Closing Bell - Closing Bell: Can the Rally Keep Going? 7/8/24

Episode Date: July 8, 2024

If the economy is slowing and the Fed isn’t cutting – what’s next for this rally? Trivariate’s Adam Parker and Payne Capital’s Courtney Garcia give their forecasts. Plus, Boston Celtics Majority Owner Wyc Grousbeck discusses all things sports, the team’s record 18 championship wins and his sale announcement that stunned the sports world. And, Skybridge’s Anthony Scaramucci breaks down the fall in Bitcoin and tells us how he is navigating the crypto space right now. 

Kelly, thanks so much. Welcome to Closing Bell. I'm Scott Wabner, live from Post 9 here at the New York Stock Exchange. This Make or Break Hour begins with this critical week for the markets. The rally trying to roll on, but more questions now emerging about the state of the economy and how long earnings can hold up if things slow. We will ask our experts over this final stretch. Also coming up today, an exclusive interview with Boston Celtics lead owner and governor, Witt Grosbeck. We'll discuss his team winning an NBA record 18th title last month and then stunning the sports world by announcing the team is up for sale. We'll discuss all of that in just a bit as the Larry O'Brien trophy. There it is. It's going to make a big appearance today at post nine. In the meantime, check out the scorecard with 60 minutes to go in regulation. Some uncertainty in the markets for sure today after some early gains today and ahead of the Fed chair's appearance

on Capitol Hill tomorrow. Lots of economic data is on tap, along with earnings season getting underway, as you know, takes us to our talk of the tape. Whether this rally can keep going if the economy is slowing and the Fed isn't cutting. Let's ask Adam Parker. He's the founder and CEO of Trivariate Research. Courtney Garcia is here as well of Payne Capital Management, both CNBC contributors. Good to have you both here. That is a question, right? I mean, there seems to be more questions now, Adam, about the state of the economy and where we're going to go from here. We've come a long way. The market's done real well in the first half of the year. Now what? Well, I think the Fed commentary tomorrow will matter for sure.

No big earnings pre-release is negative here in the first week, so I don't expect a bad earnings season. My suspicion is that September is when you'll see downward revisions. The numbers for the second half of the year are still too high. You think they're too high? Yeah, they are, and they're too high for next year. 14.5% growth is what's in the numbers for 2025. I think that's too high. Does that mean that the market multiple is too high as well? They're plus 21 times, a little more than that? Yeah. Look, I think the problem is you walk in the door now and you say, okay, what do I need to believe to get

10% plus upside, 6,100 on the S&P, right? I have to look at 26 or 27 earnings, or I have to embed a lot of multiple expansion. That's why people have been cautious. The question is, does the narrative change at all about the dream that AI can give me on earnings in the out years? If that narrative changes, we'll get a correction in the equity market. If people still believe the dream and it's still innocent until proven guilty for a lot of companies, it could be okay. I kind of look at it and think equal chance, 10% up, 10% down. Still, because you've been saying that for a while. It still feels that way? It feels to me like it's hard to get there. Look, we've been directionally positive on the market, I'd say, but I think it's hard to get 10% plus upside without a dream that 26 and 27 earnings are going to be up a lot. Is the dream, Court, the rate cuts that the market is expecting?

Is that the key to the dream? Yeah, that's been the whole focus. I feel like a broken record talking about the Fed going to lower interest rates, but that's really what the markets continue to be focused on. And as we continue to get data out, we're seeing that unemployment ticked up to 4.1%, which is showing a slowing of the economy. You're seeing that if the PCE numbers continue at that 0.08% month over month, we'd actually be on track for that 2% year over year target by the end of the year. So all of this is really just

