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tv   Closing Bell  CNBC  July 28, 2021 3:00pm-5:00pm EDT

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that process of buying a new home very quickly moved to much more of a virtual process. and so they were able to do that and other industries as well have gone to takeout and no-contact things. so that can all -- it seems like we've learned to handle this we would like to get back to, you know, the way things were, and i hope to some extent we will over time but of course, the big wave we had last winter had significant employment effects particularly in, you know, hospitality and leisure and other areas with a lot of direct contact. a lot of jobs were lost because that was a very strong wave that happened in the winter months last year. just before the vaccines arrived. so with delta we'll just have to watch. again, with a reasonably high percentage of the country vaccinated and the vaccine apparently being effective we're not experts on this, but
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it seems like the -- a good going in estimate would be that the effects will probably be less it probably won't be significant lockdowns and things like that, but those are not decisions for us or -- nor is it something we'd be expert in. in terms of the channels, i -- this is kind of speculation, but it's pretty -- people, you can imagine, school districts deciding to wait a month or two for the delta wave to garks way. i'm not saying this will happen but it's tease imagine that. it's also easy to imagine that some people might say, i'm just going to wait a couple of months before going back to work. wouldn't be hard to imagine that happening. if schools don't open, then caretakers have to stay home and if people don't go back into the labor force and the job growth won't be as strong, those kind of things. so it doesn't, again, sitting here today, not being able to
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really know the future, it doesn't seem as though the effects will be very large but there may be effects, and it may be that the effect is to slow the economy down just for a period of months or not there are many parts of the country where it might not have an effect and we're just going to have to see what the economic effects are. >> thank you, now to david gura at npr >> thank you, mr. chairman i was going to ask if you started drafting your jackson hole speech but i'm going to go in a different direction steve liesman asked you about semantics. i'm going to ask about the term transitory i think of you as someone who explained policies and programs in recent months and made a real concerted effort to explain them to the american public as a whole. i wonder about this term and what you'd say to people who don't know definitionally, don't know what it means and see prices going up and wonder how long they'll have to wait. so just some broader definition from you i'd like to hear about
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what it means or how you understand it. and quickly as well, you've talked about vaccines a bit. your colleague in minneapolis has placed a mandate on vaccinating -- coming back to the reserve bank is that something you'd expect to see or like to see systemwide going forward? >> the concept of transitory is really this. it is that the increases will happen we're not saying they will reverse. that's not what transitory means. it means the increases in prices will happen so there will be inflation, but that the process of inflation will stop so that there won't be -- when we think of inflation, we really think of inflation going up year upon year upon year upon year that's inflation when you have inflation for 12 months or whatever it may be, i'm just taking an example and not making an estimate then you have a price increase but you don't have an inflation process. and so part of that just is that
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if it doesn't affect longer term inflation expectations, then it's very likely not to infect -- to affect the process of inflation going forward so what i mean by transtory is just something that didn't leave a permanent mark on the inflation process. we don't mean -- i don't mean that, you know, producers are going to take those price increases back that's not the idea. it's just that they won't go on indefinitely so to the extent people are implementing price increases because raw materials are going up or labor costs are -- something is going up, you know, the question really for inflation really is, does that mean they'll go up the next year by the same amount so you'll be in a process where inflation, the inflation process gets going and that happens because people's expectations about future inflation move up and we don't think that's happening. there's no evidence that it's happening. all the evidence is that it's not happening.
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but nonetheless, we have to watch this very carefully because this is, you know, we have two mandates. maximum employment and price stability. price stability means inflation averaging 2% over time so we've got to be very careful about that but i think it's a good point that it's a term what it means is temporary but then you got to understand that it doesn't mean that the increases will be taken back some of them will be but that's not really what it means. in terms of -- so we're working virtually here and we'll be coming back down the road in a couple of months starting to bring people back here at the board of governors in washington and, you know, we're going to follow public health guidance and things like that we really haven't made the fundamental decisions about exactly what that will look like and it will depend to some extent on what cdc guidance looks like when we do bring people back in >> thank you
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we'll go to michael mckgee at bloomberg tv p. i wanted to ask you about your taper timeline in the sense that you said you want a couple more months of data, and the statement says that the fed is going to use -- to evaluate the developments in the markets in jobs and inflation in coming meetings. does that suggest that we wouldn't see anything before september or november in your meetings i know a lot of people on wall street have basically felt you're going to lay out your taper plans at jackson hole. is that the plan or are we not going to see anything until the fall? >> so in any decisions about the timing, and i did not -- if i said we're looking at a couple more months of data, i'm not meaning to suggest anything about a particular time at which we might taper because we really have not made that decision. all i'm saying is we're not at substantial further progress
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there's a range of views on what timing will be appropriate and those views ultimately track back to people's views about the economy. and what will happen as we make progress towards our goal. so that's really what it is. we will, of course, as we -- we're going to continue to try to provide clarity as appropriate on timing, pace and composition. but today i've given you what i can give you because, again, this was the first really deep dive on the issues of timing, pace and composition, and it was a good meeting but no decisions are made, and i'm just not in a position to give you much guidance -- really any guidance on the actual timing but i will say, we are making progress we expect further progress, i and we expect if things go well, then we will reach that goal and when we reach it and the
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committee is comfortable that we have reached it, then we'll taper at that point. floos n there's nothing i can say about jackson hole we're in the process of writing that speech. i am going to give a speech but i wouldn't want to say what will be in there at this point. >> if i could follow up, several people have recently noted that the fed has got the markets working well, and you have got bank loans up. in other words, you've stimulated demand. but savers and companies like insurance companies and pension funds are getting hammered by the low rates. and they are wondering if the balance hasn't started to shift away from benefiting the economy to doing more harm than good >> asset purchases were just a key part of our response to the critical phase of the crisis they really helped us restore market function to these markets
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on which are very, very important to our economy and the global economy and then they were a big part of creating a comdating financial conditions to support demand they were strongly needed. it was that commitment to continue asset purchases that provided strong support for the economy and has been a part of the story for why the economy is so strong right now. so we said we would taper when we achieved substantial further progress and we're going to honor that commitment. it's -- and again, we're talking about it right now meeting by meeting and moving in that direction we will taper when we reach that goal and we'll provide more clarity on that as we go, as is appropriate. >> thank you to hannah lane at the american banker >> hi. you've been asked a lot previously if the fed's monetary policy at all contributes to inequality
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but i was really curious to know where you think the fed's regulatory policy lands if you think the fed's bank capital requirements have had the effect of penalizing lower income households seeking loans is it possible to achieve the balance of a safe banking system with one that also provides equitable loan access? thanks >> i think strong capital requirements are essential for banks, particularly for the largest banks. and i think that an undercapitalized banking system as we've seen can be a real threat to the economy and mostly -- or to the greatest extent, to people at the lower end of the income spectrum if you look back at, not this previous -- not this crisis but the previous one, the banking system was undercapitalized. higher capital requirements are, you know, are really a good thing because they allow banks
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to weather downturns and continue to perform the functions they perform i think it's other tools that we have to -- and the fed has some of these tools congress has some of these tools. other agencies have some of these tools to ensure or support the wide availability of credit, particularly the low and moderate income communities. that's cra we're working on a new cra proposal right now with the other banking agencies and we think it's going to be good. and we'll support the flow of credit to low and moderate income households. it's also the anti-lending discrimination statutes that we enforce, and it's some of the programs that congress has in place to support the flow of credit to low and moderate income communities i think capital standards work the other way. strong capital is what enables banks to continue to serve their communities, including low and moderate income communities. >> thank you we'll go to chris at the ap.
