generation that has experienced zero or near-zero federal funds rate. some think we're heading in that direction again. what's the likelihood that cheap money is now the norm? >> so this is a question -- you mean after we get through all of this. st just a great question that we just, we can only speculate about. intuitively, most -- many, many people, anyway, would probably say we're probably not going back to that era where there were trillions of dollars of sovereign bonds trading at negative rates, long-term bonds trading at negative rates. and it looked like the neutral rate might even be negative. people were issuing debt at a negative rates. it seems that's so far away now. my own sense is that we're not going back to that. but, you know, honestly, we're going to find out. but, you know, it feels, it feels to me that the neutral rate is probably significantly higher than it was back then. how high is it? if i just don't think we know. it's, again, we only know it by

its works. >> reporter: one more. how do you respond to the criticism that will likely come that a rate cut now has some political motivations? >> yeah. so, you know, this is my fourth presidential election are at the fed, and, you know, it's always the same. we're always going into this meeting in particular and asking what's the right thing to do for the people we serve. and we do that, and we make a decision as a group, and then we announce it. and that's always what it is the. it's never about anything else. nothing else is discussed. and i would also point out that the things that we do really affect economic conditions for the most part with a lag. so nonetheless, this is what we do. our job is to support the economy on behalf of the american people. and if we get it right, this will benefit the american people significantly. so this really concentrates the mind, and, you know, it's something we all take verying

very seriously. we don't put up any other filters. i think if you start doing that, i don't know where you stop, so we just don't do that. >> [inaudible] liz: breaking news, the economic doctors at the federal reserve cut rates for the first time since march of 2020, skipping the scalpel and instead chopping interest rates by a larger 50 a basis points. fed chair jerome powell still speaking to the press. the markets are touch and go. let's go back to the news conference. >> -- you know, the u.s. economy is in a good place and our decision today is designed to keep it there. more specifically, the economy's growing at a solid pace. inflation is coming down closer to our 322% -- 22% objective -- 2% objective, and the labor market is still in solid shape. our intention is really to maintain strength that we currently see in the u.s. economy. and we'll do that by returning rates from their high level which has really been, the purpose of which has been to get inflation under control. we're going to move those down

over time to a more normal level over time. >> reporter: just a follow-up to that. listening to you talk about inflation moving meaningfully down to 2%, is the federal reserve effectively declaring a decisive victory over inflation and rising prices? >> no. we're not. so inflation, you know, what we say is we want inflation -- the goal is to have inflation move down to 2% on a sustainable basis. and, you know, we're not really -- we're close, but we're not really at 22%. and i think -- 2%. and i think we're going to want to see it be around the 2 and close for some time. but we're certainly not, we're not, we're not saying mission accomplished or anything like that. but i have to say though we're encouraged by the progress that we have made. >> [inaudible] >> reporter: hi. katarina -- with bloomberg news.

i just would love to know kind of how the committee is thinking about the persistence we've seen in housing inflation. you know, do you think you can return to 22 -- 2 with housing inflation where it is? yeah. >> is housing inflation is the one piece that is kind of dragging a bit, if i can say. we know that market rents are doing what we would want them to do, which is to be moving up at rell the tyly low levels. but they're not rolling over -- the leases that are rolling over are not coming down as much, and oer is coming in high. so, you know, it's been slower than we expected. i think we now understand that it's going to take some time for those lower market rents to get into this, but the direction of travel is clear. and as long as market rents remain, you know, relatively low, inflation over time will show up. just the time it's taking now

several years rather than just one or two cycles of annual lease renewals. so i think we understand that now. but i don't think the outcome is in doubt again as long as market rents remain under control. the outcome's not as in doubt. so i would say it's -- the rest of the portfolio or of the elements that go into core pce inflation have behaved pretty well. you know, they all have some volatility. we will get down to 2 inflation, i believe, and i believe that, ultimately, we'll get what we need to get out of the housing services piece too. >> reporter: some of your colleagues have expressed concern with starting to cut rates you could reignite demand in housing and see prices go up even more. you know, what's the likelihood of that, and how would you react to that? >> the housing market, it's hard to game that out. the housing market has, in part, frozen because of lock-in with

low rates, people don't want to sell their home because they have a very low mortgage. as rates come down, people will start to move more, and that's probably beginning to happen already. but remember, when that happens, you've got a seller, but you've also got a new buyer in many cases, so it's not, you know, obvious how much additional demand that would make. the real issue with housing is that we have had and are on track to continue to have not enough housing. and so it's going to be challenging. it's hard to find, to zone lots that are in places where people want to live. it's -- all of the aspects of housing are more and more difficult. and, you know, where are we going to get the supply. this is not something that the fed can really fix. but i think as we normalize rates, you'll see the housing market normalize. and, i mean, ultimately, by getting inflation broadly down and getting the rates normalized

and getting the housing cycle normalized, that's the best thing we can do for house olders. and then the supply question will have to be dealt with by the market and also by the government. >> [inaudible] >> reporter: hi. victoria -- with politico. just following up on some of the labor market talk earlier, you know, monetary policy operates with long and variable lags, and i'm wondering how much you see being able to keep the unemployment rate from raising too much comes from the fact that you're starting to act now, and that's going to give people more room to run versus just the labor market is strong? and then also if i could following up on nick's question, do you see today's 50 basis point move as partially a response to the fact that you didn't cut in july and that sort of gets you to the same place? >> so you're right about lags, but i would just point to the overall economy. you have an economy that is growing at a solid pace. if you look at forecasters or

