Closing Bell - AI Trade Cooldown; Andreessen Horowtiz’s Katherine Boyle on Private Markets; Lessons from Gig Earnings 11/7/25

Episode Date: November 7, 2025

Are markets starting to rotate out of tech? Jim Paulsen of Paulsen Perspectives weighs in as investors reassess the rally. On Capitol Hill, Emily Wilkins tracks the latest on the government shutdown. Mark Mahaney of Evercore ISI breaks down gig economy earnings and investor takeaways. Dana Telsey dives into retail and consumer trends. Plus, Kathy Boyle of Andreessen Horowitz joins to discuss the cooling AI trade and OpenAI’s leadership drama. Also featuring travel disruptions with Phil LeBeau and a look at next week’s catalysts with Adam Crisafulli of Vital Knowledge. Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Well, that's the end of regulation. World leaders in data and AI ring in the closing about the New York Stock Exchange. Apex Treasury doing the honors at the NASDAQ, a big intraday turnaround for stocks. That's on news of a possible end to the government shutdown or at least movement in that direction. Coming as the University of Michigan report showed growing fears about the consumer, the doubt basically flat. S&P 500, similar story, the NASDAQ about a quarter of a percent lower. The Russell 2000, that closed higher up about half a percent. We had losses on the week, though.

The NASDAQ, the hardest hit, having its worst week since the tariff turmoil back in April. Tech, communication services, consumer discretionary. Those are the worst sectors, both for the day and the week. Tesla, Nike, Chipotle, leading the consumer names lower. Chipotle today hitting its lowest level in more than two and a half years. Bitcoin, ether, gold, all higher today. they're still down 11% on the week. That's the score on Wall Street, but winter stay late.

Welcome to closing about overtime. I'm John Ford alongside Morgan Brennan. Ahead, text tumultuous week as the AI spend narrative remains under scrutiny is the foundation of this market rally starting to crack. Plus, consumer sentiment hitting the lowest level in more than three years and just off its worst level ever. Could it mean, what could it mean for the retailers and the crucial holiday season? And travel headaches beginning with.

airlines cutting flights as the government shutdown continues. We've got the latest. But now let's get right to the latest on that government shutdown. And news of an offer at least to end it, but are Emily Wilkins reporting that offer not likely to be accepted. Emily, is that definitive? There seems to be some hope heading into the weekend. John, the hope is quickly getting smushed over here on Capitol Hill. So as you know, Democrats did come up with a new offer. They took the floor. Chuck Schumer said, look, Republicans, if you can give us a year-long extension on those Affordable Care Act tax credits, we will give you the votes needed to reopen the government. But that's been really quickly extinguished by a lot of Republicans.

Majority Leader John Thune said that that was an unsurious offer. He said, look, it's better than the last offer they put forward, but we clearly have a long way to go. Meanwhile, Senator Lindsey Graham took to X. He tweeted out saying that we should not be made to continue flooding health insurance companies with taxpayer dollars under Obamacare as the price to open up the government. Graham continued, I find Senator Schumer's demands ridiculous and equivalent to political hostage-taking to continue bad policy.

So looking at this point like that might not be a path forward, of course, I have learned that there were also a number of more moderate Democratic senators who also had a meeting today, who don't necessarily agree with Schumer's stance. I know this group is interested in finding a way to reopen. the government, maybe a little bit more eager than some of their colleagues. But, of course, Democrats had that really great election night on Tuesday. They had a lot of momentum, and they wanted to see if they were going to be able to use that to get more concessions from Republicans when it came to health care. So at this point, the stalemate is still on.

Unclear if we're going to have a vote today. Unclear if we're going to be here this weekend. And really unclear at this point when the shutdown is going to end, guys. Okay. A lot of lack of clarity still, it sounds like. That being said, the fact that there's even some. some sort of movement, even if it's just headlines and possible proposals here, Emily. How much of this is also not just the fact that we came out of this election Tuesday night with a

certain result, but the fact that you had the threat to potentially end a filibuster, which I know has always been seen as a third rail, and you also have the Trump administration cutting flights, which potentially could be the thing that gets the public upset enough to get this thing to an end. I mean, Morgan, I'll start with the second item first. I mean, really one of the interesting things about this particular shutdown is that there have been so many pressure points that we thought, okay, this is going to be the thing that really motivates lawmakers to move. We thought that when it came to funding the military and then Trump found a way to fund the military. We found that with WIC funding. That's gotten funded. Snap funding. Now the USDA has come out and said that it will fund the program. So a lot of these potential pain points got alleviated before they could really be felt by many Americans.