showing that there's more and more of a higher likelihood that the Fed's going to cut rates at some point this year. And interestingly enough, we're seeing more money go into cash. We're over $6.1 trillion. That amount just went up last week by the highest amount in the last two months. So people are still nervous. There's still a lot of money to go in the markets, which just adds this whole idea that you can eventually see a melt up. People are chasing momentum. But once rates go down, those money markets aren't paying 5%. That money is going to make its way back in. And I think at a certain point in time, you are going to see that happen. The question is when, but I don't think you want to be behind that. I'll say something crazy. Okay. So if there's one maxim that we all believe in, I've said and

written this a hundred times since 2011 is don't fight the Fed. Right. Right. And yet I know the market gets increasingly anticipatory. Once we learn something, then it's three months before. Maybe the crazy thing this cycle will be that uh you kind of yeah sure maybe you sell you sell the first you know cut that basically you're already paying for some of this accommodation and that people are going to say all right well i buy the market you know i bought it really since jan 23 thinking we're close to the hiking and now now maybe it's hard to get the multiple expansion from here and i need the earnings to come through and and so maybe that's what's different this cycle is the one thing everyone believes in is no longer the case.

Court, you say one of the biggest risks is the Fed cutting too soon. Now, I wonder, as the data has been a bit softer over the last couple of weeks, whether we're starting to come into the risk zone of the Fed cutting too late, that by the time they actually do cut, it's too late. It's a fine line. I mean, it's a tough position that they're in, right? I mean, that's what they don't want to do is cut too soon and create a melt up or cut too late. And then the economy is in a bad position. I don't think we're there yet by any means. I mean, I think if they are cutting and it's a pretty high likelihood they're going to cut September definitely by, well, not definitely, but a higher likelihood by December. I think in that range, the economy is

still holding up. You're seeing inflation is increasingly becoming a concern for consumers. They are pulling back, but overall incomes have been going up faster than inflation, which is why the economy has continued to hold up. So if that continues to happen, I don't think they're going to be behind the curve. But it's a tough position they're in. I mean, they need to try to get that right. Would someone ask you, has this been a good start to the year? How do you answer that question? Because Tony Pasquarello, Goldman Sachs, like, well, the S&P returned 15 plus percent in the first half. But if you take out NVIDIA, that drops to 10 percent. If you strip out the entire MAG-7, that drops to 6 percent.

Viewed one way, there's a very top-heavy market. Viewed another way, plus 6 percent in six months is perfectly acceptable. It annualizes to the average long-term return of the S&P. So you have to put it all into perspective. Yeah, I think it's been a great year. And the reason it's been a great year is most people were bottom-up stock pickers skewed toward high-quality companies that have good momentum. And those two factors have worked really well this year.

So, you know, if you're a long-only person, you should have some exposure, as you said a million times, to those big names. And you should have been able to find good stocks. The other thing I'd say is 50% of stocks in the top 3,000 U.S. equities have underperformed by 20% or more. So this year, a lot of the battle was just avoiding the blowups. Own a couple of the big ones. Avoid the blowups. You should have done well. So you should have had, let's say, high single-digit first half of the returns. And that's above the long-term average for half a year. Does this say what Tony is suggesting, that you stay with what's worked the best at this point,

especially as I'm asking you questions about how strong the economy actually is? Or do you start to play the broadening train, the more cyclical areas of the market, the industrials, the financials, the materials? Yeah, I mean, you really want to stay broadly diversified, because I don't think that the momentum trade here is ending, especially in the short term. But when it changes, it's going to change fast. And when you're looking at valuations, there's a lot of opportunities here. When you think of things like materials, things like banks, things like the energy sector, which regardless of what's happening with interest rates, just has this secular momentum that's likely going to continue to improve.

I think you want to take advantage of those because over the long term, those are going to be the better plays. Short term, I think the AI trade is still here to stay. So you need to play both of those. You have your short term trade and your long term trade. We're doing those together. You believe that? Because I hear people suggest it's too soon to play that so-called long term trade. We read, I think, 15 second half of your outlooks recently just to see what the consensus was. When I say we, an intern. And I asked the guy to summarize it. And what he showed pretty convincingly was that everyone thinks small caps are going to work in the second FDR.

