Transcripts For FBC Mornings 20240704

America and it was also very sad driving through washington, d. C. , seeing filth decay, and all of the broken buildings, graffiti this is not the place that i love, this is the persecution of the person that is leading by very, very substantial numbers, in the republic primary and leading biden by a lot, so if you cant beat him you persecute him our prosecute him. Maria former president also writing on truth social i need one more indictment to sure election jon ernst Moxila Upadhyaya great to see you. Thanks for being here Moxila Upadhyaya thank you Moxila Upadhyaya how do you access what is taking place senator . What i hear from iowans is that they believe there are two systems of justice we have one system of justice, if your last time is trump and you have another system of justice, if your last name is biden. So, of course, iowans are upset, they want those who have done things wrong held accountable they dont see that in this case they see this a political move with the latest indictment of President Trump very little action or engagement when it comes from the o department of justice, with the hunter biden and the big guy, dealings with our foreign adversaries, so two systems of justify and iowans want getting back to Holding People if possible theyve done something wrong we just dont see that. Maria feeling across america your take on caucuses less than 20 days away from first republican president ial debate iowa caucus four months from now fox business poll finds 46 likely gob iowa caucusgoers backing former President Trump desantis in second place senator scott number three, 11 finds 41 caucusgoers sigh the economy is topsh what are you expecting, in this upcoming iowa caucus . Six months to go until iowa caucuses, first and nation gop caucus and it is very exciting, because we do have a number of candidates, that are crisscrossing the great state of iowa ron desantis on bus tour, we have tim scott, nikki haley, mike pence at iowa state fair kicking off next week will visit with as many iowans as possible to shore up votes for the caucus on january 15. So it is going to be exciting we have that six months to go yet, but what i can say, is wow we have a lot of talent a lot of skills ability a breadth of knowledge in this group of candidates exciting to see them engaging with their voters we dont see that level of energy and excitement surrounding the biden campaign. So grateful. President trump keeps calling this election interference. If were watching this indictment and perhaps another indictment to come from georgia, play out in the coming 11 months, is it is it possible to believe that trump will get a fair shake in the election knowing that he has got indictments, he has got to go for court dates, he could be, scheduling a trial . Do you think that sort of colors the story for voters . Maria, i think an interesting point a lot of color out there. Unfortunately, it may not be what the democrats want to see i do think any time we see political moves coming from the left, indictments of President Trump, then, of course, republicans run to back President Trump. So, i do think that President Trump is on to something when he says all these indictments are spurring people on to support him i think he is correct in that. So there is a lot of white noise out there i just hope that all of the voters whether democratic independents republicans whatever in in election season that they sort through all of the extraneous annoys focus on candidates what they have brought to the containable what abilities will be will they have a successful, term as president i hope they can view that without all of the additional color as you put it. Maria yeah, that is the thing, i dont know if this will turn voters off, to the extent that they will say well, i am going for another candidate. You know i am not going in on trump because he might have a trial, or that is when you say election interference, former president says election interference is its materializing because will turn voters off can you have a trial so close to an election. Right. I think they have to look at what is the substance behind this, as well. I think what this latest indictment is seem to be a whole lot of nothingburger without any meat behind it. So it is really unfortunate for the former the former president. But, again, i have to go back to what i think iowans are saying what americans are feeling, is just that our department of justice and those that are process prosecuteing former president seem to lean one direction, Serious National Security issues as we have seen with potentially hunter biden and father as Vice President , trying to influence foreign companies, that is a big concern, yet we dont hear Mainstream Media talking about it, i think that is a much greater concern, as we are looking to the future. And whether our standing is around the globe, as United States of america. We have a lot of dangerous adversaries out there it seems that this administration is more intent on enriching