You're not seeing that with the airports. Obviously, those are causing real delays for a number of Americans. You still, of course, have federal workers, the two million of them who have not got a paycheck. And now you're even being to hear about programs, government programs that help folks heat their homes in the winter. And, of course, as it gets colder, that program's becoming more critical. So it's a little slower than maybe what we've seen with past shutdowns, but the pain is ratching up. I will say on the filibuster, I've kept asking Republican lawmakers how they feel about this. really the overwhelming consensus is that the votes are not there to end the filibuster.

Trump might want to do it because he has his two years left where he wants to get stuff done. A lot of these Republicans will be in Congress for much longer than two years, and they know that if they get rid of the filibuster now, if Democrats take back the chamber, that's going to mean a lot of difficulty for them. All right. Emily Wilkins, thank you. We got breaking news out of the Fed. Steve Leesman has that story for us. Steve.

Hey, Morgan. Yeah, the Federal Reserve out with its twice annual financial stability report where it looks at all the risks in the financial system. And there are some areas of concern, among them asset values remaining elevated relative to historical norms. Commercial real estate values are showing signs of stabilization on the good side. But there's concern about some of these refinancings that have to happen to this commercial real estate in the coming years. Business and household debt was stable relative to GDP. but the leverage of publicly traded firms remains high, but the ability to service the debt is robust.

Hedge fund and life insurers leverage also remains high. Banks, however, are maintaining a high level of liquid assets. Auto and credit card delinquencies, as we've talked about, remain above average. And there's an interesting box in this report about algorithmic trading driven by AI, some concern about it that it could engage in sophisticated market manipulation, saying there's good and bad stuff coming to financial markets, from AI. Recent bankruptcy is a first brands and tri-collar that we've also talked a lot about. The Fed's saying in the report were isolated events. It is citing robust bank lending to special

purpose entities as well as private credit. And there's also a survey in here. And respondents are citing risks to the economy if these AI valuations suffer large losses. John? All right. Steve Leesman, thank you. Well, the markets did see a reversal on that possible movement in Washington, but still closing out a down week, especially in tech. Let's get to Simo Modi at the New York Stock Exchange. Seema. Hey, John, a sizable pullback in tech this week as investors questioned the return on of investment of artificial intelligence and, of course, valuations.

Take a look at Microsoft, seeing its eighth straight negative session for the week. Invidia falling by 7% this week as the selling accelerated after Open AI hinted at the prospect of a government backstop for AI funding. Simultaneously news of mega debt deals by the likes of meta, Oracle and Google, that certainly got getting the attention of investors, specifically Oracle, which is now trading below the high that it hit back in September. And then there's Tesla down as well as a debate over Elon Musk's pay package rages on that stock lower today and for the week. Palantir, despite an impressive earnings report, shares falling 11% this week on renewed concerns around its valuation

and if all the good news is priced in. Taking a step back, the stock is still up about 135% this year, Morgan and John. All right, Simomodi, thank you. Now let's turn to the bond market as it digest the shutdown and consumer sentiment number. Rick Santelli is in Chicago with the details. Hi, Rick. Hi, indeed. If you look at what's going on, Morgan, we did have very weak University of Michigan,

especially the current conditions. I have a database that goes back over 50 years. I couldn't find a lower number. But do keep in mind, University of Michigan doesn't correlate with the markets the way it once did. Look at a twos and tens for the week. Well, 10 years virtually unchanged. Two year yields are a smidge low. We're only talking a couple of basis points. Next chart. This is since the shutdown. Ten year no yields? Virtually unchanged. Next chart, this is since the first rate cut, right before the first rate cut in September, virtually unchanged. Moral's story is that

10-year yields, and for the most part, most treasury yields, don't seem phased by much. Maybe it's the lack of data, or maybe it's just quite comfortable slightly above 4%. So, Rick, along those lines, I was just going to ask about that, especially when you look at some of these yields, basically unchanged on the week. On the one hand, we've had some softer economic data, what we have gotten. And on the other hand, you had those opening arguments for the AEPA, the trade and tariff sued in front of the Supreme Court, and this possibility based on some of the initial skepticism from the judges, that the justices, that perhaps.

Perhaps the revenue that's being generated by those tariffs could ultimately go away. Is that a push-pull dynamic that's playing out in the bond markets here, too? To the best of my knowledge, I don't see many effects. And I think I could make the summary to the answer very easy. Many overrated the effects of the tariffs, and now I think many are overrating the effects if they're removed. I think the market has it right. I think analysts are a little bit over their skis. All right.