That that's the consensus view. And I don't think that's right. Unless you're massively bullish and you think there's a big, strong second half, I don't see how small caps work. They're generally an inferior asset class. So I think you stay with the large cap names unless you're massively bullish that we're going to get, you know, kind of stimulus plus a lot of evidence of AIs working. So it depends what you mean by broadening. If you mean at the sector level, sure.

This year, there's been plenty of diversification, actually. Oh, sure. Several sectors have done quite well. 7, 8, 9, 10 percent. It just doesn't look as great when you're comparing those to comm services and tech. Because when you're $3 trillion and you go up 10%,

it's hard to add $300 billion everywhere else. But I think if you're a stock picker and you're doing quality momentum, you can skew to the large caps and still do well. You don't need to start buying small cap companies

because they're optically cheap. They're optically cheap because they're cheap for a reason. They're worse. All right, we're going to leave it there. Adam, thanks. Great to see you. Go Celtics.

All right, let's send it over to Pippa Stevens now for a look at the biggest names moving into the close. Pippa. Hey, Scott. Well, Corning is the best performer in the S&P 500 today, with shares at a more than two-year high after the company boosted guidance for its second quarter core sales, saying the outperformance is primarily driven by strong adoption of new optical connectivity products for generative AI. And shares of SolarEdge jumped as much as 13 percent after an upgrade to neutral from Bank of America, with the firm saying that shares are pricing in an unlikely worst-case scenario of inventory write-downs, a lack of demand recovery, and an inability to monetize the balance sheet.

But B of A sees a return to profitability in the first half of next year. Those shares up nearly 8 percent. Scott? All right, Pippa, I appreciate it. Back to you shortly. Tech stocks still on a tear as the second half gets underway. But could the upcoming earnings season derail that run? We will ask First Mark's Rick Heitzman. He is back with us now at Post 9. Welcome back. Hey, thanks. You know what I find interesting is that there's so much risk on in tech, but you don't necessarily see it in the venture world and the going public world. It's not risk on yet. There's not risk on yet.

People are thinking longer term. Therefore, they're still concerned with interest rates. They're still concerned with the IPO market. And they're still concerned with who the next president is going to be or who the next presidential nominee is going to be. I mean, that so we've now morphed into the political conversation coming into the boardroom at VC. In just general risk. So if you think about IPOs being the riskiest issues, the newest issues. How do people feel about the rules of the road? How do people feel about the long term rules of the road on interest rates?

How do they feel about the political issues? How do people feel about the long-term rules of the road on interest rates? How do they feel about the political issues? How do they feel about consumer confidence? And, you know, obviously this earnings season will give a sense of how confident both enterprise and consumers are, and then where do we go from here? What do you think we're going to get in earnings season? Because there's a lot of hype now to theoretically live up to, right?

There's going to be a lot of a mixed bag. I think there's a lot of hype to live up to, especially some of the tech names. You're going to start to see, and we've talked about this in the past, when does AI really work, right? Is Microsoft going to be able to see Copilot is really working?

It's really being able to be an ROI sale. ServiceNow, which has slumped a little bit, they're really incorporating AI. Are they able to sell more of their product? Because although not being AI native, they have a lot of AI infrastructure. Have people transitioned from doing proof of concepts and testing AI over the last 12 months to actually implementing AI in the next 12 months? Is that going to be a more serious part of the conversation around AI and these tech companies?