them than pushing back on them. Maria why i keep asking what does ccp have on joe biden given incredibly sharp response to all aggression mike pompeo former secretary of state said many times ccp is now inside the gates you are warning china is in are our house demanding answers after california warehouse turned out illegal chinese run Virus Laboratory . Reportedly againetically engineering with hiv, hiv malaria . What can you tell us . We have to narrow in what is going on with chinese they have seen them attempt to purchase land around significant military installations, here in the United States, we see them erecting a spy base in cuba now. Where they are coming on american soil, and doing dangerous experiments in warehouses in california weve got to wrap arms around this President Biden really needs to step up, and stop appeasing the chinese, he aappeases chinese iranians, you name it. But this is very dangerous. And i think that is the beginning of covid when he we were pushing back against chinese, President Trump was pushing back we were called racist, no. This is about making sure our citizens are safe Moxila Upadhyaya dont forget chinese nationals at the southern border up 1300 could that have something to do with people operating these labs . It could. And we have to put all of these strings, dots together. On my most recent trip to the border, of california, with darrell issa we saw for eners rounded up by Border Patrol not from central or south america. These were chinese, Illegal Migrants from turkey. Senator extraordinary times right now thanks very much for being here senator, good to see you. Thank you. We will be right back, stay with us. Hi, im todd. Im a veteran of 23 years. I served three overseas tours. I love to give back to the community. I offer what i can when i can. I started noticing my memory was slipping. I saw a prevagen commercial and i did some research on it. 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Ys to drowning finding body in barriers this spokesperson says memberscan government is flatout wrong preliminary information points to the drowning before the body was near barriers, the justice department, is suing texas over buoys, krysia your thoughts greg abbott has been trying to do anything he can, to stop all of the illegals from going into his state. Kelly why the government saying texas poos fault taking a stands joe biden and administration have not, and not surprising pointing fingers again what is that people trying to try to do in this case under this administration, weve seen, as you know, over seven Million People come across our border, since joe biden has been in office had over 200 people on the terror watch list that we know of cross our border not to mention fentanyl Human Trafficking an epidemic at this point, so the fact that Governor Abbott is trying to do anything in his power to stop this kudos to him unfortunate, yes, deaths have resulted because of joe bidens policies, with our border as allowing people to come across recklessly at this point. Maria look weve seen lots of people drown in the rio grande, in their journey, into america, not the first time, and we saw that happening before buoys were in place see if he can prove that a texas Law Enforcement drone meanwhile, caught images of human smuggler carrying a long gun he was guiding a group of Illegal Migrants across the rio grande before returning to mexico we see on camera from drones drones. Kelly you and i spent time at the border, during my live shots on your program i have had people hopping over wall Border Patrol within eye sight not surprising now you have people who are armed as they continue across that river. Maria these drug cartels incredibly dangerous they have equipment, that is equal to the military of mexico i am told john, this is who you are dealing with taking home billions of dollars, not just from their you know Human Trafficking but Drug Trafficking as well. John why have Border Patrols the real crime is dereliction of duty on Biden Administration no escapinging that how dare they claim upholding the law . You know a starting point for disrespect for law, if Biden Administration doesnt care why should i care as a common shoplifter a common criminal . Look at new york. The lines of migrants in new york city, this has become much bigger impactful story than just in texas at the youve got gotaways the witness we innovative more than a million, apparently going to tucson as first stop, then youve got drugs coming in lou look at the border you dont have togoing to texas or arizona to understand all you have to do look in your city bussed to big cities. A way of putting downward pressure on wages at the same time isnt it . You have to ask since weve labor shortages, lowpaying occupations, why arent these individuals put to work . I cant figure it out. Maria we are keeping a spotlight on it i thank you krysia lenzo being with us ten minutes away from Economic Data we will see you soon thanks for being here john kelly we await jobs months coming up how markets are moving ahead of july jobs number in 12 minutes time making money with Charles Payne host, Charles Payne is here with his expectations, stay with us. New projects means new project managers. You need to hire. I need indeed. Indeed you do. When you sponsor a job, you immediately get your shortlist of quality candidates, whose resumes on indeed match your job criteria. Visit indeed. Com hire and get started today. The chase ink business premier card is made for sam who makes, everyday products, designed smarter. Genius like 2. 