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tv   Mornings With Maria Bartiromo  FOX Business  March 17, 2023 8:00am-9:00am EDT

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rate 13% talking about chasing people after they leave the state claiming a portion of their income. they -- the supermajority in california legislature knows no bounds, so, you drive there the roads are terrible. the infrastructure is crumbling, they raise taxes focus on issues maybe not in best zrz of citizens i loved the city i was born there, but i would never go back. maria: it is a sign of what is going on policies there, also starts with policy, stay right there next hour of "mornings with maria" begins right now. . >> our 21 seasonal he can risk kaishths look at equity credit one of the highest probabilities of a crash in the stock market within 60 days. >> not unique in economic history you need to put slack
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into economy not just to keep prices down tame wage inflation on sustained basis. >> going to be a really bad kind of s&l 1980s crisis the market probably drops 20 to 30% at the end of the day we are trading 19 times earnings, we have -- four banks blown up last week. borrowing 4% before fed started raising rates that as of last night was just under 9%, so, that is a massive obviously, more than a doubling of the prevailing interest rate there is more than a trillion dollars in debt, that needs to be refinanced this, year. >> if you have interest rates, in policy at zero rates massive increases in money you are going to have interest rates staying low. >> we rather have the fed continuing to tightening first economy then recession squeeze
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out inflation, our call fourth quarter. >> sbc idiosyncratic issue i don't think that is true i think reflects credit story hilt from higher rates on ability to service debt going forward. >> montage of guests this week incredible week today is the final deadline or deadline fdic put in place for banks to bid on failed silicon valley bank bank and signature bank newer details after 11 banks rescuing first republic with 30-billion-dollar deposit yesterday jpmorgan citigroup bank of america wells fargo contributing five billion dollars smaller contributed 2 1/2 billion smaller one billion, all coming up with 30 billion dollars in deposits for first republic. >> mieshlg kantrowitz bear
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traps founder larry mcdonald laffer tengler investment officer nancy tengler great to have all to react michael give your take, on where we stand today, markets are up on the week after all this volatility, and concern over the banking system. >> good morning, maria. . and many to the rest of you good morning we think acute period of this banking crisis fear is moving behind us, and you know this is not in our opinion, a revisiting of what happened in 2008. it is happening for very different reasons will have different consequences, and we're seeing different solutions fed fdic government treasury provided facilities to backstop problems as i mentioned other banks also intercepted to help other areas of the financial markets. and so, i know i think
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investors while they have -- in my opinion over shot, in terms of how much they expect how quickly they expect fed to cut rates, i don't think this is the big one, and that markets are going to be spiraling out of control, in very near-term, i am more concerned about the lag effect of all tightening, moving beyond the banking system and corporate profits, and employment, and that is where historically very consistently problems a bump in the road one heck of a big bump up expected bump but not what ultimately makes the market down. maria: larry we are looking at headlines here impact of all this first republic bank this morning is down 13%, it just got a 30-billion-dollar infusion of cash, deposits from major banks the stock is
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still down 13%, let me also point out silicon valley bank financial parent has commenced commenced chapter 11 filing gone bankrupt on up sized bank funding program appears successful banks pulled nearly 12 billion out through wednesday, 11 banks putting 30 billion in first republic your solutions from bank bailout 30 billion dollars to dpocht bailout by regulators sure all deposits are safe, to this bank term funding program how do you assess where we are after this week that was. >> a larry. >> well, there was he have we have a federal reserve that three weeks ago, four weeks ago told us they are on a quantitative tightening path 09 billion dollars a month preaching to the world
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preaching, preaching they were tightening, reducing the balance sheet, right -- qt, in last -- three, four days put close to 300 billion dollars basically -- the balance sheet expanding again. it mind-boggling, when you see that type of -- destruction from congressional banks makes depositors all -- that is why, this -- rolling, you don't like -- because, about what they're doing, x, y, z, and a, b,c. maria: the journal editorial board rights yellen insures banks run, the first line of this editorial board op-ed says janet yellen offered more are in insurances u.s. banks
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are safe and sound even treasury secretary we doubt believers it nobody else does the biggest american banks committed 30 billion dollars on thursday to rescue first republic bank since bear stearns collapsed still down 13%. think about last six months -- you have [inaudible], pension crisis london, october then regional bank crisis from then credit suisse. so, you see, these are -- cockroaches are coming out of carpets, you don't know as investor what is next, because -- the truth is bleeding out one drop at a time you can't possibly make investments with that like what is next? you tell me. maria: right, well -- i mean look michael, what about that? you see you know credit suisse, and its struggles can