Rick Santelli, thank you. Have a great week. Well, the market breaking a three-week, three-week win streak with a NASDAQ posting its worst week since April. The government shutdown was one of the factors that led to victory for the bears, along with AI valuation concerns, a weakening consumer. So what do investors do now? Well, let's bring in Paulson Perspectives author, Jim Paulson. Jim, it's great to have you back on. And actually, the place I want to start with you is this afternoon recovery we got in the equity markets on hopes.

and I realize now maybe based on Emily Wilkins reporting just a few moments ago, we're still at a stalemate, but hopes that maybe just maybe a government shutdown could end sooner rather than later. Is the market right to be excited about that possibility here? Well, I think that who knows, you know, I think what we do know is it's probably going to end before too long. You know, I think that the pressure, which you've covered a little bit earlier, is ramping up here. It's, you know, if you look at ADP numbers now, they're flat in the last three months the challenge or layoffs have exploded here of late though the job market looks like it's ground to kind of a halt and then then you got

confidence cracking big time on on Main Street overall and you're really ramping up pressure on you know food stamps and heating needs down the road and also the big one might just be airlines right ahead of the Thanksgiving and and holidays and as coming up and a lot of travel time. So I think the pressure is going to be building for some kind of negotiated result here over the next couple weeks. And I think that's what the market's reflecting. I think it's partly that. And with all this week data, it's partly that the Fed is going to follow through with the December cut. You think the Fed follows through with the December

cut? I asked that because I know we had comments from Rick Reeder at BlackRock that across the tape earlier today, too, where he basically said that we're seeing a softening labor market, that that's quite significant, that if we had more of this data, there would be more of a case to cut. But we don't have the data. And this week, what we did have was a lot of Fed Speak that was tilting a little more hawkish. Well, I think that most of the private data has been pretty consistent on the weaker side since the shutdown started. But I'm most impressed, Morgan, by let's go away from that minutes, we don't have hard data from the government. Let's look at what the market's doing and what it's saying. We've had a tremendous collapse.

in the relative price of the cyclical sectors of the S&P 500 really since the government shutdown. The relative price performance of those cyclical sectors, the main four cyclical sectors in the S&P, have fallen almost to their lowest levels in 35 years since 1990. That tells me that the weakening off in their relative performance, the most sensitive to economic growth tells me that economic conditions have been continuing to weaken since the shutdown. And then on the inflation side, look at what's happened with the relative price of material stocks. They've just plummeted since the shutdown, which tells me that that's a strong correlation with CPI inflation, or if I look at the inflation-sensitive stock

price relative price performance, it's plummeted. So I think market signals to me are suggesting a continued weakening trend since the shutdown. It was already in motion before that. I personally think the Fed started and is going to continue on a consistent easing well into 2026. I inflation is going to go away and growth's going to do the main. Is the Fed the only one who ought to be taking some kind of cue from this? I mean, we're talking challenger layoffs, Michigan confidence cracking, election night results seemingly driven by voters looking for some change on the economic front. And yet we've got to market at these valuations and a holiday season coming up without a lot of macro data.

How should investors position with all that in play? Well, my guess is the economy is slow, John, and going to slow, and I think it's going to bring broad easing not only from monetary authorities, but also fiscal authorities, to end it, if you will, eventually. And that tells me we're already seeing the impacts that in the market. For example, we have seen lower rates on the short rates. We have seen lower bond yields. And we have seen a lower dollar this year. We've seen faster money growth already. And look what's kind of happening.

We are seeing better results in high beta, relative high beta stocks. We've seen better results in small caps and microcaps stocks. We certainly see the results in international stocks. All those reflects those policy changes. And if we get more of those, I think we'll see more leadership in those areas. But what I wonder is, can investors expect to continue seeing that, given all of these other factors coming into the mix and the fact that we had sort of this tech-driven I hesitate to call it a sell-off because we were at highs and some of these stocks had run quite a bit.

