the board, you guys. we're looking at rate cut hopes. offsetting weaker earnings we got particularly within the consumer sector. i will mention them again, tapestry, airbnb, were a few coming out today saying the consumer looks a little bit shaky. we will push forward to a few earnings after the bell, like over 90% of the s&p already has been in. yelp, drop box, h&r block for tax season of the those are coming up. overall earnings season has been a success. we're nearing the end. a few more left to go as we go higher other than the equity markets. jackie: even the consumer data points not rattling this market at the moment. it is beginning cracks people are starting to pull back. that will eventually take a toll. you think about that going into an election into november. i think the timing is interesting. but, no one cares what i think anymore. they want to hear from charles payne. taylor: not true. charles: by the way earnings have been killing it but not revenue, not guidance. we have interesting things coming up.

thanks, guys. good afternoon, i'm charles payne, this is "making money." breaking right now the market acts great you about why does it feel so bad? maybe it is the ham-fisted reaction to earnings when they miss and revenue when they miss because there has been hell to pay. we'll have owed to foghorn leghorn. powell wants to desperately avoid looking political. when 90% belongs to one political party kind of hard not to get the message across. could this be the summer of hell for the housing market. we have a lot of evidence pointing that way. would you get a heloc loan if you could get it here? paying native-american not to work has a folks cheering massive illegal immigration. kaylee mcghee-white, so much more on "making money". ♪.

♪. charles: all right, folks that's the theme of earnings season. you know, you have some of these stocks in your portfolio got whacked just like that. beyond meat maybe? airbnb maybe? roblox maybe? everything. i'm telling you miss by a little bit they take them out to the woodshed. taking them out the woodshed. what does that mean. promise in private. that was old meaning. new meaning if you miss the earnings, folks, there is hell to pay. fact set says if you miss you're down 3.3%. a full percentage point above the five-year average. we know this does not really illustrate the carnage, the absolute carnage many stocks are taking. let's take roblox. this used to be one of my favorite stocks. my granddaughter used to love this thing. down 22%. this is where it closed yesterday. this is where it is right now. absolutely crushed, crushed.

earnings have been beating. it has been so what? here's the thing though that is really crazy about it, the overall market is doing really well. we entered today's session with upside bias across the board, short-term, medium term it, long term, all green arrows, right? in fact we've enjoyed the best six-day start to a may in history. of course coming out of the april decline there was a lot of anxiety if you will about, what's going to happen here and what's really interesting about, i think today, really since april, has the markets been propelled by economic data. disappointing economic data. that's right, the good news is that more bad news was out this morning. initial jobless claims. look at this spike. big move in initial jobless claims, 231,000, way above consensus of 214,000. in fact you have to go back to last august before you see a number just this high. so now, you've got the negative data coming through. wall street wants to see this because they think it can motivate the fed.

here is where we are with the citigroup economic index. this is happening, hard data was coming down anyway. look at the plunge we've had in soft data. all parts of this have come down dramatically. let's bring in ned davis research chief strategist ed clissold. ed, i want to begin with earnings, the earnings season has been fantastic. first of all i love your work right, ned davis work. you have your earnings season here, you can see the chart well above the mean. exceptionally well, elevated earnings is the title of the chart but, the revenue misses and the guidance, i mean even the slightest weakness in any of those and they're taking these stocks out to the woodshed. why is that? >> well i think we look at it from the prism you of being a five-month rally, starting in november that was one of the strongest that we've ever seen. so stocks had already run up on expectations that earnings would come through. so if you do come through

everything is fine. if you don't, they were investors ask a lot of questions whether or not the valuations are warranted and also, these algorithms have taken over a lot of the day-to-day trading of the market. so somebody misses, the al go says sell it and that's just the answer. that is participate of it as well. i do think there is a bigger story here that the market has priced in at a lot of good news on earnings. that's fine, if it doesn't, the stocks will have to pay the price for it. charles: to your point what we've seen recently earnings estimates have started to really rocket higher throughout the year with the fourth quarter, you know, being absolutely bonnkers. i personally like when earnings estimates there is a little bit of hetztation because it feels like maybe later on this year there could be even taller hurdles to climb? >> yeah. if you look at the second half of the year the expectations are pretty high. it depends on your data source

