jonathan: you mentioned paul volcker and i think the quote of the week on paul volcker came from laeld who said "40 years ago paul volcker noted the dual mandate is not an either or proposition and runaway inflation would be the greatest threat to the continuing growth of the economy and ultimately to employment." that is the situation the doves find themselves in. it is not an either or. lisa: one of the unspoken questions a lot of people have is if consumers show resilience, then why not allow inflation to run hotter? if it is not crimping growth than why not go past the 2% threshold the fed has clung to for so long. jonathan: they've been beyond 2% for a long time. coming up on the portfolio, geraldine sundstrom. looking forward to that. this is bloomberg. ritika: keeping up-to-date with news from around the world with the first word. ukraine's foreign minister says his agenda is simple. he wants nato to give his country weapons. he met with the nato secretary-general in brussels before a meeting with the alliance. ukraine has been pushing for more air defense systems and antitank

the policy showed up one year later in the form of paul volcker. where is today's paul volcker?lenn: the fed has understood that it is behind the curve and needs to step in. i worry that the period from 1975 to 1983 is more instructive than people might think for today. it is naive to think that the fed wants to crush inflation to 200 basis point and the fed funds rate will do that. we will have to see but i think the fed has the courage to act and i do not think the market should take comfort in that. tom: i will not mince words. you are on the short-lived for chairman. -- the short list for chairman. volker had 4% yields. powell has 1%, 2% yields. we cannot do what volker did, can we? glenn: it is difficult and i will tell you why. fiscal policy, as the fed tightens, the federal deficit gets a lot worse. we shorten the majority of the debt. we have a very large debt today relative to what paul volcker faced. there are issues on how much the fed is willing to tolerate. if the fed wants 2% inflation, i find it hard to believe that a soft landing as possible. lisa: what does that

number one he told the fed chairman, paul volcker. for volcker as his secretary in new york. he told voark, pull back on the money supply, increase the value of the dollar. let me handle the politics. you get the inflation rate down. pull back on money supply, improve the value of the dollar. that was the key point. the burden of proof will be on the federal reserve. reagan cut tax rates. he lowered marginal tax rates across the board for businesses, for individuals, for capital gain. it didn't take effect for a while. but when it did, it increased the supply side of the economy. more people producing, more people working. think about this for a minute. if one definition of inflation is too much money chasing too few goods, he had volcker curb the money supply, but reagan increased the supply of goods. so that was anti-inflationary. those tax cuts created a 3 decade long prosperity. the final point, reagan deregulated and decontrolled the price of oil. reagan took out the price controls that were left over from nixon, ford and carter

volcker would say, no, no, no.ould you accept? fed chairmen ought9 to say there's a link between budget deficits and deficit spending and money creation. we've thrown that link out, and a that is the root cause -- neil: you need someone who's brave too, because he put his name behind -- >> also true. neil: -- and, you know, that's bravery you don't see these days. i'm just curious how far does the fed go? we have to be at a fed funds of close to 5% to beat back historical norms. could we get that high? >> we're gone that. neil: really? >> we're gonna. if gdp deflater rate, fed looks at that personal consumption deflater, 6-7% right now. it's not the cpi, it's not quirky. it's the basic underlying inflation -- neil: and it's got to parallel that, right? >> you want a target rate that's a couple of percentage points above that. neil: whoa. >> so you're looking at, just ballpark here, we're having fun on a wednesday, neil cavuto show, my honor, you're looking at a 6-7% fed funds rate before this is over. very good art

let me go on former ambassador kurt volcker. i hardly know where to begin. the number of pieces of evidence of mass graves continues to grow. at this moment what do you see as putin's strategy? >> well, i think he's trying to salvage something he can portray as a success to justify this tremendous loss of life, loss of military equipment, loss of military personnel, crushing actions on the russian economy. he needs something to show it was worth it. what he's trying to do is carve off this piece of eastern ukraine through mariupol, create this land to crimea and possibly all the way across to moldova but that will be much, much harder. >> if he's able to do that and claim some sort of victory, do you think that gives him an off ramp and then go to the negotiating table? do you think he ever wants to negotiate? >> no, no. and we should not -- we should drop the idea that putin wants an off ramp. putin is doing what he wants to do. he wants to build a new russian empire on he want to take this territory. even if he takes a pause to regroup that doesn't mean he

