lauren: elon musk is planning to get into the artificial intelligence race. yes, i know, you said he's already in it, and he has been for a while. the financial times is reporting that musk is planning to launch a start-up to rival chatgpt, maker open.ai. he actually co-founded open.ai back in 2015. he's already assembling his team of researchers corps of engineers, pretty fast. a speed that might surprise some since he just penned an open letter calling for the six-month pause on development of ai after gpt 4. elon musk also raising eyebrows in his quest to prove he's not a nepo baby including the belief many have his father had an interest and musk tweeting he will pay a million dogecoin to whoever can prove that mine existed and now you know always something interesting on elon musk. here is liz claman. liz: it's never not interesting,

okay folks we have one hour left to trade and it may come down to the final minutes to see whether the nasdaq can squeeze out a gain for the week. everybody is in the red at the very moment. we've got the dow jones industrials down 180 points the s&p down 13, nasdaq down 56, the russel down 20 points. now for the week, take a look right now on this friday, where we stand. see how close the nasdaq is to either dipping into negative or seeing that gain at the moment, the nasdaq looks to come out to the upside here for the week, but by barely, barely a bit here s&p up two-thirds of a percent on the week. the dow more comfortably in the green by more than 1%. for the dow at this hour though, you can distill the point loss in the dow right now, down to a boxing match between jpmorgan versus boeing. jpmorgan owns the good news on this session. this percentage gain at the moment of 7%, it was even higher earlier, marks the biggest one-day gain for jpmorgan shares

in 15 years, thanks to ceo jamie dimon & company posting blowout earnings. first quarter profits surging 52 % driven largely by higher rates the bank was able to charge on loans while revenue rose 24.5% to 39.34 billion from a year ago. analysts expected 36.19 billion, but declines in boeing blanking out jpmorgan's gains here we've got shares of the aircraft maker diving 5.6% after warning yesterday it had paused deliver ies of some of its 737 max jets. analysts say 60% of boeing's free cash flow comes from its aircraft sales. a third of that from the 737 max boeing disclosed the halt is due to incorrectly installed parts from supplier spirit aerosystems and marks another issue for the jet which suffered two deadly crashes in 2019 and 2020. jpmorgan rivals though, you can look on the screen. everybody from citi to wells to

pnc and blackrock on balance reported solid numbers with a mixed picture with blackrock and citigroup higher of course as well as jpmorgan. wells is down just slightly its been toggling back and forth and the flat line,pnc is also slightly lower. all reported they built up their cash reserve pile, a sign that worries in the wake of the regional bank crisis in march are far from over. specifically about blackrock, assets under management grew 5.8 % sequentially quarter-over-quarter to 9.09 trillion while down 5% year-over-year blackrock did lead the industry with 34 billion of bond etf net in flows, lots of money rushing into those etf's and that accounted for 60% of total fixed income etf trading volume. as investors pull their money out of smaller banks and park it in bond etf and bigger financial names what dangers are still lurking that the could pull-down the markets?

joining me now to talk about what he sees, blackrock chairman and ceo larry fink. welcome, larry. glad you're here. >> hi, liz and high, charlie. charlie: larry before we get into your earnings which were pretty amazing, there's nobody better at assessing risk on in the financial system than you. you've been through a lot of the dry runs before the financial crisis. you went through the financial crisis. we have a banking crisis right now, mostly regional banks. there's at least a lull in that crisis or is it over. where are we right now? >> you framed it quite well. the large u.s. banking system is as strong as ever, and i think they have a great global run in front of them. they are just very well positioned and in terms of the small regional banks, there are many issues that could really make it more difficult for them.