5 cash back on purchases of 5,000 or more, so sam can make smart ideas, a brilliant reality chase for business. Make more of whats yours. Ah, these bills are crazy. She has no idea shes sitting on a goldmine. 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Back in my day, it was scary stories and flashlights. We dont get scared. Oh, really . Mom can see your search history. Thats what i thought. Introducing the next generation 10g network. Only from xfinity. Maria welcome back. Futures this morning are now higher we have been looking at mixed story but we are just about 8 minutes away from july jobs report look where we are dow industrials up 2 points, nasdaq up 21 s p 500 higher by 6 expectations for the jobs number are good expecting 200,000 nonfarm payrolls added in july Unemployment Rate expected z 3. 6 joining me right now is host of making money with Charles Payne, charles great to see you what are your expectations for this jobs number . What are you going to be zeroing in on what is most important here my expectation is probably a beat on the number itself, you know we are starting a new streak after 14 months in a row whatever it was something ridiculous but i think earnings have come in below expectations, if that is the case would it be a win for fed win for market ultimate, i know considering how many jobs are still open out there, it stands to reason if we get 250,000 thats fine but i think what powell wants to see obviously, wage growth slowing down, i think that is probably going to be the case, so if that is the case a positive for the economy in general a positive for the fed i think a positive for the market. I am looking at always first and foremost participation, one of the things that happened sort of participation has intend sliding a long time but sort of lack of enthusiasm for work in general in this country i think an epidemic a crisis. You know 37 we dont work we slough off monday dont go in friday lie to boss on wednesday that kind of thing we want to see participation i want Transportation Warehousing jobs a great segment way for people in leisure, retail, to move up into higherpaying jobs o, and you know those jobs we can recently amazon closed a few warehouses at least slowed them down i want to see that resume a great pay for folks with limited skills to find better paying jobs. Maria your take on earnings, tech has been setting the tone for markets all year, once again weve got, big numbers on the tech earnings, last night amazon soaring this morning, really, with beats all over the place including, its expectations for the Third Quarter apple had disappointments even though it did report, betterthanexpected numbers, we are talking about a Third Straight quarter of sales declines at apple. Amazon, of course, bringing in 10 Million Dollars from from Online Advertising unit aws Amazon Services most people were talking about the stock up almost 9 right now on amazon interesting last four times reported the stock got hammered, so this is great reporting, a. I. Story is really about opt myselfing platform layering a. I. On three levels, expectations low i think for amazon operating income 7. 7 billion only 62 above estimates, not bad. Again doesnt hurt to have low expectations. On the other side High Expectations for apple maybe why youve seen this response, what stands out to me services number, because not only 21. 2 billion from if up from 19. 6 billion but gross margin is 70. 5 , product Business Gross margin 35 if they keep growing Service Business they are really going to do extremely well one thing i got to point out i have heard people say you know apple numbers reflective of strong consumer sonl strong consumer in china america consumer was down, something keep in mind talking about American Consumer how strong they are how much extra skash they still have to spend. Maria net sales at amazon 134. 