 All right interest rates are rising but this time you know the traders weren't freaking all right They they they held their own stocks ended up on the day Even though interest rates actually backed up a tad more the 10-year note now Resting comfortably over that 3% level and a lot of people said that would be the level at which people would say that's it Doesn't look good for stocks I'm gonna put my money in the safety of a treasury note or bond Because at least Uncle Sam will back me up can't say the same about corner wall and broad Let's get the read from retail watcher Heath of Herzog and market watchers Dan Geltrude and Melissa Arbaugh Melissa the view was is that a backup in interest rates is bad For stocks when I'm looking at this being the old Foggy here remembering a 10% handle on a 10-year note around 1987 and this is less than a third of that. Well, you're right about that overall in the bigger picture It's really not a crisis. This isn't a reason to panic However, the fact is the market's been rallying for quite a while and now we've seen since selling in the last few months We've seen more selling than buying the market isn't gonna go higher stocks aren't gonna go higher It's like a tiny little bit from below so we had big selling in the morning big selling yesterday We only ride a little and all of these things that have been having earnings like Facebook's out tonight. It's up But it's not up a lot. It's not up enough visas up tonight on earnings to not up enough We had good earnings of the bank. So what are you doing? Well, I think we don't see brand-new highs in the market until maybe the fall towards the end of the year No, I'm not I'm actually optimistic. I think the market still has plenty of room I think that the the interest on the 10-year treasuries being over three. I don't think it's that big of a deal However, why don't you think it's a big deal? Well, because I just don't think unless it's going to be a trend that you're gonna have that much of an impact on Interest rates because really I'm more concerned about how is this going to affect borrowing both on an individual Basis and a corporate basis. I just don't see it. You know, he thought you could make the argument here that The backup in rates is largely because of an improving economy, too, right? Absolutely And I think that's what's been carrying this rally for a while people have been feeling better about the economy And we've seen these rates go hit, you know past three percent for you know Many times and they've retreated back a little so to your point it is a little bit weird that everyone is well What do you think it's going to do for for shoppers and are they gonna tighten up? Well, yeah, well, I think if we see a continuing trend upwards I think people will get a little bit Concerned with the inflation rate going up and you know it maybe in the fourth quarter We'll see people start to retreat when it comes to shopping and consumer spending But if you look at the same-store sales and if you look at retail earnings, they've been positive So the consumers feeling good out there I don't think any sort of upward trend of a Interest rate at this point is gonna have that much of an impact on yeah I tend to look at this as good news sometimes is good news I know we look at good news as being bad news elitist of the Federal Reserve tightening and all of that But market rallies have always been sustained even in the midst of rising rates could they not necessarily one goes with the other so again, yes a strong economy That's why they're raising rates because the economy strong that's good that in the long term That's what I'm saying long term. It's great long term. The tax plan is great long term. All these things are great But right now People have a lot of credit card debt and we are gonna see an increase in rates Maybe two three more times this year and in the unsecured debt that means people's payments are gonna go up But now they just had that tax savings They just had it now their payments are gonna go up and that's gonna affect people usually have about 15,000 I think is the average of unsecured credit is kind of coming down right now people are paying that down However, I mean if those rates do go up and I didn't read that But I don't know what where the sources are but either way I'm saying The fear that you know the short-term rates, you know, you could argue with this Flattening yield curve it in two years, and I don't want to bore people. I saved that for well my show that It portend something is gonna slow down down the road Well, I think what you could see happen here is with the housing market depending on now How the Treasuries are gonna impact mortgage rates now mortgage rates Trail behind the Treasuries, but they will start to inch up That's why I said before if this is the beginning of a trend related to a rising interest rate on the Treasuries now we could see those borrowing rates go up and now what happens with people's monthly Mortgage payments when they're looking at I could only afford so much housing prices are gonna have to come Is that a wash with the tax cuts or no? I don't think it'll be a watch to that extent Neil There will be some benefit, but that's not gonna be a dollar for dollar offset. What do you think? Yeah, we're talking about a Domino effect and again if those mortgage rates go up people are gonna have to start shifting their Income around what how are they gonna pay for certain things like if you know, they're their credit card interest rate going up You know, where are they gonna? You know put money aside for potential tuition for school, etc. Complaining about stuff that should be good But I mean this is a Fed's job really there it's their job to find the sweet spot where there's enough Right they are but again because you're miss negative You're like I'm not miss negative But my outlook for that for the year for 2018 has changed because we had so much just on the basis of this uptick No, no no no no just since February because we've seen so much selling and so much selling I just don't see it that way Neil. I have to beg to differ with Melissa. I'm an optimist about what's gonna happen I see room in the market. I think we're gonna see continued growth. Let's not panic. This is no And I feel really good about the economy. I think we're gonna be okay. Okay, I think we're gonna be okay, too I'm very positive. I'm just saying right now. I'm talking about the next three to four months of summer summer 2018 I don't think the market makes new highs. We might we could here. Let's see I don't even know I'm gonna have breakfast tomorrow All right guys, thank you Very much. I told you they were geniuses. All right, you know Jeff sessions was up on Capitol Hill and he was asked a bunch of questions like Why didn't you recuse yourself in the Cohen case and About sticking around to the White House if Rod Rosenstein is fired. What do you think he said? We have the answers after this