talk to companies, they'll say that they think 2025 the should be a good year too. so there's no sense -- the u.s. economy basically is fine if you talk to market participants. i mean, you know, business people who are actually out there doing business. if so i think, you know, i think our move is timely, i do. and as i said, you can see our 50 basis point move as a commitment. to make sure that we don't fall behind. so you're really asking about, your second question, you're asking about july. and i guess if you ask, you know, if we'd gotten the july report before the meeting would we have cut? we might well have. we didn't make that decision, but, you know, we might well have. i think that's not, you know, that doesn't really answer the question that we ask ourselves which is let's look, you know, at this meeting we're looking back to the july employment report, the august employment

report, the two cpi reports, one of which came, of course, during blackout and all of the other things i mentioned. we're looking at all those things and asking ourselves what's the right -- what's the policy stance we need to move to. it's clear that we, clearly, literally everyone on the committee agreed that it's time to move. it's just how big, how fast are you going, what do you think about the paths forward. so this decision we made today had broad support on the committee, and i've discussed the path ahead. >> elizabeth. >> reporter: thank you, chair powell. elizabeth -- with abc news. mortgage rates have already been dropping in anticipation of this announcement. how much more should borrows expect those rates to drop over the next year treat? very hard for me to say. i can't really speak to or mortgage rates. i say, you know, that'll depend on how the economy evolves. our intention though is we think that our policy was

appropriately restrictive. we think that it's time to begin the process of recalibrating it to a level that's more neutral rather than restrictive. we expect that process to take some time. as you can see in the projections that we released today. and as, if things work out according to that forecast, rates in the economy will come down as well. however, the rate at which those things happen will really depend if on how the economy performs. we can't look a year ahead and know what the economy's going to be doing. >> reporter: what's your message to households who are frustrated that home prices have still stayed is high as rates have been high? what do you say to those households? >> well, what i can say to the the public is that we had the highest -- we had a burst of inflation. many other countries around the world had a similar burst of inflation.

and when that happens, part of the answer is that we raised interest rates in order to cool the economy off in order to reduce inflation their pressures. it's not something that people experience as pleasant, but at the end what you get is low inflation are restored. price stability restored. and a good definition of price stability is that people in their daily decisions, they're not thinking about inflation anymore. that's where everyone wants to be, is back to to what's inflation, you know? we just keep it low, keep it stable. we're restoring that. so what we're going through now really, it restores -- it will benefit people over a long period of time. price stability benefits everybody over a long period of time just by virtue of the the fact that they don't have to deal with inflation. that's what's been going on. and i think we've made real progress. i completely -- we don't tell people howe to think about the economy, of course, and, of course, people are experiencing high prices as opposed to the

high inflation. and we understand that's painful. >> [inaudible] >> reporter: hi, chair powell. greg -- from market watch.com. i was wondering if you could go through, you said just at the beginning that the coming into the blackout there was, like, an open thought of 25 or 50. you know, the fed could move either 25 or 50. i would sort of argue that when we had those two last speeches by governor waller and new york fed president john williams that they were sort of saying that maybe a gradual a approach was going to win the day. i mean, i sort of want to the ask a seven-part question about this -- [laughter] but, i mean, could you talk -- would you have cut rates by 50 basis points if the market had been pricing in, like, low odds of a 50-point move like they were last wednesday after the

cpi number came out? it was a really small probability of a 50-point cut. does that play, play in your consideration at all? just talk a little bit about that. thank you. >> we're always going to try to do what we think is the right thing for the economy at that time. that's what we'll do. and that's what we did today. >> >> [inaudible] >> thank you, chair powell. simon, with the economist. you noted that payroll numbers have been less reliable lately because of the big downward revisions. does that put your focus overwhelmingly on the unemployment rate in and given the sep projection of 4.44 basically being the peak in the cycle, would going above that be the kind of thing that would trigger9 another 50 basis point cut? >> we will continue to look at that broad array of labor market data including the payroll numbers. we're not discarding those. we'll certainly look at those. but we will mentally tend to adjust them based on the qcew

adjustment which you referred to. there isn't a bright line. you know, it will be -- the unemployment rate's very important, of course, but there isn't a sickle statistic or a single bright line over which that thing, that might if move that would dictate one thing or another. we'll look at each meeting all the data on inflation, economic activity and the labor market, and we'll make decisions about is our policy stance where it needs to be to, you know, to foster over the medium term our mandate goals. so i can't say we have a bright line in mind. >> [inaudible] >> reporter: thanks, chair powell. matt eaton from cnn. i know that you discussed earlier how the fed does whatever the right thing is and nothing else factors in. but many general, can you talk about whether or not you believe a sitting u.s. president should have a say in fed if decisions on interest rates?

because that's something that former president trump who, obviously, appointed you has previously suggested. and i know the fed is designed to be independent, but why? can you tell the public why you view that so importantly? >> sure. so countries that are -- democracies around the world, countries that are sort of like the united states all have what are called independent central banks. and the reason is, is that people have found over time that insulating the central bank from direct control by political authorities avoids making monetary policy in a way that favors maybe people who are in office as opposed to people who are not in office. so that's the idea, is that, you know, i think the data are clear that countries that have independent central banks, they get lower inflation. so we're not finish we do our work to serve all americans. we're not serving any politician, any political

figure, any cause, any issue, nothing. it's the just maximum employment and price stability on behalf of all americans. and that's how the other central banks are set up too. it's a good institutional arrangement which has been good for the public, and i hope and if strongly believe that it will, you know, continue. >> kyle. >> reporter: kyle campbell from the american banker. thanks for taking the questions, chair powell. a couple of regulatory developments in the past week that i want to is ask you about. first week, vice chair for supervision, michael barr, outlined his views with the changes to the basel iii end game. wondering if you are in alignment with him, if those changes have support of of the board in a broad way that you're looking for and if you think the other agencies are also fully onboard with that approach. and yesterday other banking regulators -- >> you know what? hold the second question.