but the one we look at shows mid single-digits first half of the year jumping almost 20% for the s&p 500 third and fourth quarters. there is no macroeconomic reason for that. so those numbers will probably need to come down at some point to get to something a little bit more realistic. you know it has another hurdle, the market will have to overcome. charles: talk about this bad news being good news. this morning i was a little bit surprised when stocks went down after the initial jobless claims. that looks like the kind of number wall street would be cheering. obviously since then the market has come on pretty strong. here is the thing i want to get your thoughts as longer term investor what is the better narrative for the stock market, a longer economy that hope or weaker economy opens the fed spigots. >> a good economy so the fed doesn't intervene. if they do, they do so slowly with a few cuts. when the fed is cutting five,

six, seven times in a year, charles, that is something has gone terribly wrong. that means the earnings story we've been talking about will be pretty nasty. investors don't want to get involved in that. it is more about the economy doing well enough that the fed doesn't have to intervene. that's a food environment for stocks. charles: you know the american association of individual investors their retail sentiment number out this morning bearishness plunged t was 32.5 a week ago. down to 23. the ndr short-term sentiment gain was in extreme pessimist range. is this still considered generally a contrarian, sort of a general buy signal with the overall pessimism being high? >> we come off of that a little bit. so what, by the way, that aaii survey is one of the inputs into our broader sentiment composite t was showing quite a bit of optimism by the time we got into april. it came down to pessimism. last couple days it has inched

higher again. i call it neutral. kind of in a no-man's land at the moment. a lot of the exuberance that we saw by the end of the first quarter has been, has been wiped out. that's a positive sign overall for the market. charles: all right. hay, ed, thank you so much again. guys. jackie: ned davis, the research sun matched. appreciate your time. thank you. >> thanks for having me. charles: you know, folks i do find it interesting that the street clamors so much for rate cuts. you heard ed talk about, hey we prefer a strong economy right. here is what is interesting, this pause we have, these pauses they work so well for the market. you would wonder why we have rate cuts, right? take a look at this folks, here is where we entered as the second longest period ever between the last time the fed hiked rates and cut. obviously they haven't cut yet. the record you can see, look what the stock market did. the stock market exploded. we're having a great year right now. so you got to wonder why wall street is so desperately

wants rate cuts. if rate cuts are on the table, they start to come on the table the landscape changes a lot here, folks. i will bring in rob luna, from rob luna economy. the founder there. rob, this is before, 12 months before the rate cuts and then the after the rate cuts and it is so compelling to me you can really see a changing of the guards. first, get a thought from you, do you see rate cuts coming this year, what time frame do you have? >> i think more than likely we'll see something. i think it is one or two cuts, not the six that were being predicted coming into this year i think it will be third and fourth quarters. that's what we're seeing in earnings play out, charles. charles: do you think they happen before or after the election though? >> that's the million dollar question. if i had to bet on that i would probably say after. charles: because here's the thing, we're looking here, again, if they're going to be after, then that means six months away. you still want to be in the winners, communication services

does pretty well, but you see a shifting of the guard. staples starting to rock and roll. financials start to rock and roll. industrials start to rock and roll. we're starting to see that, aren't we? >> that makes sense. the market is forward-looking. we've all been trying to jockey for position in a lot of high-tech growth companies with the idea the fed will cut rates. when you look at all the names, charles, they skyrocketed already. if they are coming out beating revenue and earnings if that guidance is slightly light, you showed that foghorn leghorn moment, the woodshed, that is what they're getting man, beat over the head. charles: golly i cannot believe the amount of, amount of damage that's been out there but still the market's up. this is still a really very strong month. i mean could we say there is clear sailing ahead, maybe a few speed bumps but purchase clear sailing you think? >> i think it is exactly, if you take the earnings season is really important because i think this is inflection moment where you're really seeing you have to