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>> hi. thank you for taking my question chair powell, i guess i wanted to ask about the last -- when you were before congress earlier this month, you mentioned, i think, something along the lines of, it won't take too long before we see if you're right about inflation and its temporary aspect you also mentioned learning a lot more in the next six months about the economy. can you tell us more about what you mean by that when do you think you'll get a clean reading on inflation that is free of most of the distortions that we're seeing now? >> right so with inflation, as i mentioned, we look not just at the headline number, but all the components that go into the calculation of inflation and if you do that, if you look rnd the hood what you see is not that widely across the whole range of goods and services that are in the economy, we're seeing upward pressure on prices. that's not really what we're
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seeing what we're seeing is a handful of things that really account for the overshoot of inflation and as i mentioned, it's things like cars. new, used and rental cars have moved up in price because of the car shortage, because of the semiconductor shortage and housing -- sorry, hotels and air fares have moved back up, but that really just is retracing the very large downward movement in prices they had before so that's a big, big part of why the inflation readings are so high and those, frankly, don't carry significant implications in the long run for inflation or for the american economy so what i said was we are going to see whether these things -- we don't need to see everything do what lumber prices have done. if you look at lumber prices, they went up and they went down. what we want to see is these other things
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do the prices flatten out? do they actually move down if they flatten out, then their contribution to inflation becomes zero over time so they're not contributing to inflation. and so if we start to see those things happen fairly widely among the things that have really moved up quickly, then we'll -- they won't all happen at once or happen quickly but we'll know that our basic understanding of the situation is broadly correct and i don't think it will take -- what i said was, i don't think it will take a very long time to see whether that's the case it is probably the case that, frankly, that the overall reopening of the economy is going to play out over a period of time. this is an historic -- world historical event that the global economy is now reopening it's not going to happen quickly. it's going to take some time and it's going to be very uneven as we discussed before. but i think we will know when we know but i don't think it will take
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that long. i don't want to put a number on it, but i do think that if we see those things happening, we'll know that we have the story basically right. >> thank you to brian chung at yahoo! finance. >> hi, chairman powell just wondering if you can provide more color in terms of how you're thinking about mortga mortgage-backed securities within the context of home prices continuing to rise. we heard a lot of people talk about the idea that maybe they'd like to call off on specifically the mps purchases. is that more because of the optics or because there's an observed relationship from the committee's view between mbs purchases under qe and hot housing market thanks >> so a number of participants raised that question around mbs and tapering at today's meeting, as a matter of fact and yesterday's meeting. and i'll just say that generally speaking, i don't think, and i
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don't think that -- i think the treasury and mbs purchases affect financial conditions in very similar ways. there may be modest differences in terms of contribution to housing prices but it's not something that's big so where i think we are is there really is little support for the idea of tapering mbs earlier than treasuries. i think we will taper them at the same time. it seems likely based on where people are now the idea of reducing mbs purchases at a somewhat faster pace than treasuries does have some attraction for some people. others, not so much. and i think it's something that will be continuing to discuss. >> thank you to michael derby >> thank you very much yeah, i wanted to ask about the standing repo facility and get your sense of what you think it
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will do for market trading conditions and also kind of -- the reverse repo numbers have gotten bigger since you raised the repo rate at the last meeting. are you concerned to see nearly a trillion dollars a day pouring in through that facility >> so on the standing repo facility, what is it going to do so it really is a backstop so it's set at 25 basis points so out of the money, it's there to help address pressures in money markets that could impede the effective implementation of monetary policy. really it's to support the function of -- functioning of monetary policy and its effectiveness. that's the purpose of it and it's set up with that purpose in mind. your question on the rrp so we think it's doing what it's
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supposed to do, what we expected it to do, which is to help provide a floor for money market rates and help ensure the federal funds rate stays within the target range it's essentially what's happening is that it just results in lower amount of federal reserve liabilities that are in banks in the form of reserves and federal reserve liabilities in money market funds in the form of overnight rrp balances so that's all that's really happening there. and we expect it to be high for some time. it's being driven, of course, by the relatively lower quantity of treasury bills and also the onset of the debt ceiling and decline of the tga, thanks like that so we don't have a problem with what it's doing. it's kind of doing the job we expected >> you don't see any issues with like disaggregating markets from
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investing in private money market securities? the idea that the fed's footprint is getting too big you don't see any issues there >> not really. not at this point. i mean, money markets -- private money market funds are choosing to invest because the rates are attractive at some point, rates will not be so attractive as the whole rate cluster normalizes and you'll see it shrink back down. >> thank you >> thanks. let's go to craig robb at marketwatch. >> hi. thanks for taking my question. chair powell, i wanted to go back to inflation a little bit i was kind of surprised by your tone it seems like you're just sort of warning that if inflation gets too high, the fed will act. isn't it true that, i mean, a little inflation is good for the economy and that we -- it somehow maybe we can get the economy out of this place where
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we are going to be close to the zero lower bound isn't there a good story to tell and you're sort of panicking people >> certainly don't have that in mind no, look we, as you know, we're targeting a moderate overshoot of 2% inflation for some time. we want inflation expectations to be centered to 2% we feel like they may be a little below that. so the bigger picture is that, you know, that would be a healthy thing. this is a different thing. this is not that that was the kind of inflation we were thinking about that comes from a very, very strong labor market and a booming economy maybe. that was the kind of inflation this is something different. this is really driven by the supply side, which is not able to handle this big spike in demand that we're seeing as the economy reopens with vaccination and fiscal support and monetary policy support, the
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supply side just all over the world, you're seeing the same thing, which is it just can't keep up. and there are labor shortages in a lot of places, the same sort of thing so, you know, there's absolutely no sense of panic. i just have explained, i think, several times here today that the best -- my best estimate is that this is something that will pass it's really a shock to the economy that we'll pass through. and, you know, if you look at where forecasters are, people who write down a forecast for a living, very, very strongly, they see it that way now we are actually responsible for this, though so we have to take seriously the risk case which is that inflation will be more persistent, that it might move expectations up and that we might -- that the kind of things that might require a response. we don't see that now, but we have to be on the alert for it and people have to understand and believe that we will react
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if we need to. and we will. but again, it's not my base case my base case is that, as i've said repeatedly, is that inflation will move back down. and, no, we're not -- we have not at all changed our view, i haven't changed my view that inflation running above 2%, moderately above 2%, is a desirable thing. this is not moderately above 2%. this is well above 2%. it's also not the kind of inflation we were looking for. this is really driven by a supply side shock. >> thank you >> thank you we'll go to don lee at the "los angeles times" for the last question >> thanks, chairman powell wondering if you can talk about wages. many workers seem to have gotten some good wage gains in recent months what can workers generally expect going forward, and doesn't sound like you're concerned about rising wages
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feeding into broader inflation is that right? >> so wages have moved up. a lot of that is driven by new hires and it's -- a lot of it is driven at relatively low-paid jobs in the service industries as people come back. so that's not troubling. and we don't see -- there is a form of wage inflation that can lead to price inflation and we're not seeing that right now. and that really iswhat we call unit labor costs move up which really puts -- move up in a way that is hard for companies to manage and puts them in a situation where they have to accept substantially lower margins or raise prices. now when it happens gradually, we've seen long expansions sometimes labor costs do move up and put some pressure on
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margins. long expansion, that's been happening late in the expansion. that's not a problem either. the problem is if it happens in a way that pushes firms broadly into raising prices. it was called the wage price spiral we don't see that now. this is something that was a feature of the high inflationary era of the great inflation it's not a feature now we don't see that now. of course, we'll be watching that and this is one of the reasons why we're watching so carefully to see whether labor force -- whether people do come back in, accept jobs. given the large job openings and large number of unemployed people we'd like to see some matching going on there so people get back to work. we think labor supply would be a healthy thing. but wages moving up across the spectrum, consistent with inflation and productivity, is a good thing
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>> thank you, chair powell thank you all for coming >> thanks very much. fed chair jay powell just wrapping up his news conference. maybe taking the fed some baby steps closer toward tapering or scaling back asset purchases the extraordinary stimulus but did say that there's still substantial progress to be made saying that they are seeing progress on that progress in terms of the health of the economy. but also said there's still some ground to cover on the labor market and some way away from seeing substantial further progress welcome to "closing bell." i'm sara eisen with scott wapner as far as the market's reaction, scott, things improved the dollar is weaker that tells you that the fed did not move the ball significantly closer to tapering or scaling back those asset purchases did mention the delta variant. haven't really seen or don't know what the economic impact is
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going to be of that. what you've seen with these waves is they don't have a really big impact on the economy in terms of scaling back the reopening. we'll see how this plays out >> i thought the key was the answer to steve liesman's question where he said we're some ways away towards maximum employment and we know that of the two fed mandates, the one that he is most concerned with at this point is the employment market steve liesman asked him, what substantial progress numbers are you going to be looking at specifically that will, ring the bell for you that says, now it's time to taper. and he made it clear and has time and time again but underscored it today that it's the employment market. the fed is not tapering any time soon >> no rush >> we're some ways away. some ways away doesn't correct itself in a week, a month, two months or even three, i don't think. >> this fed chair has made it very clear he's not thinking about raising interest rates they are just starting to have the taper conversation would not commit on a timeline said there's been no decision on a timeline
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and not even commit to steve's question on some numbers of what substantial progress looks like. just we'll need to see more. some better jobs reports >> you said it at the top. a tiny step toward a taper >> baby step >> you guys are on the same page in terms of how you read what the fed chair had to say we have a big show coming your way. not just the fed, of course. facebook, qualcomm, ford, paypal, all set to report at the top of the hour. we'll break down the numbers and have instant analysis. plus, the ceo of jetblue is here with his airline outlook. the rise of the delta variant putting pressure on the travel sector in and u.s. transportation secretary pete buttigieg joins us from washington where officials are making big progress on an infrastructure deal there's lots to talk about today. we've got so much coming up over the next 90 minutes. >> you picked a good day to join us us. >> let's kick it off with the fed. former deputy treasury secretary and former federal reserve governor sarah bloom-raskin.