The who has it now and who has it later? Everybody may fit into one of those categories, but there are only so many dollars to go around and only so many results to be chased. And that's why the software index has drifted down because people are unsure who's invested ahead of the curve and who's going to be leapfrogged. So as we think about the software universe, both in the public market and the private market, you think about who's investing for the future and who's going to be leapfrogged by maybe the AI native new venture solution or by a big company who is invested ahead of the curve, which is why everybody's buying as much Nvidia as they possibly can, because they do not want to be leapfrogged,

but they're unsure who's going to win. How often are you getting a look at prospective things to invest in for the capital that FirstMark has? Several times a day. Several times a day? Every day, several times a day, most of it being AI or AI, how AI affects an ecosystem, financial services, health care, whatever that may be. And how's the decision making process on that? Well, I think we have

a framework of how do we, you know, is this really an AI solution? I mean, there's a lot of things that people claim are AI, but are not AI. Oh, do you have like a healthy, have you developed a healthy level of skepticism in the kind of environment we're in? We have for the last several years. As soon as AI became a hype train, you just see the number of things in your inbox saying AI for X, AI for Y, AI for Z, all day, every day. And then we go back as a firm and as a partnership and say, hey, what is AI really doing? Where is it going to really be able to create value? And we have a framework the same way we have in software,

as is this technology really going to be able to create value and capture value? And therefore, your enterprise customers or your consumers are going to get out more than they pay for it, because if you're not creating value, you're not going to be able to capture value in the long term. Let's go back to where we started, when the doors sort of swing open for capital markets and more IPOs. What's the mechanism? Is it, as I was discussing with our market guests, like rate cuts? Is that the role? I think that's going to be one of them.

I think there's going to be a more settled political environment. I think we're going into what's going to be a dead season, right? We're already post-4th of July. Things start to slow down. August will be very slow. And then there'll be a very brief window of about six weeks from Labor Day to when things slow down for the election. That's a tiny window. That's a tiny window. So you might get a couple of things there, but it's not going to be that great. But you have to hope that the election is pretty clean. There's a new president and the interest rates get cut and people have a pretty clear rules of the road that finally then after three years, reopen the reopen the window for IPOs in the beginning of 25.

We'll leave it there. Rick, thanks. Thank you. That's first Mark's Rick Heitzman joining us once again at Post 9. We are just getting started here. Up next, a can't-miss closing bell exclusive. Boston Celtics lead owner and governor, Rick Grosbeck, is here at Post 9. He brought his friend Larry, too. We'll explain, because we're going to talk all things sports. The team's record 18 championship wins. Of course, the sale announcement that stunned the sports world as well. We're live at the New York Stock Exchange.

You're watching The Bell. We're back right after this. All right, welcome back. Fresh off winning an NBA record 18th World Championship last month, Wick Grosbeck stunned the sports world by announcing he would sell his majority stake in the franchise. He will remain the team's governor until 2028 and hasn't addressed his surprising decision until today. Wick is here on set at Post 9 for a CNBC Sport exclusive interview. He did bring the Larry O'Brien trophy with him.

Welcome back. I think it hasn't gotten old yet, huh? 2008 hasn't gotten old. I'm still celebrating from 16 years ago. It's a great feeling. Thanks, Scott. All right. So you got another one. What have these last couple of weeks been like for you? It's been just a dream. You know, carry the trophy around. It's heavy. Put it down here at the Stock Exchange. Put it in the Hamptons last weekend, wherever it is. People cluster around. It's heavy. Put it down here at the Stock Exchange. Put it in the Hamptons last weekend, wherever it is. People cluster around. They love feeling the vibe of Celtic pride or of the championship. And it's a great feeling. Can you describe what that day was like of the parade

as you see? Look, Boston's a pretty hardcore sports city, right? Let's be honest. I don't know how many millions of people were out there on the route. But can you describe what that feeling was like after winning one a number of years ago and now being able to do it again? It's a great feeling to have everybody in Boston and around come out. I think we had a million five, but that's the 13th parade Boston has had this century. So I'm a very proud, born and raised Bostonian. It's not just the Celtics for me. It's everybody. And this, to have had two of the 13 parades is a thrill.

I love being part of Champion City. Was it sweeter given some of the issues that the team had over the last few years, right? You've been a favorite. Haven't lived up to, I think, many people's expectations at the end. So does that make it sweeter this time around? Yeah, the first time came together quickly and worked magically and was unbelievable to win your first championship. But this one was a battle.