there is somewhat of a loss of confidence and this is why we saw in a few weeks, hundreds of billions of dollars of deposits. charlie: interesting. >> to the larger banks and to money-market funds and bond etf. we were a big source of where that money ultimately went to, but what we were seeing is the balance between the capital markets and the banking system. the united states has the strongest, most robust pockets in terms of capital markets and banking systems in the world and there are times when the banking system is not as strong and money moves into the capital markets. charlie: and that's where kind of we are now but i guess the bigger question is are we talking two dozen banks that have problematic or mid-size community or regional banks? >> we might. i don't know if that's a problem we certainly may have a few other banks that are going to

show real problems to their income statement, as they are having to pay much higher rates for deposits, and their assets were accumulated heavily during 2020 and 2021 when rates were much lower so they have big, they have big losses in their bond portfolio and that's what happened to silicon valley bank and signature. charlie: what's the next trigger , do you think? >> pardon me? charlie: what do you think the next trigger is for more banks? is there a triggering event? >> i think the trigger is in the next few weeks we'll see the bank earnings. charlie: interesting. >> through the bank earnings, we'll see how impaired our earnings are. talking about the smaller banks that are going to and the regional banks when they report earnings. how much will their net interest margins decline and how impacted they will be. we're going to learn about how much deposit losses have occurred. how much borrowings they had to

do with the federal reserve or the federal home loan bank board. they received liquidity there, and let's be clear. that liquidity that they are receiving keeps them going, but they are paying a market-rate so that's going to be the issue. the big issue, charlie, that we haven't discussed enough in my mind is what triggered with silicon valley bank and signature bank were the impairments and their held to maturity account. banks have the ability to put an asset in their trading account where they must mark-to-market everyday and it goes up and down with the marketplace or they are able to put much of their longer term lending, their mortgage book, into a held to maturity account where they don't have to mark-to-market and they are able to keep those loans on their books for the entire term of those loans, but the marketplace this time started to say we want to look through it. charlie: right so i guess the long and the short of it, it could happen again in the next couple weeks because of that? >> correct. liz: larry, i mean, just

yesterday, we broke the story. charlie and i about truist financial exiting its mortgage backed security business. they implemented wait a few layoffs. they have had some trouble with the fixed income part of this piece. then you have the wells fargo cf o today saying he expect s specifically that staffing levels will decline this year. he didn't say exactly where, but you've got to tell us exactly what that really means because if you start now, weeks after silicon valley bank and signature banks implosions to see people exiting their entire fixed income business, what does that tell you? >> well it means banks may be going more towards floating rate lending, which puts the responsibility of the up and down of the market on to the borrower, not at the bank. that has big consequences and that means more fixed rate lending then needs to go to the capital markets and that's part

of this whole ecosystem. do you keep the assets within the bank or keep the assets within the capital market system these are big unanswered questions we'll have to see but i think the the bigger issue is this relates back to something you've been talking about a long time and that's inflation. charlie: well let me ask you this. how many rate increases do you think are left? and have we sleighed the dragon somewhat? >> by no means. i think we're going to have two to three more rate increases. charlie: two to three, that's a headline. >> you know, and the reason why is i believe interest rates need to go higher, especially in the shortened, because we have stickyier inflation. look, inflation is coming down but can it go down below 4% and in my view it's going to be hard to bring down inflation. liz: but how do you then, larry, capitalize on market dislocation s that we are seeing from the fed raising rates? well they've already raised rates nine times in a row since

one year ago. you're saying it could end up being 12 or 13 total. you know they are going to be more dislocations. how do you as an asset manager capture that and make it lightning in a bottle? >> first of all there's a lot of lightning in a bottle right now. you could earn 6% in a intermediate bond credit portfolio today. a year ago two years ago you were lucky to earn 2%, so for most savers, those who are on a fixed income, for most retirees now, you're finally able to earn money on your savings. charlie: right. >> this is really important. charlie: and not having to go into the stock market out on the risk spectrum which i think is -- >> you don't have to. you could derisk now. you can buy an appropriate amount of fixed income, even treasuries and earn four or 5%. charlie: that's a great point. i want to turn this to blackrock a little, larry. i look at you as the energizer bunny. >> [laughter] charlie: you take a licking and

you keep on kicking? liz: ticking. charlie: kicking too. i mean, like larry, you get crap from the left. you get crap from elizabeth warren from the right wingers, the governors, yet blackrock is a resilient company and i think that it's pretty amazing. i mean, charting this middle ground between the two, like i'm sure you've read the letter that brett landler said, the new york city comptroller said you need to get out of fossil fuels and you said okay hit the road, jack and you heard what some are saying in the red states but charting that middle ground how hard is it? is it does work in terms of the earnings or else you'd have $9 trillion in assets today. >> so first and foremost, we've turned 35. we had our 35th anniversary. liz: congratulations. >> everything we do is for our clients, and for new york city, or any client who has those type of wishes, our job is