volcker didn't say i will raise interest rates at next meeting.cy meetings, jacked it up a percentage point each time. we need very aggressive policies bring it under control. we have to recognize it could cause a recession. pay me now, pay me later a lot more situation. charles: you know what? volcker and reagan, had the combined swagger. took the heat early on. then they,erred in at least a decade's worth of prosperity. thank you very much, my friend. >> take care. charles: so inflation taking a real mighty toll on americans who basically have cut back dramatically on all kinds of discretionary spending but there are certain things, let's face it we cannot cut out or cut back on. sadly those are the areas seeing largest price increases. i want to go to iwf policy director hadley heath manning. hadley, we toss around numbers, 11.5%cpi, 8.8 ppi. the fact of the matter there are real lives behind the numbers. what does it mean the average u.s. household spends extra $5200 a year for the same stuff they bought a year ago? >> exactly, charles, for a

we've not seen such movement since the days of paul volcker so it is weighing on the markets, how far or how high do we go? 10. 9%, had been a lot higher but the fact is the reality is there. what you look for in a day like this is things ease up with the concern all the rise of rates and what is going on in china and fallout from the pandemic and cases being reported that will way on this and put a on how high oil prices go and how high rates go. they are all over the map but the general theme is down across the board for equities, looking at 1/3 losing week. we are looking a lot of confusion on what happens with interest rates and the mask drama. you know the justice department started weighing in on this issue trying to appeal to the florida judge's decision on letting the masks go. whatever happens at the federal level you have different signals at the local level even when you get off the plane wear masks are not required depending on the airport, you might not want to throw away the mask you are clutching to. lydia has a lot more on that confusion. >> reporter: a lot of evolving

eventually, volcker came in in the late 1970's and just let interest rates go up to levels that causeession. we know that recessions always bring inflation down, but whether we can achieve a soft landing is the big controversy here. i suspect we either do or we get a real short and moderate recession. again, because i think the system is relatively robust. jonathan: ed yardeni, thank you. there was a note from deutsche bank in the last 24 hours. i read through the whole piece. this idea that they believe a hard landing is the base case for them, the fed have to get the fed funds rate potentially into a range of 5% to 6%. that is not the base case on wall street right now. lisa: however, what would that do to an economy, the idea that inflation is so hot, that is what they need to do to curtail it? it is an outlier call, not only is it a recession base case, but severe recession resulting from that type of tightening. jonathan: futures are just about positive on the nasdaq, up a quarter of 1%. more so on the s&p. it's been an ugly 24 hours on the nasdaq. terrible month, difficult year.

. >> since volcker. >> since volcker.stion is how do you control prices. it is a very hard thing to do. and that is what we're sort of up against at this point. and the question is can you do it without tipping the economy into recession. deutsche bank saying that recession is coming. goldman sachs saying maybe. the question is what does that recession look like. deutsche bank saying that we could be looking at unemployment creeping back up to 5%. that is actually not terrible on a relative basis to where we were post financial crisis when i would come in with you and we were talking 10%, 12%. it was up there. >> you mentioned houses being more expensive. and you talked about a housing bubble. the dallas fed last week said that this is coming, it will burst. may not be like 2008, but prices have gotten so detached from market fundamentals. >> there is a limited supply and there is so much money being thrown into the system. so if you make it more expensive, maybe you as to that. you have a lot of people with these seven y

this has happened throughout the 1970s, and we had to pay heavily when paul volcker came in to deal with it hopefully we'll deal with it a little sooner this time, will be a much less painful process. it will be painful but much less through than in the early 1980s. >> is there anything they can do to avoid the recession for instance if they hiked the policy rate a full percentage point or tried to front load tightening to get inflation expectations down, is there anything you could do to avoid a deep recession next year >> well, i mean, deep recession, maybe we can get by with a milder one that is still our house call at this point the problem is the labor market is over tightened. by our estimates unemployment is now running about two percentage points below the current level at which inflation would stabilize at the desired level we need to get unemployment up by at least a percent and a half or two in order to take this extra pressure out of the labor market and out of the inflation process. that's going to be painful anytime the unemployment rate rises that is a recession. >> well,

ambassador to nato, kurt volcker. he's also the former u.s. special representative for ukraine negotiations. good morning. so nice to have you so bright and early. i want to talk about these new strikes in odesa. explain for our viewers why this is such an strategically important port for russia and why they want it. >> well, there are several things. and remember, part of this war is putin's vision of restoring the russian empire. so odesa was a partially russian-speaking city, part of the former empire of russia, part of the soviet union. so it's a target in thatceps. from a military perspective, it seals off the black seacoast, so that russia controls all of ukraine's southern coast, from donbas, mariupol, crimea, odesa, and all the way across to romania. so that is important for them to cut off ukraine that way. >> mr. ambassador, throughout this last month, we've seen the information war, really crucial here. we have ukrainians on the one hand saying they're liberated in cities around kyiv. it's been a measured response, but that's sort o