find the companies that will be able to execute going forward. the ones that will get hurt are not going to be doing well. the other thing i think is really interesting, charles, we've been prolong being this recession or whatever it is. i don't necessarily know that will be recession but i do think the average consumer, talking to mcdonald's owners, talking to my barber the other day, they are slowing down. the middle income is being squeezed. they're not renting airbnbs, they're not going to fast-food. they're pulling in. that has me a little worried about this economy here. charles: mcdonald's struggling big time. i wish i could pull up a chart. the stock is really struggling. trying to find the sweet spot. a lot of artificially induced wage increases across some of these states. >> absolutely. charles: talk about some of your stock picks here, pretty interesting group. let's start with american express. it is interesting here, the last time they reported they said millenials are spending like crazy, even gen-z, but do they have the kind of powder to keep

that going? >> i think they do. that is more of a life-style choice. 60% of their new customers are gen-z people. those are the ones spending more. if you look at the american express, those are the haves and have-nots. american express is isolated here. it is a best-of-breed stock. i would like to buy it on a little bit of a pullback but this stock continues to sky rocket. >> like chevron. feels like crude is sort of range-bound right now. the narrative comes and goes, china's economy, middle east skirmishes and wars. but i mean you still have confidence there? is there something else about it like the dividend? >> yeah i like the dividend. 4% it is growing. ceo came out they see 10% plus free cash flow, not only for this decade but for the next decade. you are looking at what you want right now is transparency to future earnings. people are starting to look for something a little safer. i think chevron is a name you start to see money come out of tech into a name like chevron.

charles: money is coming it of tech into utilities. dominion, this one is on your list. utilities i don't think they will be able to lead the market back but they looked pretty amazing the last couple weeks. >> i love dominion. this is under the radar cloud play, charles. they're based primarily in virginia where you see all the new data centers are moving. they will put 15 new data centers on this month. a good dividend and good bounce. charles: i like your thinking there there my man, i like your thinking. rob talk to you real soon. >> thanks, charles. >> stagflation, still lingering around. some are saying maybe it is the new transitory? my next guest on what you want to be looking out for? how do you benefit from that economic state that everyone so fears? michele schneider does the work. she is here to explain next.

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stagflation they keep hearing this spook which word, what is it? gross domestic economy going down, unemployment is going down, demand is going down. that is stagnation. here's the thing, here is the inflation part of it, prices are high and keep going higher. now, you know, listen, in the fomc meeting jay powell just completely said there is no stag, there is no-flation. hard to suggest that maybe it is lingering out there the possibility, right? >> like i said maybe that is the new transitory because it could be that doth protest too much but we're seeing all the signs of it, particularly as we've gone through this earnings seals season with the projections going forward the bottom line is being impacted by rising costs and less demand for their particular products. so there you go. that's proof right there. charles: all right, so let's say we're in that environment or something very close to it. you say the biggest sector to watch this week will be the transportation index. there is a lot of ways watching

it. you happen to like the i-shares transportation. iyt is the symbol. between 50 and 200-day moving average, sort of in a no-man's land. what are you looking for, what are the signals you're looking for here? >> first of all it is underperforming the rest of the market if you're looking at the overall indices for one. for two, it hasn't really gone anywhere around the consumer market is also starting to decline as well in certain pockets. so there is actually a lead indicator. it is the transportation services index. and right now, that thing peaked a few years ago and hasn't really come back since. so if that starts to decline and 130 i think would be the key area that would actually i believe below covid levels, that kind of tells you maybe not even stagflation but even the possibility of recession back on the table. so right now it is warning, but it is certainly not critical. charles: right. >> that's why the eyes are