3 billion versus estimate 131 but what about big news this week Fitch Rating Service incidentgraded from trim a, to aa not focusing on nation 32 trillion dollars debt, charles. What is your take on this, how important it is . Markets traded down officially critically important really is critically important a warning sign about time, you know talking heads, here is thing maria, i remember going back when president obama was in Office Former president obama we used to have this conversation a lot right taking away from children, grandchildren, their future some point going to pay 400 billion dollars, just on interest alone now at a trillion we didnt go off cliff any time one talks about it rings hollow free money works all of these things we need this flare what made me angry all the economists who know merit circumstantial evidence the wagon said this is not a big deal janet yellen 3 years ago 20 billion in debt said the we should not be able to sleep at night now 32 billion sleeping like baby give me break be honest about this we cant always decide if news is good or bad depending on what party is in white house we are getting downgrade of credit a couple weeks, or month or so, before the government runs off the money so september 30 going to have to do a continuing resolution i assume not having a government shutdown, but situation, this issue, important dime, because when they come back not only are House Republicans going to be focused on all investigations, they are going to be focused on keeping the government open, paying our bills here is the chinaing short reprieve from last fight they spend like crazy parents going away for weekend like know we will be back going away for weekend okay, this is what happens we raise the debt ceiling how many times have we raised it 70 . We lose track once they move coast clear let me tell you last bill both parties came up with like they looted the joint i cant wait to see how much they a lot next time 32 trillion maybe a drop in the bureaucratic a year or two jobs numbers out less than a minutes expecting 200,000 jobs created in july, in the last jobs report it was a lot of Services Spending on travel, on services, as well as, job creation, in those areas, do you think we will see a repeat i think a repeat but getting stretched if you listen to mast card some others Summer Spending boom after that again, spending money running out people have been maximuming out credit cards depending on how strong this is, we will dictate the fds next move about you expecting another hike. Not next meeting no. Maria no tick in september meeting no. We will see what happens, in terms of these numbers, whether or not the inflation data, in the week ahead informs the fed, dow industrials up 40 points right now 57 on dow nasdaq up 64 into numbers, Cheryl Casone with the numbers, right now. Cheryl ive got them the first two the nonfarm number, we came in a little bit weakerthanexpected we came in 187,000, the estimate for 200,000 so this is weaker than expected, looking for 185 k, goldman on opposite side, 3. 5 is now the rate. They also had revisions revived june to 158,000 let me two through some 185,000, average workweek for july negative. 1, down 34. 3, 34. 3 average Hourly Earnings gain of. 42 . 42 average Hourly Earnings the yearoveryear number 4. 36 , is a little bit better than expected. For anyway for wages i know charles is looking a lot of us looking at that Labor Force Participation we do not have estimate for that that is number, that we got. Lets look at a couple more things, especiallyings revisions i think interesting, but lets go through some jobs actually were added, government jobs, came in 15,000 on government jobs, did not have estimate for that. And we also came in factory jobs a loss of 2000 factory jobs. Privately payrolls for 172 k, that is also, lighter than expected looking down here again i gave you that, that private sector number 172 again that was we were looking for 179 there, it is under employment rate 6. 7 , then, again, but look those 4. 4, 4. 4 i am going to round up on average Hourly Earnings yearoveryear, to 4. 4, estimate was 4. 2. 4. 4 there. Let me go through exactly what is happening, again within the reports give you a sense of where we have seen over last really yeartodate had seen lease ush hospitality sector where jobs issue being add i think Goldman Sachs was look for a, a better number than what Goldman Sachs was estimating basically saying, that if you look in the report saying that job gains outsider healthcare that is same story, social assistance financial activity wholesale trade i am going through the report to see what i can pull for you maria. Maria thanks very as much we will get back to you my headline out of this report, kneejerk reaction here is the wages, Hourly Earnings up 4 10 of a percent, june 4. 4 on annualized basis, this tells me 2 jobs market is as tight as it has been, there is no letup in the cost of talent the cost of employment, with Wages Holding steady up 4 10 of a percent, that would be my takeaway, just from looking at headlines july jobs report, crossing the tape joining me to react is Heritage Foundation commitment former trump economic adviser steve moore, smbc nikko chief s economist joe what vorna Eric Freedman Charles Payne. Cheryl casone thanks for being here steve moore your reaction to jobs numbers . Yeah weaker than i thought i was expecting well over 250,000 jobs, by the way, i was reading the report cheryl reporting it, looks like, that both the previous two months were revived downward weaker job market strong for people for people who dont have jobs two takeaways one last seven months you know what the number one industry that is hired most workers maria . Healthcare no. No to have was number two. Number one is government. Maria okay biggest employer so the reason i say that growing economy in all the wrong places we want Government Employment private Sector Employment rising, the other thierng right about the fact that 4. 