mike: ronald and nancy reagan were celebrating the first christmas in the white house in paul volcker was in his second year of being the fed chair. we know what happened after that. this is probably not going to be the same. analysts are suggesting this is the peak for inflation. one because gasoline prices have started to come down this month and because we have base effects. inflation was so high in the four months we are in now last year that this year it will come in lower on a statistical basis. romaine: and we are trying to look for bright spots. we are talking about a report of energy prices rising. we have seen in moderation in some of those prices and we saw a car prices fall in the most recent month. mike: used car prices are interesting because they were one of the biggest contributors to the surprisingly strong supposedly transitory inflation last year. a lot of rent-a-car companies had sold their cars and when the pandemic started they had to buy back all the used cars they could find and then there were no used cars for anybody. and then we ran into the semiconductor sh

paul volcker is one of his heros i think he also believes, as i do that probably paul volcker is oneeveryone is looking just past the end of their shoes , so i think that taking this stance, i think is probably at least consistent with his views and letting this inflation run probably was a mistake if you look at the five year forward now, what the fed's preferred method of looking at inflation expectations, at 2.9 it's the highest level since 2014, so the expectations are starting to rise and that's a main concern of the fed and i think they just want to extinguish that as quickly as possible. charles: let me quickly go back to that einhorn letter there's something else i want to ask you about he says we believe the policy response to high energy prices likely leads to even higher energy prices. the u.s. government chosen to subsidize demand by granting holidays and releasing strategic oil reserves. again, you know, jack, we look at the inflation around the world for developed nations, very few have higher inflation than we do and yet, we could cure the energy side of that. is there

into recession, it will not be an intentional one, such as the ones in the 'sg50s r the one paul volckernk move quickly to avoid that problem. and so as jamie's letter said and others, where think what we're in for is a lot of uncertainty, a great deal of market volatility, headline risk, and in that sense, sort of buckle up your seat belts. possibility of recession higher than we would like, and therefore at least think about what one might do to be defensive in that space, not a foregone conclusion, and the second part i would make is if the odds play against us and we end up in a recession, i think the fed will move relative lay quickly to avoid having that be long and deep. but you know, we will see. so much of this depends on the other thing, which is inflation expectations, which have been rising a little bit. and obviously, some, a great deal of the inflation we're dealing with has to do with supply chain matters that we're hoping would sort themselves out. and then finally, we see oil prices, which are very volatile and headline driven. so it's a complete witch's brew of forces a

in a moment we'll talk to kurt volcker, former ambassador to nato. ♪.d suffer like that. i started cosentyx®. five years clear. real people with psoriasis look and feel better with cosentyx. don't use if you're allergic to cosentyx. before starting get checked for tuberculosis. an increased risk of infection, some serious and a lowered ability to fight them may occur. tell your doctor about an infection or symptoms or if you had a vaccine or plan to. tell your doctor if your crohn's disease symptoms develop or worsen. serious allergic reaction may occur. best move i've ever made. ask your dermatologist ♪. stuart: all right, we still got a significant loss for the nasdaq composite. it is down 140 points, a lesser loss for the dow and the s&p. big tech down all across the board significantly so. that's because interest rates on the 10-year treasury are rising sharply. all of big tech way down. >>> russia appointed a new commander to take control of the next phase of the war. his name is, i don't flow what it hiss name is h in russian but the nickname, but

bill: the inflation volcker had to fight built up over a longer time so expectation started to rise significantlys harder to get away. the good news is inflation expectations are well anchored. the fed will not have to do as much to push inflation back down. jonathan: your line in your piece this morning has got everyone's attention. "to be effective, it will have to inflict more losses on stock and bond investors than it has so far." run us through financial conditions and how you gauge them and why you believe stocks to be a big part of that? bill: they are important in the u.s. chair powell has emphasized this in his prepared remarks. that is how policy works. the economy is run on short-term interest rates, long-term interest rates and the stock market. a lot of people have exposure. it affects their wealth. the fed has said clearly we need to tighten financial conditions, slow the economy down to keep inflation in check. financial conditions have not tightened much. stock market 4% off the high, sharply up from a couple years ago. bond yields, 2.6%, still really low, especially when you adju