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we see more bank failures and still believe that the economy and banking sector are okay? >> to a um, yes, you know i think this going to add confusion to a backdrop that is probably already confusing investors more than ever in history with all different crosscurrents around the world. i think investors are need to compartmentalize what is going on across the banking system, we would not categorize what fed is doing in terms of being lender last resort as qe. 1, qe 2, qe 3, the size of the balance sheet 8 trillion dollars so far up about 159 trillion dollars in discount window uptake new facilities 12 billion dollars, so the banking system is about 12 trillion dollars -- i'm sorry 23 trillion dollars in size de
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minimis compared to the size of the balance sheet size of the banking system the size of what was actually qe. so i think we need to compartmentalize putting backstops in uninsured deposits banking system, and reality that the fed still believes they have wood to chop on inflation. we're expecting a 25 basis points rate hike, as we saw the ecb did 50, so we have to compartmentalize these it is not fed doing qe wuting interest rates would bring down auto rates consumer loan rates credit card rates et cetera, it is going to further confuse but i wouldn't read it qe like we know in the past decade. maria: i want to know what the lag impact is on all these rate hikes slip in a break continue our conversation with michael kantrowitz nancy tengler larry macdonald live a market down another 170 points
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right now, the bank silicon valley bank has filed for bankruptcy protection, we look at housing market as well we've got housing data out next week, fox business jeff flock in eventsa with a live report, you are watching "mornings with maria" live on fox business we continue our n, conversation, next. . but you're right on track to reach your goals. my ameriprise advisor helps me feel confident about my financial future. he knows me and my goals. it's not the first uncertain environment he's helped me navigate. probably won't be the last. but with his advice, i know i'm on track. the plan we created can withstand uncertainty. no wonder clients rate us 4.9 out of 5 in overall satisfaction. because advice worth listening to is advice worth talking about. (vo) the fully electric audi e-tron family is here. with models that fit any lifestyle. and innovative ways to make your e-tron your own. through elegant design and progressive technology.
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housing market take a look at numbers, 80% commercial lending 60% residential lending is down by regional banks not big boys according to goldman sachs, nahb, has concerns a follow-on effect of the pressure on regional banks continued fed tightening will be further constraints for acquisition development and construction loans for builders forward we talked to miami realtor says, the effects of this are going to be felt sooner rather than later. >> i think that definitely the capital outflow liquidity in issues smaller regional banks, and going to have insolvency issues as well may not be -- in local level. >> maria housing sector under pressure because of increases in rates, although we had a
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downtick from 7% to 6.6% on average 30-year from 6.22% to 5.9% on 15 so that is good news but still a lack of supply out there if you look at pending home sales as of last week i think red kidnap says down 16% year-over-year, housing, definitely under pressure this thing is not making it better. maria. maria: for sure thanks very much jeff flock, i am back with my manually michael kantrowitz larry mcdonald nancy tengler, nancy so far serious issues, within tech and some issues within real estate, just heard from jeff flock here 37 what else is hovering what other areas do we need to be focused on? because clearly, the banks that collapsed did not see the severity of those two real weak spots in this economy. nancy: i think this time i agree with michael the bank the fed lending is de minimis
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in comparison to all lending but margin has been material, i just read a report last week, lending facility the discount window will surged from the five billion two weeks ago to 153 billion this week additional lending by fed was 318 billion half went to secure deposits, in failing banks at the margin creates a problem i think for banking sector, and for the economy, and for potentially fed policy so i hope they will take this, and use it as an opportunity to pause a pause is not a pivot, we can still address inflation but want to get stability back in the banking sector, but i do think, counterintuitively you know, i've talked about adding risk into portfolios six months the nasdaq is only really bright star this year up again this morning, i think what it is telling us is that large expect a companies especially
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in technology sector that can deliver reliable earnings will be a safe haven in environment like this, because they -- they can provide some stability to your portfolio. so, we've been pleased with that investment, i would encourage you know all investors to about think about that what we know during volcker's years in double-dip recession environment stocks were up 362%, so some of this negativity is already priced in, and the question will be you know how choppy out is between now and end of the year but we are kind of optimistic frankly. maria: we are going to talk with dan niles about that longtime investor in tech about what he is doing with holdings, but i mean larry you came on this show about a week ago said look, your work including your conversations with large institutions, led to you believe the market was about to crash, within 60 days, that is exactly what happened. as soon as you said it markets were nervous and i want to