to follow what their wishes are for them. we're not, all $9 trillion is other people's money. our job is to be working with every asset owner and designing a portfolio to achieve obviously great returns, which that's one of the things we've done very well over the 35 years, but more importantly, to follow their wishes. charlie: so if they want sin stocks you'll do it, right? >> of course we will. i mean, what clients don't want sin stocks? we have many different products that don't have alcohol, that don't have tobacco. we have some products that are heavily oriented towards energy and energy companies, and we have some products that are -- liz: listen. anybody just looks at i-shares and they could see they could pick any type of investment. there are that many choices. i want to go back to the bond issue because as we look at yields, certainly off the highs recently, but the six-month and the four month are still looking incredibly good when you're

talking about short-term opportunities. rick rader, your fixed income guy, sitting right on the set, called it the nirvana situation for bond yield investors so my question is we know trees don't grow to the sky. we know all good things come to an end. how much longer do we see these higher rates last? >> i think it's going to be a little longer than the market thinks. i don't think we're going to see as i said we're going to have a few more tightennings which is going to, because we have more elevated inflation for longer and i think getting back to small and regional banks is the real issue for some of them if i'm right around inflation and where rates will be going. charlie: where does the rates go the top rate? liz: how high? >> another 75 basis points from here. it's not, you know, you could see where they have to go, but the marketplace is now forecasting out i think nine or 12 months they start easing. i just don't see that.

liz: okay if anybodies grandma came up to you and said mr. fink , where do i put my money right now that's safe? are you saying stay in treasur ies at the moment? because that's where you're getting the best yield? >> well i would say for those who are on a fixed income, if this is the best opportunity you've had in 10 years to invest and whether it's in treasuries, depending on the type of risk or some form of bond etf where they could earn a little more higher income , you know, so that really is something that we haven't seen in years, liz. at the same time, valuations for equities are better today then they were two years ago, so markets two years ago valuations were pretty extreme levels and come down quite considerably. liz: what wouldn't you touch at the moment? >> i'm just not as pessimistic as most people. i see opportunities because of higher returns and i do believe we're going to have more stresses and have more geo

political issues so i'm not trying to suggest this , but because 54% of the assets we manage are retirement assets. our job is to seek the best long term returns so more and more people can live in dignity and with pride when they are retired that's my job. charlie: and that's great. larry people forget that you built blackrock from zero. now it's 9 trillion and one good thing about fox business, is if you watch us, you get larry fink as your financial advisor. los angeles liz: but we ask the questions the other wonky business networks won't, so larry, thank you. thanks guys, stay safe. liz: always a pleasure, larry fink of blackrock. sure the bank earnings did shed new light on how the fear surrounding the collapse of silicon valley bank was a boom to earnings at the big money center banks and asset managers like blackrock but what is that fear doing to the startup world and small businesses in america

which feed off borrowing money? it's their mother's milk. with stunning new numbers out on the approval rates of small business loan requests, up next, entrepreneur julie wayneright, founder of the real real on what the staggering stats reveal about the startup landscape and what today's retail report indicates about consumer health. closing bell 45 minutes away. dow is down 243. the "clayman countdown" is coming right back. don't move.

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call today to request your free bond guide. 1-800-217-3217. that's 1-800-217-3217. liz: we are just getting this breaking news. we have a report from the "wall street journal" that best buy is laying off hundreds of employees at its stores as more and more sales move online, so you can

see the stock is flat intraday but if you look year-over-year over the past year, down 23%. its been very hard for retailer names out there. we have been getting more and more evidence that consumers are bracing for a possible recession retail sales overall got that number today, dropped 1% month-over-month in march. much worse than estimates of four-tenths of a percent gain. now, since actually four-tenths of a percent loss rather. since the federal reserve began raising interest rates a year ago, the cost to borrow money has gotten more expensive and it is about to climb even higher. according to the futures market which at this hour, is pricing in a near 79% probability of another 25 basis point hike in may and you just heard larry fink of blackrock say he expects two or three more interest rate tightennings. how will that impact not just consumers but lending conditions for small business? julie wayneright is an entrepreneur and the founder and former ceo of the real-real