1 , wage growth is a good thing, but we are starting to see inflation tick up look at gas prices, gas prices back up to 4 dollars gallon i think from 9 to 3 percent i think headed back up i think you are going to still see a squeeze on worker raises, and wages as we go forward. Maria yeah, just to be clear i didnt say a good thing, i am saying the fact that they market is tight is remaining the case joe lavorgna an issue from Business Managers ceos thank you very much spoken with this is tightest labor market theyve ever seen, that they have to keep raising wages great to see people making more money i am looking at it as Economic Indicator not referring to it as necessarily good your thoughts two things tight labor markets are good even janet yellen said was a good thing for some reason the fd believes a tight labor market is a bad thing because time people working, cases inflation, and steve in your my friend larry kudlow clearly not case wages do not cause inflation the San Francisco fed said the private labor market no impact that jay powell is focused on the other point i want to make the temp hiring down three months in day row very good leading indicator of where the economy is likely ago to. Construction still positive, but that will not remain the case especially with Mortgage Rates as high as they are the trends of weaker growth and recessionary crosswinds are blowing, even as you accurately said labor market on surface is tight. Maria your thoughts joe on Participation Rate 62. 6 what does that tell us yes, tells economy improved since vshape under President Trump sorted out partly he will he reflects regulatory excessive Government Spending yesterdays productivity numbers a nice report, im skeptical productivity trend turned potential gdp as high as four years ago i dont see that in macro data. Maria charles has what is your read workweek is the key here. I thinkment i am surprised market isnt focusing on that wages are up, by the way, one of the, of wages being up lower paying jobs are hardlyly any of them, retail 8. 5 leisure 17,000 up from 113 a year ago, fewer lower paying jobs skews overall average workweek is key yesterday we got labor unit labor coverts, productivity number productivity went up okay, maybe we are back in business. Abysmal down dramatically, so the workweek was down, down monthovermonth, yearoveryear your weekly income 1157. 28, up from 1155. 84, point 00124, point 00124. That is not necessarily inflationary in my mind i would like better participation, does this mean steve mentioned the temp numbers i started earlier maria saying people able to leave lower paying jobs go to Transportation Warehousing that was down again down 8400, down two months. Row great paying jobs pay so much more than if you worked in a burger joint those are going away, i dont know how folks at bottom part of economic income ladder start to make their way up. That is a good point i also want to know about that, what is the makeup in terms of highpaying jobs versus lowpaying jobs in this the highpaying jobs held rocketed higher owed of healthcare, steve made that point other than that nothing okay leaped out at me i think workweek listen bosses dont want to let people all go, they loathto let them go limited to what they can do giving them less hours. Eric freedman your takeaway i think that is report consistent with a very strong consumer backdrop driving markets, and if you look at participation which is flat wage growth we can argue if inflationary or not at 4. 4 , versus, inflation of has what is called below 3 , a delta fed not going to like. Maria that is what i was referring to, right this is something that the fed focuses on that is why i raised it yeah, it is more academic exercise does it or not cause inflation long trm but nearterm that is consumer that continues to gain in terms of wages as well as broadening out of economy, so if you look at equity market what has been working consumer stocks, casinos, Hotels Restaurants consistent with consumer continues to benefit from higher wages continues to reflect that in activities doesnt put in our mind a fed hike for september but raises risen if we see cpi and Producer Price index index runs hotter than expected things we think could put the number back i see are you expecting a hike after september then eric . Or we could see one maria. Yeah. I think there is two things one if you look at the cpi we had in june it was comped off very, very high number, lets kind of look past that i think if you see, a continuous s consumer participation what you are seeing in this jobs number report you could see a pretty strong, you know both pce as well as Consumer Price index report next two months would put september back into play. Maria interesting