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know what you think about that. is there more underneath the hood we're not focused on silicon valley bank was un-don by deposit clients, of course, a bad deposit structure all those venture capital companies needed money seeing stress signature undone partly because every commercial real estate issues, do we know the extent of these issues right now? >> yes, so the markets, if you've been in market nasdaq, two years you are basically flat if you put, we can discuss a couple weeks ago a million dollars in market two years ago, almost down actually. so that person is frustrated, the average -- 73 trillion dollars in hands of the baby boomers, the gen ex' 7 trillion wealthy in boomers gennex, the older boomer 79 --
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63 old boomer baby, is close to 80. that person got hit over head with covid, hit over head with lehman, you know just -- frustrated, now, has this, credit suisse, all uncertainties that person is going to cash i think, going to put his money in treasury bill or asset for now until cloud of uncertainty gets released, that is why we go lower, to nancy's point -- sure, but that person is through ringer probably much lower good time to put to work. maria: you said you think federal reserve is going to change its position as well we are seeing cut if rates before july 4th? >> yes, the fed, so think
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about tightening, we haven't seen -- the sense promised the world three weeks ago promised the world this federal reserve, this is the largest central bank most powerful on the planet, two weeks ago promising -- additional rate hike now, if that is probably gone. right so that is a pivot, that is like when you promise something don't deliver that is a pivot, the fact, you don't about the you don't have to try. but, so that uncertainty of that shift, i think okay the -- didn't do 25, i think they stop and then, you know definitely going to get another at least 50 basis points rate cuts. >> michael kantrowitz we've got to jump you have a note to clients you said when market identifies a problem it becomes that problem, don't the fall for bear market rallies should i sell this market here down 208 on
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futures? >> you know i think maria the markets going to bounce back-and-forth several months between soft landing and pivot, hopes, recession and inflation fears, i think we are in a sideways market until either we decidedly crush inflation, or we decidedly have evidence rising unemployment claims of a hard landing i am in that camp, we recommend investors not over reacting to what is going on here, keep moving into higher quality stocks, with good interest rate coverage cash flow, and have a framework don't be rebeing aive the framework that we have tells us going to see unemployment deteriorate later this year when bad things happen. maria: kanancy -- yesterday said recession fourth quarter we pressure it dow industrials down 207 right now. we'll be right back. . . there are some things that go better... together.
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. >> he supposing we have 1.3 million getaways we know of, has what is your estimate of the people that we don't know about that got away. >> my confidence level got away number continues to increase is it one hundred percent no, sir, at 358,000 gotaways so far, this fiscal year, we continue to refine that number -- i have -- eliminated time need a number
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how much more do you think got away that you don't know about. >> probably between 10 and 20%, sir, more. >> more? >> yes. >> well that, was florida congressman jimenez house homeland security committee hearing on wednesday questioning border patrol chief ortiz on number of illegal migrants got away what would he expect on top of just numbers we know of? they remain completely unaccounted for in this country we don't know what intentions are but we know that they did not want to be apprehended, congressman carlos jimenez joins me thanks very much for being here for leadership on this subject, tell us why this is important, for americans to understand the got away part of this. >> well those are folks that don't want to be apprehended, the majority of
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migrants through follow signs takes them to the customs patrol turn in in all probability allowed in united states 1.3 million that we know of like chef said 10 or 20% i think that is low i think even higher than that, that got away that don't want to be detected, and they got away we don't know who they are don't know where they came from don't know where they are. we certainly don't know what they are doing here or what intentions are. >> there is another element to this that is the people that have been apprehended that were actually on the terrorist watch list, so that is another element where we know that people have been apprehended that are actually on the fbi's terrorist watch list. that number is outpacing last year's record so far this year, border agents stopped 69 people on fbi terror list,
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only 8 people apprehended on terrorist watch list between 2017 and 2020 for three years congressman, so i guess, potential terrorists criminals figuring out wide-open i will get in that way. >> even chief and i got to give him kudos for courage, told us that out of nine sectors he you customs and border protection have five out of control no operational control five out of nine on southern border directing contradiction to what secretary mayorkas has told us two years no this border is under control chief in charge of all agents said i am told under oath five of sectors are out will control basically not basically the second has been lying to the for the last two yoors maria: do you want him impeached? >> yeah, no, no, this secretary is -- is a disaster