there. charles: i have to get your thoughts on the rates, the fed, all of this stuff. i want to ask you treasury, raising $125 billion to of course help fuel this runaway government spending yesterday. we saw a little bit of tough sledding with this 42 billion-dollar 10-year note action. the when issue was 4.483. i'm sorry win issue, 4.473. the high yield was 4.473, one basis point. there was less international demand. so you know, people wonder why the bond yields aren't going down. i wonder why they're not going up even more. what are your thoughts on this? >> well, i think maybe the policy mistake might have been the pause for so long because at these levels, what we're seeing the interest rates cannot control the demand for raw materials that we're seeing from some of the newer places the whole a.i. revolution of course has tremendous demand on our resources. there is just not enough.

so these rates are basically ineffective at these levels. charles: right. >> i think that's why we'll stay in this range. that is not necessarily, i know a lot of people jumping into bonds. i would not necessarily be doing that at this point. charles: hey, i only got 30 seconds. i have symbols of four of names you like. sym, elf, mp, and urban. i want to ask you sym i never heard of it before. just came on my radar last week. made a really nice move. starting to watch it right now. what do you like about it? >> symbotic is the company. they do automation and so obviously that's another thing in the future but also at it really reflects a lot of the reshoring and a lot of money that has come back into this country as opposed to trying to do so much outsourcing and that company's a big benefit from it. so i like the where it was technically. it had earnings and it gapped up. so if it settles here around current levels i still think it is a good buy. charles: fill does close sure i have subscribers they will report soon.

fingers crossed michelle. it has been too long, thanks. great seeing you. >> thanks. nice to see you. >> all right, folks as election season ramps up, the fed facing a whole lot of pressure when it is going to cut rates, before or after. i got joseph wong and jim bianco in studio, not own to talk about that, but the morality of inflation next. ♪.

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charles: folks from supermarkets to the stock market everyone in america is tuned in right now with "the federalist" reserve. of course for good reason. kelly o'grady what is at stake, what we may need to know. >> charles, i mean fed chair powell at this point he is such a household name i'm surprised he wasn't at the met gala. i have to look again to see if he was on on the red carpet. everyone now is so intune with the fed because inflation rocketed to a 40-year high. it hasn't looked back. i don't care what economic class you are, you have felt this crazy trajectory, right? so right now, fed chair powell, he has got two issues. the first if he cuts rates before reaching the fed's 2% target he risks being branded as political, which by the way is not a new dilemma or accusation

for the fed. back in 2016, the academy of arts and sciences they featured this article, titled, the federal reserve was a political institutions. the first sentence reads, when the federal reserve celebrated its sin tenille in september of 2013 it bore only passing resemblance to the institution created by democrats, progressives and populists, just a century before. now the article suggests that what started as a decentralized reserve system it has transformed into a powerful regulator, a financial regulator. powers that congress continuously expanded. so, let's think about this election that we've got coming up. if there are rate cuts before november, a lot of folks will be pointing to the fact that among fed economists 208 are democrats and 20 are republicans. by the way, i want to draw your attention to the board of governors. 97 democrat, two republican. so the big challenge here is

going to be for fed chair powell to navigate that political branding. another challenge though for him is the competing dynamic of the jobs market, right? powell strongly hinted he may cut-rates because of the job market weakness we're seeing. even if that means, inflation lingering for longer, remember, he said, unexpected weakening could bring those cuts. since then, charles we got an unexpectedly weak jobs report. that shifted the cme group cut-rate expectations to september from november. but of course, then you run the risk of seeming political. on top of that, sticky cpi, that is the orange line here, it has been remaining elevated and then you look at flexible cpi, right? that started to break out higher as well. so no matter what the fed gus it will likely continue to share blame with the white house over the sky-high inflation. last thing for you, the economist has this cover this week, asking if inflation is