to see where jobs were Education Health services 100,000 jobs Leisure Hospitality 17,000, and jobs declines in this month o professional and bigs services transportation, and warehousing cheryl youve got here. Cheryl i was pick up ons Leisure Hospitality story little change for leisure and hospitality Goldman Sachs, said the month of july expecting a huge jump for leisure and hospitality july summer jobs i dont know if flat was a question mark about construction jobs going under this report because of the hot weather. Over the last, last several weeks. But construction actually you know stayed fairly strong, real estate job gains in real estate, but, you know, the government job story talking about is interesting, because the previous number was 60,000, for government jobs, that was what we had last month now 15,000, so, in a is a bigger peace of the report than i think we are paying attention to here, but overall, that Leisure Hospitality number has been you know weve not had 1. 7 million plus today, over almost at you know 1. 1. 9 million or so jobs add throughout the year, but Leisure Hospitality powering that kind of flat, gone which is a surprise. John lonski. John i am focusing on wage growth, you know back in the first quarter, that average wage rose by 3 10 of a percent per month on average, since then growing by 4 10 of a percent, just a a 3 1 2 announcement rate, i have to ask myself if we are going to continue to grow this economy, arent we risking a rejuvenation rereacceleration plus inflation i picked up the wall street journal today allow and behold we have he United Auto Workers uaw is asking for a 40, a 40 wage hike over the next four years from the big three automakers, weve become too dismissive about Wage Inflation taking off fairly soon in the event economy continues to grow. Maria are a great point, and that is why i focused on the wages as well. I agree that this is really telling, telly thoughts . Kelly my big takeaway for the jobs report is manufacturing, i was hoping to see an increase in manufacturing. Jobs. Because you know we talked about earlier, they pay more than real leisure for, you know, the folks that need higherpaying jobs they are down 2000 if you triangulate with some other Economic Indicators when it comes to manufacturing space, the Labor Productivity report for the a Second Quarter hours working manufacturing down ism index we are seeing that contract more and more manufacturing is heart of Middle America in terms everything making sure our economy is strong i go back to what President Biden has said, that he wants to save democracy one factory job at a time, for me this is not a good read when it comes to that. Maria right, weve got to get some factories turned up in america versus relying on other countries like china, so that certainly is something we are watching as well. Joe lavorgna what is your take on what this report tells us about potential for recession, later this year or early next year . Ho the it doesnt really tell us that much other than perhaps maria Unemployment Rate because the Unemployment Rate up 50 basis points from credible low to therefor signals recession in other words, the low is at 3. 4 if we got 3. 9 could Start Talking about rumblings of recession onset the report doesnt say we are going to have a recession the problem with wages hours employment they generally are coincident to lagging indicators this is very important the data bet revived, all you have to do is look at press reports in early 2008, the economy in recession many people didnt believe it we didnt know about it because some numbers that looking at as today were positive Going Forward focus on Unemployment Rate when that starts to move you can get worried about recession onset almost imminently steve where are you on that . I want to make an important point about what is going on we talked a lot about wages, i want people to remember, that since joe biden came into office, weve seen this 16 increase in prices, the average family this is the most important statistic of all the average family maria has loss about the 5,000 dollars in purchasing power. That is to say the average American Family is poorer today than two and a half years ago that is why, a lot of surveys are coming out showing 65 to 70 of americans feel economy otherwise headed in wrong direction even though we have a good jobs market so america poorer no question about it, that is because high inflation. Now, the other point i agree entirely, i am in favor of high wages i want to see American Workers be paid as much as they can possibly get this is where you get inflation maria when wages rising faster pace than productivity that is by definition inflationary, what i am saying i dont think we have mid on inflation problem look at crisis right now continue to rise, so i think that we are going to start to see inflation again, and weve got to figure out how to deal with this problem fed raised rates 11 times we still have inflation in the economy. Maria yeah. Add on to that, all strikes or potential