tv Power Lunch CNBC October 15, 2021 2:00pm-3:00pm EDT
get an audit notice. that's why they have been raising a lot of money from these respectsy notice. >> that would be enough i would think to dissuade a lot of people from making that choice maybe that's the point robert frank thank you. that does it for "the exch exchange", "power lunch" begins root now move your dog, change your dentist, pick a different school you have got to do it. it is not just 183 days, folks you have got to move welcome, everybody, to "power lunch. here's what's ahead. as for you all my friends who have gone south to florida bitcoin's watershed moment price is $60,000 as the s.e.c. gets set to apparently allow a futures etf a potential step to opening the crypto market to a much wider audience. consumer spending rose despite shortages rising prices,
and the delta variant. and it is not just shipping and trucking bottle necks. it is not just covid there are forces at play that no one is talking about, and they could really transform the globe economy. quick check on the markets they are off the session highs the dow is up 365 right now. a 1rz gain, a strong two-day rally. jp hunt is on track for a record close with today's nearly 10% gain, this after reporting strong quarterly results moderna taking a dips on reports the fda deleted its application for covid in teens and the fda votes in favor of johnson & johnson covid booster for folks 18 and older any time two months after you received
the first one. it has j&j shares up a little less than 1% take a look at bitcoin which i believe after topping the $60,000 for the first time in six months is above 61 tlouds right now. traders are optimistic they will get the green light to go ahead with the futures etf. >> they are bracing for the start of trading of the first bitcoin futures etf on tuesday when the pro shares bitcoin strategy etf is scheduled to begin trading at the new york stock exchange the etf is based on bitcoin futures contracts that trade on the cme. there is one catch here. the etf will go active and start trading unless the s.e.c. objects to it and the filing that could happen, believe it or not, right up until the evening before it begins trading now, some are disappoint in addition the s.e.c. is poised to approve a bitcoin futures etf
but not a plaur play bitcoin etf. they are arguing that the cost of rolling over into futures contracts for that futures bitcoin etf every month can be very high and won't necessarily exactly track bitcoin as well. that's true. however, most into crypto and etf community seem happy with half a loaf rather than none at all. s.e.c. chair gary gensler has indicated he's very concerned about fraud and manipulation on crypto exchanges, approving a regulated futures bitcoin etf would remove some of those concerns over custody and fraud as well. and show the pro shares etf begin trading on tuesday, there are four other futures etfs that will likely begin trading in the days and weeks ahead what happened, there is pressure on gensler to do something, a confluence of two big forces, the etf community and the crypto
community who both want something to get going right now. it looks like for the moment a futures bitcoin etf is in the cards. >> how did the pro shares one end up becoming the first out of the gate are there any chances they could pull the plug? >> yes this is one of those things that's called first filing normally the s.e.c. when you have essentially similar products, they will approve -- allow the first one that's been filed to start trading first in theory, they could stop this all the way up until midnight on monday but there is a history of this, and this is why people are fairly confident they are not. if they were going to stop this, they would have indicated already because you do a filing, you have to file paperwork months ahead of time and the s.e.c. responds to that. they give you comment. if they think there is something wrong, that there is a defect in the filing they will tell you historically wooks ahead of time you have got a problem, you
better cure this defect or we are not going to allow it to happen they haven't done that legally it is within their purview to stop it but it is unlikely a news alert on disney let's get out to julia boorstin. >> there's a report out from puck, this is a new news outlet, saying that bob chapek, disney's ceo asked some of his deputies to explore the strategic rationale for potentially spinning off espn. this is according to a report by dylan buyers this is sending disney shares up nearly 2%. the question is whether there is perhaps more opportunity and more value to be unlocked in espn in sprarting it from the rest of the disney assets. i reached out to the company for comment. we will be back with more as we learn more. >> interesting story there
espn once so much of a home run for disney now, apparently, possibly a spin-off campaign. back to bitcoin. not only are prices getting a boost today but bitcoin mining stocks are also getting a bid. not only because prices are rising but because of global supply chain disruptions kate rooney explains what does a supply chain have to do with this. >> it is a very good time to be a bitcoin miner as long as you are not in china that's because the chinese government banned bitcoin mining altogether at its peak china about 80% of the market share they now have zero miners don't have to worry much about new competition. that's because of the global chip shortage. it made it nearly impossible for those leaving china to get new mining equipment the minting process that requires the high powered computers you are looking at
with special computer chips that are already in high demand from other industries as well as other key electrical hardware that are right now caught up in shipping backlogs. bottom line, a bitcoin bonanza for those existing miners. u.s. miners are collecting an estimated 90% margin, guys the main cost for those companies right now is energy bills. reward, a new bitcoin, which you can take a look, topped $60,000 today. d.a. davidson put it in a note this week, with bitcoin prizes rising these companies are quote literally printing money they initiated coverage of bitcoin mining stocks. they see 5a 606% upside. but the stocks are highly leveraged to volatile bitcoin prices as well and its competition is likely to pick
up they may see more competition once the supply chain is unclogged. >> what happens to miners' profitability in a crypto downturn i think you said they are making margins of 90% even if their power costs and their computing costs go up, they have still got a lot of cushion with which to make money? >> a lot of cushion there. in order to be bullish on these names, you have to be bullish on bitcoin. the prices are extremely relate. analysts talked about crypto winter a couple years ago when prices dropped 80% that weeded out the companies that couldn't be profitable around the $10,000 range d.a. davidson estimates a 14% drop in cryptocurrency prices and says they can still be profitable there but like you said with 90% margins they have cushion. competition is going to be the main thing once the issues are unclogged,
chinese miners are able to get back into the aircraft they are going to be gunning for the business we went to some of the companies down in texas. they are in a good position at least for the near term. >> quickly, where do we think the chinese bitcoin miners decamped to. >> rockdale, texas, new york, wyoming. the u.s. states are gunning to get that new business. >> with the s.e.c. getting closer, it appears, to approving a bitcoin futures etf, wall street beginning to embrace the stocks states 5ding it to their balance sheet. is this bitcoin's moment to prove it belongs in your portfolio. our guest. let's start with the basic building blocks. what would the sanctions of a bitcoin etf futures mean to the price of bitcoin, to the underlying asset what would it do >> it would obviously be bullish. what you would have in the
futures product is a bid for the front contract what i think people look forward to is a spot market etf which is likely next in line after the futures etf comes into play where they are actually going out and buying spot market bitcoin. the futures role has issues. they are rolling the contract each other it creates aday indicate on price performance and it is a poor tracker of the underliar. it is an exciting moment it will bring capital into the market it creates an opportunity for things like mutual funds and retirement plans to investment but the ultimate goal is for a spot market etf. >> which would be basically based on the underlying asset, the bitcoin itself let me ask you this. if you are going into something that's a derivative, buying an etf of a derivative, what percentage of bitcoin's gain or
loss are you likely to receive as return in a bitcoin futures etf? do you see what i am asking? >> yeah. so that's a fluid question so you can look back at things like ung, the natural gas etf. that rolled. you can look at tracking there based upon the underliar of that etf. it is a market maker's dream prospects around the world are going to take advantage of the roll and take advantage of certain market dislocations that occur because of the structure of really taking a 24/7-traded asset -- the future obviously isn't 247 but a 24/7 traded assets and isolating it to market hours it is going to create a lot of volatility within i think the crypto or bitcoin price. but i think it will be a net positive we will see what comes of it the last 24 hours are an extension of late september when gensler came out positive an a bitcoin etf. we were in an accumulation phase
krrngs me blew out last 24 hours has been derivatives led. a lot of leifered traders. it is going to be a volatile 24 hours pending the approval the consensus is approval but we'll see. >> let's assume approval, there is a raft of bitcoin futures etfs that come to market what does it mean for demand for bitcoin? it has to raise it, even if it is synthetically >> a few different things. one, regulators are on board that's a very, very important takeaway from this entire process. so i think there is actually regulation and macro are two critical things to focus on. regulation, getting etf approved, moving toward a spot etf. also this morning we saw a settlement between tether and bit for next these are slaps on the wrist
which means they are saying to these companies, work with us, you will have to pay for your past describesies but work with us today and we can move forward together that's a big piece of news i think has been underreported today. the other part is the macro backdrop important for bitcoin. we are in an inflationary cycle. growth stocks, commodities, energy, metal and copper, tungsten cubes, everything is off the charts this is a great good time for bitcoin. at the same time gold is down today, down 10% on the year. bitcoin's inflationary is picking up as gold is breaking down important to note. >> let me conclude with this i think of bitcoin in two ways half the time i am saying god i wish i had some. and the other half, god i am glad i don't have any. i think futures -- i think futures are a volatile asset they are like a coiled spring. if i lay a futures on top of
a -- a futures derivative on top of an already volatile you assets, how much more volatile is an etf comprised of futures likely to be to the underlying assets >> the reality is derivative have leverage. derivatives are a normal point of leverage. they are obviously a hedging mechanism. when you have an underlying that settled at around 70 to 80 volume, you don't need leverage. if you really want to know bitcoin take what you wouldn't be concerned about losing, go out and buy half that way you own it. and over the next three years dollar cost average in the second half of that. that's what i am telling friends, family. it is the best way to approach investing. bitcoin is a macro assets.
crypto is a technology they are foundational across economic and monetary policy it doesn't have to be a yes/no it is a spectrum you can allow yourself to blend into the spectrum. you can say i don't believe in it and so i will put in 50 basis points or i do and i will put in 10%. that's the way i put to it people outside the industry. >> appreciate it. coming up, retailers are selling just about everything they have, and at less discounted prices. but still some are struggling. a former industry insider will break down today's retail sales number, tell us which numbers he likes and which to avoid plus, ignore the bears and buy, we will speak to an analyst recommending stocks despite what some call a perfect storm of head winds. as we head to break, the dow is up 405 points we are back in a moment. ve to the cloud? the cloud would give us more flexibility, but we lose control. ♪ ♪
welcome back to "power lunch. i'm julia boorstin with the latest on the disney report that the company was considering or looking into potentially spinning off its espn division that news sent the stock up about 2% but i just spoke to a source close to the situation. that person telling me this report is inaccurate and that disney is focused on building the value of espn+ for its digital bundle, saying they are happy with the role that the company -- the company is happy
with the role that espn+ is playing in its digital bundle and that the company hare pursuing further value in sports betting for espn, seeing that as an opportunity to grow both espn+ and the linear networks. it will be interesting to see what comes of this when the company does report its earnings but we have no official comment from disney. disney tends not to comment on rumors and seclation we do see that that stock is now up about 1.3%. >> the original report, julia came from where again? you mentioned it in your first report >> it came from puck this is a new news outlet. it's populated by a number of journalists who left more traditional outlets. it is more of a newsletter format the original report was from dylan biers, former nbc news reporter the report said disney's ceo bob chapek was investigating the
possibility of spinning off espn of course espn has been in such focus for disney over the years, you know, a couple years ago we heard bob iger talk about the dangers espn was facing as part of the traditional bundle. more recently disney has been investing in espn+ and offering espn+ along with hulu and disney+ as a bundle. it sounds like, from my source, like they do see the tune there. let's get to kristina partsinevelos for a mark flash from just across the studio. >> let's talk about shares of 23 and me they are soaring today up about 16% its best day since his spac marger in june the stock popped yesterday why? because of cnbc. during "closing bell" when we had emg capital founder say that 23 and me was top pick for two reasons, one for its subscription business and two
for it is therapeutics business. they collaborate with drug companies to develop drugs based on the genetic data it collects. credit suisse and other company are bullish on the stock it has a huge database of genetics with more than 11 million geno typed individuals myself included. >> not i >> i did one once with bill griffith after he had -- he wrote a whole book about his, and yep. i found out i have stand nativian history i didn't know about. >>; is that right. >> yeah. never count out the consumer retail sales beating estimates last month as americans stepped up their spending slugging off delta variant concerns and enhanced benefits. is this likely to continue jerry store itch is ceo of store itch advisers a retail
consulting if i were also affiliated with toys r us and hudson's bay how much of this spending is real how much is price increases? >> about 3/4 of the increase is absolutely real. the only way to look at it and have it on a level-headed basis is looking at it on a two-year basis. what were sales in september compared to september prepandemic in 2019. they were up 21% if i told you two years ago sales would be up 21% in just two years you would have told me i was a wild-eyed optimist there were no summer doldrums. i know you are good at pattern recognition. the last three months, 18, 19, 21 what are the next three months going to be, the holiday season? i bet it is going to be around 20% f. those numbers happen it is going to be a phenomenal christmas.
>> let's talk about that how much is the supply side going the hold things back. >> certainly i think the big retailers like walmart, target, costco, they have been doing well all along they will keep doing well. why? they have a diversified assortment if they don't have exactly what you want they have something else you can selling with at those stores and they are able to charter ships. other retailers are flowing with the trends home depot continues to be way up by the way, the building materials segment was one of the biggest increases in september in retail sales. they are very strong kick's sporting goods. people are spending a lot of money on sporting goods. that should continue then people who were winners before the pandemic and as we open up i expect will be big winners again, tj max and dollar general. and amazon they own their own supply chain.
they are the only ones who can bring it to your house themselves they can control it. they don't have to count on fedex or ups who are sending mixed signals about being able to deliver everything for christmas on time. >> i am surprised what you are saying about stores like macy's or coal's. you are saying for those kinds of department stores don't confuse a pandemic downs with a strategic turnaround you see weak trends there. can you explain? >> absolutely. they were -- the department stores were among the weakest segments, even though they were still up year over year or two years over two years and by the way they haven't been throughout the pandemic while they were up, they are the weakest stack over that two-year basis. and fundamentally they haven't done anything to address the fundamental strategic problems they had you hear people take we fixed everything, this model or that model we applied here in ohio,
that's what worked during the pandemic shoot, everything is working now. the question is, did they really change the perception in the mind of the consumer did they change their business when you come out of the pandemic -- eventually, it is going to stabilize when it starts to come back down again, the people who were losing before the pandemic, if they haven't fundamentally transformed their business, and almost none of them have they are not going to make it out the other side in financial health the financials are weak formal based retail stores. it is the same story as we were talking about two years ago before we started talking about covid and vaccines >> jerry thanks for your time today. ahead on the practice, it has been a volatile fall for equities. but our next guest says you can make money if you stop trying to read the indexes and focus on breakout stocks. he will name the names next. plus the supply chain risks the market isn't talking about covid had an impact on the
supply chain but there are other caws of the disruption that may be here to stay we will discuss those longer term snags when "power lunch" returns. - [narrator] introducing the grubhub guarantee: our promise to deliver the food you love on time, and give you the lowest price, or you'll get $5 off your next order. it's a thirteen-hour flight, that's not a weekend trip. fifteen minutes until we board. oh yeah, we gotta take off. you downloaded the td ameritrade mobile app so you can quickly check the markets? yeah, actually i'm taking one last look at my dashboard before we board. excellent. and you have thinkorswim mobile- -so i can finish analyzing the risk on this position. you two are all set. have a great flight. thanks. we'll see ya.
welcome back i'm rahel solomon. here's your cnbc news update a panel of fda adviser is unanimously backing johnson & johnson's covid booster shots but not saying exactly when the shots should be given. the company says a second dose provides protection as early as two months after the first shot but might work even better after six months. president biden is in hartford, connecticut today to promote his build back better agenda he was at a school talking with children mourning the stabbing death this morning of conservative mp david angus, counter-terrorism officers are leading the investigation. police don't know yet if it was a terror attack. a suspect is in custody. china is sending a three-person are you for a
six-month stay on its space station. it will be a new record for chanz astronauts as they continue construction on the station. stocks are near session highs. just a couple points off those levels we saw the dow up more than 100 beliefly s&p up 33, nasdaq up 72. >> a busy remainder of the hour for you coming up. ahead on punch we will dig deeper into the love/hate relationship with crypto while the path to acceptance is growing one company abandoned its plans to accept crypto we will tell you which one, in why. is the planning effect. this is how it feels to know you have a wealth plan that covers everything that's important to you. this is what it's like to have a dedicated fidelity advisor looking at your full financial picture. making sure you have the right balance of risk and reward.
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welcome back everybody. oil has been a story lately. it is closing higher for the day and for the week let's go to pippa stevens at the commodity desk. >> oil is wrapping up the week on a positive note once again hitting multi-year highs brent crude is up .9% at $84.70. earlier today it topped $85. -- wti is up 1% at 82.14 that's the highest level in
seven years. the contract also poke posting its eight's straight week of gains. the longest since 2015 oil is not the edge thing at a seven year high. the national average for a gallon of gas topped $3.30 not seen since 201. stocks are on track for a winning week the dow 1% off its record, the s&p a little less than 2% from it have the markets turned the corner our next guest is known for spotting big market moves. he shorted the s&p on september 13th just before it fell he says this week's rally is encouraging but we may not be out of the woods let's bring in mark minervini. welcome. good to have you with us what caused you to short the s&p on september 13th? >> the way stocks had been acting and there was a lack of participation.
i saw a divergence between how stocks were acting beneath the surface and the indexes masked that the nasdaq was loving up, but on less and less names that were above their long term moving afternoon, the 200 day the nasdaq was well above the 200 day. but the percentage of stocks were below 50%. >> you are back almost to closing that position out. did you make money on it >> well, we were up on it. but i decided to go an all or nothing bet. once we were at a profit, the s&p came up 5% after i shorted it now we are backing up the my break even point if it hits break even i am out my all or nothing bet. >> you have some picks i am going get to them in a minute do these tactical moves mean that you are exactively a market timer, or not? >> i'm more of a stock timer than i am a market timer even the market calls that i
have made, i have made a lot of market calls that pegged tops and bottoms with some accuracy but i'm not really looking at the indexes per se when i do that i am looking a the individual stocks then they lead me to either be invested in the market or out of the market then i sort of de facto get to the market call from the individual names. >> some individual names that you like right now and have actually been putting money in right now include upstart. that is one. tesla, mgm, and aig. why those four, all of which you bought within -- basically this week except tesla, end of last month. >> so upstart is up about 25% just in four days since we bought it. we bought it about four days ago. so that's actually made a nice move in the short-term probably extended right now. but longer term, that's a good-looking name. very powerful, very strong earnings >> what do they do i don't know them? what do they do?
>> excuse me >> what does upstart do? >> well -- i'msorry. >> what kind of company is it? >> i'm not -- you are breaking up sorry about that. >> i guess we have got an audio problem there, mark. i'm sorry, i do know mgm, i know tesla, and i know aig. but a 25% move in a week is good for the company, upstart thank you, mark, for your time, we will have you back soon appreciate it. could the disruptions in the supply chain be part of a bigger and more permanent evolution in the global economy we will speak to an expert to whether lay out four trends you need to pay attention to in just a moment
♪ i see trees of green ♪ ♪ red roses too ♪ ♪ i see them bloom ♪ ♪ for me and you ♪ ♪ and i think to myself ♪ ♪ what a wonderful world ♪ a rich life is about more than just money. that's why at vanguard, you're more than just an investor, you're an owner so you can build a future for those you love. vanguard. become an owner. when we talk about supply chain issues and bottle necks we tend to focus on shipping
issues, trucking issues, factory closures, lack of labor, long shoremen, et cetera. but what if there was more to the story than the head lens we tend to focus on our next guest says we are missing key factors playing into the problem that are more structural, deeper he cites four max trends, cyber warfare, 3d printing, ai and robotics and political tensions. he is an international attorney, he has been to china more than 60 times putting businesses together with manufacturers. good to into you i skimmed the book which goes on sale today or tomorrow via amazon what is the connection between cyber warfare and the supply chain bottle necks we are having right now? i will stipulate this is more than just covid. it is more than trade spats. it is more than a lot of things. but what's the connection to cyber? >> the big -- thank you for having me again on the show
kelly and tyler. the big problem is that we have been looking at things like colonial pipe lin where the russians come in and say give me so much money through the cyber criminals they allow to prepare. supply chain is like any chain with many, many links. what i predict is going to happen is already happening is that these cyber criminals are not just going to be going after the really big companies, which are in many ways rehl protected. but they are going to go against the little companies that supply the big companies. so the shortages that you have reported on often on your show are going to get worse because somebody sitting in india or another country over there can essentially pick off a small supplier and say, look, pay me $10,000 or i am not going to go allow to you continue to go forward. >> i see. >> that i think is going to be the big story coming along. >> component manufacturers, the little guys that feed the big guys and make the big products possible item number two is 3d
manufacturing. you say is upending where and how components are made because cheap and reliable asian based manufacturing no longer exists are those 3d manufacturing capabilities widespread enough, at sufficient scale, really, to be disruptive? in the long run it sounds like a good thing. >> well, it is going to be good for the united states because a lot of the 3d manufacturing that you are talking about will be going on here rather than a supplier in china where you have to have 10,000 or 20,000 parts made and if they back up you have a real problem. in the case of 3d printing, you can go and have several dozen parts made now they will be more expensive in the short run but i think what you need to look at in the future is there are now server farms being set up so you don't have one 3d printer sitting in the corner waiting to make these. but they have many of these.
it is becoming economically better to have these things made when you need them and not 12,000 miles away but sort of up the street. >> what's the implication for china, dennis? >> i think china is going to be the big loser. china now exports between 2.4 and $2.6 trillion worth of things essentially over to the united states. that is really going to drop off. i predict that the -- the elephant in the room is china. china production is no longer cheap. with the chinese government becoming increasingly aggressive about clamping down not just on chinese companies but american and european companies doing business there, i think the chinese government's omniscient pressure on these companies is going to make you say, do i really want to make my products over there in china? no, i think i am going the make them somewhere else. >> so they will be cutting off their nose to spite their face in fact. >> what is happening, the chinese are saying to chinese people, buy more chinese-made
goods, don't bring them in from overseas i think the chinese already see this coming. by predict about a third of the number of products exported to the west are going to drop china f they want to keep these companies busy are going to have to buy it themselves. >> i wondered on numerous occasions, tell me i'm all wet which you are good at, because we are old friends we have known each other for a long time. but i have wondered at times whether china is, the sweet way of putting it, messing with us. >> i don't think china is our friend i think china is more than an economic competitor. when you see over the last week and a half they have sent a lot of sorties going over near taiwan i think china is not just messing with us. but china would like to replace the u.s. as the dominant economic force in the world. it is up to the united states to decide yes i am going to let that happen or no, i don't i think by dealing with the supply chain, making more things
here in the u.s. that are supplying u.s. manufacturers in the western hemisphere is the strongest way to support economic growth in the u.s. >> a lot of people would say that ball game has already been played and china has won you don't agree? >> no. china has won because in the past -- sorry my friend i will disagree with you -- because manufacturing in china was cheap and reliable making things in china is no longer cheap the elephant in the room says if you are making one product and you are supplying it solely from china, that's a mistake. you can get it done less expensively in southeast asia, but certainly more securely made if it is made, you know, in usmca, canada, mexico, or the united states. dennis great, thank you, great the see you. and jim cramer breaking down the supply chain and china in his investing club newsletter. soon up for the newsletter today by going to cnbc.com/investing club or point your phone at the qr code. do you have to put it on camera when you do that.
>> yes, you do camera mode. >> you have to do that, can't point your dead phone at it. ignore the bears and just buy? we will speak to one analyst who says there are three stock picks he thinks will climb despite market head winds. he will name names - [narrator] introducing the grubhub guarantee: our promise to deliver the food you love on time, and give you the lowest price, or you'll get $5 off your next order.
there are plenty of market risks from inflation to supply chain disruptions but there are opportunities us the best idea i chris parkinson. he just initiated coverage of the groups with buy ratings. so let's start with crown holdings. >> crown holds is one of the world's largest producer just they're in an expansion. i think under pressure due to some euphoria that's waning and we like this and the progression the management team is making on the portfolio and think they'll price and grow above mark and like that one. >> i love the way the company connects everything from aluminum to everything going on and shares down.
you have a $129 price target and a pick in chemicals and agriculture. dupont explain where we are in terms of quote/unquote cycles or the supply/demand balance here. >> great question. looking at dupont it is not the massive bellwether management team got the portfolio where i perceive where it needs to be potentially a few more steps to take and dupont through the segments has excellent pricing power. best in class. when i look at the end markets they have a fantastic electronics business which i think will have a growth expansion and then also water and protection i think it will grow at least mid single digits and that's one that coming into this i think it's been a significant
underperformer but the tides are beginning to turn for the company and bullish on that one. >> $123. you like fmc and like ppg. and let's ask whether all of the companies would potentially be squeezed by a high energy prices or high input prices for raw materials. >> they already are. when you go back to i would argue it's occurring right towards the end of the 2020 covid when we were all still shut down and start seeing inflation across pretty much any feed stack into the chemical supply chain whether that's natural gas, oil derivatives, ngls and coal elsewhere in the world and you have seen that be exacerbated by winter and then hurricane ida and problematic. you have also seen facility closures, planned and unplanned,
due tomaintenance deferrals in covid and transportation logistics and see the port of long beach and also pricing and reliability issues and labor from shortages to a relative staggering amounts of inflation so the good news is looking at the factors collectively i believe that they're beginning to ease and as some guests pointed out earlier today i believe the term transitory is used to have. >> do they have pricing power? can they pass them along >> our favorite picks to do if you look at the most common factors across the three to seven top pick this is week most of them do have a net pricing power is the term i like to use and in accelerated rate of inflation in 2021 companies are playing catch up which is difficult and going to continue to be in the back end of this
year heading into 2022, and if we get even a little bit of moderate embedded in the forecasts there's companies to hold on to the pricing power. you mentioned ppg. coatings should be a sector. we like that and other factors there but on the inflationary front they should get in that pricing. >> we appreciate the granularity as they confront the issues. >> thank you. >> thank you. up next, cash only one of the largest mortgage lenders ditching plans to accept payments in bitcoin as bitcoin crosses 60,000 those details next sales are down from last quarter but we are hoping things will pick up by q3. yeah...uh...
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welcome back the country's second largest mortgage lender ditching the plans to accept payments in bitcoin. cnbc was first to write about the pilot program in august. mackenzie, it is the first in the industry to accept crypto. what happened? >> not enough people wanted to spend the holdings on monthly mortgage payments. i spoke to the ceo of united
wholes wholesale mortgage and he said six homeowners took part in the experiment they paid in bitcoin, ether and dogecoin and they said it was cool and liked the option but uwm didn't think there's enough demand to pursue given the costs of dealing in crypto and the uncertainty in the space kelly? >> yeah. again, look. if bitcoin were down and could pay in bitcoin and then take it as a tax loss, write-off, but you have to pay taxes when you transfer property and that's what bitcoin is. it cracks me up they gave you the number six people dogecoin -- none of it makes sense to me. >> it is not an ideal tax situation. for the six homeowners that took part some face a tax bill for the payments made in crypto because the irs classified it as
property and it is a taxable event with that difference between how much you paid for the cryptocurrency which is the cost basis and the market value at the time you spend it and that difference can trigger income capital gains taxes and let's be real. we have seen a rally in the crypto market and probably facing a tax bill. >> can you find these six people >> actually a great idea. >> let's have them on. >> i will ask them. >> they can have a support group of crypto mortgage buyer just right? talk them down to thelanding field there. i guess you would feel good right now buying crypto at 30,000 and paying the mortgage with it at 60,000 and don't use as much bitcoin. >> or as much. >> but six people nationwide. >> right when you think about it, like you said, bitcoin trading for half of what it was in july and probably be kicking yourself for
not having held on to it now seeing the major price run. >> they'll reach out to you. i promise. >> i hope so >> have a great weekend. >> thank you for watching "power lunch. enjoy the sunshine but first "closing bell. don't go outside just yet. welcome to "closing bell." i'm wilfred frost at new york stock exchange stocks rallying across the board as we get set to close out the trading week. >> happy friday. i'm sara eisen let's look at what's driving the action goldman sachs a big winner in the dow after a blowout earnings report this morning. september retail sales number this morning strong and travel names powering the sector higher after the white house announced to lift international travel