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jeffries chief strategist david zerbos and paul mccauley all-star fed panel does this change anything as far as the next step the fed is going to take toward tapering that extra stimulus? >> no, i don't think it does i think chair powell did really a very good job communicating that they are starting to think about a taper. he is not committing to it being the first step and he got a question exactly to that point during the press conference but he has indicated that this is going to be coming next. and he even tipped his hand a little bit in terms of what those discussions are looking like whether the mbs will be paired back at the same time as the treasuries so i think you can be quite certain that there is thought going into the taper at the same time, this does not mean, and hehas underscored this repeatedly.
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this does not mean that the first step is being telegraphed quite yet. >> ten-year yield is a little firmer the dollar is weaker and stocks are going strong nasdaq was outperforming all day, david it still is. now up 1%. the dow down about a quarter of a percent. what is the market takeaway? >> the dollar is weaker. the stock market likes it. that's good for risk assets. 10-year say little lower all in all it came out -- this was telegraphed as a dovish meeting. we all thought they'd wind things back because of the delta variant rise so there was a risk they would disappoint a dovish expectation and they didn't. i think the market reaction was decidedly on the more dovish side was it significant it wasn't super significant, but it was a dovish reaction >> paul, scott wapner, how long can the fed afford to wait until the employment market gets to the point where jay powell is ready to start tapering? he seems willing to wait a long
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time >> i think he's going to be very, very patient and that's the prudent thing to do and the big thing he really wants to see is what the job market looks like once we get into the fall, post the supplemental employment -- unemployment insurance and also the reopening of schools he really wants to see a clean picture to the extent you can get one in the fall, and then after that would be the likely time to move towards tapering. but the next big hurdle, and i think he did a really good job of explaining this is seeing what the job market looks like in the fall and particularly if labor force participation moves up >> everyone stay with us we want to get to steve liesman for more on the news conference. steve, we referenced your question that was really the key on how he's thinking about substantial further progress >> yeah, i always walk away disappointed, as you know, when i ask for a direct answers on
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details and data and what he's looking at let's run the aforementioned sound here so that people know what we're talking about when i asked him, give us some idea of what substantial further progress will look like, and here's what he said. >> i'd say we have some ground to cover on the labor market side i think we're some way away from having had substantial further progress with -- toward the maximum employment goal. i would want to see some strong job numbers, and that's kind of the idea >> all right let me pick up with what scott said earlier you don't -- if you are a ways away, you can't get there in a couple of weeks, a couple of months, maybe not a couple meeting. the practical effect of this is it takes september off the table for an announcement of a taper that said, i think it's worth saying what -- underscoring what sara just said
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this was the -- powell said this was the first deep dive when it comes to taper in timing, pace and composition. and as sarah bloom raskin said, they did talk about whether they do more mbs, less mbs. they are taking these steps but it's a glacial pace. the practical effect is it takes september off the table. more likely a november announcement and on track, i would suggest with a january taper. >> does that mean, steve, that jackson hole is off the table? there were some who were thinking that maybe they put the groundwork really in action at jackson hole next month and it sounds like you're saying that might not happen >> first of all, scott, i was never in the camp that thought they would announce an fomc decision at jackson hole remember, the fomc has to decide to reduce purchases. that's an fomc decision. >> sure, but at least get it -- yeah, but at least get a little more explicit, like it's oming
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>> well, he could. remember, he's going to make a speech it's about inequality in the recovery so it won't necessarily be on topic but you'll have the august employment report. we'll see if we're on track to get there, scott he's just doing this incrementally. remember, it's a simple eq equation he's trying to avoid a temper tantrum and taking a risk with inflation to avoid it. he's winning this battle, but we don't know if he's won the war and he's given himself about six months to find out is this inflation thing transitory >> the market is giving him the benefit of the doubt steve liesman, thank you paul, how do you see that sort of timeline that steve liesman just laid out? do we need to push it back a little bit because of those words that the fed chairman used today? >> no, i don't think we do i think steve's got it right, and the beginning of next year is a logical time to start the taper. and between here and there,
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there will be a chance to get a lot more data on the employment side and also for chair powell to incrementally move the rhetoric closer to tapering. i think he wants tapering when it's announced to be the most discounted event of his tenure he's basically said that all year long. and incrementally, he's a great script writer and he wrote another chapter in the script today taking us closer, but it's still not imminent so i think he's doing a great job as a script writer here. >> sarah, we haven't talked about his comments on inflation and he got a lot of questions about them and was anticipating it and still sticks to his guns that it's transitory explained what that meant. he sees pockets of the economy reopening and supply chain gaps and bottlenecks and all of that. how do you think he did at explaining it, and where do you
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think this goes? >> yeah, i thought he really spoke a lot about inflation and the disanchoring of inflationary expectations he really wanted to, i think, emphasize both sides of the dual mandate. so while there has been so much discussion on the labor market and maximum employment side, i thought he really spoke quite a bit on the inflation side. and, really indicated and paul mcculley would probably say he drew out the contours of the framework in a very specific way on the inflation side because he talked about how it was important to achieve higher than 2% inflation for some time so he really is acclimating people to the fact this new framework is going to mean that we're going to be living with inflation above 2%, and we've got to get used to this. this is a different framework. this is not a framework where
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the fed does a preemptive strike before inflation gets to 2%. he is saying, no, it's going to be not just 2% it's going to be higher and it's going to stay there for a while before we come in. i thought that was just an extraordinary articulation, really, of what's in store for this side of the mandate >> david, i also wonder, as we think about powell's own future, how he thinks that plays into whatever decision he is going to make trying to convince the committee of it and the time frame around the whole thing his appointment runs out in february and i've heard commentary from a number of different sides saying, well, he's unlikely to be reappointed or, no, it's a shoo-in that he'll be reappointed. you think that factors into his thinking on timeline at all? >> i think it does, but it would never be admitted to so you -- if you ask him that question, steve asked him that question, he'd probably say it has nothing to do with it, but i think it does. it argues to the point you and steve were alluding to earlier
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which is that he really kind of set the stage to make this a much longer process. we still have some ground to cover. we -- assessing progress over the coming meetings. that was in response to steve. coming meetings is not one meeting or probably even two might be three that takes us all the way to the end of the year. even a throwaway line. i don't know if anybody caught this he said it may be a couple of years to fully repair the job market a couple of years. we have 6.8 million missing jobs still and i think he's got an equality -- inequality speech coming up. we'll get nothing at jackson hole, to me, about tapering or the timeline >> does the timeline matter, david? really quickly, but does it matter to the market if it's september or december or january of next year this has become an obsession >> i think it does only in the sense, sara, that the market gets nervous about the fed taking it away too quickly what happened in 2018, going too
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far. not really understanding balance sheet production can have a significant impact on the market and the market is very scared of a fed that is going to maybe make a mistake and that's why we saw some of the reactions we saw on the long end of the bond market after the last fed meeting he didn't want to admit it but that was something going on. it wasn't really technical i think the market is very sensitive to how quickly these are going to move . >> i think he's right. i think it's everything. the people who say the market is ready for the taper. everybody who says that are the same people saying, yeah, i'd buy on the dip until the market sells off a lot and they don't all jump in, en masse. >> that's why ever headline from powell matters thank you for joining us, sarah bloom raskin, paul mcculley. a big hour of earnings as well facebook, qualcomm, ford and
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paypal all set to report at the top of the hour. we'll break down the numbers with another all-star panel. and the ceo of jetblue joins us with his airline outlook. and a check on bonds treasuries are seeing higher yields across the board. i mentioned the weaker dollar. yield is firmer there. 10-year, 1.23. not much to speak of we'll be right back here on "closing bell. dow down 73. nasdaq and s&p all higher. sales are down from last quarter but we are hoping things will pick up by q3. yeah...uh... doug? sorry about that. umm... you alright? [sigh] [ding] never settle with power e*trade. it has powerful, easy-to-use tools to help you find opportunities, 24/7 support when you need answers
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let's send it over to mike santoli for a look at today's market action. >> scott, the market hanging in pretty well, taking to the message from jay powell that nothing too much is going to change too soon. we often get a rethink after the press conference, sometimes the next day or even in the days and weeks ahead. here are the fed meetings so far this year. one there, one here, one in late april and one in mid-june. you had a little bit of period of chop in the days and weeks subsequent but nothing has stayed down for long in this market take a look at the reflation versus specular growth trade banks against tech banks outpoerforming today. year to day basis, they've converged. tech is a little flat today. but banks are coming up and trying to kind of overtake again. so you see it's not really been one way or another all year. also on the kind of reflation, disinflation front look at the relationship between yields and small cap outperformance over big growth that's what the next chart
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shows. the blue line is the russell 2000 relative to the nasdaq 100. this is all year they've peaked around the same time the 10-year treasury yield peaked in march. traction in the 10-year, 1.25. we'll see if this reverses here. it does seem as if no taper any time soon means things can run hotter we're talking about smaller moves today. relatively incremental probably the way the fed likes it >> technology up again on that point. straight ahead -- facebook headlining a big hour of earnings after the bell we'll preview the key things to watch next in the market zone. millions of vulnerable americans struggle to get reliable transportation to their medical appointments.
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♪ the moment scott has been waiting for. 13 minutes to go in the trading day. are you ready? we are in the closing bell market zone. commercial-free coverage of all the action going into the close. mike santoli here to break down the crucial moments of the trading day. today we've also got ritholtz's josh brown back as well. we'll kick it off with the broader market major averages moving in different directions the s&p 500 and nasdaq higher today for the sixth time inthe last seven sessions while the dow is trading in the red. importantly, mike, the nasdaq is rebounding from yesterday's slide where it was the worst day for the nasdaq in a few months still seeing pain from apple microsoft is flat. google higher. >> it's a google, amd, facebook story. really small caps kind of stealing the show today. up close to 2% at least at one point. so, yeah, i think the message from powell to say, things are
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on track but not in any hurry to alter things is being absorbed okay doesn't give you a lot of incremental information at first. the treasury market seemed to say this might be tilted hawkish, but, no it wasn't. he's taking advantage of the fact there's no dot plot, no other committee member views to explain away or rationalize and create a confusion and he more or less said we're in no hurry that works the market is firmer than it might appear based on the s&p. >> josh brown, what's your read on the action today and heading into facebook? >> first of all, great to have you on our show, scott sara and i are appreciative you could join us today. >> pleasure is mine. >> well, i just -- i think i just want to -- >> josh owns the -- >> wednesday but, okay >> sorry >> one thing about apple, judge. i wasn't on halftime and feel it has to be said there's so much commentary about like, oh, why wasn't it up such great news. maybe that means the top is in
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apple is such an important stock. i really go back to this idea that most people have memories that don't last longer than 24 hours. this is a stock that's gone down, if you include today, on four of the last days after they reported earnings. so it always happens and in that stretch over those last four quarters, the stock is up the stock is up almost 60% that's a big deal because it's the largest company in the world. apple has added $800 billion in market cap since this quarter last year. so i feel like that's a very important part of the story. it goes very far toward explaining why you're not getting big follow through it's possible that markets are looking forward. not back ward and the news has been priced in and then some i think you can make the same case with microsoft. google is interesting. this is a much bigger reaction than i would have expected i think most of the excitement there is around youtube.
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$7 billion in quarterly revenue. this is a massive media property i thought they made a good -- they did a good job on the call. just explaining the fact there are some consumers where youtube is literally the only way advertisers can reach them they don't watch tv. they don't listen to the radio or read the newspaper. they kind of have a strangle hold on that market. facebook is trying in video but youtube is succeeding. i think that explains a lot of why big tech is where it is right now. again, there are six stocks that are 26% of the s&p, 40% of the nasdaq they really are the key to everything until you can make a convincing case that these stocks should for some reason be lower, i think it gives a lot of support to the market and that's why we're hanging in there to para phrase santoli. >> you can look at the extraordinary revenue growth numbers for each of the big
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three that reported yesterday after the bell and question whether it is legitimately in terms of that metric as good as it gets and what it means ultimately going forward. maybe there's a little bit of that the numbers were so blowout. it was unbelievable. >> it's unbelievable it's unbelievable to have companies that are this size not only posting the year over year growth and comprise -- surprising to the upside and bullish wall street consensus. there's no period in history that you can look at where we had corporations this large with this high of growth rates and these levels of profitability, look, 40% profit margins in some of the lines of business it makes no sense! it defies anything that we've ever been taught about competition and supply and demand so that's really important and on facebook tonight, just very quickly, this is a company that did $18 billion in the
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quarrel they're about to report tonight last year. tonight they're supposed to be $28 billion! here is another company that is going to add $10 billion in revenue based on consensus expectations also completely unheard of $3.53 a share versus $2.25 last year these are monster gains! now is it as good as it gets to answer your question, well, we don't know because the goal post changed i'll give you an example, facebook user growth is really only supposed to be, like, 11% it was 15% last quarter. that's not amazing especially not by facebook standards but the goal posts have shifted and we're not looking at user growth anymore. we understand there's a finite amount of humans on the planet what are we focussed on? modernization of the platforms, youtube, build out an e commerce, payment solutions. these are things that weren't important and now wall street is choosing to focus on them.
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that can happen for any of the other tech giants and that's why facebook looks great going into the numbers. we shift what we're focussed on. now we're focussed on profitability. great. facebook has a ton. >> yeah. we'll see what happens seven or eight minutes from now or thinks about. josh is with us for a little bit. pfizer is one of the biggest winners in the s&p 500 today after reporting earnings meg spoke to the drug maker's ceo and has the highlights. >> hey pfizer having a big beat in the quarter. much on top of the covid-19 vaccine which predicts bringing in $33.5 billion this year i talked to the ceo about the prospect of booster shots and what they're seeing in terms of an and waning protection. here is what he said. >> we've seen it in israel-- and
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impacting what used to be 100% against -- and now in a six month period it's becoming low 90s and middle to high 80s. >> guys, he said the good news is they have data. they just reported this morning showing a third dose of the original vaccine boost anti-body levels against the delta variant by five times for young people and 11 times for older people. so they are suggesting we are, indeed, will need a booster 6 to 12 months later. they have given the data to u.s. health regulators and others we'll have to see what they do. >> thank you news from the private sector coming in this afternoon, which i think is worth mentioning. google is going to bring workers back in october and require vaccinations for people coming back to work netflix, according to deadline, is going to require covid-19 vaccines for actors and other zone 1 personnel whatever that is and apple is now telling staff and people who come into the
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store they have to wear masks. is it going to come from the private sector as far as the vaccine mandates we'll see if they come soon enough, i guess that's the question shares of amd rallying today. the company seeing strong chip demand in gaming and data centers. the ceo is on "squawk on the street" earlier talking about the growthing strength in the pc market. >> the pc market has been very strong for very strong for last year and very strong the first half of this year. yes, we believe we gained revenue share. it was a record for our pc business, and we continue to believe that we're having more customers actually prefer, you know, amd given the strength of our products and the work we're doing with our customers. >> lisa su earlier mike, another big note for the stock up 7.6%. it often surprises on the upside. >> yeah. and often trades lower and people get reassured about the long-term story. it is, though, interesting today
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that it's just nosing above where it traded in january as a high i mean, spent nearly six months more or less sideways after a massive run. it's probably pretty encouraging what she's saying about this and it reflected in the relative sluggishes today it's working and growing into a towering evaluation and now it's more reasonable. facebook will lead another hour of earnings after the bell. julia has a preview of what to expect julia? >> well, facebook shares are up over 20 percent since the company's last earnings. 82% of analysts have a buyer overweight waiting on the stock. the question whether it can keep growing revenue faster than expectations analysts are looking for 49% revenue growth to $27.9 billion. and revenue has beaten consensus 18 of the past 20 quarters investors will be focussed on any guidance after snap and
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twitter issued bullish third quarter revenue guidance today spot fie was bullish about advertising and other growth coming ahead guys, back over to you. >> julia, thank you. we've got about two minutes to go in the trading day. a little over that mike, what are you seeing in the market internals in the dow down more than 100 points. >> yeah. a lot of sloshing around in the indexes today. a little bit of turn around in the flat line for the s&p 5700 as mentioned earlier we look at new york stock exchange prep advancing volume more than triple what declining volume is. they mentioned the small cap firmness this is kind of countering some of the weakness we've seen over the course of the last few weeks. take a look at the nasdaq. new 52-week highs and lows keep taking a snapshot of this metric it's been a little bit counter intuitive. we've had more lows than highs for a few days now i think it's maybe 10 of the last 14 days showing you a lot of smaller names are falling by
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the wayside. this list of the new lows is a lot of small buyout teches and things like that you can write it off but it's creating a little bit of a drag. then volatility index came in, as you would expect after the fed meeting passed you have the known catalyst on the calendar and got a little bit of a build up above 20 yesterday and down below 18. in tact and keeping the down trend in place but not crashing into lows. maybe the summer friday action that will happen in a couple of days. >> nasdaq the outperformer today. right now the nasdaq is good for 108 points that's where the focus is. mike was talking about it. josh was talking about some of the megacap tech performance following their earnings we are building up to facebook, which does report after the bell today. so you get another great read into big cap tech. [ cheers and applause [ cheers and applause
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[ closing bell ] [ cheers and applause >> no idea we're getting -- [ cheers and applause welcome back to "closing bell. i'm sara eisen here with scott walker and mike santolli take a look how we finished up the day on wall street dow closed lower under 28 points the biggest drag on the dow today was unc, mcdonalds, visa, american express and boeing was the biggest winner s&p 500 and the just about flat. weakness in consumer staples, utilities, and real estate and strength in energy
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and communication services and health care. google and facebook a big part of the story there the nasdaq did well today. it was google and facebook story. invid ya did well and so did moderna. microsoft ending the day about flat the russell 2,000 index the big winner up 1.5% we saw the higher treasury yields jay powell making it clear he's in the a hurry to take away the punch bowl get set for another wild hour of earnings ahead facebook, qualcomm we'll break down the numbers as soon as they're released and robin hood we'll bring the news as soon as it's out and transportation secretary
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scott buttigieg. qualcomm just out. >> eight on the top and bottom lines for the fiscal q 3 and a beat on the guide. so the numbers qualcomm turns in revenue of $8 billion versus $7.58 expected eps nongap of $1.92 versus $1.68 expected for q4, they're guiding to a range of eps $2.15 to $2.35 versus $2.04 expected. and the gap revenue guide is $8.4 billion to $9.2 billion so the standout here in these earnings is everything but phones not that phones are bad, but the other segments including iot and
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automotive, those grew 83% year over year and 1.6 times the rate of mobile chip growth. so for those who are used to thinking of qualcomm as a proxy for smartphones. the ceo earlier this month told me, hey, the biggest challenge is to get people thinking about qualcomm but the report is first step in that direction given the rate of growth in things outside of phones. of course, we'll listen for the geographic break down for how qualcomm is doing last quarter they talked about how they were able to work the supply chain and get around the chip shortage issues it appears they may have done it again, sara. >> yeah. lice licensing strong, as well. the stocks up more than 2 more than after hours don't miss john's interview with the ceo of qualcomm tomorrow let's talk about the market. joining us at the top of the hour is josh brad is still with us mark is with us from ever corps.
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isi joining the conversation with the big cap tech earnings, first, the comment to you, mike. on qualcomm or the close. >> qualcomm is working off a 15% drop from the high that's a little bit of a reassurance. pretty good guidance lift, as well you know, i think the market has been dealing with it its own issues, which is everyone is expecting earnings to be great and the bar has been high. you've had a little bit of a sense of deceleration. not sure what the bond market is trying to tell us. 10-year yields couldn't hold the minor rise they had after the fed. i think that kind of fed into a little bit of a soft close but, hey, .5% from all-time highs market getting more reasonably valued earnings are up not less i think it's the flow issues are a little bit of a challenge for the market right here as get into a rougher seasonal point. but so far it's hard to kind of pull the benefit of the doubt away from stocks where they've been acting. >> josh brown, what do you take from qualcomm? i mean, we're going to have to hear about chip shortage and things like that once the call
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starts that's what is going to matter most is the outlook of relative to that issue. >> it's an extremely high quality business i know there's a big cohort of investors who think the stock is misunderstood but maybe it isn't. maybe people recognize that some of the markets they sell into aren't terribly exciting and there's not a ton of -- there's not a ton of innovation here even though the companies got a extremely valuable ip, which everyone is aware of trades about a 2% dividend yield. it's not terribly expensive as far as chips go or large cap tech i think the stock is okay. i didn't see above 167d 0 to get excited to feel there's a break out coming until then a little bit of a no-man's-land technically. >> okay. let's go to phil lebeau. ford's results out. >> it is a profit not a lot but
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the street was expecting a loss instead ford boosts a profit of 14 cents a share they were expecting a loss of 3 cents. revenue a little light of expectations at $24.13 billion they cut their production by 50% in the second quarter. we knew that second quarter would be challenging what is the outlook? that's what people are focussed on four important pieces of news that ford is making today. first of all, it's full year e bit is up by 3 $3.5 billion. that's a nice increase from $9 to $10 billion for the full year second of all, the full year free cash flow raising it from $4 billion to $5 billion in the second half, the volumes, this is the important one, it's going to be up by 30% compared to the first half. so you can see that the semiconductor chip crisis is easing in the eyes of ford, in terms of how quickly they'll be able to start ramping up production again speaking of expectations, the
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f-150 reservations now top 120,000. there you have it on ford. better than expected earnings with a profit of 13 cents a share. back to you. >> appreciate it we understand facebook's earnings are out julia has those. hi, julia. >> facebook leading on the top and bottom line reporting revenues earnings beatingestments with $3.61 per share versus the $3.03 estimates. but we see the stock moving lower in afterhours. it appears to be tied to the company's guidance they note that advertising revenues growth in second quarter was driven by 47% increase in average price per ad a 6% price per increase in the number of ads. in the third and fourth quarter we expect total revenue growth rate to decelerate
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they also say when viewing growth in a two-year basis to exclude the impact of covid. we expect year over year two-year total revenue growth to decelerate modestly in the second half of '21 they said we continue to expect increased ad targeting head winds in 2021 from regulatory and platform changes notedly the recent ios the apple operating system updates, which expect to have a greater impact in the third quarter compared to the second they said this is factoring into our outlook. so that stock is now down nearly 5% after hours now 5% after hours despite beating on the top and bottom line we'll dig into the results and get back to you with more. >> julia, thank you. mark i'll go to you on that. perhaps wall street knew that the comps would be tough from the covid environment. what is surprising they expect year over year two year growth comparing it to 2019 to zeal rate modestly in the second half of 2021. is there a disappointment to
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you? >> no, i think they had said they used that fed speak on this company. they used a language of significant zdeceleration last quarter. you had google that put up 10% upside this company put upside to the street but not that high i think there were expectations, including ours, they could print as much as $30 billion everybody was looking for upside they didn't get quite as much. nothing changed for the fundamental long-term investor but the near term expectations came in light versus that. now you're looking at a tough constant back half of the year i don't know if the deceleration will be significant or not my guess they overstated that. i guess deceleration will be harder for any stock we could see a consolidation to year to date gains in the back half of the year. >> if growth is slowing, in any way, shape, or form, mark, it doesn't cause you to rethink your rating on the stock in, i
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me me mean, it has to happen at some point if the growth rate is going to slow. >> yes it depends on whether they'll maintain premium growth rate i'm certain they'll get premium growth rate for the next three to five years. i mean 20% plus top and bottom line growth. probably better than that on the bottom line. step back. what is the evaluation like on facebook today it presents as trading something like 26 times gap earnings if you take out the cash, and investors should want to know how much are you investing in virtual reality. i think they invest more than they realize i think the company is under earning. i think it trades at 22 or 23 times earnings i think that's fundamentally attractive for the asset doing for the next two or three years. and that scale that's rare we like the stock but near term wouldn't be surprised to see consolidation. >> mike, they said they expect ad targeting heads winds from regulatory and platform changes and the ios updates, that's
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something investors have been watching carefully hasn't affected the companies yet. >> no. i think you can probably say there's a note of caution or excess caution in how they describe these things. they want to be out there saying they're tentative to them. i don't think, i mean, the consensus was basically irrelevant on this i mean, it barely went up since the end of april in terms of the quarter's eps and the stock up 22% or something i think it shows the mismatch mark was talking abouting. i think you have to be on board for that it's been the case for a long time it's not been in the management of facebook's interest to bring a lot of attention on how profoundly profitable and great this business is you know, it doesn't make sense to say we can't help but make all the money. so i think you can kind of maybe kind of use that as a filter how you interpret their cautious statements. >> it's astounding when you make $29 billion in a quarter in terms of sales josh, you're an alphabet guy
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you don't own shares of facebook anymore. as someone characterized it earlier they said mark zuckerberg was teflon. in many respects this stock has been, too. despite the regulatory issues and the chatter around it, the stock has held up well what do you think now? >> it has. i would point out it closed at $350 share on thursday of last week it's like six days later it's quote, unquote, selling off at $3.57. if you're a buyer a week ago you're up. it's not like it's having a catastrophic reaction. i prefer alphabet. i almost always have again i think the story with facebook is about how profitable the company is even if you think the platform change at ios is getting people changing their ad preferences to disable tracking, which, by the way, i don't think it'll happen. even if you think it'll happen, i don't think it'll have that
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big of an impact what could have a major impact, positive impact for facebook is as they build out the commerce platform they're deadly serious about challenging all of the e commerce players right now and doing everything soup to nuts. the payments part of it and all of the tracking internally on their own platform that could be a very big deal a couple of years from now they seem to be going without it very deliberately. so i think people that are bullish on facebook now are more focussed on that and they understand the idea they're always going to be platform changes that may threaten some aspects of their profitability i don't think you can get away from that as a shareholder of facebook i think that is priced in. that's why it's not selling 30 times earnings it's closer to 20 times. people get it. >> mark, i'll give you the final word apple back up 3% facebook down 4% after hours and we've got amazon tomorrow. is amazon still the favorite for
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you? >> yeah. a lot of this near term comps and being tactical about the stocks amazon forward last year went into tough comp period and the stock went sideways for a better part of seven months i don't think it's going to be the same case with google and facebook i think those gains probably consolidate as you go through the next kind of three to four months it's a better market environment for growth now secular in the back half of the year versus the first half i think the stocks consolidate the evaluations are very reasonable, i think, just growth slows down because of tough comes, the market will step aside a little bit people will come back to it with more confidence in' 22 and '23 they've had great rub -- runs. buy amazon instead. >> all right we'll see. speaking of, reports earnings tomorrow thank you. up next, more reaction to facebook's earnings and what investors should be listening for on the conference call when
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we're joined with an analyst plus, the ceo of jetblue on the airline's earnings and whether rising covid concerns could hurt future bookings later transportation secretary pete buttigieg on how the new bipartisan infrastructure deal will be paid for, if, a big if, if it becomes law. back in two minutes. (sound of people returning to the workplace) (sound of a busy office) (phones ringing, people talking, meeting) the company we've trusted to keep us working remotely, is the same company we'll trust to bring us back together.
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facebook is lower after hours warning on revenues. we'll get to jeweulia on more. >> in addition to that revenue warning of head winds ahead, i want to dig into the user numbers here if you look at the user numbers in the u.s. daily active users and monthly active users both flat between the first quarter and second quarter so 259 million monthly active users in the u.s. just like the prior quarter. daily active users 195 million unchanged from q 1 the other thing i want to mention is while the user base
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is growing, it is that growth is slowing. so decelerating growth both daily active users for the entirely of facebook and monthly both decelerating from q 1 to q 2. sara >> i know we always miss these large numbers, mike. is this a case of long large numbers or something to be worried about? >> partially the case of the massive base effect. it's harder to grow when you have an large set. there's no doubt about that. but, again, it's relative to expectations if you thought they would be able to outperform it, they did. that accounts for some of the disappointment. >> all right we'll bring in cnbc contributor ed lee it's good to have you with us. what julia told us, the decelerating growth and dau and mau. significant or not >> facebook is closed to saturation levels. they're getting close. i think this was anticipated
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probably show the same numbers in q4 it would be a bigger -- right now i think you have this. and also one thing i would highlight is when they talk about the second half deceleration and the two-year stag, if you run through the numbers, giving you -- much about what wall street is right now. and telling you want to do it and going have modest deceleration you have more than 50% growth on a two-year stack if you do the math versus 2019, the numbers come out to be much about. this is a confusing language they'll give them a pass on the user growth but realize the growth is really -- here at facebook. >> okay. and are you sticking with your guns here on the facebook? you have a buy and 380 is not
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much above with the stock is currently trading. it sounds like you're about to pull something out that is a little higher than that in terms of price target, am i right? >> for what i would say is there's a lot of unmonetized in this area that keeps growing it's a very cheap stock for the amount of catalysts that facebook has so we like facebook. >> ed, how do you interpret the warnings from facebook on second half revenues? especially around ad targeting how concerned should investors be about that? >> i think the platform issue is actually sort of the key issue for facebook i think mark zuckerberg has recently talked about what he calls the term of art that a lot of techies use you're living in this other, you
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know, cyberspace tech universe that's really a prelude to him saying, well, we want you to buy more they need to own a platform because what we're seeing on ios and the fact they're seeing the head winds on the ad targeting front, you know, i as a user, when i get that message, you know, do not allow tracking. i say don't allow tracking you know, and i suspect a lot of people do the same so they're seeing that already and i think it's hurting them. because they don't own a platform the way that apple or google does. i think that will be a major factor i also think, you know, if you look at the saturation point, i agree with that. i mean, they're growing their monthly active users about 7%. last quarter it was 8% but they're delivering ads at a slightly lower clip. 6% more ads delivered. they're trying to match the gap there. they don't want to flood you with too many ads but they're running out of room and they're only getting the ad revenue that the bumps in ad pricing, which is nice but they're going run
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out of room there. i'm surprised they didn't do better on the ad front for that past quarter 56% i mean, if you look at youtube 84%. a lot of e commerce based. i'm surprised facebook hasn't taken better advantage of more direct e commerce sales through their ad platform. i think there's a lot to worry about. >> still total revenue growth 56% year on year and it underscores the comps that are going to be extraordinarily tough for all of these companies that delivered it it's unbelievably high numbers in the last 24 hours. >> yeah, no, they have different comps but so much about facebook's advantage is competitive advantage even relative to google it has a lot of targetable data and because they know so much about you. they know your name, your location, and everything it's stuff you input yourself. and, you know, they relied so much in that and the fact it is starting to go away is starting to hurt them they're facing more head winds
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than google does or other, you know, big ad players like amazon which is reporting tomorrow. i think amazon, you know, their advertising will start becoming even more significant and, you know, now entering the triathlete phase of digital advertising where amazon is the third big player so not owning the platform i think it's a big deal for facebook. >> down 3% after hours thank you for joining us today one stock that has outperformed facebook over the last year is paypal. those earnings are just out. kate rooney has the numbers. >> hey paypal stock down more than 7% after hours following a -- top line for the second quarter and lower than expected guidance this is due to e bay head winds. ebay has been transitioning to the own payment platform and off of paypal. revenue coming at $6.24 billion. just shy of what wall street was looking for. it was up 19% year over year and bottom line adjusted earnings coming in at $1.15.