the leader in luxury reselling items online which ipo'd on the nasdaq back in 2019 but she founded the company in 2011, building it up at her kitchen table and many other businesses she started with the help of loans which are now much harder to get. julie joins us now in a fox business exclusive. okay, i mean, we have best buy, a huge business obviously, making these lay off announcements on top of that we know that any small business at the moment is having a much more difficult time getting a loan. how much of this has to do with the silicon valley bank collapse >> oh, it absolutely does. i have to tell you i did start a new business beings and it was funded in october of last year. we had our money at first republic, not silicon valley but we really were so afraid of the knock-on effect, we moved it to b of a, but in the past we've always, i've always gotten venture funding and then supplemented that funding with bank loans, from banks in

silicon valley and that money is gone. liz: and these were the regional s that are much more inclined to take a chance on local businesses and start ups, correct? >> absolutely. the regional bank is really important to any small business, as they know you. liz: we've got these bank lending numbers. so the larger banks approved just 14.2% of applications in february. that was even before the march collapse of silicon valley bank, down from 28.3% in february of 2020. small banks granted about 20% of loan applications in february, but they were approving about half of all requests a couple of years ago, before the pandemic hit. how much harder? we're hearing anecdotal evidence of start up and entrepreneur companies who say they've been rejected by three banks or four that previously gave them money. >> well look, it was hard heading into a recession anyway. so then everyone, we've been talking about recession for 15 months. now it feels like we're really

in one, with the collapse of silicon valley bank and the pressure on the regionals and the bailout of first re public, by jpmorgan and others , it's really going to be hard and then venture capital is also drying up. so the combination for new start ups doesn't look good. liz: what does that mean for the overall economy? we know that small businesses provide the backbone of hiring in this country. >> small businesses drive the economy, and most small businesses are started by women, by the way. so i would say it's going, who knows. things don't last forever, but i would say at least for now, maybe a year, it could be two years. you're going to see a big pause, and the good news from people that have money, they need to be really smart about how they use it, and they can gain a competitive advantage, but you're going to, i just think it's going to slowdown innovation and it's going to have an incredibly negative impact. liz: what were the , what was it

that made you pick bank of america when you moved your money out of first republic bank >> well honestly there's only about four banks now to move your money in and it was to be honest -- liz: that's sad to hear you say that. >> well it's true. we felt safe about and by the way i've been a customer of first republic for 22 years. we've always had a startup money there. they are a beautiful bank. liz: did they try and keep you? >> of course they did but the truth is you've got to protect your money and when it's only insured to 250,000 you have your entire start up budget there. look bank of america, why? to be honest they were the first one that picked up the phone and got the deal with us. liz: really? >> yes and i'm sure everyone was overwhelmed and we ended up closing that, getting everything setup on a saturday morning, and first republic was still working on sunday to actually queue up the wire for the monday. liz: oh, gosh, you know, i have to tell you that as we finish up this interview, i look at when you took the realreal public. this is going to hurt ipo market

, isn't it? >> its already hurt that market , yes. it hurts everything. the whole economy. the innovation part of the economy. the new business formation of the economy is going to grind to a halt. liz: well i'm sorry that the news is bad, but you're still starting up businesses, so there have been many a business folks that started during recessions. fedex, ibm, the list goes on so julie we wish you the best of luck. >> thank you, liz, i appreciate it. liz: the founder of the realreal ev maker lucid hitting a roadblock, a start up ev company , the concerning results that have the stock plunging to the bottom of the nasdaq. that's ahead of pop stocks plus is money actually growing on trees and floral arrangements? consumers are facing major sticker shock at the flower shop up next, we'll examine the factors causing inflation to take root in the garden. closing bell ringing in 35lad minutes. s.