But Oracle is an example, right? We're going to talk about that in a bit. It lost all of that big pop it had. Well, John, I think my take on the tech thing is everyone believes that it's going to end like dot com. And I think there's another alternative. I think what it could do is tech stocks start to underperform, but as the easy policy easing finally comes for the first time in this recovery, that picks up, you know, cyclicals and smalls and value and international stocks and tech rather than collapsing just underperforms. You know, the dot com, at the peak of the

dot com relative total return of the tech index, it peaked in March 10th of 2000. And the Fed didn't start its first easing cut until January 2nd of 2001. And by that time, the relative price of tech stocks had already fallen by 80% of their total decline during that crisis. So basically the Fed didn't start easing until the tech collapse already was over. This time is very different. The Fed started easing over a year ago, money growth, the dollars now easing. I think fiscal juice will pretty soon. The yield curve starts steepen long before the tech bubble, if it is a bubble, has even peaked. So I think there's much greater support under this one than there ever was under dot com.

all right jim paulson thank you thanks well check out shares of new scale power one of the names that was soaring on ai demand this week stock losing more than a third of its value we're going to have more on some of the hot groups that turn cold this week and we got results from several companies in the gig economy door dash slightly higher today but still down 20% for the week is this another sign of consumer weakness overtime's backing too Welcome back to overtime. Some signs of risk off in the market this week. Take a look at the quantum names, losing anywhere from 17 to 30 percent over the past five days.

Arquette is the worst performer. The rare earth names also seeing some steep declines, critical metals, down more than 20 percent. USA Rare Earth, down about 18 percent this week. And high-flying AI-related energy names, particularly in nuclear names like Oak Glow, but also New Scale, Verve, those ending in the red, deep in the red for the week. Oaklo posting its second worst week ever. Yeah. Now, from food delivery to vacation rentals and car rides, it was a rough week of earnings for the gig economy.

Check out the moves lower in Uber, Airbnb, and DoorDash. Those names taking a hit, along with much of tech this week after earnings. Each story's different. DoorDash dinged on spending. Uber had undisclosed legal and regulatory costs and a mixed bag for Airbnb as earnings. learning's miss, but bookings rise. So what lessons can investors take from these results about the broader economy or the tech industry? Joining us now is Mark Mahaney, Evercore ISI, head of internet research. Mark, I want to ask you particularly to begin about Duolingo and DoorDash,

because I saw a common theme running between those two. Dualingo, which I know is a favorite of yours, saying, look, we're going to shift the balance between investing. in growth and product quality away from letting money flow through to the profit line, DoorDash in a way doing something similar, saying they're going to unify their platform across those three properties, DoorDash, Volt Deliveroo for AI and do some other things operationally for the long term. Investors didn't seem to like that. You know, I'd spin it another way or similar to what you just did, John. investors don't like investment cycles.

So I think that's the case with meta, dash, duolingo, Uber. I think there's a few other names in there, too, maybe Pinterest. You know, all those companies that went into and out of this earnings cycle and sort of negatively surprised the market by saying we really want to lean into investments first. And I think DoorDash is, you know, to me it's kind of like you just can't be that surprise. They just closed the deal with Deliveroo. they bought the asset to invest in to regrow it, and yet the market didn't like it and sold off the stock aggressively. The good news, though, so that to me is kind of the common theme here.

The good news is investors, yeah, you don't want to buy a stock before they announced the investment cycle. But if you believe that it's a good investment cycle, this is your clearing event. This is your chance to get in on a stock. DoorDash hasn't been one of my top longs. It's been along for us. Hasn't been a top long, but it's something I got to seriously consider now. You've got the bad news out of the way. And what's happened, you know, There's been some reports about consumer flagging. You're not seeing it from DoorDash. You're not seeing it.

By the way, in the travel names either, Airbnb, I mean, the demand was better than expected and intrinsically strong across all the travel names that I look at, and for DoorDash, too. So I like DoorDash here. I understand the investment cycle risk, but guess what? That's behind us now. Investors don't seem to care so much about investing in AI if you're doing it through data centers and buying Nvidia chips. I mean, not to say they don't care at all, but a lot of the hyperscalers.

and mega cap tech seems to be getting more of a pass here. And I wonder if you think that there's even more of a bifurcation now between how some of these software names are doing and what some of the valuations and expectations for the really big names are. Well, that's a loaded question, John. I'm going to do my best at it. It depends where you start with valuations.

