and we'll talk to wharton's jeremy siegel.s will join us to break down gm's big plan in the ev space and how it stacks up against ford and tesla and washington is considering a new round of covid relief. lots to come in the second hour of the trade but much more importantly, we are sharply lower. cnbc senior markets commentator mike santoli here to break down these crucial moments of the trading day. and we've got ritholtz management's josh brown with us as well. let's kick things off with the broader markets. we are pretty much at session lows sort of steadied at those lows for the last 20 minutes the dow, though, is selling off more down 321 now, nearly a percent. the nasdaq is stabilized at around 3%iii% of declines josh brown i'll come to you first of all it seemed to be the fed minutes that triggered this selling. what do you make of it >> i think this new wrinkle about balance sheet runoff seems to have been the trigger just the fact that they're even talking about that at this stage in the game probably caught some peop

. >> we're going to talk to jeremy siegel a little later.id there could be a lot more pain to come. we'll see if he still feels that way. thanks, dom. >> you've got it. >>> scott wapner said last week he thinks impossible is better than beyond meat. >> from a taste perspective? >> i think so. >>> when we come back, the omicron strain has been confirmed by half of the u.s we're going to hear from dr. scott gottlieb on the subvariant >>> take a look at the markets the dow is off by 250 points nasdaq which was in the green now ten points, s&p opening down 20 points. back after this. >> announcer: this cnbc program is brought to you by baird visit bairdbusiness.com. >>> welcome back, everybody. while people in the united states still argue about kids wearing masks to school, that's nothing compared to china. you've probably heard about their zero covid policies, but you may not know what that entails or what it's like living with them. we have more of a picture of what this means. eunice, it's good to see you. >> reporter: it's great to see you,

outpaced inflation over the long run as inflation rises, dividends go up, so do share buybacks jeremy siegelong-term history is that earnings and dividend goss up with the price level, fwhoets high and in low inflationary times, not year over year, but over the long run. the s&p total return index shows the companies have been able to keep pace with inflation and then some throughout most of the pandemic buybacks and dividends, here's what's interesting they have not kept pace with the increase in free cash flow in the year ahead, jonathan from credit suisse thinks there's substantial scope for the return of cash to shareholders and looks for it in old line manufacturing companies rather than technology firms. take that, "techcheck" at 11:00. macro tells me, corporate cash levels are quite bloated and if they can't use the money they generally do give it back. now higher dividends and buybacks are not going to offset every risk factor in the stocks valuations could take a hit if the fed is forced to do more to contain inflation. corporate cash flow has been keeping pace with inflation and th

wardrobe you should be thrilled about that, and i think it can go up, 30, 40 points from here >> jeremy siegel is a professor of finance at the wharton school he's back with us now. it's good to see you welcome back where are you in this market it feels like it's treacherous and tumultuous and yields are cooperating. >> yeah. you know, i think we have to look at that cpi report this morning. it wasn't as bad as some had thought, but it wasn't good. as one of our participants said i'm looking at oil at 83 that's, like, one dollar off its high energy was minus 4% in that december figure. it's not going to be minus 4.4% in the january figure. everything is pointing upward. some of the people are saying we look at hospital services and do we know what's happening in the hospitals? do you think that those services will stay only 1% above the cost of what it was a year ago? everything is going up and you interviewed me last year and the fed will be far more aggressive and in my opinion, far more aggressive than what the street thinks this year >> professor, okay i'll give you the benefit of the doub

whether it has staying power i want you to listen to what the professor the wharton school of jeremy siegeld me yesterday in our conversation about the markets here and now and what you should do as an investor let's listen >> stocks are real assets. you just can't hold paper assets which are bonds. they're the worst. stocks are real assets what higher real rates does mean is the rotation that we've been talking about. that certainly happened in the first week of this year, and i think it's going to happen throughout the rest of this year so you see, jim, the professor has been out there suggesting that everybody's getting inflation wrong and the fed's got it so wrong that they're going have to raise rates more times more often than the market is expecting so when i said to him, does that mean you're getting out of stocks, professor? you are known as one of the biggest bulls around also, right? he said no, no, no, no you will still be in stocks, you can't be in bonds and you have to be in the right stocks and you have to play that rotation which he said in a follow-up question, he thinks th

one of the voices on the network today was professor jeremy siegel who tried to answer the question of how much more selling do we need to endure let's listen >> i certainly wouldn't be surprised, nasdaq, to go into bear market territory and the s&p because it is top heavy with tech probably going to deep correction territory as you know, i've been saying that inflation is much worse than the fed admits even now that they're way behind the curve. they've got to catch up. >> i mean, bryn, you've suggested that the market is doing the fed's bidding in some sense, but the professor, look, we're down about 17% from the highs on the nasdaq. so bear market, okay, so do we have a few more percentage points to go oftentimes, as you know, as well as everybody else, you have a tendency to overcorrect to the downside the elevator down is a lot faster than it is on the way up. is that the kind of environment we're in is the professor siright? he's been saying the fed is going to have to be more aggressive because inflation is much worse >> as we know, markets ride up and escalator but come down to

that was the message from wharton professor jeremy siegel last hour.e said dividend stocks are one place to look for inflation protection where else should investors be looking and what stocks should be avoided joining me, the ceo of genter capital management this is music to your ears, isn't it >> absolutely kelly. i have been singing this song quite a while. the fact it was coming to fruition was obvious because it is the only game in town we added to a lot of bonds so i like bonds, but the reality is the math is what it is it is going to be very difficult for people to achieve a significant long-term outperformance, if you will, or even keep pace in bonds. the reality is that, you know, the high dividend stocks that are generating you cash flow, cash flow that at max is going to get taxed at 20% and 15% probably for most people, and then get you a little growth, it is going to be one of the few games in town, if not the only game in town that also gives you some liquidity so your capital is not committed for possibly years at a time >> one more ques

not going to go away because inflation is a problem and the fed is going to have to react. >> jeremy siegel. he said the fed's going to sound much more hawkish. jay powell will sound much more hawkish and if he's looking at things, you could see the declines more than double. he was talking about the nasdaq getting into bear market territory and the s&p getting well into correction territory so if you're down 5.7% on the s&p, that would be well more double than what we've seen. same story on the nasdaq, not near bear market territory does that sound right to you >> so it's significant because it comes from jeremy what sounds right to me the fed doesn't quite know where the fed is and where it's going. when you look at the analysis, i haven't seen such dispersion about what the analysts are saying not only what the fed is going to do but what the fed should do. so the federal reserve has lost control of the inflation narrative, understandably so because of mischaracterized inflation talk for so long it has to regain it. the question is how do you regain it? in my view they need to be bold. t

jeremy siegel told us why he thinks there is more to come. >> by do not expect good inflation news this think they are going to be more than four fed hikes. i suggested they make a have to go up to 2% by the end of the year to really stop the inflation. at this point, equities are not really priced for that amount of aggressiveness. i think they are going to have to get used to it. the nasdaq will probably enter a bear market which is described as 20% and probably correction territory for the s&p 500. shery: our next guest says clients may be underestimating earnings risks. senior investment stratagem and for equities at alliancebernstein. rate to have you with us. earlier we had david coston from goldman sachs telling us he was disappointed about netting -- about not getting enough earnings guidance during this earnings season. where do you see the downside pressure coming from? >> thank you very much for having me on the show. we are generally still constructed on global markets including the u.s.. we agree with that other david that the earnings guidance so far has been opaque. i thi