[laughter] let me -- we'll give you the second question. so the answer to your question is that, yes, those changes were negotiated between the agencies with myport and with my involvement. my support and my involvement. with the idea that we were going to repropose, repows pose -- repropose the changes that vice chair barr talked about and then take comment on them. so, yes, that is, you know, that's happening with my support. >> [inaudible] >> it's not a final proposal know -- though, you understand. we're going to take comment and make changes. we don't have a calendar date for that. and as for the other agencies, you know, the idea is that we're all moving together, we're not moving separately. so i don't know exactly where that is, but the idea is that we will move as a group to put this, again, out for comment. and then, you know, it'll come,

the comments will come back 60 days later, and we'll dive into them and try to bring this to a conclusion asylum in the first half of next year. >> reporter: and then yesterday there were merger reform finalizations from the other bank regulator. what does the fed have to do to ea line itself on a merger? >> you know, i would bounce that question to vice chair barr. it's a good question, but i don't have that today. thanks. >> and jennifer for the last question. >> reporter: thank you, chair powell. jennifer -- with yahoo! finance. you said earlier that the decision today reflects with appropriate recalibration strength in the labor market that could be maintained in the context of moderate growth. even though the policy statement says you view the risks to inflation and job growth as roughly balanced. given what you've said though today, i'm curious, are you more worried about the job market and growth than inflation? are they not roughly balanced?

>> no. i think, and we think they are now roughly balanced. so if you go back for a long time, the risks with were on inflation. we had a historically tight labor market. there was a severe labor shortage. so very, very hot labor market. and we had inflation way above target. so, you know, that said to us concentrate on inflation, concentrate on inflation, and we did for a while. and we kept at that. the stance that we put in place 14 months ago was a stance that was focused on bringing down inflation. part of bringing down inflation though is cooling off the economy and a little bit cooling off the labor market. you now have a cooler labor market in part because of our act it. so what that tells you is it's time to change our stance. so we did that. the sense of the change in the stance is that we're recalibrating our policy over time to a stance that will be more neutral. and today was, i think we made a good, strong start on that. i think it was the right decision. and i think it should send a small that we, you know, that

we're committed to coming up with a good outcome here. >> -- to a shock now that could tip it into recession. >> i don't think so. i don't -- there's, as i look -- well, let me look at it this way. i don't want see anything in the economy right now -- i don't see anything in the economy right now that suggests that the likelihood of a recession, sorry, of a downturn is elevated. okay? i don't see that. you see, you see growth at a solid rate. you see inflation coming down, and you see a labor market that's still at very solid levels. so i don't really see that, no. thank you. >> thank you. liz: well, well, well, look at this. the markets are swimming between hot and cold water depending on which second we were watching this news conference. in the wake of the historic move by the federal reserve. chair powell if9 and the company that is behind the federal reserve voting, policy

committee, going for the jaws move, biting off not the more modest 25 basis points, but a larger 50 basis points from the benchmark interest rate can which now stands at 4.75-5%. in the wake of this first rate cut in four years, the tow intraday, look at this, it had spiked 375 points right after the announcement at 2 p.m. eastern, but then seeped into the red. it has a crossed the unchanged line, just to give you a sense of how unsure some of the market participants are about this, it crossed that line 48 times and right now it is at the moment up 60 points, on pace for a record close. now, it just needs 15 points at the close top outside to get into the history books. flip it over to the s&p 500 which yesterday during the session touched a record. right nowst the up 3 points. -- it's up 3 points. it, too too, has been in and out of negative territory but mostly positive. nasdaq up 2024 points -- 2024

points after the the announcement -- 204. as we watch now it's down 13 points. well, yeah, that's about flat as far as percentages. speaking of percentages, folks, bar none, the russell has been the marvel of the day. percentage winner here. small caps, the big beneficiary of lower rates. we do have the russell up about 11% -- 1% at the moment, tree-quarters. again, moving all over the place, up 16 points. now, it's important to to look at volatility. right before the 2 p.m. eastern announcement you see that volatility the was, you know, just kind of moving around. nothing big. right around 2 p.m. it op popped up but not very high. and during powell's news conference it moved, went negative and now it's at a 18.2 the for a gain of about 3%. and wait until we show you what treasury yields are doing. the the 2-year yield, the one that most closely follows the fed stance, opened at 3.600. it dropped precipitously during

the can news conference, and right now it's at 3.636%, up 3 basis points. 10-year yield, you know, you kind of would have expected these yields would have fallen, but they are not. the 01-year is up 6.7 basis points to 3.714%. it had started the session at 3.64. so we now have a much wider inversion at the moment than we have had in a long time. so, actually, no, de-inversion. [laughter] the yield curve is steepening finally. and this is a milestone moment in market history. we've got every angle of market rea action, andy brenner, peter schiff, jpmorgan's gabriela santos, star the trader kenny polcari and two wall street whales, michael -- and jack january city wits. each of those gentlemen has more than a trillion dollars in assets under management. you need to hear what they have to say.

while the fed did lop off 50 basis points today, fed chair powell indicated the committee isn't just going full speed ahead when it comes to future rate moves. listen to how he put it. >> it's a process of recalibrating our policy stance away from where we had it a year ago when inflation was high and unemployment low to a place that's more appropriate given where we are now and where we expect to be. that process will take place over time. this ising nothing in the sep that suggests the committee is in a rush to get this done. we can go quicker, if that's appropriate. we can pause if that's appropriate. but that's what we're contemplating. his liz that may be why the dow is having so much trouble holding on to gains, right now it's down 4 point. what's the the real message behind the bigger chop? we begin our commercial-free coverage with global fixed income head andy brenner and your to propacific chief economist peter schiff. of andy, give me your headline from all that we've heard.

