interest rates going higher. that is the bet now. dow down 570. s&p down 42. our closer says this is whiplash and "alice in wonderland"

market. you don't know which pill the market will take that sounds right to me. we have jordan kimmel. explain to me what you mean by that. >> all you do watch the market one day at a time. every day, folks on one side of the boat, the fed will break the economy, we're going to new lows. next day, we know this is baked in. we know this will happen, watch technicals of the market. there is this back and forth. cheryl, trading difficult, investing is hard, but trading is difficult in this kind of a choppy market. what i talked about over and over, the need to have real displain. the markets go up most of the time. when they're not going straight up, that is when you find out who is for real, who has got a process and who really knows what they're doing. these are different times. cheryl: jordan, do you think that the market is overreacting today to this? >> today i do because we knew

what powell is thinking. we know he says he has more work to do. we could have put the words in his mouth yesterday. we should have seen this coming but that doesn't mean he is not for real rating will go higher. you need a portfolio that match this is market. balance sheets profits, profit margins of the bear market will end eventually but that means you have to have discipline and quality all the time. cheryl: one of the things we saw today which we haven't seen since 1981, the treasury yield curve widened the most inverted since 1981. signals recession on a technical basis. this is the most debated telegraphed recession i think we ever have had. what is your thought? >> it shouldn't be debated. there will be a recession. that is obvious. the fact is, the question will

be, is it an 08-09 type of recession? the answer is most probably not. so recessions and expansions, bull markets, bear markets, they're part of the cycle. we will have a recession. -- you should be protecting yourself. it is risk first but that doesn't mean you can't be invested either. cheryl: definitely watch out for your risk. we also heard the phrase today, once again, cash is king and a lot of people seem to be sitting in cash because of days like today when you see all the volatility. tomorrow, report about the new pill that could change the trajectory. what could really change thing, the jolts report and jobs report on friday. [closing bell rings] jordan kimmel, thank you very much. major averages taking the plunge. the dow snapping a four-day winning streak. that will do it for me. see you tomorrow. ♪.

larry: