Welcome back thanks very much for joining us this morning. I am maria bartiromo. It is friday, august 11, at 8 00 a. M. On the button on the east coast more questions surrounding thenvice president joe bidens controversial 2015 trip to ukraine. A newly surfaced is toh shows joe biden on air force two briefed by advisory who was apparently in connection with both hunter biden, and his burisma associates, this happening right before biden threatened to withhold one billion dollars in u. S. Money, if they did not fire the o prosecutor general Viktor Shokin investigating burisma. Even massachusetts senator Elizabeth Warren is asking questions expressing deterrence about hunter biden business transactions. I always worry about the influence peddlers in washington regardless of Party Affiliation we got to shut down the door he thickens rules that apply to everyone. She would not specifically address joe bidenp House Oversight Committee Chairmen james comer joined this program yesterday i asked if he would take action if biden family refuses to cooperate with his probe, watch. Are you going to subpoena hunter biden. We are going to subpoena the family i mean we are putting the case together to win in court, obviously, with all the opposition obstruction we are getting from biden attorneys now, we know that this is going to ends up in court when we subpoena the bidens we are putting together a case i think weve done that very well, i wish the media would ask the president what exactly did your family do to receive this 41 Million Dollars at House Oversight subcommittee has proven he continues to say anyways not true we have the bank records maria bank records dont lie gentleman joining me wisconsin senator ron johnson member of the Senate Homeland security onto these Ranking Member of Senate Permanent subcommittee on investigations, he was among the first senator to open up this inquiry, into biden family influence peddling. And senator, good to see you youve been working on this a long time. Your thoughts on these bank records . And 176 suspicious activity reports would suggest joe biden has been taking, hunter biden have been taking money in from foreigners for years. Good morning, maria. We have known this. Senator grassley and i laid out west, entanglements in our report september 2020 media ignored our report, our Ranking Members, by the way, democrats, colleagues during our investigation, accused of us of his veritating, his veritating dissemfaith if aing russian disinformation i wish senator warren would have prodded them to help us in our investigation we cognitive unkorred more in 2020 when person people have might have made fully aware of the fact joe biden highly compromised as president they didnt do that. Ins instead sabtaijd. House members want an inquiry into impeachment for joe biden, what happens if it happens and comes to the senate does it die in the senate . Well hopefully, impeachment inquiry would give the house greater powers of access and information, the problem we always have, certainly senator grassley and i had doing our investigation, is you go to the Justice Department you go to fbi, and they say well you know we would love to cooperate but we have an active investigation that was 2 way they were able to insulate from scrutiny that expert at doing that. You need documents you need information before we sit down question and depose witnesses others they try to skirt around all your questions, so you need that documented evidence to complete investigations very difficult when administration holds all cards we know we have leftist partisans in Law Enforcement agencies, with bidens. It is a good point in the middle of information, from the witness testimony to the bank records to the suspicious activity reports, weve got the doj attacking donald trump, special counsel jack submitting proposing former president 2020 election trial start on january 2 next year, that is just a few weeks before the iowa caucus, it is a month before the nevada and South Carolina primary, yeah. I i mean jack smith wants trump on trial, while his competitors are campaigning. This is third election, in a row, that federal Law Enforcement will be interfering in our president ial election ex, in 2016, 2020 quite hoejsly did it in my 2022 Reelection Campaign in wisconsin now doing it again in 2024, media is corrupt complicit in this i know a report, by abc news, where they are basically downplaying, all the information the new tell a james comer is revealing say covered in senator gratly, senator johnson report september 20, downplaying saying old news weve known all this, of course, in Public Domain 2020 bidens werent prosecuted must be nothing there game plan of the media to continue to downplay the severity corruption how they try to move on maria what are you going to do about it . Have what with a can you do about it the censorship does not stop there. I mean, they are in the white house, creating their i narratives, and running with it whether it has to do with trump, whether it has to do with biden, and the money taken in, whether it has to do with covid. We learned this morning, that the fda is saying it is okay to take ivermectin if you have covid, i mean senator i remember, talking with you, repeatedly during covid, about your upset that they are trying to cancel you because you were talking to doctors, to try to find out the right way to treat covid, without having to get to a many boosters i took ivermectin it was hard because officially the pharmacist wanted to report my doctor didnt want i had to like, it was hard to find my doctor, to finally you know, address this, and prescribe ivermectin he did my covid was gone in a day when i took ivermectin, three years later fda says that is fine take ivermectin. What . You know doctors i have been dealing with talking to for years now, they may believe, hundreds thousands americans lost lives denied treatment because fda sabtaumgd it did save many, many lives people did have doctors with courage to and compassion treat patients using it putting at risk medical license we do have reports like yourself all people have courage to report truth against the mainstream media, narrative, that is the only way this is solved we need to truth to be exposed, we need more americans to listen to the truth. To be exposed to truth open eyes understand what has happened in this country we are going down a very dangerous path, but a path being laid out and planned by weak group of people, that wanted to take total control over our lives what they are doing bit by bit, increasing massive Government Spending increasing size of government, take over the, amendments coming out voted on 2024, frightening, they really risk taking away all sovereignty, people have to wake up awaken to endangers of the moment. Government working with social media to amplify lies suppress truth doing so repeatedly we saw the facebook story the twitter files, all of the all the way government officials from the cdc, fbi, you know cia a thousands people according to are the reports working on twitter files worked with social media to amplify lies suppress truth, why couldnt American People know that, you know, there were other alternatives to treat covid why cant American People know there were side effects with the vaccine . This is all preplanned. By elite group of people that is what i am talking about, occurred in late 2019 prior to knowing about pandemic. Again this is very concerning in terms of what is happening what continues to be planned for our loss of freedom. Maria umhmm. It needs to be exposed but unfortunate, very few people even in Congress Take a look at this they push the vaccine they dont want to be made aware of the fact that vaccines might have caused death, so many people simply dont want to admit they were wrong going to be to make sure not proven wrong, we have to get a paw full group of people. Allowed invent the room on social media cancel people attack you trying to search for truth some get scared dont want to deal with this kind of scrutiny let me move to Foreign Policy another mess u. S. Reportedly reached deal with irain to release iranian americans held hostage in freeze nearly six billion dollars in iranian assets release a handful iranian nationals serving prison sentences what is your take to give unleash six billion dollars to the leading sponsor of terrorism, iran. Going to result in exactly what you think it would result in more hostage taking. Again we want to see hostages free but this is not the way to do it you are going to encourage the taking of more hostages i mean pretty oshgs happening with iran under Obama Administration Biden Administration they keep pumping in billions of dollars into larger of the state sponsor of terror only thing it has tone in terms of iranian behavior made it worse has not made iran behave better simply doesnt work, do you achieve peat through strength what biden has done every policy in his administration has weakened america the open borders war on fossil fuel record gasoline prices, 40year high inflation, embarrassing dangerous surrender in afghanistan, all he emboldened our enemy if you set out to plan how to weaken america you couldnt have come up with better game plan than what Biden Administration completed makes me wondered we are o wong if president is compromised, senator grassley and i tried to warn america you have a president we sea transfers of wealth between his family members, and china, russia, ukraine, kazakhstan, you know, those are real things that was verified there was nothing in report ever proven untrue including, joe biden setting up a meeting between hunter biden and amos to talk about situation in iran we approved joe biden had been lying to american pub approved september 20 all called russian disings information, sound familiar . Russia, russia, russia, china eating our lunch, senator thank you. We will keep a spotlight on that senator ron johnson this morning in wisconsin, thank you, sir. Quick break. And we are continuing our coverage of inflation, on the other side of this morning mornings with maria is live right now. What if you could make analyzing a big banks data. No big deal . Go on. Well, what if you partner with ibm and red hat, use a hybrid Cloud Solution to connect data across clouds, then analyze all that data with watson. Okay, but this needs to meet our. Security standards . Yup. Compliance standards . Mmhmm. So they get the insights they need. Yup. In real time. Check. To make quick decisions . Check. Aaaand check. Thats the solution ibm and a global bank created. What will you create . Ibm. Lets create. More shopping . You should watch your spending honey. Im saving with liberty mutual, mom. They customize your Car Insurance so you only pay for what you need. Check it out, you could save 700 dollars just by switching. Ooooh, ill look into that. Let me put a reminder on my phone. Save 700 dollars. Pick up dad from airport . Ohhhhhh. Only pay for what you need. Liberty. Liberty. Liberty. Liberty. Providing for your family is a top priority. But what happens when you need Affordable Health care . Christian Health Care Ministries could save you up to 40 today. As a member, you can choose your provider without network restrictions. Sign up at your convenience with our anytime enrollment. Join a Christian Community that supports each others medical expenses, offering peace of mind as you prioritize whats most important. Enroll now at your chm dot org. Maria a. Maria maria welcome back, as we have been reporting, the lt. Governor mass is asking residents in her state to open their doors, and take in a migrant family governor of declared a state of emergency earlier this week i asked Texas Department of public lieutenant olivarez about this. Texas has bussed over 30,000 to sanctuary steez we we in a week in texas illegal borrowed crossings sanctuary cities, need to watch for be carefully essentially, at doorstep. Krysia this is an issue for states across the country i want you to hear, what the lt. Governor told the people of the state this week, watch this. If you have an extra too many or suite in where our home please consider hosting a family. Safe housing and shefrlt is our most pressing need become a sponsors family. It is all very nice, krysia but is it realistic. Certainly not to have you love how democrats sanitize language saying lend a helping hand take in a migrant basically as if you are bringing in a Foreign Exchange student but we know the people coming into your home could be a Chinese Nationalist terrorist a member of a carter lovely how they frame this issue lend a helping hand i would like leaders of the democratrun citiess to be first to take in these migrants, clearly they are not doing so i have yet to see someone in office, take in a migrant and talk about it. But you have to know it is pretty bad when the governor of massachusetts, eric adams, the mayor chicago saying that you are in a crisis this particular moment in time just getting worse, even in new york weve seen Roosevelt Hotel become overrun with migrants now we are again opening up a shelter on randalls island, we closed it drones shown ready to go the crisis is not solved by people quartering mooifgz in their home. Maria i mean we dont know if lt. Governor has an extra room we dont know if hosted a migrant family but, you know, when russia first invaded ukraine, ryan, that has what is poland took in, they needed help that is completely different story, these are people coming into texas we just heard ol varis tell us 7,000 to 8,000 a day some people have been on the terrorist watch list some of those people coming from 150 countries, some of those people are Drug Cartel Members how do you know whose who to open your room host family. You dont here in new york it is real i live in Greenwich Village close to where you went to school you see problem the amount of people sleeping on street when you walk out i walk out in the morning i walk over a woman literally smoking narcotics every wondering not saying i wouldnt want to take her in but it is a horrible situation doesnt help anybody to your point what is coming across the border with fentanyl you see people on drugs like youve never seen before they are screaming you outside a real thing a big problem that needs to be addressed asap in new york city i can tell that you. Maria you are saying it is real in new york, ryan if it became real for you in new york stepping over this woman smoking crack or whatever it is real for everybody it is real in every city every state because they are dealing with this massive over population of foreigners, extraordinary krysia final comments i thank you for being on ho so that thank you so much for having me again, it is real for everyone every city every state is a border city and state the blame game needs to stop i mean we have, democrat leaders pointing fingers at governor abbottor desantis it is joe biden he needs to it is a derelictions of duty of his administration that is the problem there come back soon brian you are with us as we break ppi coming up allhandsondeck for inflation data at hand. Well be right back. My relationship with my credit cards wasnt good. I got into debt in college and, no matter how much i paid, it followed me everywhere. Between the high interest, the fees. I felt trapped. So i broke up with my Credit Card Debt and consolidated it into a lowrate personal loan from sofi. I finally feel like a grownup. Break up with bad Credit Card Debt. Get a personal loan with low fixed rates. Borrow up to 100k. And no fees required. Go to sofi. Com to view your rate. Sofi. Get your money right. upbeat music constant contacts advanced automation lets you send the right message at the right time, every time. constant contact. Helping the small stand tall. Maria welcome back, moves in markets ahead of the july Producer Price index out in about 4 minutes take a look dow industrials down 5, nasdaq down 26 s p lower by 3 1 2 now the expectations for Producer Price index going to be out in 3 1 2 minutes expectations are for a gain monthovermonth 2 10 of a percent a gain yearoveryear 7 10 of a percent irron ides macroeconomics plaining partner barry knapp so happy youre with us to access inflation what are you expecting how would you characterize the inflation story of today . Well, the street is 2 10 for all monthly changes, headlines, core then trade services the trend has been really story cpi even more favorable, the question is is that enough . And the context that i would put all this in is the yield curve. We have often said yield curve can either signal a recession or cause a recession. Weve only had yield curve this deeply inverted, three times in postworld war ii, quite frankly u. S. History ever it was october of 73 summer of 79, summer of 80, that deep invehicle, was followed by very deep of recession i am not forecasting that i do think there is a way out of this but only one really viable you know favorable way out of that which is inflation comes down, and fed cuts rates in response to inflation coming down, so, step back think why is that deep yield curve a problem . A, it destroys bank profitability, just think about the way banks operate, if threemonth bills way above you know 10year treasurys, longer term treasurys cant operate, core at why moodys downgraded regional banks puts members on watch, so, that is what have i been ascribing unstable equilibrium, the best way out of this the fed cuts rates in response to lower inflation. Not because growth coops it so sort of on a race here as to how we resolve that. Expectations have completely reversed in materials of any cut expectations now markets are not expecting a cut are certainly not this year, in the middle of all of this moodys downgrades several small, midsized banks reviewing an six other banks what do you think about the Bank Stability or instability on top of all of that as well. You know, um, so i have been downgraded banks after Silicon Valley bank merger, banks have a third holds in securities, those securitiesdeeply underwater largely context of the way the fed conducted easing in 20, and 21 forced banks had no other alternative but to put money to work in treasurys, mortgagebacked securities, then when fed n tightened i urged them to be moretive with balance shes less aggressive with rate hikes they didnt do that. That caused a deep inversion essentially an existential threat for small banks that doesnt matter for homeowners for large corporations that can sell Investment Grade credit in you know, in the Capital Markets but matters a lot for Small Businesses. A lot of Small Businesses that is right those are banks are in a lending to Small Business Small Businesses are job creators i am wondering if that creates more pressure on Small Business as weigh await numbers july ppi is out, the expectation called for gain 10 of a percent monthovermonth gain 7 10 of a percent yearoveryear lets gets to Lauren Simonetti with numbers. Hey maria for july wholesale inflation did come in hotter than expected monthovermonth, we saw increase. 3 . The expectation was. 2 , yearoveryear also higher,. 8 versus estimate. 7 , the first increase in annual prices, in 13 months. The core level you take out food, Energy Prices more volatile, hotter than expected, core monthovermonth increasing. 3 versus estimate for. 2, annually, it came in at 2. 4 , so it did not cool on the yearly level as well. Producer price index, a proxy for potential change that consumer will feel when they go to the store it does capture some services doesnt capture rent, obviously, there is still inflation in the system. Down from peak of double digits 11. 2 back in june last year, but bottom line here might be, it might be too early to declare victory on inflation especially for the fed with at least one more Inflation Report coming before the september meeting maria. Maria lauren thank you markets worsened as us were giving that news dow industrials down 60 points, i want to get barry knapps take now that weve seen numbers come out because it is also, coming in the face of expectations, that were going to see a cut in rates perhaps not after this number, joining us right now to break it down o former cbo director howing last holtzeakim. John catsimatidis with barry knapp our panelists today ryan payne also here thanks very much for weighing in have on this, doug first give your reaction. Well, i think this is about what i expected hotter man immediate app expectations we saw increases in have gasoline prices, didnt show up in cpi report weve seen pressure on energy front that has been the legally vacation from inflation five straight months commodity, ppi five straight months energy in cpi. Maria you know John Catsimatidis, youve seen these moves firsthand. Running the Grocery Store empire that you do you said many times it is all about oil. Gasoline, spiked during july, so youre probable and june you are probably out in surprised to see this spike. But gasoline is elevated i am wondering if more august story, meaning these numbers will continue to elevate, as Oil Prices Stay high. Well, there is an economic war going on, in the world. There is parts of the world russia, and the opec nation want 8 five dollar parts north america want 65 oil who you mean do bells toll . It is, obviously. Now russia needs money to wage their war in ukraine, russia needs money, now started a war in africa nobody knows about. But the wagner group taken over 5 countries in africa, and, they need the money want 8590 oil you know who is getting poor like we said the American People are getting poorer because of the price of oil, and the price of food. And the prices are not going down. Until washington revises realizes s realizes what is a going on they want stability they want okay, washington is on our side. And then they dont get that feeling right now maria. Maria yeah. Well, look, barry knapp your thoughts on this what this report a tells us it has been a market mover markets worsening as a result of this worse than expected Producer Price index a fraction worse than expected nonetheless, does it change the fate of the fed . Um no, the truth is on inflation were not really going to have a clean read on what the longer term trend whether is going back to inflation more likely, going to be above 3 until round about Second Quarter next year largely because of the screwy lag impaired shelter measure that is so important for cpi, pced, my perspective probably higher than trend inflation through 20s relative to os, 10. I think that is likely, and, i didnt expect favorable reaction to this even on inline numbers we didnt get a particularly favorable reaction to cpi yesterday we got, initial rally then as soon as we got to the 30year treasury auction went right back to the steepening of Treasury Curve not good for equities risk assets in general. Maria yeah. Yet, this market up yeartodate even as inflation, has risen to 40year highs the question you have been right about macrostory not worried about a recession, you were not worried about inflation. And we see nasdaq up 31 yeartodate how do you want to allocate capital now rest of the year . I think first off i think i look at, the forest, the trees the Producer Price index over 11 last year, having huge decline,s asymmetrical the way up asymmetrical way down stubborn, i do think to johns point i will issue is a big issue, because china some point will bottom demand for oil going up as well could put more pressure on oil prices, i dont see oil prices weakening or softening that much, over the course next year prescribe keep Inflation Higher than one would like, bottom line, look. If you look overall, we have a Strong Economy when you look at wage picture, wages are continue to stay strong because labor shortage, wages starting to go you will over inflation so if that stays i think it will hold here, i think you are going to see that goldilocks scenario you want stocks because picture Getting Better i talked earlier about this reacceleration of gdp growth a lot of investment on u. S. Right now, whether manufacturing, electric vehicles, you name it, infrastructure, so a lot of money spent in u. S. As well, i think that is going to stay strong i think that we will see, inflation continuing to moderate may stay stubborn because of oil sflies there were stubborn areas yesterday John Catsimatidis in terms of what food items were stickiest or were most persistent in consumer pricing what is your take at the Grocery Store . Where are the areas that he we havent seen much helpful he on in terms of price hikes. Food prices are not going down ceos, interest costs going up, fuel costs are going up, overall they dont have the confidence to lower prices at this time. You need confidence. The banks are worried about their own existence not opening up to Small Businesses, the real estate portion, of the banks, who is going to construct new buildings, if you pay 7 or 8 interest . Who is buying a new home if they pay 7 in Interest Rates. So, the the banana peel will come if we if washington doesnt do the right thing. And that is my prediction maria. Maria what do you mean if washington doesnt what is prediction they wont if the fed doesnt do the right thing, and ease up on banks ease up on the Interest Rates, then a depression could happen. Maria depression now talking about, i was asking about a recession not a depression. You know let me tell you something, people are worried ceos are worried, they dont want it everybody is working hard to avoid it. But if the fed continues in their direction, problems could happen. Douglas holtzeakin i thought ironic that joe biden yesterday comes out said he regrets calling Inflation Reduction Act the Inflation Reduction Act because it doesnt do anything to reduce inflation. So admission this is just more spending, your thoughts on policy what needs to happen now. There are two things going on in numbers one oil story i clearly agree with that, looks worse Going Forward than looking back, the second conflict between fiscal policy and fed first 10 months estimate, 1. 6 trillion, the biggest increase in spending interest costs, by the way, so that tells you environment we are in, but, you know, while all talking about reducing inflation, it has, chips science act 3 hundred billion the act up to 6 hundred billion, omnibus all coming online the firming in gdp growth is really good oldfashioned insure high surplus not what fed wants, going to lean harder, there is an old if you want never want to fight fed they are not on same page not helping american consumer. Barry knapp, that is the somebody Robert Callahan former president Dallas Federal Reserve said at this point fed only trying to rein in inflation because all of the money out there that is still flowing, is representing more stimulus exactly what got us here 40year highs in inflation. Right. I started writing about this in 2021 how this mythology fed caused great inflation of 1970s is bologna. It was fisca fiscal authorities working across purposes, at crosspurposes there is no real way for fed to offset fiscal policy stimulus, done great work on this about fiscal theory of price level intrack nl that is right of inflation i couldnt agree with more strongly that is really the the true issue here, yesterdays price action was indicative of it right a great cpi then we go to sell 30year debt. And the again, the back end of bond market sells off immediately. We just weve got too much supply, and we just have a structure that means the banks cant buy debt fed not buying debt foreigns arent buying as a much as they were because trade itself weak janet yellen a lost all her best customers. Ryan i agree with, this morning up again i think that is probably one of the bigger risks you have here; right . When fed is go done a food job i hate to criticize fed credit for anything they kept longer term Inflation Expectations in check, at the end of the day we are 4. 1 on that 10year treasury but if it starts to get up 4 1 2 , 5 , i think you do have a problem, and of that itself where the fed is going to be between a rock and a hard place i think conditions are tight enough we just talked about how banks right now when it comes to lending starten to tighten you you see in surveys a credit downgrades right now, i do think it is meeting do i t in september, the smart move here is look theyve kind of won here right we are in a situation may not have recession, and tighten Interest Rates you know policy a lot of Monetary Policy a lot if they back off here give us more normal rates especially comes mortgages, companiesing boring going into next year they are going to win looks like fed dont screw it up. Maria they are not winning on price of oil John Catsimatidis, lets get into energy for a moment here, because the administration and specifically the Energy Secretary Jennifer Granholm has talked about needing to replen tish Strategic Petroleum reserve. We are down to lowest level since 1980s look at how they have to replenish with oil above 80 dollars a barrel. Not going to happen i dont think going to replenish anything now theyve done almost everything wrong, in corporate world, besides when banking, and Corporations Companies Public Companies especially cant make the right numbers, that wall street expenditures them to do the next shoe that is going to fall, that begins the beginnings of the end towards recessions. There will be layoffs, if they cant make the monies that wall street expects them to make. There have been already been layoffs i am wondering from your standpoint do you see oil as an indicator or as a trigger, in other words, if youve got 80 plus there are a a barrel oil doesnt that represent impediment for Economic Growth . Getting more expensive to fill your containing more expensive to heat your home, maybe cut back on spending out there. Or do you see price of oil all the way up 80 dollars plus as indicator of demand, demand is thriving across the world and so that is a goos see what happens to china. And china if they dont have the demand, whether they have demand or dont have demand, and the spigots produce more oil, force oil to come down to 65 dollars, 55, 65 dollars guess what . Inflation goes away we have to raise Interest Rates it is that simple all you have to do. Maria it is not that simple when you have administration that has Climate Change agenda as priority. That is the problem. Maria they want to do away with are fossil fuels. We are working on Governor Youngkin on a small margin reactors not windmills not solar energy if you believe in that, i sell you brooklyn bridge, going to be, smrs small modular reactors virginia is ordering 10 in over next six, seven years, and Nuclear Energy is really w. All right. . If somebody wants to buy windmills, i sell you the brooklyn bridge. Maria barry same question for you on price of oil what is the impact . Welcome actually it is a bit of a problem in u. S. Given that we are now in oil exporter, interesting effect on currency as well, i gus speak is to go some international investors, investors here which is, this is actually a much bigger problem for china, japan, germany, the whole of europe because now the dollar used to obviate the negative correlation with price of oil would go up dollar would be weak, that would lessen the blow to big oil imported such a big producer. But, again, for the American Public is it an issue . For sure, you make a good point maria because it is a sign of demand improving globally but there is a limit to it right it has a negative feedback, for the u. S. , i like Energy Stocks for sure i started plying them the day biden was elected, never really had exposure last 10 years, i dont see any reason why you wouldnt continue to stick with energy, with much bigger weight than s p 500, you know, whatever, 10 for the folio at least in energy. Maria yeah. Ryan you have expected a broadening out of this rally energy had a great year last year what about oil stocks. Yeah, i am with barry one hundred percent i think they have a long behind them face it economics of oil is we dont have enough supply to the market, global oil complan is going to continue to go higher, i agree that thesis as well he will the fact Oil Prices Going up to some extent the fact gobble growth starting to improve you saw Commodity Prices bottom, copper prices started the right direction, you look at that as good indication of Global Growth in general, i think remarkable that weve done as well this year gdp growth the fact china hasnt moved, so imagine some point you know economy does move right direction second largest in the world apply a lot of goods and Services Commodities from countries great for emerging markets brazile on your show i mentioned markets up 20 this year so a lot of places to put money outside s p 500. I have joked a lot on show a tech fund indrag, basically seven companies from capitalization perspective, so just a great time to broaden exposure one of the best opportunities i have seen in my career. That is what were doing for our clients. Maria brian if you for that doug holt holtzeakim i want your tick we are talker about 13, access the situation. I think this quite as likely going to end up having a Government Shutdown house and senate are worlds apart. They started out, marking up bills house fiscal year 22 year level Senate Fiscal year year 23 levels hundreds of billions apart no agreement to come to conference, they have really had zero progress also pressures to spend more seeing ukraine supplemental go up from president several republicans want to go above defense cap there is no agreement on levels distribution of funding, in the budget. I just dont see any way going to get to yes, september 30th, typically what would happen ac a continuing rolls of they are not going to play that game want a agreement lower level of spending close before a cr it is going to be rocky next couple months, interesting, because it is going to be rocky and, yet, you know, the republicans dont want to be on the hook for Government Shutdown, then media you know portrays it as the republicans fault. I i completely agree with that i dont know how they get past it dont see alignment gets to cr september 30. Maria barry, does this work into your models in terms of what to expect in the fall given now weve got deadline september 30 government running out of. It does for sure, i mean weve got a Government Spending, running 10 above a year ago weve got treasury announcement lo and behold xral 500 billion for sale sets the core of bear steepening to move higher in long rates weve been getting gem does lead to riskoff, that is part of the issue i guess i would shade the issue a little bit in the sense that i think a winning issue for the republican party. If they fight hard on this spending. The public tend to come down on the side of the party that is pushing for fiscal responsibility, 891 in true democrats pushing it was true in gingrich,a the press will bash party in this case republicans trying to rein in spending if you look at Election Results the following year they tended to go well for the party that was pushing back on spending. So, that would argue for you know, potential again risk related to all this if doug does a great job following this i suspect probably right not getting, the totally appropriations process done by september 30, seems highly unlikely. Maria we will see about that, John Catsimatidis, weigh in here on i know youre worried negative in terms of where this economy is going, because of the level of inflation and oil prices. But, do you see some optimism given weve come all the way down, from the highs of the year ago, i mean look cpi running 9. 1 . Welcome yes, i do see optimism the American People dont want to see a recession. They are working towards were all working to make sure it doesnt happen. And the only one that can force it right now is the fed by doing things, in the a dumb way youve got to open banks you got to give them a license to lend lend to Real Estate Industry bring at least consumer real estate loans down, you want to sell homes we want to sell condos, real estate. You want to give an incentive to real estate people to build, new homes new new apartment buildings but not going to happen with Interest Rates being where they are, and the being nervous for existence youve got to open up nobody is going to build a new factory nobody is going to build a new business, based on the Interest Rates, and you know we look at it very carefully, we can afford it. But we look at it very carefully, you know if we have to buy a00 you in trucks 50 new trucks look at the Interest Rate factor we say wellet wait till next year, so what is going to happen . You are going to start going backwards, that is the way ceos think. Versus how the economists think or how this statistic isstitions think backwards on stats last month the month before you got to look forward what is it going to take to keep the economy going. Indicator for me douglas has always been whether or not weiss are spending more on future are they investing in i. T. , in r and d . Are they investing in Capital Equipment if answer no because they dont have visibility, beyond a couple of months, then we have a problem. I completely agree that is right read. If you last year a camp a recession end of 2023 what has been surprising first half the strong Business Investment numbers weve got in gdp report completely different than last year, and i think this is to high Interest Rates a headwind more confident about demand coming out of Government Spending bills infrastructure bills, the Inflation Reduction Act clean energy chips, finance getting capex out of that the surprise of the economy so far. Cap a lift. Other thing i would say maria, it is true inflation has come down a lot, but if you look at Core Measures hovering around 4, twice fed target, so are they really done . I think you have to worn is it easy to get from 9 to 4 pretty hard from 4 to 2 . That is my concern, that is the part where you start thinking maybe things arent going to be so good the end of this year into next year. A good point, with would which a change your allocating of capital ryan if in fact we were to see a recession in the it would be really hard to change my optimistic viewpoint here, but i think if theres any sort of recession, of course the market forecasts that ahead of time. The markets a great forecaster of whats going to happen. I think thats what the market told you this year, is recession odds have come down drastically. And my argument last year was, you know, i was one of the few people who said we probably wont go into are recession, is you just cant fix the labor market. What the fed cant fix is supply, and we literally have 2 million baby boomers retiring every single year, and theyre not being replaced. Its not credits their biggest issue, its finding workers. Theyve got a lot of business to do. As long as the labor market stays strong, we need a lot of houses built in this country, another reason Interest Rates have cotom can down to come down because were undersupplied. Theres just a lot of supply issues that the fed cant fix. And i think because of those issues, its just going to keep the economy relatively strong where a lot of strategists and economists didnt think that was going to be the case. Reshoreing, its all happening, and this is the roaring 20s. This is the way i put it. Maria yeah. Well, i mean, barry, you heard that. What are your thoughts, barry, at this point into 2024 . What are you expecting in the new year . Yeah. First, i think that we already had something of a recession. It was gross domestic income going down for a couple of quarters. Earnings going down, were actually coming out of that. My issue is whether we have something of a double dip because the banking system, you know, it struggled so mightily with creating credit, providing credit for commercial real estate and all. So it really does come down to do the inflation aggregates fall enough to create the head room for the fed to start reversing some of those rate hikes in the first half of 2024. Yesterdays cpi, i would argue, yes. Todays ppi a little bit less so. But to me, the key is the trajectory for inflation between now and the end of the year and the fed be cutting in the first half of next year. If it looks like inflations stubborn and theyre not going to be cutting, then 2024, at least the first half of it, is going to be pretty difficult, in my view. Maria difficult stock market. Correct, yes. Im sorry. Not being clear. Maria no, no worries. John catsimatidis, from the grocery standpoint, are you expecting to raise prices again toward end of year . Well, were going to raise prices as our costs go up. Electricity costs, which theyve announced are going up, energy costs are going to go up, then, yes, because theres a lag in there. Electricity prices should have gone up last year, but theyre not going up til this year. So as our costs go up and our costs of labor go up, we will increase prices. And i agree with the other gentlemen that the ability to get from 4 inflation rate or 3 inflation rate down to 2 the, that will hurt economy even more. Maria all right. We will leave it there. Great conversation, everybody. We so appreciate your time this morning. Douglas, barry, john, ryan, we so appreciate it. Lets take a look at markets here before we hand it over to stu. Dow industrials down 83 points, the nasdaq and the s p also negative. Nasdaq down twohisser of a percent, 102 points lower. Ill see you tonight on wall street, 7 p. M. Eastern here on fox business. Have a great weekend, 30 minutes before the opening ball. Varney company take over. Stuart good morning, everyone. First up, the latest reading on inflation. Its the Producer Price index, otherwise known as costs to business
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