And the advantage you've had with a name like a Google or a meta is that they start off at like 21, 22 times earnings kind of like at a market multiple for what I think are kind of tech stable staples with just a lot of good interesting growth opportunities ahead of them. So there's not that much downside risk in those names, I don't think. And then the question is, are there other stories? I'll just correct. One thing you said, which is that I think one of the reasons that Google is actually sort of the outlier here and is outperforming the market in this is not just because it's buying in video chips, but it's because they're diversifying away

and they've got their own chips, TPUs that the market's actually pretty bullish on, and they're just starting to vend this. So all of a sudden, you've got a full tech stack, tech name like Google, that's showing you chips. Nobody ever talked about Google as a chip company before, and now that's entered into it. So that's part of the levitation of Google shares. I use DoorDash as a metaphor when I'm explaining agents to people, right? Like you used to go to the restaurant yourself, but now you can send your agents there to bring the experience to you is for these service companies i'll throw air bn b in there

uber as well is a i more of a threat or is it more of an accelerant do you see them being the place where people go to get this efficiency deployed or do you see something like open a i anthropic etc becoming the interface coming on over them and uh and commoditizing them i don't think they'll come over them i don't think you'll commoditize it because you you got to get physical right if you're doing, if you're doing delivery. I'm sorry. Now, the what could go over the top on name like Uber is physical manifestation of AI, i.e. Robotaxies. I'm of the belief that they'll actually be one of the winners because their network is so strong. Their demand network is so strong, large. And they're going to have multiple AV vendors, robotaxy companies to work with.

I may be wrong in that, but that's our point of view. I'm really intrigued, though, John, by what AI could due to increased personalization for e-commerce companies, travel companies. I mean, I think that's where there's real upside. Jassy talked about this at the end of the Amazon earnings call. And it's been kind of sparked an idea. I've been calling Mulling for a while. I think there's a lot of opportunities to improve. And you could see this inflection, I think, in online retail, sales growth, online travel.

If you make that product, that service a lot better, that's become a little bit commoditized. But if you can go in there and really say, hey, I'm looking for Hoka shoes, but I'd like something that's a little less expensive, but with a similar functionality, like to have that kind of conversation with a bot with either chat GPT, Gemini, or Amazon, and they'll get you to good shoes. That's a level up of online retail experience. And I think that's what we're going to have happen to us. Somebody's going to win. Mark Mahaney. Thank you. Thank you, John. Well, we've got some news on Open AI. Mackenzie Sagalos has the story for us. Hi, Mac. Hey, Morgan. Open AI is asking the Trump administration to help lower the cost of AI infrastructure, according to a letter obtained

by Bloomberg. The startup wants the White House to expand a key Chips Act tax credit to cover AI data centers and related components like Transformers. Now, this comes just one day after OpenAI faced blowback over a comment made by its CFO implying that it would look for a government backstop for its $1.4 trillion in compute deals. They have since been walking that back. Now, I will say we already knew OAI was advising the administration on domestic chip production in an effort to diversify away from Taiwan, produced silicon, a part of why the White House took that stake in Intel. About to open eye on the letter, but no word back yet. Back to you guys. All right, McKenzie Sagalos, thank you. Well, still ahead, consumer sentiment nearing its

lowest level ever as shutdown fears continue to grow. What does that mean for retailers ahead of what some are hoping will be the first trillion dollar holiday season? Let that one sink in. We'll discuss. Welcome back to overtime. Mixed picture on the consumer this week. Today's University of Michigan survey showing consumer sentiment nearing its lowest level ever, but the National Retail Federation said holiday sales are expected to surpass $1 trillion to the first time. And on the earnings front, names like Tapestry, Treks, CarMax, and Elf all fell big on earnings,

taking the XRT down for the week. For more on the consumer, let's bring in Telsey Advisory. group CEO, Dana Telsey. Dana, these University of Michigan consumer confidence numbers three weeks before Black Friday don't feel great. So can the luxury consumer save the season? Well, thank you for having me, John, and I agree they don't feel great. When you see numbers hitting the lows on consumer sentiment, there's nothing to rave about. But yes, we are seeing the luxury consumer and that upper middle and luxury consumer spending. You look at the sales results yesterday that you had from Tapestry and Ralph Lauren, that was encouraging. However,

this government shutdown definitely puts a damper on that lower to middle income consumer and the case-shaped economy that we have is only widening at the edges. We certainly need to see an improvement in the step up of that lower to middle income consumer, while the higher end, it seems like the strength that they have, you look at the stock market and the resiliency there, they're continuing to spend on newness and differentiation. Volume-wise, there's a lot of non-luxury stuff that needs to sell relative to how much luxury stuff there is in Q4. So thinking about inventories and the positioning of these various companies,

how good are you feeling about how lean they're running, given the uncertainty about how prospective buyers feel? I think overall the inventory levels appear to be in good shape. Remember, some inventories have been brought in a little bit early in order to be able to manage the tariff impact that's out there. That's going to be the headwind in the first half of 26, managing the margins against higher costs. When you think about the holiday season, one fewer day, I'm not seeing promotions go off the rails lately. You're heading into Black Friday in just a couple of weeks, and you're not seeing a pickup in promotions.