normally wrong morally wrong. that is the big difference between a market and moral economy. interestingly the subtitle suggests that economists don't think inflation is morally wrong. moral or amoral, voters certainly think it is frustrating. charles: absolutely. thank you so much, kelly. joining me monetary macro.com cio joseph wong, bianco research president, jim bianco. we have so much brain power here guys, we have to open the doors, keep it down here. let me start with you, joe, first time in studio. i was reading your work. let's go backwards, the balancing act for jay powell, you think he will say it is okay to cut rates based on softness in johns even though it means longer, sticky inflation? >> first of all it is pleasure to be here. this is a magnificent studio. i do think that is how it works. the fed is ultimately political because the people that work there have certain values and

beliefs, are right? when you look at values beliefs are, they are heavily part of democratic party. you see that in public voting data. one of the hallmarks is vowing employment more than inflation. so i think when push comes to shove, when we have a little bit higher unemployment, when we have even if inflation is still a bit high, i think they're going to cut and i think that is going to keep us stuck with higher inflation simply because politically that's the value system. they really, really afraid of unemployment. charles: jim? >> i would agree with that, that the fed value system does lean that way. i would put a nuance on it, that the fed is not necessarily partisan. and what i mean by partisan, they don't sit around the fomc table to say who do we want, who do we want to win the november election. i don't think they do that at all but i think their political values come in. where i will take a little bit of disagreement is, if the fed wants to tolerate a little bit

higher inflation, they're going to risk a bad reaction out of the bond market. bass bash because i think the bond market is comforted when the fed is on the case by inflation. if the fed says we'll tolerate a little bit inflation, we'll tolerate owning a little bit less of your bond, push the price down and push the yield higher. >> we talked about this a lot for a while. you're in no-man's land with the no landing. then the bandwagon started to fill up right now. you have kind of adjusted your stance here a little bit, right? >> yeah. i was always looking for the idea we would make a new high in yields at five to five 1/2. we got to 4.75. so i kind of moved to neutral only because it is 75% of the way done. what is the old line on wall street, pigs get fat, hogs get slaughtered, i will take 75% and back off. i still think we mite get five, five 1/2. it is not that far away anymore. if we get that without any kind of major move in the market, i suspect we start getting long in

this market, looking for a meaningful bond market rally. charles: joe, one thing i worried about, used on the a few times on the show, hemingway, gradually then sudden, jobs report came in significantly higher than expected, maybe there is quirk with the new york data. they circle the wagons quickly when the narrative starts to change. are you worried about a shock. i'm not sure where it would come from? it feels like there, the economists are too sanguine about this, on either side they believe it will gradually go up or gradually go down. known seem to expect any sort of shock to the system? >> so i think you're right to note that the labor market has been deteriorating. we saw this morning in the jobless claims. saw it in the non-form payrolls. what they say this time around we significant increase of supply of labor. millions of people coming into the country. a lot of them are illegal. we don't know how many. i think what could 457, as we have weakening demand, we have

the ongoing supply, people just don't know, can see but it's there in the millions. we could have a rise in unemployment, a weakening in the job market. that is faster than expected. >> but in certain industries that wouldn't help. these industries these are not necessarily all skilled laborers. >> exactly. charles: people can't go straight to silicon valley and get a job. >> right. a lot of people coming, they're not sending their best. in certain sectors we could have the unemployment rate shoot up a lot faster than expected. instead of demand i think weakening demand and suddennen surge in supply. charles: jim what are you seeing now most prevalent on your radar? >> probably the economy and inflation. the inflation rate really stalled, let me use cpi, above 3%. it will be above 3.4, if the estimates are correct for the april cpi report. and this whole narrative that wall street has had that we were in this last mile going to 2%. charles: right. >> fed officials saying that the

inflation rate will fall later this year, is a phrase used called the base effect. look at numbers from a year ago. they are very, very low the inflation numbers. if we get modest or normal inflation now, the year-over-year number will start trending higher. that will be difficult for the fed to be making the case they're still on the path towards 2%. the numbers won't be headed that way until earliest the fall only if you get the data kind of to cooperate. charles: jim, with what did you think of sort of a wild card, housing or shelter? powell initially began the rate hiking cycle, not long after the data was coming in. it was still surprising the part was hot, things like insurance, housing shelter. all the economists saying way they factor it, way they figure it out, always will be a three or four-month lag. it has been like a year lag. maybe housing is going in the other direction. if that doesn't fit itself what

will the fed going to do. >> no matter what you think about housing everybody's biggest cost, whether it is rental or owning a home. what we're missing with the housing numbers, what we talk about with general inflation. cumulative impact of housing inflation since 2020 has been much greater than people think. so, while they talk about housing rolling over, we are the owners equivalent rent, part of c-p, rolling over, bringing down cpi, it still hasn't caught up to things like sill lee or apartment.com showing 30 or 40% increases in rent. it is only up about 25%. charles: right. >> that's why i think it has been difficult for it to come down. it is still driving to correct that diverge answer. charles: i saw a report yesterday said 2023 new york rents went up seven times new york salaries went up. somewhere like one out of four people in manhattan is a millionaire. you have to be. that is to get a shoe box apartment. joe, what is most prevalent for you? what are you most concerned about right now. >> so what i'm most concerned about is really the fiscal situation. i think what is really changing

going forward is that if you continue to have a 6% fiscal deficit what you're really doing you're printing dollars, you're debasing the currency. that i think throws everyone off course. charles: are you surprised these bond yields, bond auction rather, i mean it was a little sloppy but it considering how much money they're raising? at some point do you think that could be a place, because you talked about the bond vigilantes i guess, these bond auctions seem to be going off okay so far? >> i really surprised about the bond market f i were a bond investor and i saw 6% fiscal deficits forever, that so much even merited a mention in the if reports i wouldn't be buying bonds with these yields. i'm with jim i think bond yields should go higher. perhaps the market we've been in multi-decade bull market a long time, you have a lot of complacency here. you have a lot of people growing up in a world where you buy bonds and you make money. charles: for 40 years. >> i think that's changing. that takes time to filter --

charles: ironically changing right before our eyes but feels like a slow motion train wreck. by the time we all catch on maybe people wish they saw this segment. joe and jim, thank you very much, really appreciate it. >> thank you. charles: folks we'll stick with housing. when it comes to the housing market right now many are saying it reminds them of 2007 including my next guest who thinks maybe that's a little overblown but there are things you have to be concerned about including tapping a heloc loan. we'll slain -- explain next. ♪. when enamel is gone, you cannot get it back. but you can repair it with pronamel repair.

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charles: have you ever like found money between sofa cushions or old coat in a closet you didn't wear since last winner or any part of the house, you felt like golly i just hit the jackpot? what if i told you that your house is the jackpot for newfound money? well u.s. homeowners are sitting on almost $17 trillion in equity on mortgage properties and my next guest says katy-bar-the-door but don't look now because the heloc dam is opening. we have economic analyst amy nixon. amy i know you think, you say

that there are pros and cons to this so give us both sides. >> okay, charles, i'm always looking out for how things impact the middle class american. on the one hand we have middle class seniors for their home is their net worth and i, last thing i want to see seniors forced to sell homes where they raised their families because they can't afford property tax increases, insurance increases, they're on fixed incomes. they are the group getting hammered the most by inflation right now. so a heloc can be a lifeline for this cohort. on the other hand, this keeps prices elevated which keeps younger generations locked out of housing for longer and i think the biggest negative is, it is going to encourage speculators to take out money and buy more properties and while that is capitalism, yes, that is only fair if the risk burden is born by the entities that issue the loans and people taking out of loans. instead with this move by

freddy, it is going to be on the back of american taxpayers and i don't like that. charles: especially with their track record. that what you described is the gordian knot we exist in already. people have mortgages. they will not sell a house increase in value to buy a new house with higher mortgage. we see gobs of investors, including wall street buying gobs of housing. how do you want to unravel it, how do you want to unravel the gordian knot. >> i don't know, this is huge dilemma. housing is a incredible dilemma for the fed. i actually don't think monetary policy alone can solve this and a large part of the reason because this is not just an asset or an investment class, this is shelter. this is with people live and it seems like right now outside of building a lot more of supply the tradeoffs are we have to sort of booed people out of their homes to get open availability for younger people

on, you know, it is like, sort of like a no-win scenario. that's why i think this has been such a hot topic and sew frustrating for so many people. charles: ironically a lot of people thought maybe the fed could come to the rescue. as lot as everything has been though, we're seeing bifurcation. this is something you tweet about, write about all the time. i want to understand, how do you explain in huge surge in seriously underwater homes in many states? >> yeah. the data just came in and it is an alarming headline but the actual reality the number is 2.%, which is still below pre-pandemic let alone anywhere near where we were at in 2007 but in certain states it is high and i think those are the states that were sort of pandemic hot spots. a lot of people were buying the top of the market. they paid really high prices in 2022 and those people are underwater but with underwater mortgages you have to remember that it is still okay if they can pay. so as long as they have a job and they can make the payments

they will be okay. the problem comes when like unfortunately the labor data today doesn't help the problem comes when people lose their jobs. they're unable to make those paints. when you see the walk away turn in the key type behavior. charles: we've seen that in droves. hey i've got 30 seconds the tweet that you had pinned since october 16th, 2022 reads, the airbnb bust is upon us. well guess what, the stock is getting shellacked today. what is going on and why could this be a good thing for overall society? >> you know this, these earnings actually were okay the earnings were okay, charles. they just keep going up honestly with their profits and their revenue. a lot has to do with their business model because, what they're doing is sort of like an insurance company. they're inflows vesting float. because interest rates are so high they're absolutely killing it in this high interest rate environment with interest income

as part of their profits but for society it's not great because it has taken so many homes off the market. it actually put all of the risk in that company is on the backs of individual operators and there's a lot of them that unfortunately may be in that underwater mortgage category that sort of fomod into the top, didn't understand the business and those kind of folks will be in trouble. so i think those homes might be hitting the market soon but in terms of the tech company itself, man, they have positioned themselves very well. so, i'm not sure that i'm bearish on their stock necessarily but, in terms of individual operators i think there is a lot, may find themselves in some trouble as long as mortgage rates stay high. charles: you've definitely been critical. not only that a lot of states have joined behind you take too many homes off the market you artificially increase the prices of some, people can't get the american dream. so i'm not sure where i fit in on this in terms of a free market and capitalism but certainly a great discussion.

i'm glad you always brought that up. amy, thanks so much, appreciate it. >> thank you. charles: all right, i've got a question for you. the neutral education, is it really feasible, right? what is happening we've got an education crisis that's not getting enough attention because it leads to an economic crisis and everything else. caylee mcghee-white joins me, she has written extensively on this, including an article that just caught my eye. we'll be right back. as a fiduciary, i promise to be the financial steward that you and your family need. i promise to put your long-term financial well-being above any short term transaction. everyone has a big picture. my job is to help you invest in yours. [announcer] charles schwab is proud to support the independent financial advisors who are passionately dedicated to helping people achieve their financial goals. visit findyourindependentadvisor.com

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charles: all right, so we spent a lot of today's show talking about fiscal spending and the federal reserve because it's a threat that run rubs through all of our lives and inform ifs our future. there's another major detriment as well x that's education. or in the case of too many americans and the hack of a decent education. my next guest has covered this extensively, her most recent article titled there's no such

thing the as a neutral education. kaylee mcghee white joining me now. let's talk about this article. what prompted you to write this article? if. >> well, the point is that, again, when i say that there's no such thing as a neutral education, what i mean by that is that someone is going to be impressing some sort of value system on students. and ideally, it would be a value system rooted in american tradition, in western civilization. charles: right. >> too often what we're seeing in the public school system is the exact opposite, it's teaching children to reject those values, and and it's what we've been seeing on college campuses over the past week. charles: and with that in mind, what do you think -- i always wonder what's the end game? like, for me i see a place like new york city, i think they deliberately watered down the education for the folks who have nowhere else to go because when you become older and you're in the 12th grade but you've bot a 9th grade reading level or, you've bot to vote for the person that's going to give you

free housing or food stamps. you don't have the ability to compete in our country, and if that's the case, i think it's nefarious at best, you know, maybes wither. >> yeah. in best case scenarios, their just lazy. and we see this often times with government-run institutions and the bureaucracy in general where they get all of this federal and state money, and they just stop trying to do their jobs well. and that's what we're seeing in the public school system. there was an article last year about how baltimore if public schools, 3% of kids can read in baltimore if public school. they're not doing their jobs, and they're not trying to be better. charles: and there's no accountability. so last year our math and reading scores went down to an all-time low. we always talk about being in a global economy. where does this put us? samsung, taiwan semiconductor opened a plant in arizona, they said they couldn't find americans to do the job. >> yeah, this is actually something that i worry about with the rise of a.i. as well.

i'm gen-z, so my generation is the first to be.com name. ed by the interyet. we grew up on it. in some ways it's been great for the economy, but it has made us as people just a little bit stupider. i worry about this with a.i. that we're going to become too dependent on technology to really think for ourselves and to wrestle with these concepts. charles: right. the irony is 50 years ago the futurists said this was going to be great because it would allow us to up lock the potential of our minds because we only use a fraction of it. to your point, i can't remember my home phone number, right? it's under home. i want to switch gears a little bit. we had a guest last week and a lot of folks have been coming on saying, hey, illegal immigration has been a great hinge for america because it's filling jobs. and for me what's frustrating is if you look at native born job participation, we're at a 61% whereas foreign born is 70%. you talk about the system being lazy, it feels like we're spitting i out kids who are lazy

but also een abled because they still get money, they still have programs. we're paying these young folks not to go to work, and that opens the floodgates for people who do want to go to work. >> right. and they're not willing to do the sort of manual labor. my husband is in construction, and he's grateful for his job, and he has a difficult time finding employees down in washington, d.c. because there are a lot of people who are just not willing to do the work. and, again, like my in-laws' family in ohio, my mother-in-law has worked in the auto factory since she was 16. the people who are coming into those factories now are immigrants who are willing to be paid way less than union workers. charles: right. >> and it is a massive economic problem. charles: i was trying to correct the economists, we don't lack workers, we lack people who are willing to work. >> yes. charles: great stuff, kaylee. yesterday president biden was in wisconsin bragging about a handing billions of taxpayer dollars over to microsoft to build a semiconductor plant. by the way, the it's not the only company getting billions of

dollars. what they all have in common, obviously, is they are the richest companies in the history of humankind, the richest. you know, i did back of the envelope math on microsoft right before i came down. since 2017, they've made a trillion dollars in revenue, a there trillion dollars. do you need to give them money? so they invest around the world $150 billion into semiconductor ors all the time. if we go down this rabbit hole where somehow the taxpayer is going to subsidize this, we're going to be paying out for a long time. the white house's narrative that the corporations and the wealthy don't pay they are fair share, that -- they all say that, right? and people believe it. and yet you can still brag at the same time about not only rewarding the richest companies in the world, but also paying college loans. it's a crazy world we live in, but ooh i've got to tell you i think it's a political trick. i don't want it to work. liz claman,s over to you. liz: you know, it could be with. but they would argue -- meaning the administration -- they're