tom: you went into economics at columbia at the time of paul volcker and the ferment we saw in the late 70's and 1980's. this is the first time i've spoken about this with greg staples and i will -- in eight years. soft patch. define how a soft patch is doable versus the bloom of recession? gregory: when you talk about recession you're talking about two consecutive quarters of negative growth. forecasters are starting to talk about that in 2023. we would not be surprised at all to see a quarter of two of one handle growth or even one handle of slightly negative growth. that is not a recession. that is a soft patch. we do not think there any overleveraged balance sheet items that will lead to a sharp slowdown. the data is always erratic in the u.s. economy. it picks up and slows down. a true recession we do not see. lisa: do you think fed policy is on autopilot? gregory: the short end has little bit of flexibility. if you see a couple of quarters of lower psi receive the jobless claims numbers soft and a little bit. i think they have the flexibility to go on to pause, maybe 25 basis poin

not necessarily fist -- 50 basis points but it's the narrative that is this volcker style shock. my max is flat at the moment as the eu didn't go out to the jugular from oil. dollar-yen is at a seven year low. policy divergence puts more pressure on the yen. dani: there you go. as the bond market tries to digest what a big runoff on the balance sheet will mean, so too is the equity market. has the equity market been too complacent? we saw selloffs yesterday. we don't know what the size will be. we are trying to pry something and. continuing to see at selloff -- see a selloff. 4/10 of 1%. s&p not doing as bad as tech. it's going to continue to be longer duration equities, highflying tech players that will take the brunt of the beating. tech down to tens of 1% compared to a flat s&p. manus: we will have cathie wood's on the tape again saying, great opportunity to load up. let's get to the team around the world. james maker with the latest data on the report. our correspondent on the fed. juliette saly with the markets in singapore. maria tadeo on the latest on the war in ukraine. d

so the federal -- neil: it worked for paul volcker though, right?t a time i. worked for him. >> well, by the time he came in we'd had 12 years of ever worsening inflation, and he felt, okay, we have to do drastic measures now. and so we went into a recession, 10.5, 11% unemployment. we don't have to do that here. neil: all right. >> the quicker the fed acts, the less the disruptions. but the longer they delay like last year when powell wanted to be reappointed and and the dictates of the white house, we now have, as they say, a fine mess. neil: well, i'm too young to remember that late '70s, early '80s experiment. steve, always great talking to you. enjoyed talking to you back then, and all these decades later. steve forbes, thank you very much. he saw a lot of people with this pain at the pump what they're going through, and he's looking at it and seeing the lines outside gas stations, and he said, you know what? if i'm going to do something about this. he's very rich. he sells exotic cars. that's just part of his success, but he thought he'd share

think the odds of a really deep recession, you know some people are raising those shades of paul volckerhe deep recession we had than. i think that is very, very unlikely. extremely unlikely. shery: that former fed vice chair on the possibility of a u.s. recession. our next guest says equities can do fine if the fed hikes are slow-and-steady. with us is ellen hayes and, chief market strategist at putnam investment management. good to have you with us. you have the likes of deutsche bank saying that we could see the most aggressive tightening since the 1980's. how are you positioning in terms of a recessionary outlook in your market allocations? ellen: so, looking at 2022, we don't think a recession is likely this year. but no question, the stakes have become higher even in the last few weeks as we have seen at the federal reserve become more hawkish in their speeches. of course, they have only raised interest rates 25 basis points, yet look at how the market has reacted. clearly the rhetoric is doing a lot of the job for them. what will be key to watch is first-quarter earnings, and we a

we also need to and ambassador volcker brought up navigation.luence military outcome. i'm not saying attack. i'm saying that they need to deny free access. they need to deny the fact that the russians think black sea is their lake. >> final question before we go. you've heard that president zelenskyy has released the information that secretary blinken, secretary austin on their way to kyiv perhaps as soon as today. if you were advising, when you were in iraq, you had high level visits and that information kept secret until those folks were on the ground for their security. if you were advising the secretary for today about whether he should keep his appointment in kyiv, would you say he should? >> well, i know how general austin will react and i have extreme faith in the wonderful diplomats that we have. these are men of courage. women of courage. secretary blinken, secretary austin i'm sure will be front and center where they need to be and i'm not sure what the dynamics are in the reveal of the information, but these two delegations are going