>> this was a hawkish 50 basis point cut. if you look at what powell said through the conference, we told you the economy's still good, so we knew that he was trying to let you know that he's not going to cut aggressively. and we think powell had to make, had to do a lot of horse trading with some of the newer and hawkish fed governors. and that's ooh why the sep or the dot plots is not as aggressive as we would think. we still think there's going to be at least another 75 basis point amount of cuts between november and december. we called for 50, we were right. we called for 1225 for the year, and we think we're going to be right -- 125. of course, time will tell. this was a hawkish 50 basis point cut. that's why 10 will have year's got down to 3.6 the 2, and they're now 3.711, and the 22-year got down to 3.5 and now back to 3.64. this is not a great cut for the market which is why your s&p and other equities keep flipping. liz: the that end, the s&p is

now in the negative, down 11 point. this is a moving target° 1 point. peter schiff, this was not unanimous. michelle bowman did say she thought/ed be a 25 basis point cut. do you see a mistake here? >> well, i mean, any cut was going to be a mistake. i think the fed caved into the pressure of market expectations and cut 50 when they probably were set to do 25 the a week or two ago. but think they changed their minds. look, you know, the market is delivering a verdict here. interest rates are rising, they're not falling. long-term interest rates are going up, and i think the fed if rate cut marks the low in long-term treasury yields and mortgage yields. so i think you're going to start to see rising interest rates as the fed cuts rates -- liz: whoa, whoa, whoa, whoa. really? >> you not going to get the -- you're going to get an increase in consumer prices. liz: i just want the tell you, okay, before the cut, prime rate, the rate upon which auto

loans and a lot of loans are built, had been at 8.5%. we are hearing, breaking news, truist has just cut its prime rate, peter, to the 8. so they're coming down. >> yeah. but -- yeah, that's a short term. and, of course, depending on what rate you get over people, rates are headed up. credit card rates are going up. they're at record highs and they're going higher because defaults are trying. inflation is not dead and buried like powell claims. it's about to come back for a whole new lease on life. in fact, it never really got close to 32%. the fed -- 2. the fed is playing around with numbers. and i think we're already in a reeducation. it's not about how -- recession. it's not about how strong the economy is. he's trying to talk up the economy because he's trying to help out harris and try to, you know, continue this false narrative that we have a strong economy. we have a weak economy. the only thing that's strong is inflation, and people are about to see how much stronger it's about to get now that the fed is

i throwing gasoline on the fire. liz: well, to your point, the short-term treasury yields are tanking. we just saw the 3-month down about 10 basis points. andy brenner. >> in due respect for my dear friend mr. schiff, i think he's got some good points in that i think the term premium at the long end of the treasury market is going to go higher, but i do think rates are going to stay lower. we've just moved, you know, 10 year's at 4.5 and now they were down to 3.55 or something like that. i do think the fed does not believe that we're many a recession. i don't believe we're in a recession. i don't believe we're going into a recession. i think inflation is tame. but i do not think that rates make sense to buy right here. liz: do you -- is anybody shocked? if peter, are you shocked that fed chair powell, who has been incredibly measured and very anxious about making sure he's brought inflation down, went with the crowd?

because, again, most of them felt it should be a cut of 50 basis points. some even felt it should be 75 basis points because he has been very concerned that inflation, at least in certain pockets, remains sticky. >> well, look, if powell cared about inflation, he never would have cut interest rates to zero in the first place or left them there as long as he did, he wouldn't have done all this quantitative easing. inflation is the fed's tool, the only tool they what actually have in their chest for trying to artificially stimulate the economy. powell said that the fed's job is to sport the economy. that -- sport the economy. that's not the fed's job. you recall, that's what powell thinks is his job, and the -- he thinks you support inflation. now inflation is the problem, and now he's trying to solve that problem with more inflation. and, you know, powell indicated that for a while he could keep doing quantitative tightening while they're cutting interest rate. well, i think by q1 of next year

the fed going to be back to quantitative easing because the rate cuts are not going to stop the recession x they're going to result in higher long-term interest rates, and the fed is going to try in a panic to reduce long-term interest rates by going back to quantitative easing, and that's ooh just going to increase the pain because it's going to send the dollar through the floor, gold and other commodity prices through the roof and consumers are not only going to be dealing with a loss of jobs, but much higher prices when they go to the supermarket or any place else that they try to spend their rapidly depreciating dollars. liz: peter, andy, we are watching a market that's still in decision load about where to go and how to absorb this. right now the dow is in record territory again, up 711 points. andy, peat -- peter, thank you -- 71 points. after the fed first announced interest rates were going to be cut 50 basis points, the dow and s&p both hit all-time highs. look at the majors now, green on

the screen. but it's kind of interesting because interest rate-sensitive stock, some of them are in the red after the fed's first cut in four years. let's look at regional banks, and we mentioned the truist, u.s. bank, western alliance and regions, they are moving higher. regional banks etfs are powering higher. but we also saw that credit card stocks were light slightly lower, at least most of them. and you look at the housing market set to men from it from the -- benefit from the 50 basis point cut. zillow, remax, redfin, we've got anywhere real estate, actually, redfin is just slightly lower, remax is un, rh -- unch. and as the benchmark interest rate comes down by the federal reserve, 30-year fixed is already at an 18-month low. so it was kind of front-running what was going on. so we expect to see that mortgage rate come down although peter schiff said is it probably will not. remains to be seen.

we've got the home builders like pultegroup up about 11%. not huge -- 1%. refar and dr horton -- lennar and dr horton slightly down. markets and investors are figure out what to do now that the federal reserve appears to be in at least a rate cut or rate-neutral cycle. what is the trade? how should you be manipulating your portfolio now in this new atmosphere? let's get right to the floor show. joining me now, chief market strategist for the americas, gabriela santos and slatestone chief market strategist kenny poll carry. gabriela, adjusting portfolio, should that begin right now for our viewers? who? yes. and perhaps even a few months ago, but it's not too late to the adjust it now. i think therd word of the press conference was recalibration for chair powell in terms of bringing rates closer to newt rule. i also think investors should are recalibrate portfolios for a

rate-cutting cycle. if you think about the savings side of the equation, you had very juicy cash yields for things like c'd and 3-month, 6-month treasuries, those are coming down fast now i that the fed -- liz: okay. so which part of the yield curve do you say people should go in? >> we think there's no need to go too far to the other side. i very much agree with your previous guest that the long end shouldn't come down much more. it's really short-term yields coming down -- liz liz from what, 3 to the a r 5? >> a sweet spot is 2 years where you can lock in the income as short-term rates come down, and you can count on that in the future should there be more of a concern about economic growth, a little bit of a protection in case of a recession. liz: 3.6322% for the 2-year -- >> it's off the highs. we always want the price we used to have when yields were closer to the 5 percent. liz: can we see the 3-year? if go ahead. >> it's been fascinating. liz: we have a 5-year.

>> we've had 5 months of consecutive yield decline in anticipation of this, so you've had 8% return from your more intermediate core, nixed income temperature might have missed a bit of that but i still think the risk is really around cash rates coming down and at least you can lock in the actual income a little bit longer. it's not the whole solution. liz: kenny, give me your gut reaction to this move. people are trying to to figure out what it really means. >> well, so, first of all, i think that he caved, right? that 25, i think, was the numbei was -- liz: he caved to, what, the rest of the voters? >> he caveded to to the traders, everyone who was putting pressure on him, congress, lizzie warren, everyone putting pressure on him to cut, cut, cut. so i think he caved. i think it was too big of a move initially, but it is what it is, right? now i think he made it very clear that he's remaining data dependent, but the path is

lower. come november, come december, i think he kind of indicated that potentially there's another 50 basis rate cut coming either in november or december which, again, i think is ridiculous. i was looking for three 25 the cuts in september, then november and december k and not three 50s cuts. i think that's whey too aggressive and sends a very different message. i know that he's trying to to tell everyone he count know anything, he wants to the stay in front of the ball versus behind the ball, but if he keeps cutting at 50 basis points, it's going to send a different message. that being said, the market's all over the place -- liz: except the russell. the russell's gorgeous at the moment, it's up 15 points. it's actually off the highs but still, would you go into some of the small caps? gabriela says you still have about six months to recalibrate -- >> but not necessarily to the small caps. but, question -- question -- yes, go ahead. >> recall wait or put --

recalibrate or new money into sectors, to me, that means sell this and buy that. to me, it mean take new money and put it in those sectors that may up til now have been underweight or that are going to benefit in this cycle. so look at things like utilities which have been the star performer this year, really at the top of the line, the most boring sector in the world is now the greatest performing sector almost this year. i think it's the number two spot, actually. liz: does it shock anybody that the dow now flat to slightly negative? [laughter] >> no. and i actually think it's going lore. before this is over, i think they're going to end in the negative -- not hugely down, but i think they're going to end negative today and move lower tomorrow. >> it's been a tricky last 30 minutes of trading. usually during these fed press conference days, it usually trades down, and tomorrow it'll kind of resume a more sustainable trend. liz: equity world. talk to me about equity world. >> so here's where some recalibration we mean either putting new money to work or

recalibrating within the market because it's been about tech, tech, tech, tech, tech for a year and a half now. and what you're starting to see when there's a bit more confidence that the economy can today on track, that they're proactive rate cuts, you start to see other sectors do well and do better. so things like today industrials, energy, banks. so really you start to see cyclicals do a bit better than your pure tech or defense we've sectors. so a rotation within but large caps. small caps, we think it's way too early still. it's not quite that goldilocks environment. liz: kenny. >> listen, i agree with most of what she said. i like a small caps. in a lower interest rate environment, i think they'll continue to lift their head. they have lifted their head nicely, i think they'll continue today that. and you also have to look for names like in the energy industry, look at something like energy transfer. that's, like, an 8% yield, do you realize that? and it's the best in the