And also think about Amazon Prime Day in October. It was solid, but it wasn't off the rails there either in terms of strength. I think you're seeing that lower-income consumer focus on the necessities and the value pricing that they're looking for. Yeah, you just said the word that I want to hone in on here, and that is value. We've seen it within restaurants. What are we seeing within retailers in terms of that perception of value? What constitutes value and who are the winners in that environment? When you're thinking of value, what constitute value, it is brand and price.

The off prices are who constitute value, along with the Walmarts of the world and the Costco's of the world that constitutes. value. That's where you'll see consumers navigating towards. Because the other thing you're not seeing, you're not seeing many retailers experience such weakness that there's a watch list. Look at the results that you had from the retail real estate landlords, whether it's the Simons of the world, the Tangers of the world, they're still seeing strength and leasing from value players in particular. All right. Dana Telsey, thank you. Thank you. Well, it's time now for a CNBC News Update with Bertha. Hi, Bertha. Hi, Mark. The Department of Agriculture sent a memo to state saying that it will begin fully funding the SNAP food aid program following a court order from a judge in Rhode Island.

It says the USDA will comply with the order as an appeal works its way through the court. The memo says the fund will be available. The funds will be available as soon as today. The U.S. has lifted sanctions today on Syria's transition president Ahmed al-Shara. and removed designations of specially designated global terrorist on Al-Sharah and his interior minister. It came one day after the United Nations did the same. The Syrian leader is due to visit with President Trump Monday at the White House. And James Watson, the controversial scientist who discovered the double helix structure of DNA with Francis Crick has died.

He was just 25 years old when he made the breakthrough finding that ushered in the age of genetic. The achievement won Watson and Crick the Nobel Prize in medicine in 1962. In his later years, his reputation deteriorated over comments he made on genetics and race. James Watson was 97 years old. Morgan? Worth a Coombs, thank you. Has the AI trade officially cracked? Well, many of the big public companies are pulling back this week.

What's happening in the private market? We're going to get the view from Andresen Horowitz's general part. partner, Catherine Boyle. Stay with us. Welcome back to overtime. Airports around the country seeing the impact of shutdown-related flight cancellations. Our Phil LeBow joins us from the Dallas-Fort Worth Airport with more. John, here's a headline that could make you think, oh man, things could get worse. This afternoon, Transportation Secretary Sean Duffy said the level of cancellations,

if the government shutdown continues to go on, could. rise to 15% or 20%. As a point of reference, today is the first day of government mandated cancellations from the airlines in the top 40 airports. It's 4% today, 6% of the flights on Tuesday, 8% on Thursday. And if nothing changes by a week from today, it'll be up to 10% of the cancellations, of the flights into the top 40 airports being canceled. Is there an impact? Here's American CEO Robert Isam talking with us this morning about what they're noticing. Of course there's an impact. Nobody wants to put up with hassle. And again, we're doing everything we can to make sure our customers know. But as we get into the busiest travel part of the year, this is something that we just can't let happen. Flight cancellations today, 1430. By the way, more than half of those were mandated by the federal government through the airlines in advance. The remaining 700, that just happened because of the way the staffing is for air traffic.

control around the country today. Delays topping more than 4,000. Guys, this is the worst day since last weekend. It gets a little bit better on Saturday because there are fewer flights, but the bottom line is this. We could see the cancellations continue to ratchet up over the next week. Back to you. All right, Philobo. Thank you. Well, coming up, Oracle, becoming the poster child for fading AI optimism. It's lost all of its post-earnings gains. So what does the AI trade stand right now. And while the broader market closed down today, J-Frog jumping after its results, we're going to hear for the company CEO next on overtime. Welcome back. Some big losses in AI names this week. InVIDIA down 7%. Pallon's here down 11%. Oracle is now lower than it was

before all that AI backlog enthusiasm, all three stocks posting the worst week since April. Now those jitters extending into the private markets to OpenAI CFO, Sarah Fryer, causing some concerns when she said at a conference this week, the government could, quote, backstop some of the startup's funding deals. Friar quickly walked it back, writing in a LinkedIn post, that her word choice muddled the point, quote unquote, and that Open AI is not seeking a government backstop. Joining us now, though, is Catherine Boyle and Dresen Horowitz, General Partner. Catherine, it's great to have you back on the show. Welcome. It's great to see you.