today i am told it is your 40th anniversary at the federal reserve which meant you come in when paul volckeras there. how would you compare that in terms of the uncertainty about monetary policy at how the economy is developing and the pressure the fed is under? esther: when i started at the kansas city fed 40 years ago we had very similar inflation rates. we were coming off a long period of expectations being high and problems with wage price spirals. today, i view as different in this sense only that we have had a different kind of shock. it has been a year. we have a commitment to get back to an inflation target that i hope reassures the public of our result to do that. and, in that sense, i think different. the pain you feel today around high inflation not much different. mike: what about the pain fed officials feel about try to deal with it? esther: it is a big issue. i don't think anyone underestimates the task ahead of us. to try to bring inflation back to our target, that is our mandate. to do that and ensure there is a steady expansion in the economy. that is how we achieve our full

the reason why is if we go back to the late '70s, early '80s, i think the lesson that paul volcker taught everybody was the only way that the fed can truly stymy inflation is by crushing the economy. we know all inflation is is demand greater than supply if demand is greater than supply, prices go up don't need a ph.d. to figure that one out if you can't control supply, which the fed cannot do ever, if you want to slow the economy, you have to stymy demand they have a lot of work to do before they're in a contractionary phase >> i appreciate your comments. especially the way you categorize this as looking for late cycle sectors that's where i get confused. you know, where are we in this cycle? is it ending because we're -- if you think we're going into a downturn or what starts it again how can we hit reset explain how this compares with what the market has done in the past recoveries. >> so the key thing you said is ending i-n-g. if you think about the yield curve, twos to tens inverted for a nano second, but it did invert the clock has historically been a year, year and a half, until yo

you have to remember the last time inflation was this high 40 years ago, paul volcker raised short-term interest rates to double digit levels. that's going to sink the stock market and the economy >> what bill is saying is the fed is going to have to inflict more losses on the stock market in order to tame inflation do you think that's right? let's look at the landscape since they started this hawkish pivot, and we've seen five-year break evens move higher. the ten-years are holding roughly steady but moved up this year real rates are deeply negative his point is the market is not reacting as if it's tightening granted, the last couple sessions we've seen a bigger change in tune >> yeah. i think it's going to take a while for the market to digest all this and we still don't know exactly what the consequences are going to be for the broader macro economy. remember, we have an 8 % inflation rate interest rates are near zero they probably will go to 2, 2 .5 that's still a very negative real rate and inflation adjusted rate so it may be that even if the fed gets to 2.5%, it doesn't have to

in your mind do you think powell and company have the fortitude to pull almost a paul volcker what we'ret think it will be volckerresque but there are parallels to this, they will have to raise rates quickly and do it meaningfully. our estimates the fed will hike 50 basis points at the next meeting in may and i also believe they will do the same thing in june as well. really what the bond market has gotten rattled on the last couple days is the balance sheet. charles: right. >> they have amassed almost nine trillion dollars of bonds on the balance sheet and they're very adamant unwinding the balance sheet as well. if adding bonds to the balance sheet and cutting rates, those are both accommodative posturing, right? it has to be tightening posturing on both sides. we'll call it double-barrel tightening from the fed. they're not just hiking rates but they're also going to unwind the balance sheet and let these bonds leake into the marketplace. so what we got from the fed minutes yesterday, you got a preview from brainard the day before, this will be significantly unfaster unwind from the f

and the only way you can do it is follow the playbook of volcker and call out a pearl from the 1980s. liz: we don't want to deal with something like that, right? right now all you hear are people saying go into energy and cash-producing, best in class technology. those kinds of names. and yet stay out of what were the momentum names, these high multiples like teledoc and chewy. all these kinds of names, peloton, docusign. so does it suddenly mean that it's time to completely shift the portfolio? >> well, i'm not shifting portfolios, the question is if i'm an investor, i want to preserve wealth. secondly, if i want to make money, i want to have a look because tax rates are, you know, short term are very high. so what do i do 12 months from now? i think the economy is going to do better unless putin does something better in europe, and the economy in china will do better with xi getting nominated. so what do i look for is companies that warren is looking for and that he highlights in his annual report, companies with cash now; that is, earnings with regards to interest, taxes and compen

just like paul volcker did in 80 and 81. the tragedy is a year ago and i'm happy i said it public so it can be checked, i made it very clear, people i respect like stan, the same thing, this was not transitory. this was a real serious case of inflation. we lost a whole year on addressing the issue. only because frankly we have leadership today in america that isn't willing to admit when they're wrong. they made a terrible blunder here. now the price has to be paid. if you want to get inflation back, you want to benchmark, you will need interest higher than 8.5%. the other thing as is we have exacerbated the problem. for example, the energy issue in america. we didn't have to be deficient like we are. by now, that pipeline would be almost complete. now biden is blaming the oil companies? this is a disgrace. the oil companies are reacting to supply and demand. if they're making this much money, where are they in the numbers? it's wrong. it's absolutely wrong. knock is going anything about it yet in a way that will address the