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that border a disaster, you know appointed by president biden, he should remove him but i believe doing president biden bidding president biden i think happy what is going on at the border another question i asked is president dumb or secretary mayorkas are they dumb the answer was no, i don't believe they are dumb they've been told over and over again things they have to do to control border they refuse to do it means they want to do it on purpose this all done on pepper the reasons why on purpose? i don't know. by the way, those -- those terrorists that we know we got they were apprehended, how many terrorists actually getting through that our gotaways if you are a real terrorist i don't think you really want to go, and get apprehended i think you want to get away, so whatever that number is over 89, 90, that we have apprehended, you can probably triple that on the got away side, at least. maria: look, there i also the
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china component because now communist china is not just abusing our visa process but actually sending individuals, in through southern border, i spoke with the -- jonathan ward earlier on xi jinping positioning upcoming meeting with vice president here is what he said. >> have s xi jinping often his way to -- you know have another round with putin on comprehensive strategic partnership of coordination for new era this is a deep relationship as we've talked could about a long time very clear whose side china is on add to xi jinping recent speeches talking about u.s. containment and suppression of our country, and that sort of thing in foreign ministers talking about how on path to convict it is very clear what they are russia, china axis forge about a being decade in the making. maria: congressman jimenez you are aen m of house select committee on strategic competition between u.s. and china. there is an on they had
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morning out from -- says chinese officials knowingly permitted covid-19 virus to spread around the world, state competitors don't deliberately spread deadly advisers, this president will not call china an adversary he calls them a competitor. will the. >> no. we -- look our select committee says says competitor they are adversary playing same game by same rules china doesn't play same rules they gotten follow ruled that is adversary in my subjects i am go similaration they totally are adversary what china does not in best interests of united states we need to decouple from china quickly as possible allies decoup absence quickly is as possible they want to devour us i think we've woken up allies starting
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to wake up too about the reality of what china really is, and threat chinese communist party poses not only to united states but to rest of the free world. maria: some of us may have woken up doesn't appear this administration has, because if so they would change policies to set tone for corporate america, are corporate america wants money -- >> yeah? >> well there may be a reason for that i think, you know, our oversight committee with representative comer is digging into why is the president so soft on china? it could be that he has interests, and his family has had interests has been paid for paid by chinese communist party. and other nations. maria: . >> thank you, carlos jimenez, we'll be right back. . huddle up! i call the time outs. didn't expect to see me so soon, huh? well, i invest in a fund that fuels innovation, like next gen video conferencing,
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get $1500 purchase allowance on a 2023 cadillac xt5 and xt6. ♪ visit your local cadillac dealer today. . maria: welcome back, microsoft adding chatgpt technology to office software
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cheryl casone with details. cheryl: maria mfrt ceo, tweeting about new a.i. ---eddon with microsoft 365 coplooilt giving more agent making technology more unbelievable with advanced a.i. most universal you're internatural language the features available in microsoft 365 popular business app word, powerpoint excel sometimes it will be right other times usualfully wrong, up almost half a percent, california is planning to ban food ad advertises from skittles, even baked goods if the bill becomes law including vegetable oil potassium -- will change formula or not
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loud for sale in california, gabrielle filed this to curb use of ad advertises linked to cancer ailments the plan hopefully rest of the country will pick up with california starting the conversation. >> new york city supermarket to use facial recognition swear to deal with out of control theft. fairway supermarket using technology in wake of shoplifting spokesperson saying this technology is helping stores reduce retail crime, a challenge but increased dramatically over last few years, the store has signs letting shoppers in other fairway is collecting biometric information some say kind of like big brother fully disclosure i shop at fairway a full one way or another next week i am going later tie see how this goes. maria: that will be our
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indicator when you go, to fairway report back. cheryl: waving. >> the federal reserve march meeting happening upon us kicking off tuesday a two-day meeting tuesday and wednesday we have questions, about whether or not we're going to see interest rate hike following this week's bank fallout joining me to access it all after a wild week is the founder of the satori fund portfolio manager dan niles with us great to see you thanks so much for being here. my pleasure, maria. >> i want your assessment of the fallout around the collapses of banks, first let's start on federal reserve. are you expecting a hike next week? >> absolutely expect a hike i think if you look what happened this week eecb the ecb thursday hiked 50 basis points, anyway that is with all issues we know of with
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credit suisse, banks got two things trying to deal with, the fed as well as central banks around the world trying to deal with banks stability on one hand so using the regulatory powers lend er of last resort to try to stop that ecb is raising rates having to deal with high inflation so that is the monetary side of the mandate those two have to come together so that is what i think, on friday, fed raists raises too data dependent, in markets, the rally despite with ecb raising 50 basis points market in u.s. up almost 2%. >> i mean we have this bank
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term funding program, that seems to be a success, banks pulled nearly 12 billion out of that wednesday, but here is a note this morning, first responder capital markets says the bank funding program was only 12 billion before you get excited thinkings a huge positive for regional banks on notion they didn't need much seemed they used discount window to tune of 150 billion, tack on what fdic borrowed 143 billion to support deposits of silicon valley bank and signature 300 billion needed dan we talked about owning banks before what are you doing in terms of capital i saw the other day you were buying oil stocks do you have concerns around the banking system right now? >> absolutely. i mean if you go back to late last year, we thought this was private equity world first
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you've seen redemptions companies can't meet redemptions in real estate space coming out of last year you have 620 billion in unrealized losses sitting on bank balance sheet just u.s. alone against capital base of 2.2 trillion. then in europe you have about 200 billion unrealized losses, so, you know we fully expected stresses in the system this got -- pulled a lot faster than we thought our target for s&p this year has been 3,000 we thought that would happen in back half of the year, but i think for right now this puts a banned audit on the wound but don't forget, what is the cause of the problems? the cause of the problems we have ultra low interest rates since global financial crisis, 13 years now we have had inflation. that is still here we are still to having fight with that. adopted forget china is opening up again, after three years lock downer we saw what happened in u.s. the rest of
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the world last year when we all opened from a lockdown they are going to have a lot of inflation in back half of the year so i don't think i don't see this problem going away. i see this continuing, until inflation is gone. maria: so how are you investing having said all of that dan? you were spot-on earlier in the year in terms of where to place money but these concerns rising a bank crisis going to hurt technology, commercial real estate, i spoke with "the wall street journal" chief economics correspondent nick timiraos here is what he said. >> when tide goes out you begin to see naked here i think the big question now is where is the pain going to be in financial market what air pockets are we going to hit something goes zap who is exposed to that? i think changes sort of risking management framework for investors but alsos for federal reserve here. maria: dan i want to get your
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take your so thoughtful how you come to decision, about how to allocate capital. what do you think in terms of this backdrop how are you allocating capital right now? >> sure. i mean, we talked about this on friday but we went into middle last week short a series of financials that included a basket of names silicon valley bank, signature bank first republic our view that there was something done to save the banks, you see a short-term bounce, no, i looked lived through lehman crisis false rallies our plan to put shorts back on not to take them off i think this is just the beginning as you remember, with financial crisis, it was a series of stops and starts along the way until the ultimate bottom we
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wouldn't touch any banks, they are going to bounce move every day because of what you see happening, but you would stay away from that, the other issue is that with technology, earnings season coming up, the banks are one of the biggest spenders in the tech space, 4.4 trillion technology spending, the banks account for 15% of that so it is a very large number. this happening towards the end of the quarter. so i think you are going to have a pretty rough season so from our perspective, inheritance to go down further than we thought now, because with all the banks stress lending standards went up a ton even though fed is maybe raising 25 basis points, the one thing standard probably tighten by 50 to 100 baichz banks fighting to make sure they are solvent cutting as much expenses they can to make sure in good shape what we looked we talked about this as
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investing in commodities bought oil corp reited stocks aluminum, sports gambling for all that aren't profitable this cuts off access to capital for two big guys, fanduel, doing very well should get to profitability this year biggest taking market share, and we're that is how we are thinking about this our plan to put all those shorts back on, but we covered, back on friday. got nice little bounce, 4100 highest i can see going in s&p we talked about that before, and, are you know, that is how i would play it through the end of the year. maria: i mean look this market is at lows of the morning right now regionals across the boarding dow industrials down 270, obviously, the weakness worries are accelerating, as
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bitcoin is up head-scratcher there we see you this weekend on wall street, 7 pm eastern dan niles good to see you. we'll be right back. ♪ ♪ . (vo) the fully electric audi e-tron family is here. with models that fit any lifestyle. and innovative ways to make your e-tron your own. through elegant design and progressive technology. all the exhilaration, none of the compromise. the audi e-tron family. progress that moves you.
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. maria: welcome back. all 18900 feet of train tracks removed from site of east plas tiny derailment lapping more than a month sings toxic spill ohio attorney general filing against norfolk southern secretary civil penalties costs damages after contaminated air and water in nearby areas joining joining me ohio's attorney general david yost thanks for being here what do you want to say about your lawsuit. >> this is designed to make sure norfolk southern actually lives up to promises, now and in the future. most of us remember, burn pits operation desert storm, 9/11 how health effects long-term impacts that we didn't know about for quite a long time. this lawsuit is designed to not only hold them accountable
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to make sure they remain accountable in the future. maria: a so what would you like to see in east palestine, they are still worried things are not safe. >> right. and we are still developing information, right? we don't know exactly the extent of these impacts. governor dewine and i talked about this one outcome that i would like to see, and governor would like to see, is so many kind of a fund a long-term fund that is set up to ensure against those kind of unknown unknowns that are sure to develop. maria: ohio senator j.d. vance slamming epa response to clean up toxic waft in east palestine in senate hearing last week, watch this. >> right now, as we speak, there are piles of dirt um accumulating in east palestine if i ammed with toxic chelz
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have not been moved out of the state in a week being what happens if it rains what happens if a very toxic dirt we dug out of the ground begins to sooep back into the ground causing problems for air and water for residence of east palestine. >> your reaction. >> he is right we were seeing the contaminated water contaminated soil shift out of state but to facilities that were permitted by epa they have their permits they are all approved with process and site to dispose of this sort of thing, local politicians started rearing up on hind legs, about how unfair that was instead of epa saying look we've got this, there has been a robust process to make sure that these people these companies can handle this, it has been there for years, we
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are moving forward, they got chicken legs, shut the thing down for days, and was right sitting there on the ground, and we are approaching the rainy season. >> all right ag thanks very much we will watch your work this on dave yost joining is we will see you soon we'll be right back. stay with us. . ♪ irish banned you fell in love with an enenglish man ♪ ♪ ♪ jay? jay's back? gimme a time out. huddle up! i call the time outs. didn't expect to see me so soon, huh? well, i invest in a fund that fuels innovation, like next gen video conferencing, and when i saw your defense in the first half, i had to step in! anyone can become an agent of innovation with invesco qqq, a fund that gives you access to nasdaq-100 innovations. coach, what are you doing?!
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thirty minutes from the opening bell, cal looking at the market at the close of the morning. stop industrial down to 90 right now, nasdaq 36 and s&p lower by 30. we know svb has officially declared bankruptcy and a whole host of banks have gotten together to prop up first republic with $30 billion in deposits. nancy, your final word. >> this is a complex time but often the best time to get into the markets or when things are the bleakest, matters runs the company, happy st. patrick's d day. >> final word. >> more than half of americans are more concerned about the economy than a week ago, this
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volatility put a lot fear into investors so as not when we end up government to tell us everything is fine, it's not in the investors minds to the needs to be real change and addressing of the people's concerns. >> will be watching that, a busy weekend, dow industrial down 300 points but the opening bell an hour away. great to see you both and be with you this morning, we have a big show looking ahead to next week and it will be big one with the federal reserve's two day meeting beginning tuesday and wednesday. we expect a hike in interest rates of 25 basis points. varney and company picks it up from here. >> good morning, everyone. financial crisis and everybody wants to know if it's being contained. that's a tough question to answer. i'll show you this, first republic shares are down again, despite 11 big banks putting in 30 billion. west bank and pacific western ar

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