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ahh, pretzel and mustard... another great combo. voya. well planned. well invested. well protected. liz: fox market alert. the dow down about 197 points on this friday. we do have the s&p down 15 points, the nasdaq losing about 62 points. investors are hitting the brakes on lucid after the luxury ev maker reported weak production and delivery figures for the first quarter. shares down about 6.7% at the moment to $7.69. lucid produced just over 2,300 vehicles, and delivered only 1,400 of them or 61%.

the companies deliveries to production ratio significantly lower than tesla 96% rate, but you know, tesla has been around for many years. problem is lucid is also lower than rivian's ratio of 85%. rivian is a much newer ev company. lucid's inability to sell out vehicles raising slowdown concerns among investors and analysts alike, and we should look at rivian if we could. rivian is also down about 7.5%, tesla is under pressure but barely down about three-quarters of a percent. walmart, getting a monkey off its back and express shares are swinging in the trees because of it. look at express, up 30%. it's an $0.88 stock unfortunately but walmart is down about three-quarters of a percent on news it's selling menswear brand. i know benovo are primates they aren't monkeys but just it's a segway. they are selling it to express and whp global for $75 million

after paying 310 million six years ago. express will acquire the operating assets for 25 million and whp global will acquire the brand for 50 million. walmart had acquired the soup maker as we said for 310 million back in 2017, and really, has since struggled to make the brand profitable. express shares soaring as you see , and set a big discount certainly helping the brand. parent company of north face that's vf corp. is up about 3% after goldman sachs upgraded the stock from a sell to an out right buy. the brokerage firm says improved inventory management by the timberland boots maker will help the companies profit margin s. drug manufacturer catalant seeing only negative catalysts at this hour down 26.6% at the moment after issuing a profit warning for its fiscal third quarter. this is a new jersey-based company that said productivity issues and higher-than-expected costs at three facilities will

impact results for the quarter and the rest of the fiscal year. it is definitely at the bottom of very close to the bottom of the nasdaq 100 is that what i saw? yeah. all right, it's new jersey-based we're almost at 90 degrees in new jersey and it's 86 degrees in nyc, you see that live picture of sixth avenue. how many of you are leaving work early to garden in the good weather? using that green thumb is going to cost you more green this summer. according to the march consumer price index report, indoor plants and flower prices have blossomed 4.5% since just last year, while fertilizer prices are down from their 2022 high but still up 15% if you go back to 2019. madison alworth is at a garden center here in new york city. madison what is the root cause of these price spikes? reporter: hey, liz. you know what we're hearing is that fertilizer cost is what has really driven up these prices. it is peak planting season, indoor plants outdoor plants.

more customers are coming to garden center in the community for over 60 years. those customers are getting sticker shock so i want to bring in the owner was asking what the is the biggest cost that's driving up your prices. fertilizer is the biggest cost correct? >> absolutely. reporter: how much of an increase, last year was really the high when ukraine was invaded but in general how much is fertilizer up from maybe two years ago? >> two years ago it could be actually up to 30%, but we see on average about 20% since last year. reporter: and 20% up in costs for fertilizer has to impact every part of the business, so how much are your prices for these plants up for the customers coming into shop? >> we're actually seeing that about the same. about 20%. pretty much across-the-board. reporter: customers have gotten used to inflation, we're seeing it everywhere but you do have to start to make changes when everything costs more, so what is your consumer habits here? are people buying less, coming in less often? what have you noticed from the customer? >> they are coming in but they

are not buying as much, and i think that the price is really causing that problem. reporter: all right, dmitry, thank you so much. i'll show you some of the prices trying to do my best to rep these names this is a sat in pat hos, last year it was $15 and this year it costs you $20, this is an agave plant not the one that makes tequilla unfortunately, $22 last year, this year $30 still no tequilla included and then here, we have the queen of the night, last year selling for 180, this year 250 so you can just see when even just one input fertilizer being up, that costs everything to go up in price, liz. liz: yeah, i went to a garden store in englewood, in new jersey and things were not cheap not that i know how to garden. reporter: it's shocking. liz: yeah, so -- reporter: i prefer the indoor plants, just a little bit of water and we're good to go. liz: madison the inflation is pretty shocking and you've shown that to us thank you very much.

madison alworth. talking fed heads setting off recession worries once again. just ahead the specific comments from voting members that came out in the last couple of hours. austin goulsby and christopher waller that caused likelihood for a 25 basis point hike in may to surge and we'll talk to the man who correctly predicted the last eight recessions because he created the key indicator, yes, the yield curve inversion. well just three years ago he told us this time it be wrong and it wouldn't signal a re segment let's find out what campbell harvey thinks, he's joining us next coming right back when the "clayman countdown" returns.