that wor bother you >> i'm not particularly concerned as much as chairman powell may admire paul volcker, there was a long drawn out political process to get anywhere near the will to do who volker did starting in 1979 and on but yeah, i just think we have to step back and realize what the setting was. now, i agree that the rate of change of policy tightening is a factor, and you can certainly shock the markets and economic activity i've been arguing that policy was counterproductive at the current setting. house prices going up 1.5% per month, 20% per year is a much bigger problem than a four versus a 5% mortgage marketfor real millennials households. we had lots of mall investment, money flowing into speculative investments. all the cash on bank balance sheets is impairing profitability, and that itself could crowd out credit creation much more than so-called maturity transformation, the inversion of the curve is likely to do so and of course, inflation expectations are a problem in the near-term as well. larry summers described the longer term expectations which are lower -- a wasting

whatever they're going to call it >> meantime, powell, of course, 1:00 and we'll watch as he invoked volckerdge. >> carl, thanks so much. welcome to the "halftime report." netflix bailing and buying, why our josh brown and jon najarian are buying and what sorry selling on the once-loved names and high multiple growth stocks. we'll discuss that with the investment commit. joining me for the hour, brenda vingiello, josh brown, jim lebenthal and jon najarian co-founder of marketr marketrebellion.com. the ten-year note yield headed toward 3% and 29

70 basis points because your one-year forward rate is a negative 7 we haven't seen that since the volckerforwaard curves and look at three notes earlier went from 28 basis points to 270 where it is now, up nearly 250 basis points so i ask you, when the fed embarks on 50 basis points after 50 basis points after 50 baits points of hikes because they want to get the rate to 3% in the next year, when that happens, when they're selling down the balance sheet, remember, they took the balance sheet from $4 trillion to $9 trillion in the last couple years. when they start to reverse that, they're going to be selling treasuries they're going to be selling mortgage backed securities and the market won't be able to sustain that heavy selling right now, there's a big disconnect between what the bond market is starting to signal and equity markets are priced because they're only down 60 persh on the year. earlier on the year, they were down 13% you have a lot more to go, is your answer. >> downside. i think of you as more of a credit guy, but are you shorting stocks at these levels >> we have options

i think the odds of a really deep recession, you know, some people are raising the shades of paul volcker the deep recession we had then. i think that is very, very unlikely. extremely unlikely. shery: the former fed vice chair alan blinder, on the possibility of the u.s. recession. , next guest sees a brighter future for fixed income. joining us is mahjabeen zaban from citi australia. good to have you with us. how big a role will fixed income late your portfolio this year? mahjabeen: received fixed income to be a next important element. the fundamentals behind that are really that market losses in fixed income we saw earlier this year. we see that has already been realized. . in a slowing growth environment protection from any downside equity risk is there. on an average return number, u.s. treasuries return were weakest in q1 and strongest in q3. we are looking to position for that going forward. shery: where does that leave the equity space? we continue to see the downside pressure there. mahjabeen: at this stage, markets will remain choppy, given what is happening in china. but the sc

whatever they're going to call it >> meantime, powell, of course, 1:00 and we'll watch as he invoked volcker in his initial speech today and snap. let's get to the judge. >> carl, thanks so much. welcome to the "halftime report." netflix bailing and buying, why our josh brown and jon najarian are buying and what sorry selling on the once-loved names and high multiple growth stocks. we'll discuss that with the investment commit. joining me for the hour, brenda vingiello, josh brown, jim lebenthal and jon najarian co-founder of marketr marketrebellion.com. the ten-year note yield headed toward 3% and 294 is where we currently sit, but josh, i want to begin with you. this news broke with you yesterday, you, unfortunately, were on a plane at the time, but now you are here and i want you to explain on why you decided to buy this stock which san absolute battleground there, and we'll get into the ackman news in just a minute, but you did buy. why? >> i saw the clip of you guys talking about me yesterday i love you, pete don't worry. i don't have that much conviction in, but i do think that the sto