strikes that are happening, with unions, and that also creates more demand for higher wages and more services, and benefits. Eric freedman what about that go ahead steve about that i predict you are going to see more labor agitation in months to come you are going to see you saw what happened with yellow, we cant stay in business because, of the labor problems weve had. It is very clear, history last 40 years, when inflation goes up you get more labor agitation i wouldnt be surprised if we dont see more strikes in the months to come. Maria invite, for sure, eric. Maria, i think if you look at the equity market we like to use the phrase in crisis truth, for the General Capital market environment what is working right now it is Consumer Discretionary area seeing this quarter 50 quarter over quarter growth. And so that suggests that people actually buying and selling every day, like us, are placing their capital in the American Consumer saying this is a better environment, than what a lot of people forecasted, so i do think it is relevant in terms of what commodity inflation looks like con currently this represents real wage growth for American Consumer doesnt mean it is going to happen in perpetuity, but weve got 4. 3 wage growth yearoveryear we have a 3ish Percent Inflation environment we do think i think is important we do think there is risk of inflation hangs around longer than people would like while market has anticipated no more rate hikes the rest of this year we actual would put into play the possibility of one or maybe two not saying that is definitive but upside risk for fed like personal trader by treadmill ramp continues to remain elevated, at some point consumer will slow down runner will slow it hasnt happened they had keep in mind fed has ability to temper inflation keep in mind the consumer has done very well some marginal erosion a momentum market would not be sellers here we think opportunity for equity market to still push higher. Maria look at this market. I mean look at gains in this markets how much of all that is priced in . Dow industrials up, yeartodate, not as much as the nasdaq. Nasdaq up 35 , yeartodate, with a. I. , Companies Really leading the momentum, and s p 500 higher, in the double digits youve got nasdaq up 33 , s p up 17 , the dow industrials up 6 yeartodate john lonski would you put new money to work in this market today. John no, i would not i still like tbills, that are will yielding 5 1 2 . May i mention rule puzzled by this we now have almost full employment economy 3 1 2 Unemployment Rate, yet we know there is a lot of fiscal stimulus in the pipeline represented by chip, the Inflation Reduction Act socalled ira13 act i cant help but thing we are in a situation where there is this above average risk of significantly faster wage growth ceding into inflation we might be looking at a wage driven bout of Price Inflation fed doing its job but not fiscal policy not at all the point former president of the Dallas Federal Reserve made on this program many times the fed is the only game in time right now in terms of range in inflation because youve got money sloshing around how we got here i would point out oil, Energy Prices back up look at the price of oil the price of gasoline cheryl you told us where gasoline was this represents a tax on American Families crude oil up to 8 dollars a barrel brent 85. 60. Cheryl 383 National Average for gasoline, i mean hitting records you talked about fed there a couple seconds ago i want to pick up on fact looking at fed funds futures trader are scaling back, their bets that were going to get another hike. This year. This were down to a 30 chance of a rate hike by the end of the year. So market is basically telegraphing saying they think fed is going to be done. Charles payne mentioned that earlier in the show didnt think getting another hike, he may be right. Maria joe lavorgna what about that i know people are not expecting a hike in september. But is it all datadependent or do you think there is another hike baked in there . I dont think there is another hike baked in there but dpat dependent, chair powell is correct, cpi, ppi, next report before the september meeting, that will matter the most. To me fed has done away too much i understand risk on inflation i get all that. The Inflation Expectations survey based measures expectations theyve come down yield curve massively invertdz could argue never had occur everybody this inverted when you adjust for Interest Rates i understand inflation forwardlooking bond markets, dont see it bond bond is telling us there is a problem ahead given the lags from when curve inverts to peaks were not out of woods yet when fed has done too much they should top what is lag 12 months, 18 months now 11 rate hikes in 11 months, 8, 16 months the curve, inverted last july average from version to peak of economy one year if you look last two inflationary episodes that we had in 70s, twice in 70s basically the curve led by about two years we can go, another 11 months or so, think we are fine all of a