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it was 3 cents better than estimates. 311 billion for the quarter. paypal is upping the full year guidance for payment volume. guidance for the third revenue and eps. they're citing a negative effect from e bay no longer using paypal paypal did up the full year guidance last quarter it's maintaining the 25.8 billion total accounts for paypal to thing $400 million in the quarter. that's up 16%. the quick note on venmo the app had 58% growth year over year. the stock is down big here after hours. down 8% now. guys, back to you. >> yeah. a lot of surprises there kate, thank you. up next on the show, the ceo of jetblue on how the cdc's new mask guidelines and rising covid
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cases across the country could impact his airline industry. speaking of, transportation secretary pete buttigieg on the new bipartisan infrastructure deal ithn e senate we'll be right back on "closing bell." rush hour will never feel the same. experience, thrilling performance from our
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i invested in invesco qqq a fund that invests in the innovators of the nasdaq 100 like you become an agent of innovation with invesco qqq shares of jetblue are higher today after falling nearly 7%
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yesterday. they showed a narrower loss than expected the airline said leisure demand was more robust than anticipated which helped lift revenue but down 29% compared to 2019. jetblue crow robin hayes joining us now phil is with us. good to see you, sir welcome to "closing bell." >> thank you so much great to be here. >> how would you characterize the current state of leisure travel as you're seeing it now some the other airlines ceos have been optimistic over the last week or so. >> yeah. we're optimistic we guided revenues down between 4 to 9% over 2019 levels so we've really seen a very, very strong recovery in all of our key leisure markets. what about the delta variant and
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the cdc news on the mask how does that factor into a wild card for the next severalmans? >> we've been living this for awhile now what we have seen is several months now vaccination is an important catalyst for people to feel comfortable flying again in terms the pent up demand for travel that is still true there's a lot of people who want to travel this summer that haven't. so i'm expecting the rest of summer to stay strong here as of now, we haven't seen an impact with the delta variant. that's something we continue to watch for. >> there is news today on the uk finally letting american and european vaccinated travelers come in without vaccines -- excuse me, without quarantine. i know willfred would be asking about this you had a planned launch for august but i think you've been scaling it down, robin how much of a game-changer is a decision like today?
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how much will you need to see the americans do something similar before you can look at returning to full daily service? >> yeah. first of all, it's great news. how many times have i been on the show talking about the issue. so our flight is here and first flight goes to london out of jfk on the 11th. it's great news. it basically opens up now the uk for americans and for expats living here. as a u.s. airline we always expected most of our business to come from this end so we're excited we're going it fly the schedule as planned we have taken about 12 flights out of the september schedule and planning to fly full schedule in october and november i think we see that demand come back so it's great news today we've seen this morning daily bookings to the uk double since the news was out. >> just today. wow.
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>> yeah. >> clearly -- i want to talk about the revenue guidance numbers. down 4 to 9% which was better than expected and better than some of your direct competitors like southwest and alaska. why are you seeing a quicker revenue recovery >> i think a number of things, you know, we announced the credit card partnership with mastercard you know, jetblue is well positioned for pleasure and business we have a great network to the caribbean. you know, we have some new fare structures in place now, which, again, are creating lots of different options for people we have the northeast alliance the partnership with myles, wh -- american airlines. we've never been able to grow before it's a lot of great work we're coming together at the same time and remainstreamly --
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extremely bullish. there it's phil here do you expect the mask mandate to continue past september 13th? >> well, you know, we certainly, i mean, i think we're digesting the news today i think what we have learned, phil, to take it a week at a time a month at a time. you know, my focus is in the safety of the crew members it can be extremely difficult but at the end of the day, it's a requirement. people that fly need to comply with the fedrequirements there are people fighting back from time to time and unruly passengers
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do you think if it's extended it doesn't change the equation in terms of people planning their flights for the fall and later this year? >> i agree i think people have accepted it. you look at the factors, you know, high 80s and low 90s the planes are full. >> why not require vaccines to fly in our country our colleague said there's a huge opportunity for the industry to change the entire dynamic around vaccines. do you agree with that >> i think one of the challenges there are, you know, there are so many flights every day. there are 2 million plus people flying how would you operationalize that in a way that makes sense
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more and more people are getting vaccinated and more and more people are flying and getting vaccinated if you want testing alternatives to vaccinations, that can also get difficult because, you know, people fly today in the usa than testing capacity for covid tests. woe need to encourage people to get vaccinated and case counts will come down and people will feel safer to travel we've demonstrated how safe travel is with the masking and cleaning protocols it's a safe way to fly. >> robin, thank you. we'll talk to you soon phil >> thank you still ahead, we're awaiting robinhood's highly anticipated ipo prizing. we'll bring it as soon as it happens. and later pete buttigieg on is what in the new bipartisan senate infrastructure bill all around you...
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relax people, my wireless is crushing it. okay, that's because you all have xfinity mobile. it's wireless so good, it keeps one upping itself. time for a cnbc news update. from the news here's what's happening. president biden checking out big rigs and pushing new buy american protocols at a truck
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factory in pennsylvania today. telling workers about his plan to create jobs by requiring the u.s. government to buy products that are at least 60% manufactured here in america the fbi finishing its investigation into a mass shooter who killed eight people at a fedex facility near the indianapolis airport happened back in april the fbi behavioral analysis unit reports that shooter wanted to commit suicide in a way that would demonstrate his masculinity. that he was indiscriminate in whom he shot and acted alone and our gymnasts are getting ready for olympic's women's all around competition without one of their biggest stars simone biles sitting out tomorrow but considering a go for individual gold next week. biels said she got the twisties during a team competition and that was a major factor in her decision to withdrawal tonight the down low on the
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tw twisties and why they can be dangerous. we'll hear from a sports psychologists about elite athletes and their health. thank you. an earnings alert on young china. kate rogers has the numbers. hey, kailt. >> hey the stock moving lower here in the after hours. we take you through the second quarter. earnings missed estimatings coming at 42 cents adjusted compared to analyst. revenues in line with estimates at 2.45 billion for the second quarter. the company saying it's overall same same-store sales up 5% pizza hut performed better than kfc adding rising commodity prices will become a head wind and likely turn to inflationary pressure this year also adding the recovery trajectory in the quarter was disrupted by the delta variant outbreak in southern china impacting about 400 locations at the peak of that we'll bring you any other updates as we get them back over to you. >> kate rogers, thank you. up next u.s. transportation
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secretary pete buttigieg joining us live on the back of the new bipartisanen sate infrastructure bill "closing bell" will be right back we listen. like jack. he wanted a streamlined version he could access anywhere, no download necessary. and kim. she wanted to execute a pre-set trade strategy in seconds. so we gave 'em thinkorswim web. because platforms this innovative, aren't just made for traders - they're made by them. thinkorswim trading. from td ameritrade. (sound of people returning to the workplace) (sound of a busy office) (phones ringing, people talking, meeting) the company we've trusted to keep us working remotely,
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key senatorings announcing today they're ready to move forward on the bipartisan infrastructure bill. tough negotiators saying the two sides have an agreement on major issues but it's unclear whether the deal has enough votes to pass transportation secretary pete buttigieg joining us now welcome back, secretary
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buttigieg. >> thank you good to be with you again. >> my first question to you is on the size. $550 billion i thought you were targeting more like a trillion dollars $550 billion is a step but over the next ten years, it's not as big when it could be when talking about rebuilding infrastructure. >> let me be clear on that, that's talking about the amount that is new over and above the baseline this is still a bill that is over a trillion dollars in the years ahead. it represents just in the transportation categories across them, depending on the category, about two-thirds of what the president was initially proposing back in the springtime when he put forward the american jobs plan. this is a massive investment for example, over $100 billion on roads, bridges, and major projects the most we've done for bridges since they built the interstate highway system in the first place under eisenhower it's the most we've done for public transit approaching $40 billion. the most we've done federally in
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the history of the country most we've done for the past rail track was set up. investing in new areas that nobody was thinking about in the eisenhower days like broadband we have to make sure that every american can get broadband access this is a vision to see that through with the, i believe, $65 billion put toward making sure every american gets fast an affordable internet. it's a historic and generational investment i think it speaks to how urgent it is. you have business leaders and labor union leaders who didn't necessarily agree on much when it comes to the economy saying we've got to do this. >> so agreed thank you for clarifying the overall amount how does it get paid for what was the agreement there >> so there are a number of measures that make sure there is paid for everything from targeted corporate user fees to making sure that we redirect some of the prior generations of covid relief spending that turn out
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not to be needed let me be clear, we won't take rescue plan dollars away from a transit agency or anything like that let me mention the fact that infrastructure investments, especially this type, have a return on the investments. they're going to create macro economic growth that will have a return to the treasury and to the american people. it's not just me saying it it's independent analysis after analysis by economists talking about how we will create more economic growth in this country and millions more jobs, if we do this i think that's part of why you see the remarkable thing even in today's bitterly divided washington of democratic and republican senators side by side with the president saying we have a deal. >> scott walker, mr. secretary do you have the votes? do you have 60 needed? >> we believe so you know, you have a group of democrats and a group of republicans who have each been at the table with the idea they can take this back to their caucuses and get the votes
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it will be an important procedural vote very soon to get the ball rolling on putting staff and bring the final test to the floor of the senate and don't think they would be saying so unless they mean it obviously there's all the twists and turns in the legislative process but today is a big moment you know, about a month since the president walked out of the west point and those republican and democratic senators with the broad outlines of a deal in that month since, we've been coloring in the lines and getting the details lined up and delighted to see this. it will be a historic investment, if we can get it through both chambers and on to the president's desk for a signature. >> speaker nancy pelosi said she won't consider a bipartisan bill without a, quote, "human infrastructure bill. there's word today from senator kyrsten sinema who is getting this toward the goal line saying she doesn't support a $3.5 trillion plan by the dps either how big of a problem is?