let's bring in ambassador kurt volcker.ase? >> this is a big deal, for weeks the us was holding on the level of assistance we were providing, that changed in the last two weeks and the united states pulling nato defense ministries together to assure a steady supply of arms to ukraine so we are helping ukraine win the fight. stuart: our own jennifer griffin reports there are now we 82 ten large cargo planes arriving every single day putting heavy equipment into ukraine, that's what we want to hear. >> this is what we have been pushing for, the united states was concerned about provoking russia or ukrainians would not win and it could fall under russian hands but the ukrainian military success, pushing forces from kyiv so they are only in the east, the atrocities, it is clear the united states and allies are in to help ukraine win. of the what if the russians were to seize control of ukrainian ports like mariupol ukraine became land locked, that would be a significant putin win, wouldn't it? >> it certainly would and it is wh

house in order so that we can continue to fully inhabit that role i was thinking of a moment in kurt volcker's testimony. he was the special envoy who was dealing with the ukraine conflict. obviously those negotiations didn't end up going anywhere and actually, you know, kurt who we both know well ended up, essentially trying and failing, you know being inserted into the middle of this back and forth with you know, giuliani and engages directly with him. despite many officials, you know, john bolton and fearon hill saying no, no, don't do that. that's not a good idea. he goes had because he thinks he can manage it right? he's trying to get a good outcome for for the ukrainian government and basically realizes in this breakfast he has with rudy giuliani. you know that actually they are holding up a meeting with a president of a foreign country in order to get investigations. and he has this testimony where he talks about having a conversation with a senior advisor to president zelenski in september and the he's telling him well, you can't go after your opponents in the election. you can't prose

people are talking about a potential paul volcker move, not there yet, but what people are looking forreased risk that this ends up being the cause of a recession. is it a big risk? kathleen: when you listen to what everybody is saying, the idea is that it could fast and you are going to change expectations. if you shock the market, bill dudley, former fed official today writing a bloomberg opinion piece and saying he think that is go to happen. bond yields are so low, stock prices are so high, you have got to tighten financial conditions. but he also said that in order to get unemployment to move up a bit and get inflation down, you run that risk here's what he said on bloomberg television. >> the current environment of 3.6% that wages rising well above a rate of 2% consistent with inflation, the fed will have to tighten up to push up the unemployment rate. when the fed is on that in the past, it has resulted in a recession. that is not their intention, they are going for soft landing, but their chances of pulling it off are very low. kathleen: bill dudley is looking very closely at f

i think she quoted paul volcker as saying that inflation is the biggest risk to an economy, ultimately yes, it is a tangible threat to the stock market if the interest rates go up very fast. shery: what does that mean for the greenback? because we continue to see strength with the fed really turning more hawkish, but at the same time, other central banks are continuing to raise rates. are we going to see a bull trap when it comes to king dollar? mark: i am not sure, shery. it's a tough one, because you are absolutely right. inflation is a problem globally. and i think what has been more surprising than the fed is perhaps the ecb coming out as hawkish as they are, notwithstanding the fact that they are right next to this war. so, i mean, their economy is a lot more vulnerable, and they don't have the same self-sufficiency that the united states does. so, hard to say, but to me, if you look at the major crosses, the boj is the one black sheep, where they are just absolutely committed to loose monetary policy. so i would have thought that particularly in light of the recent break and the

if you go back to the early, early 1980's and the paul volcker time, they had to raitz the federal --ad to raise the federal funds rate equal to inflaition. if fod -- inflation. if today the actual inflation rate as of this moment is not 6% but closer to 8%, 8.1%, are you really for a federal finneds rate at 8%? -- funds rate at 8%? because that's what it takes. because understand, if you're borrowing money today at, you know, federal funds rate 2%, 2.5%, and inflation really is closer to 8%, that's a huge, huge gap. those need to be in alignment. because you have a negative actual interest rate. when you're borrowing below what inflation is costing, if the dollar gets -- goes to this value every day and you're paying this, you have substantial negative interest rates, what do you think is going to happen? so back to the reality. this is what we've done. actually, i take that back. we didn't do it, the republicans didn't do it, the democrats did this. and they did it without a single, without a single republican vote. is this line -- this line functionally is newer yk. and -- is your

that's paul volcker-ish rate hikes, and i think the free money train is coming to potentially a grindingnow, the country's spreading on lockdown, that's going to mess up the supply chain in the united states and cause more inflation around the world. let's not forget the fact that we have commodity prices spiking, whether it be oil or wheat and other consumables because of what's going on in eastern europe. so it's looking like a recession is probably inevitable, and the market is responding to that. but i'd put the fed first in terms of the thing that they're keenly focused on. jackie: yeah, i think you're probably right. we've been seeing selloff as we've been getting the indication that the rate hikes could come at quicker clips than the market was initially anticipating. mitch, just to give you the final word here, you know, we were talking about mortgage rates, you know, climbing over 5%, the housing market cooling as a result of that. we're seeing demand concerns because of, again as you mentioned, china, that could -- supply chain issues. all kinds of things could be happening her