I do want to get all your thoughts on everything we're seeing with AI. But first, I need to get your thoughts on something else, and that is some major news milestone being marked, perhaps, if you will, by the Pentagon and by the Secretary of Defense, Secretary of War, Heggseth earlier today, where he basically outlined to the entire industry the fact that he wants acquisitions reform, and he used terms like commercial first policy and solutions and not specifications and calling out the defense primes in the way they do business. I want to get your thoughts on that. Yeah, so I mean, every, it feels like every administration gives a version of this speech, but this was by far the media speech that we've ever seen coming out of the Pentagon. And if there's two words to remember, it is, it is that the metrics that the Pentagon is going to use for acquisition are speed and volume. So the secretary was very forceful and not only his rhetoric, but in his decisiveness of how

quickly they are going to now change the acquisition processes to make sure that the best technologies can be acquired as quickly as possible to get into the hands of the warfighter. Major changes, as you said, like commercial first, which was a huge development in this speech and sends a clear signal to Congress that if we are building products in industry that the Pentagon can use, they want to buy them. So it's 10 years of work, I think, and lots of conversations about how technology can be brought into the Pentagon. But this was the media speech by far that that we've ever seen, and one that I think really excites startups and small businesses and companies that want to work with the Department of War. Yeah, and of course, you're the co-founder

of the American Dynamism Initiative and Fund at A16C, and you've invested in quite a few of these companies, whether it's commercial space like SpaceX or Defense Tech, with some of the biggest, fastest growing names there. I mean, if you just sort of look at the list that's been circulating of the folks that were in the room for this address today, it was everything from some of those startup founders to the defense prime CEOs to actually the mega cap tech companies like Anthropic and Google and meta, you just go on down the list here. So the fact that this statement has been made today and there is a shift happening and there's this greater focus on dual use technologies, what does it mean for you as an investor and how you see this market evolving?

Well, I think it sends a very clear signal and demand signal to startups that the Pentagon is open for business. They want to make sure that the best technologies get into the hands of the warfighter and there's going to be open competition, which has always been the goal. But it also sent a very clear signal to Primes, where the secretary said it is not enough to be investing 2% into research and development, that you need to be investing in the newest and most important technologies and making sure that those technologies get into the hands of the warfighter as quickly as possible. So it was a very strong message. It was a clear message that what matters most is making sure that the best products are delivered to the Pentagon on time. And they're making very, very strong

changes, very wonkish changes. Again, it was a very meaty speech. Actually, the secretary said that anyone watching on TV was probably bored out of their minds. But the people who were in that room, the people in industry who've been waiting for this for years, I think, are celebrating today. And I do want to get your thoughts on what we've seen in terms of the AAR-I trade. I mean, some big moves here in the public markets. It arguably started on Monday with Palantir, despite a beaten raise in those earnings for that company as well. But I guess from a private market perspective, what are you seeing within AI and all of this spending and all of this elation and all of this debate about whether there's a bubble inflating?

Well, I think in private markets, you're certainly not seeing any less appetite for investment, particularly in the top companies, the companies that have been moving as quickly as possible. The other thing that we're seeing is extraordinary amount of investment going into the physical infrastructure, needed for AI. So you're seeing a lot of energy investments, a lot of companies that are building the picks and shovels for AI to make sure that these companies can continue to grow as quickly as possible. So I think we're very bullish. We're seeing, you know, I would say, you know, any company that is building, you know, across different sectors and portfolios and AI is certainly something that's top of mind for investors, but particularly in the American dynamism practice,

We're seeing a lot of the investment going into energy and places where AI needs to be supported by infrastructure. Okay. Catherine Boyle, thank you for joining me. So good to see you. You too. Still ahead. An $800 million space deal just landed. We're going to give you the latest on intuitive machines acquisition of Lanteris space systems and why the market didn't seem to like it with a stock down 20% this week. Overtime's back in two. Welcome back to overtime. J-Frog, jumping 27% today.

after beating on earnings and giving fourth quarter guidance above expectations, I asked CEO Shlomi Ben Haim about securing AI agents for the future of software and the role J. Frog plays. The future engineering team would be a combination of developers and agents. And you will see much more teams that have several engineers and multiple agents. These agents are running an asset, the only asset, that I think everybody would agree. The primary asset of AI, they are running models.

These models need to be stored and managed somewhere, something that you can trust and can use as the system of record for what they are building. That's exactly what JFO is doing. And the stock is now doubled year to date. Well, intuitive machines announcing this week that it will acquire satellite manufacturer, Lanteris space systems. For $800 million in cash in stock, Lanterris is owned by Advent International, and the deal makes the private equity firm a significant shareholder of intuitive machines.