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liz: federal reserve voting members speaking today, sounding alarm bells in one form or another, just three days after

san francisco fed president mary daily said she does not see a recession coming. chicago federal reserve president austin goulsby confirmed the possibility of a recession before the end of 2023. he said the current economic conditions in the u.s. and turmoil in the financial sector together could create enough to trigger an economic contraction. still, fed governor christopher wallace came out at the same time to voice his support for another rate hike at the next meeting, giving no indication by how much, but if you look as we've already showed you in this hour, the fed funds futures up-to-date very latest number looks like there's a 78.8 % odds that the market is betting on a 25 basis point boost at the may meeting but if the fed continues to tighten, will it propel us into a recession? joining me now in a fox business exclusive duke university finance professor campbell harvey who created the very indicator that up until now has

been absolutely right about calling recessions and that be the yield curve inversion. professor? thanks for coming back. three months ago, you had said for the first time, the yield curve inversion is not predicting correctly, even though there is a huge gap between the two year yield and the 10 year yield, and right now i believe it's around 56 basis points or so at the latest check that i had right before the show. even though it's calling for a recession you didn't see it. what has changed in the past three months that you now, today , perhaps have a different picture? tell us. >> yeah, so thanks for having me on again, and in january, early january, when i was on the show, i really thought that we could dodge this recession and it went through a list of reasons as to why my indicator might be giving a false signal but at the end of the interview, and in other public statements, there was an important caveat,

that the fed needed to stand down in terms of the raising of interest rates. liz: oh, right. >> and they failed to do that so they consistently ignored what was going on and continued to hike under the guise that well, we were late to the game to start and we don't want to be early exiting, and i think that they have overshot and have caused damage to one of the reasons that i thought we could dodge a recession and in january, i was saying that the financial sector was reasonably secure, in contrast of the global financial crisis, but the inversion of the yield curve that the fed has engineer ed and this continual increase in rates has actually caused a lot of damage to the financial system and we've seen some of that play out in terms of what happened to silicon

valley bank and some others. liz: so it was the black swan of the regional bank crisis that we saw in march that has now made your predictor, the yield curve inversion, if i'm hearing you correctly, you say we will have a recession now. >> yeah, so this is again, this is what i warned, that we could dodge this but the fed needed to stop increasing rates. they did not do that. they have caused damage and this is not just a regional bank problem, so think of a banks business model. they take in deposits and they pay a short-term rate and then they lend out to maybe commercial borrowers or even buying government bonds and get a long term rate. so when you increase the short-term rate, or invert the yield curve, that turns their normal business model upside down, that they are

paying extra money for those deposits, and what happens? well, we seen what's happening already. some banks get into trouble like silicon valley bank. many other banks are likely in trouble, we just don't know about it, and then banks become much more conservative and park excess reserves with the fed. people start withdrawing from banks, putting into money-market funds. all of this is sucking credit out of the system, making conditions tight and drawing us into a recession, and to me, it's inexplicable. inflation is under control. over the last nine months, inflation is running at 3.2%. inflation is under control, yet we are doing the self-inflicted move. liz: let me jump in here because there are very smart people who feel inflation is not yet under control and i mean, jay powell of the federal reserve does not

believe it is. you say he's wrong. however, is a recession necessary to totally douse inflation back down to the 2% level that jay powell has said is his target inflation rate? >> so let's be clear here. 3.2% is not 2%. that's true. liz: right. >> but we're going in the right direction, and the question is is the ultimate goal just to get to 2% as fast as possible and in doing that, cause a deep recession? that doesn't make sense to me. i would rather continue the momentum that we're on and dodge the recession. we don't need to have a recession right now. we are on the right trend for inflation. as i said 3.2% is not that far away from the 2% target, and we can get there over the next year