sudden the economy rolls over, by the way, maria, the forecast economic depression not very good track record calling recession even when in one whenever it happens a lot of people dont agree we are in it. Maria a good point, eric what do you do to prepare yourself if you are in fact expecting things are about to slow down . Yeah. We think there is going to be a gradual slowdown i think this is a report where fed is not having as early as two consumers saying hey we are out of woods with respect to wage growth we think a broadening out of equity market right now if you look what is led to your point earlier technology, a. I. Focused companies if you look at even results we had last night a growth in ecommerce you are seeing a really fanning out of sectors we think is a positive. So we would be less focused on tech, as a actual net news source of capital we think if involved that is great should you trim some winners, we are would be involved in things like small caps mid caps we think that is a broadening out we see Energy Interesting Place Capital environments shareholders have been Holding Management accountable for not drilling just without discipline, that has been we think area that probably has a little bit of a to it as well, environment we maria yeah. Because an elevated price of oil could be a negative for the broader market, but it certainly could be a good indicator to get in those oil stocks once again. Yeah. Its an environment where this is still a demanddriven backdrop, maria. And, again, while we think the runner will eventually slow down, and i think thats something, again, towards the back half or middle part of next year, thats when we think the confluence of these rate hikes will likely take hold. But that doesnt mean its going to be the sort of kneejerk, all of a sudden we wake up and people stop spending money. Itll be more of a gradual decline. We still think theres some momentum ahead. Maria so lets review. Kelly ogrady, youve got wages up fourtenths of a percent for a month, up 4. 4 annual yulized. Youve got the number of jobs created coming in lower than expected at 187,000 jobs versus the estimate of 200,000, and youve got a little difference in terms of where the jobs are and were this month as opposed to the month earlier. Thats right. And, you know, i think that this balance, you know, we see the wage growth, we see the jobs not as good as expected, so so youre seeing one good thing from the labor market, but one bad thing and thats something that the fed really does have to balance as theyre thinking about that next increase. The one thing i want to triangulate this against is the job quits number we got earlier this week. That declined sharply, 2955,000. And so that 295,000. That, for some context, tells you people want to stay put. Okay, i dont want to necessarily go out and find a job, so you see this number that was revised down last month, and were seeing a lower hand expected number this month i think is going to underscore that lack of confidence for people. And certainly maybe the Economic Policy will become more and more important as we look towards 2024. Hopefully. Maria yeah. Steve moore, this is going to be the subject in the upcoming election, right many between the economy and corruption, these are the two things voters are going to be wanting to act on. Yeah. And the problem for biden is even though we do is have a pretty full employment economy right now, as i just said, people are feeling financially squeezed. In the middle class. One other quick point, im looking at the report as we speak, and, you know, if you look at mining, construction, manufacturing, transportation, those kind of hard, hard hat jobs, those were basically zero. So where is the job growth . Big increases in education and health care. By the way, those are both governmentsponsored industries. And i think theres a trend, the wall street journal talked about this, of course, people want to take the cushy jobs. I should talk, i have one myself. But those hard hat jobs, fewer and fewer americans are wanting to take those jobs because you go to a construction site or a manufacturing factory, they need the workers, but theyre not showing up. Maria yeah, its a great point. That is the crux of the economy right now. Productivity, workers changing their approach to jobs as well as this consistent increase in wages which, of course, has become the Sticking Point for some earnings disappointments in terms of business. Great conversation, everybody. The dow industrials, the nasdaq the s p reversing course and are now trading higher this morning on this jobs report which actually came in weaker than expected for the month of july. Steve moore, john lonski, eric friedman, carol ogrady, Cheryl Casone kelly ogrady, have a fantastic weekend, everybody. Ill see you tonight on wall street. We have a big show. Stu, take it away. Stuart good morn morning, everyone. When it comes to the tate of the economy, the job market is a mustwatch indicator. Here is the jobs report. Last month 187,000 new jobs were re