you point in the volcker years and '70s, '80s, do you know the s&p outperformed inflation?% during the time, despite 150% growth in higher prices an inflationary pressures. wall street is betting these companies will do well in this environment. neil: i want to thank you guys very, very much. good perspective what is going on here. wall street we're worried about the backup in interest rates, 10-year note is closing in on 3%, funny way of showing it. nasdaq racing ahead. maybe they're beginning to adjust. dad, we got this. we got this. we got this. we got this. we got this. yay! we got this. we got this! life is for living. we got this! let's partner for all of it. edward jones muck on the road again -- ♪♪ going places that i've never been. ♪ seeing things that i i may never see again -- neil: all right, i do think when it comes to new hampshire, president biden has seen that before, and he is going to see it again, and he's going there again today he's touting infrastructure spending which some might find ill-timed given the inflation problem we have and that more federal

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and when volcker came in a couple of months after that, he took it up even higher.ally higher than they are at the present time. it's going to have to do something to contract the increase in money flow. so while the goldman numbers look great, while the morgan stanley numbers look good and even if you were to subsect the jp morgan numbers and look at trading and investment banking, those numbers were pretty good. i just don't see how that's going to continue in the next couple of quarters. maria: well, look, we know that the loan loss provisions have been critical. i want to get your take on what you're seeing there. you're right, inflation is the come nearing story -- dominerring story here. inflation data higher than expected. 40 year highs. jamie dimon mentioned it in his quarterly report. he says no one actually knows what's going to turn out so i'm not predicting a recession but you know, is it a possibility, absolutely. dick, are you predicting that we'll seize's see a re-- see a recession this year and how does that blanket over the earnings and guidance tha

the only way they got on top of the horrible inflation from the 1970's, volcker came in and said youet interest rates higher than inflation. we are not even close. host: let's go to jerry calling from north carolina on the independent line. good morning. caller: how are you? host: just fine. go ahead. jerry, go ahead. i think we lost jerry. let's go to rhonda calling from new jersey on the democrat line. good morning. caller: good morning. good morning, america, my beautiful country that i love. i want to talk about the hypocrisy in the news media from fox news. they are not being honest with their listeners. they are not revealing to them all of the audiotapes with kevin mccarthy and his entire republican caucus agreeing that donald trump should resign from office. they put that girl out of her committee. they expelled her from the republican national committee. and they all knew that she was telling the truth. this is the hypocrisy that we have to live with, with the party that is supposed to represent the christian church. they are all demons in sheep clothing. they are rebels. th

the only way they got on top of the horrible inflation from the 1970's, volcker came in and said youet interest rates higher than inflation. we are not even close. host: let's go to jerry calling from north carolina on the independent line. good morning. caller: how are you? host: just fine. go ahead. jerry, go ahead. i think we lost jerry. let's go to rhonda calling from new jersey on the democrat line. good morning. caller: good morning. good morning, america, my beautiful country that i love. i want to talk about the hypocrisy in the news media from fox news. they are not being honest with their listeners. they are not revealing to them all of the audiotapes with kevin mccarthy and his entire republican caucus agreeing that donald trump should resign from office. they put that girl out of her committee. they expelled her from the republican national committee. and they all knew that she was telling the truth. this is the hypocrisy that we have to live with, with the party that is supposed to represent the christian church. they are all demons in sheep clothing. they are rebels. th

i lived through what happened in 1981 and 82 when reagan and paul volcker had to drain that carter inflation't see that now. pete: stephen, this white house has to know it is bad for people, bad politics, political liability if we go into recession. what should they be doing? if they look around the table saying we got to address this, what should it be? >> first of all, you're exactly right, inflation is terrible for the economy, especially middle class folks but it is terrible for an incumbent president. jimmy carter lost, got wiped out by reagan in 1980 because of inflation. what should president biden and congress be doing? number one, they have to start slashing government spending. this was caused, the match that lit this forest fire of higher inflation was those trillions of dollars of spending bills that we passed last year, that just flooded the economy with cheap dollars. the other thing we need to get going in my opinion is we've got to start producing american energy, get back to where we were under trump, where we were energy independent. i love how the president keeps blaming p