without inflation, but no, we raise rates again and again and the pace of the rising rates is something we haven't seen in 40 years. liz: the federal reserve -- >> it causes these problems. liz: the federal reserve says the banking system is sound. larry fink at the top of the show of blackrock said the big banks are in a terrific position. we know that there are fewer big banks than there are medium- sized and regional banks, when you put them all in the same pot, is it boiling? is it going cold? how do you view when the fed and when the treasury department and janet yellen say the banking system is secure and fine. >> so in the fomc statement, it had the line oh, our banking system is sound and secure. well, that's what i call cheap talk. so i be much more assured if they provided some evidence. we already know that the stress

test that they concocted is unrealistic. the adverse scenario had the long rate going to 0.5% and the short rate at 0 so what i would like to do is to have a redo of the stress test. i would like the evidence that our system is found and secure. i fear in the background -- liz: we get that. that's for sure. well you make a great point about the stress tests even if silicon valley bank, well it wasn't stress tested because it had less than 250 billion in assets under management. are you as we finish up saying that smaller banks should absolutely be stress tested? >> silicon valley bank would have passed the stress test, so that's very important, so even if they were subject to it, they would have passed. the problem is the stress test was completely unrealistic, and the adverse scenario didn't make

any sense, and then the fed takes us into a rate environment that's way outside their own adverse scenario. that's not fair to the banks, and you're playing with fire if you do that. liz: duke university finance professor campbell harvey, creating the yield curve inversion indicator, correct? great to have you. now you say it is indicating a recession. we will continue to watch please come back. we're coming right back with what to expect from the fresh batch of earnings that start next week. stay tuned we're coming right back. you can't buy great conversations or moments that matter, but you can invest in them. at t. rowe price our strategic investing approach can help you build the future you imagine. t. rowe price, invest with confidence.

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liz: five minutes remaining. five minutes remaining for the whole week of trade. we have the closing bell in 4 1/2 minutes left to trade. for the week it looks like we are green for the major indices. the sp -- the s&p down 10, the nasdaq down 2.

jpmorgan doing very well. the financial second storm remains in focus. bank of america, goldman sachs, morgan stanley, then we have regional banks as well which were ground zero of last month's banking crisis. they will be featured in next week's earning blitz. behind us jpmorgan and citi leading the bank stocks higher. we have bank of america 3 1/3 percent. goldman up 1. let's bring in chris whalen. he's working at higher interest rates continuing to help bank earnings but in some ways hurt some banks. what do you think next week. >> we'll see interest earns up

like jp. what nobody is talking about is all of these banks are seeing the cost of funds galloping on the interest side. jamie dimon doubled his interest earnings the last year. the interest expense is zero. it started from a low base. but by this quarter we will have caught in terms of percentage increase versus asset returns being the same. that's where we have trouble. down the road we'll see banks forced to sell some of these lower earning assets created in 2021 when interest rates were zero and buy something else so they can make money. >> schwab comes out with its numbers monday. it will capture what happened in march. even though it's the 7th largest bank in the u.s. its stock got hit very hard if

you look at a 3-month chart. how do you see schwab getting affects. >> it will be down because they will downsize the bank. the chairman said i don't need the bank. i can just pay it off. schwab got very big. they were bigger than u.s. bancorp. but that was because of the fed and wait injected into the system. that will go the other way and the bank will get much smaller the next year. morgan stanley, will it be the jpmorgan of next week? >> i think it will have balanced results. they have a huge asset management business that balances it off. and they have a nice bank. they have a half trillion in bank deposits. they are the two winners in the

asset category. >> goldman had a tough time last time around. >> they don't have a bank. they are a big broker dealer. >> do you think they will be forced to buy one? >> or they get bought? liz: by whom? >> that's the question. you have two institutions with good capital markets and no core funding, really. the dream transaction, put them together with u.s. bank, then you would ha have a to colossus. liz: there is the closing bell. red on the week. but we see the majors moving into the green. that will do it for us. have a great weekend