business in its class. so i think that's where money's going the look for opportunities in some of these stocks that are paying, you know, higher yields. they're not necessarily as sexy, but there's plenty of opportunity in other parts of the market. liz: oh, i need to look at bitcoin here. this is really interesting because it was earlier above $61,000. right now it still looks pretty good, it's $60,263. there were predictions, folks that if it were a 50 basis point cut, bitcoin would dive. that appears to be completely off the table at the moment. okay. gabriela and kenny, great to have you. thank you. dow jones industrials now down 39 points. we're watching every tick of this wild market here. we've got some individual stock names we need to tell you about. 23 and me shares slightly higher right now after the the entire dna testing kit company's board, independents, resigned yesterday effective immediately. they apparently disagree with

the ceo's efforts to take the economy private. if all seven members of the independent board penned an open later -- letter to the ceo saying, quote, while we continue to support the company's mission and believe deeply in the value. of the personalized health and wellnesses offering that the you have articulated, it is also clear that we differ on the strategic direction for the company going forward. right now it's a 34 cent stock, and we should tell you it went public back in to 20221 via a spac with richard branson's virgin group. since then, the company has fallen more than 95%. a big winner today, spew iftive a machines dooring into -- soaring into outer space. up 41% right now. that's even off the highs of the session. investors are cheering the space exploration company's new 5-year contract with nasa a to build moon data satellites. nasa said intuitive will build it lunar relay systems for the near-space network, the system

that communicates with government or commercial missions up to the 1 million miles if from earth. and people in bel air can't make a cell phone call to beverly hills. [laughter] i know, my heart's bleeding, but that's my neighborhood. [laughter] okay, well, good. good for them. a signal from a million miles away. intuitive will build and deploy these lunar satellites for communication for nasa's artemis program. the value is $4.822 billion over 10 years. it'll be issued incrementally based on intuitive's progress. well, the tupperware party, folks, it's over. the iconic plastic food storage maker has fileed for chapter 11 bankruptcy protection after years of struggling sales. according to the delaware bankruptcy court filing, tupperware listed $500 million to $1 billion in summits assets -- estimated assets. that's it? this was a global company. and $1-10 billion in estimate liabilities. while the number of creditors

listed were between 50,000-10 100,000, the brand asked the court to allow its operations to continue through retail partners, sales consultants and online. the plastic container maker went public in may of 91996. boy, it was a good time back in 2015. right now it's 51 cents, it's fallen merely 98%. -- nearly 98%. the leadership of the 11.3 million member international brotherhood of teamsters saying it will not endorse a candidate for president in 2024. this is a blow, arguably to both sides, but to vice president kamala harris who has the endorsement of country's other powerful labor unions. so that is a big story that we are continuing to watch. check the dow, down 13. we have the s&p in the green by, let's see, 2 points, and the nasdaq is up 34. let's take it back to the

federal reserve and if all that was said. edward lawrence, you were right there in the room. you ran to our cameras after powell's presser ended. what stood out to you as powell explained why the fomc voting committee skipped the quarter point cut and went to 50 basis points. >> reporter: it was very interesting, he did say he saw significant improvement towards that 2 target when we're talking about the inflation, but he did say there are risks to the labor market, and they made this bigger move, according to him, because they wanted to keep a stronger labor market going forward. now, he said that this was a timely move and made to make sure that the fed didn't fall behind the labor market that we're seeing. now, when it comes to the path of rate cuts, the federal reserve has forecasted two more rate cuts this year if they go by 25 bay spoiptses, so i wanted to know if the era of cheap money is coming back. there's basically an entire generation that has experienced zero or near zero federal funds

rate. some think we're heading in that direction again. what's the likelihood that cheap money is now the norm? >> so this is a question -- you mean after we get through all of this. it's just a great question that we just, we can only speculate about. intuitively, most -- many, many people, any bay, would probably say we're not going back to that era where there were trillions of dollars of sovereign bonds trading at negative rates, long-term bonds trading at negative rates. my own sense that s is that we're not going back to that but, you know, honestly, we're going to find out. you know, it feels, it feels to me that the neutral rate is probably significantly higher than it was back then. >> reporter: so i have heard from a number of federal reserve members that they're looking at possibly around 3.5-4%, under 4% for the federal funds rate. we'll see what happens when this cycle, this recycling or this readjusting of the rate is. the fed chairman also did say, talking about the teamsters, the

the fed chairman say that they do not take into account politics in any of this. the data comes out in that meeting and from that discussion, today make -- they make their announcement. liz: edward lawrence, you got to be in the room for what is, arguably, the most important fed meeting in many m years. first time that they have cut rates in four years. speaking of which, even before this, so we checked the 30-year fixed rate mortgageful mortgage rates are expected to start coming down more than they already have. week over week, so today before this meeting, 6.24% for the average 30-year fixed mortgage, and this is according to bankrate. last week, 6.3%. a year ago, 7.12%. so we're already, according to my data, at about 18-month lows. very interesting kind of behavior to watch as the 30-year

fixed began front-running this chop in interest rate. and let's go, since we're talking about real estate, to the real estate magnate himself, donald trump. breaking news, trump media and technology, the stock that is of his social media company, is on track to close at a record low just hours before president donald trump and other insiders will be able to sell their shares. the aapproximate if mate 6-month lock-up agreement which precludes trump and other insiders from selling shares since it just recently went public, it expires tomorrow. djt shares gained -- last week after donald trump told reporters he does not plan to sell his shares between hen he's able to -- even when he's able to. a stake currently worth $1.8 billion. right now djt is at $15.51. and the former president taking to truth social last night, attempting to try and woo new yorkers with promises to eliminate the state and local