Now, intuitive machines may best be known for commercial landers that it has sent to the moon for NASA, but CEO Steve Altimus says Lanteris, scalable production of satellites that are highly reliable will, quote, feed the markets the companies going after. There's a whole series of layered networks that we plan to put in place in space from Leo to Mio to Geo to the moon and out to Mars. And then use that service for any of the other kind of observation satellites or specialty sensors that we need for space domain awareness or for any of the national security space. needs that might arise here in the near future. So the key to the whole thing about opening up the space economy is about the communications and navigation. And if you can do that, you can place a spacecraft anywhere and communicate with it, bring the data back to Earth. And so the opportunities are nearly limitless for us once the network's in place. And Lanteris helps us with that, putting reliable satellites in places that we need to go.

So Intuitive Machines recently won a $4.8 billion NASA contract to begin building out part of this commercial network. Like other government contractors, though, the company is also navigating this government shutdown with the biggest impact, the delay in new awards, since those contracts can't be doled out until the federal government reopens. As for the stock, shares of lunar have come back to Earth. They're falling some 22 percent this week, as you can see right there. And giving up all of the election gains to basically be flat over the last 12 months.

For the full interview, though, and we cover a lot of grounds. Check out Manifest Space. That is available wherever you get your podcasts. And coming up, we're looking ahead to next week's big market events, including results from Disney. That stock dead flat for the year. A look ahead to next week is ahead. Welcome back. Let's get you set up for next week's earnings. Instacart, Paramount Corweave. That's on Monday. Circle in Cisco reporting Wednesday and Thursday. We're going to hear from Disney. So economic data that we will not get initial jobless claims, retail sales, PPI, CPI, that's all due to the government shutdown. We will hear from six Fed presidents and get third quarter 13F deadlines is Friday. So we'll get some so-called whale watching as well. Yeah, and for more on the key events that will impact your money next week,

let's get to Vital Knowledge founder, Adam, Chris Affooley. Adam, of all this stuff, what do you think is most important, or at least is going to give us the most signal, whether it's on sentiment or on what's happening in the macro, since we're without that government data. I mean, I wonder about Corweave in particular since we had the turbulence in tech this week. I think of all the names in the week coming out,

probably Corweeb is going to be most relevant just given how important that gets to the overall market, given how much anxiety there's been over the last several days about, you know, the whole AI narrative. And so CoreWeave really epitomizes a lot of the excesses and a lot of the promise of the AI boom. You're going to see probably very robust top line growth, very bullish bookings commentary, but then, you know, a big cash, a big cash consumption as well. And that really kind of, I think, speaks to both ends of the AI argument. And what about Disney? Because to me, that was the great hope of the media industry. stock-wise, X Netflix, coming out of the pandemic, all they're going to build Disney Plus,

they're going to do this, they're going to do that. And if you look at a five-year chart of Walt Disney co, it is a little depressing. So what are the signals that we might see in their results that would tell us one way or the other, whether they're up to the fight? Yeah, no, I think Disney will be obviously very important as well, you know, biggest name in media in terms of overall revenue. You know, I think people are relatively sanguine on it. I think most people assume that they've carved out a big enough footprint in streaming. Plus, they have obviously the huge non-media part of the business with the design experience as part of the company

that performs very well. You know, we're coming up on a big event with Disney in the coming quarters where the CEO's succession is most likely going to be announced. And then, you know, a couple of days before Disney, we're going to get Paramount as well. And that's probably in the near term more important just because of, you know,

they're driving so much MNA activity in the space right now with their bit for Warner Brothers. So a lot of moving pieces in media, but Paramount and Disney are both going to be watched closely. Fed speak, is that something that you're watching closely, Adam, especially given the fact that that did add to some of the market consternation we saw this week? It could be interesting. It's hard to read too much into Fed commentary just because we're not really seeing a lot of economic data for them to react to.

So it definitely seems like the Fed right now is very divided about the upcoming December meeting. But until we get some real concrete government data, I feel like it's probably not going to have a giant effect on the market right now which a perfect comment party. Okay. Well, Adam Chris Foley, thanks for joining us and setting us up for next week. And what was a mixed session today, John, really for the markets. But either way, slice it or dice it how you will. It was a comeback on some of those headlines about the possibility of movement towards a government shutdown, although still it seems a lot of gridlock and uncertainty about when and how that ends up shaking out. Market has been here for years,

though. Yeah, that does it for us here over time. Fast money starts now.