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>> as i understand it, it sounded like she was going to support getting the ball rolling on that process, too but, of course, again, you know, it's one thing to have a framework. it's another to fill in the details. that's going to be needed in order to get the support of at least 50 senates, including her so it can move what i'll say as an administration, we believe in both we believe in the bipartisan framework, the bipartisan deal that is going to get us this physical infrastructure. we also believe in what we've been calling the human infrastructure but call it whatever you like. the idea that we got to do more around making sure health care and child care and education are affordable in this country and at least from my dime, i would argue there's no reason why republicans couldn't support that, too. even though i know it's a little less likely. >> are you tieing these two together in the reconciliation bill and the infrastructure bill >> they're separate packages but the president supports them both and expects to sign them both. >> all right secreta secretary buttigieg, my question on timing.
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how long do you think it'll take to do the projects you've outlined get the regulatory approvals and cut through the red tape we learned in 2009 there's no such thing as shovel-ready projects. >> i visit communities across the country and talk to mayors and transit authority leaders and governors, i've seen there are some things they could hit go on tomorrow some things are underway they go faster if they have more funding. other things will take longer. i want to emphasize this is a little bit different than the 2009 bill. that was a stimulus. that was about getting out of the economic hole. this is about preparing the economy for the future and so there's a focus not just on shovel-ready projects that we could be working on literally immediately as soon as that funding clears but also what i would call shovel-worthy projects projects that will define what it is like to live in the united states in the 2030s, '40s, and '50s we have allowed this country to fall behind. >> let's be clear, though, i mean, you said the president
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wants both packages but physical and human. will he sign one without the other? that remains an open question. >> el with, obviously, there's a question about how congress is going to proceed and how the proceed yurl mechanics work and we leave it to congress and we trust the leadership to go ahead and bring those forward. but the president will keep his word believes in this bipartisan deal and, of course, he believes in the rest of his economic vision. again, i'm going it say one more time, i think there's no reason why at least a few republicans shouldn't be willing to support things like paid family leave in this country or free community college or making sure 3 and 4-year-olds can go to pre-k or making sure it's affordable to have child care, no matter your income in this country i'll continue to push for that to be bipartisan, too. but if it has to move with only democratic votes, so be it it's important one way or the other it happens. >> the tax increases, mr.
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secretary, and also the general expanding of government and government entitlements and both of those things are very against republican ideology. >>well, if you look across the country, you don't have to be republican to believe, for example, in paid family leave. most americans think we ought to do this. as for the taxes, one of the things we found in the president's vision, which, whicd things like closing loopholes or making sure there's enforcements so that wealthy people who cheat on their taxes are caught and that we get that revenue that's something that maybe not in washington but around america people from both parties see a lot of common sense in >> secretary pete buttigieg, thank you for joining us to talk about this deal. >> thanks for having me. >> transportation secretary of the u.s. still ahead on the show, we are still awaiting robinhood's ipo pricing, what to watch for ahead of that coanmpy's highly anticipated market debut next.
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let's check in on this afternoon's biggest earnings movers, facebook topping estimates across the board strong revenue growth. the stock did fall on a revenue warning. it's down almost 4% after hours. qualcomm beating, ford
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shares moving higher on a stronger than expected profit. paypal down 6% mixed results. tomorrow another busy day for earnings, of course. the key report after the bell welcome amazon we hear from our parent company comcast, yum brands, gilead, pinterest and t-mobile also on tap for tomorrow, robinhood's ipo. let's bring in leslie picker for more on what we can expect. >> hey, scott, interesting timing to price an ipo with all of this market moving news robinhood is finalizing its ipo price. the company looking to raise about $2.2 billion at the midpoint of the range it had been marketing to investors. robinhood and its underwriters are using an auction like system to garner bids of various prices from institutional and retail investors. they'll use that as an input into their decision-making to come up with a final price here. now, the bear investors that i've spoken with, they point out the regulatory risks, the potential slowdown in fundamentals
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the larger than usual retail allocation and small employee lockup lift, which could drive volatility but, the bulls like its massive top-line growth. we'll see how that translates into pricing within the next hour or so, feis. >> leslie picker, thank you. is this going to be the mother of all meme stocks >> you know, you would think it should be kind of a compounding of the meme stocks you have to be prepared for the fact that all the hype has preceded the deal itself has the look of a cashout for insiders as well as you're paying back the emergency providers of capital back when they needed the money back in february so there's a catalyst to this deal happening now that's also interesting because if you're letting your own investors, your own clients buy up to a third of this deal, it complicates the pricing. you don't want to maximize every dollar you get from them one final point is the consumer facing buzzy app companies that have come public in the last few
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years have been disappointments. airbnb, doordash, bumble, think all had this great long-term story, and they've traded a little -- not terribly but a little sloppily they have underperformed since their first listing. >> a lot of the larger ipos were not done well initially out of the gates or, you know, shortly thereafter so that's going to be an issue perhaps too. >> i think maybe some likely buyers of robinhood shares would be older investors that just don't get it and they want a psychological hedge, if you're short amc, you might as well own some robinhood market stock as a hedge. >> they're growing really fast great name recognition to leslie's point >> it's a call option on the future of investors and how they're going to operate. >> what are you going to be watching >> amazon should be huge, mostly for amazon as opposed to becoming a bellwether. it does not always carry over. where facebook's trading at right now.
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>> facebook down about 3% after hours. google closed up 3%, strong earnings, strong guidance there. it's going to be compared. >> with the big swings relative toy expectations, these are small moves for the sftocks. >> that's a good point >> that's going to do it for us on "closing bell," thank you, scott wapner "fast money" coming up next. sales are down from last quarter but we are hoping things will pick up by q3. yeah...uh... doug? sorry about that. umm... you alright? [sigh] [ding] never settle with power e*trade. it has powerful, easy-to-use tools to help you find opportunities, 24/7 support when you need answers plus some of the lowest options and futures contract prices around.
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life in the nasdaq market side overlooking new york city's times square this is "fast money. i'm melissa lee tonight on "fast," we are awaiting pricing for one of the hottest ipos of the year robinhood numbers expected at any moment our teams working the phones will bring it to you as soon as we've got it we're tracking after hours action, shares of facebook, ford and paypal, we're breaking down the numbers. and later cme group ceo terry


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