tax deductions known as the s.a.l.t. tax that he signed into law during his first term in 2017. yeah, he signed into law to get rid of it. it disproportionately helped blue states. the statement about this reversal is surprising, certainly the new york business community and charlie gasparino has been talking the some of them. what are they saying? >> i i a lo99 of them i know, and these are individual players that have been pushing him -- pushed him back then not to do it. let's unpack it a little bit. the s.a.l.t. deduction, you're able to -- and this is particularly big in blue states where you have large state and local taxes -- deduct it from your federal income tack. i think he capped it at $10,000. check me on -- >> iz. liz: he did. it used to be much more. >> a lot more. and it was, basically, the theory was that blue states, if you want them to have some sort of fiscal restraint, you know, don't allow their citizenry to go out and deduct federal taxes

from their, from their state and local taxes from their federal taxes. that would mean that the blue states would be under pressure to essentially lower taxes. what essentially happened after this which was fascinating was a lot of things. you had covid, you had the lockdowns, you had the riots up in the northeast and in blue states, the social justice riots. there was a mass migration of people, out-migration of poem with sizable incomes to florida, to texas, you know, from california, to florida from new york. this was one of the reasons why. the question is, why is he doing this? you know, i don't know. it sounds like a way the buy votes. i don't think there's a legitimate chance he's going to win new york stating you know? if you're buying votes to win new york state, you know, i don't think it's going to happen. he's not going to win californi- liz: we're looking at a live picture in uniondale. >> friend of mine was pitched,

had a tent pitched outside waiting, just so you know. liz: waiting to see me. >> he was begging me to try to get him in. i was, like, that's not happening. literally, the second assassination attempt, this place is going to be locked down. you know, i can't. in any event, so he got there early with his wife and they pretty muched a -- pitched a end. but getting back to s.a.l.t., if you did eliminate semi a.l.t. right now -- s.a.l.t., donald trump is not promising to cut the bum deficit much, right -- budge deficit. isn't that going to add to the budget deficit? isn't that going to add to pressure on interest rates when you have to -- if you have a bigger budget deficit, you have to sell more bonds, then you basically have higher interest rates that attract people. i mean, we're playing with fire. liz: yesterday leon cooperman, the billionaire -- >> i know leon very well. liz: -- from the family office, we asked him about whom he would

vote for. he doesn't like either candidate. >> he's going to vote for -- liz: he specifically pointed out this huge deficit, the massive debt. and i'd like to just let our viewers hear what he had to say because this goes to exactly what you're saying. if you're shipping a lot of what could be revenue. >> right. >> i think stocks are going down next year no matter who wins. that's my view. i think the stock market is very fully valued, and we're facing some very serious issues. i think we're heading to a potential financial crisis as a resultf the enormous buildup of debt in this country. and neither candidate is addressing that. >> so i theoretically agree with him, and it makes sense. i remember back in 2012, stan destruct miller -- by the way, conservative, pretty sure he supports trip. it was ironic, stan was very conservative, but he was george

soros' lead said trader for many years. stan with wrote a column, i believe it was in the journal, that it might be better off if we or, you know, maybe we -- a default might be better for the country if it leads to a situation where we start cutting the deficit. we start taking fiscal responsibility seriously. because in the future, you know, we might miss a payment because we're arguing over a budget, but it leads to, you know, essentially a budget where you start cutting sufficient. he thought that might be a better outcome than this constant rolling over and increasing the deficit for many years because we are reaching -- he believed -- fiscal armageddon. now, he said this in 2012. people, just so you know, just for the average viewer out this, people have been projecting fiscal armageddon for many years. one of the reasons why it hasn't happened is because the u.s. is, essentially, the dollar is the reserve currency. everybody borrows and invests in dollars. it is the currency everybody's

using. so, you know, this stuff -- i'm not saying this is any good, and it's not good. at some point, we're going the to pay the piper. i mean, when you have trillions and trillions of debt, i mean, debt that's, i think, the last count was 130% of gdp. so it's, like, more than the gdp of the united states plus. you're playing with fire. so, but again, did leon say who he was going to vote for? if. liz: he said neither. he wrote in mitt romney when -- [laughter] >> oh, so he's going to write in? >> when donald trump was running. he writes in. he doesn't like either of them. >> i know. i mean, listen, what's scary about both candidates in my view, i'll met you know, it's -- go, neither of them are preaching fiscal restraint. liz: that's his point. >> it's the elephant in the room. by the way, markets at some point will force us to do this. that will be -- liz: neither have pointed out

what they would cut in government spending. that's -- >> well, restoring the s.a.l.t. tax is not helping. liz: well, and her ideas have a lot of giveaways -- >> i wanted it. liz: i know, we all did. charlie, thank you thank you very much. >> he bought my vote. [laughter] liz: folks, we are 9 minutes from the closing bell. the dow has now crossed the unchanged line 71 times today. it was just over 40 when we started the show. it hit a record high right after the federal reserve announced it was cutting rates by a larger 50 a basis points, but it doesn't look like it's going to see a record although we've been all over the map. very volatile trade here. right now we've got the dow down 64 points, literally a second ago it was down 10 is points, so it's the very much citizen -- 101 points. nasdaq lower by 35. the russell up 4 points. the small and mid caps tend to get an outsized benefit from lower interest rates.

now, fed if funds futures for the november meeting, we're already spinning it forward for you. [laughter] there is a 100% chance of a 25 basis point cut but a 34% chance of the second 50 basis point cut. does this mean inflation is where the fed wants it? joining us now, two wall street whales, michael arone is the chief investment strategist with at state street global advisers and jack january city witses is the lead portfolio strategist with $1.3 trillion in assets urn management. gentlemen, let's hear how jay powell put it when he was asked if, basically, he was turning his back on that 22 target rate for inflation -- 2 target rate for inflation where we are not quite yet. >> the goal is to have inflation move down to 2 on a sustainable basis. and, or you know, we're not really -- we're close, but we're not really at2%, and i think

we're going to cant to see it be around 22% and close to 22 for some time. but -- 2. but we're learn i -- certainly not saying mission accomplishedded or anything like that. we're encouraged by the progress that we have made. liz: michael, did he make the right move? did the team make the right move today by going bigger rather than smaller? >> i was surprised by the move. liz: me too. >> it was clear that momentum was building for this move. but, liz, what's interesting is since1194 when the fed has publicized its results, there's been -- this is the seventh time they've decided to cut rates, the third by 50 basis points. the other times were '01, '07 and the pandemic. i don't feel like any of those massive, volatile events are representative today. and he kept saying how strong the economy was. so why did you neeit seemed aggy

perspective. liz: yeah. what about you, jack? >> i think our base case was for the 50 basis point cut. he's been pretty clear about saying that the balance of risks have shifted, and they're moved basically from that price stability, the 22 inflation target -- 222% if inflation -- 2% inflation market. drifting higher inflation drink -- drifting higher. and i think with rates as restrictive as they've been, we started core pce at 5.6%, it's down to 2.6, that labor market side of the mandate is really, i think, coming into focus, and that, i think, is what powell is really targeting here, the risking management side of their dual mandate. liz: but is it a concession, michael, that the fed was behind the curve? >> well, he keeps calling it a recalibration. he used that word a ton of times during the press conference. liz: yep. >> i'm not sure what the difference is between a recalibration and an admission that you were behind the curve.

i think it's career they're concerns that the -- it's clear that the labor market may move more than they were anticipating the. if you look at at the summary of economic projections, they increased the unemployment rate from 4 to 4.4%. they lowered the economic growth going forward and increased the number of cuts. to me, that suggests a the in j. ultimately, they're decided to play catch-up and call it a recalibration. liz: let's be fair though. inflation has come off the 4-decade peak from june of 2022, and he is getting props from a lot of market apartments for bringing it down -- participants and bringing it down and we don't see recession right now although peter schiff said we are already in a recession. i don't know where you stand on that, jack, but that said, what do you invest in at the moment if you believe that it's a soft landing? >> yeah. i'm, you know, when hay make the arguments that we're already in a recession, i think there's pockets of potential softness in

the economy that you can claim that to, but when you is step back and look at the broader picture, i think you're still in pretty good shape here, and our call is for a soft landing. think there's a couple things. one, cyclical value. what do we like within that space? i think the regional banks will continue to catch up. so regionals probably stand to benefit here as a soft landing starts to to continue to unfold and rates are cut. i think you can also look at maybe some of the consumer discretionary sides of the equation that got hit really hard. and if you think about rates.coming -- coming down, that prime rate's going to start to come down. so you'll see credit cards, those types of things resetting lower. that, i think at the margin, will help the consumer side of the equation as well. there's still plenty of pocks that offer value especially if you have that soft landing scenario as your base case. liz: truist already jumped ahead ands has cut its prime rate from 8.4% to 8. they are among the first

although i would imagine a bunch of others are going to follow. michael, where do you see those to so-called pockets of opportunity? >> so, >> liz you mentioned this notion of a soft landing and they are rare, i would suggest that we also believe the soft landing outcome is intact so if we look at 1995 which was the last soft landing, when the fed began to cut interest rates, six months later, the leadership was things like healthcare, consumer staples, so it's a mix of bond proxies, and interest rate beneficiaries. those stocks are cheap and we think they would benefit from bond yields coming down dividend paying stocks will become a bit more competitive so we think that is also the formula this time around. liz: can i just say, we just put up on the screen the dow is on track for a record close. it is not. it was earlier, same with the s&p. both hit intraday records. right now they are both in the red, so, this is such a

fast-moving market. there's a lot that needs to be updated second-by-second. to that end, gold. gold is at a record. what do you interpret from that, michael? gold is often a hedge, a safe haven play. >> so i think the biggest thing here and gold is now at a 5,000 year high. i think what's been happening is real interest rates are compressing and so the fed is expected to cut rates. they have penciled in 2% rate cuts between now and the end of next year so ultimately as real rates compress ultimately that tends to benefit gold as does a weaker dollar and add in kind of election headline risk, geopolitical risk, and gold has become a safe haven and ultimately it continues to touch all-time highs. liz: jack, one minute to go. one minute to go, dow is now down 100 points certainly not the low of the session, but red on the screen for the s&p and the nasdaq. russel clinging to just a 1 point gain. is this a throw-out day meaning

set it aside because it's just the absorption of the breaking news that people have been waiting for? >> i think that's spot-on, liz. we had a pretty good front-running of this 50 basis points cut over the last couple of days so not surprising taking a little bit of the chips of the tail so to speak but longer term listen, i think the labor market is the sort of the concern here for jay powell and i would say powell puts back in play and that's something to consider going forward which i think sets up pretty well for risk seattle as we go into the end of the year. liz: folks thank you. >> [closing bell ringing] liz: michael and jack we appreciate it. there is the closing bell the dow swings 532 points in a wild trading day. down 110 at the moment red on the screen we're going to see you tomorrow. liz: hello folks and welcome t