It was like climbing Mount Everest, and it took eight or nine years. And so to get to the top after an eight- or nine-year battle with the same people that you believed in from the beginning, you know, Jason and Jalen as an example, what a thrill. It's a lifetime bond you form when you win a championship, you form a bond forever with the players and coaches. And it's a great feeling. Tatum and Brown respectively, of course. Were there times over the last couple of years where you wondered whether you could win with those guys? Sure. We were ahead in the finals and we lost. And then we were behind Miami the year after. times over the last couple of years where you wondered whether you could win with those guys? Sure. We were ahead in the finals and we lost. And then we were behind Miami the year after and lost that series. We lost the two good teams. But you always wonder. We made some changes in

the offseason and we took it all the way. 81 and 21 or something. 80 and 21. It was a good run. I know that many were surprised, if not shocked, to hear the news that you were going to sell your majority stake in the franchise. Can you tell us why you made that decision? Sure. Well, I want to just clarify, it's not my majority stake. The control of the team is owned by my family. So it's a family that I belong to. And then I have the Celtics family I also belong to. So there's an intersection and there's an involvement. So the family has been involved. We've been involved 22 years. So there's been discussions and thoughts about estate planning and family planning. And so the plan, the expectation

is to sell the team in two parts, 51% going fairly soon, 49% then closing in a second closing. That's the expectation in 2028. I'm planning or expected to stay on until 28 and we're going to hire bankers and advisors. And this is going to be quite a bidding process. So this was a family decision. You said in the press release that it was, quote, estate and family planning considerations. Can you elaborate at all on that? I think that speaks, I think, Scott, that really just says it. It's just, it's a family, been in a long time and loves the Celtics. And at some point after 22 or even 25, 26 years, you know, you can find somebody else to come in with energy and commitment. We're going to try to find the right buyer. What was the reaction of your partners?

Were they shocked? There's such a good feeling. I have such a great partnership. The true answer really is, it is shocking. Yes, it's surprising to people, but the real answer underneath, after the first moment of shock is, what a great ride we've had,

and I hope it continues one way or another. But it's a great partnership. I mean, I could go on for hours about these partners and what we've done over the last 20 years. It's a unique process in which you're going to go through, because as I read in the intro, you're going to remain the governor until 2028. So you'll still be the person in charge of this franchise until 2028? You'll be the principal decision maker? Well, that's how we planned it out. So that's, I would say that's the expectation going into this process. Having said that, so that's,

I would love that to happen and that's the expectation, but we'll see what plays out and we'll go from there. Let's talk about possible price. You bought the team for $360 million in 2002. I saw a valuation the other day of $5 billion. The commanders, obviously, in the NFL went for $6 billion. That's the most ever paid. What do you think the Celtics are going to go for? I can't say. I don't know is the answer. That's why I can't say. I know it's going to be, I mean, there's been a lot of inbound interest, obviously. You can't buy these things. You can't buy these teams at the top. You can buy them at the bottom. You can buy them with a long rebuild. We poised to uh go after another championship and be a real contender

i mean we're poised we're bringing everybody back um and so we're poised for a great run going forward so i would think there'd be interest because people are would be able to start being involved in something that is at the top of the world not at the bottom well you're going to leave the team obviously in a pretty good place. You signed Jason Tatum just the other day to a Supermax deal. That was $314 million. By the way, it's remarkable to me how easy these numbers just roll off the tongue in For me, it's not my personal money as much as it comes in from fans and media.

And we put it to good use, the best use we can so we we have to thank the fans we have to thank our media partners and everybody else but everybody supports the celtics is funding these contracts and that's why we all win it when we win together it's tatum for 314 it's derrick white you just did for about 126 jaylen brown for 285 about a year ago did you ever think that you'd be writing checks this large for salaries? No, I like need a brace on my wrist sometimes. But it's a this if you're the Celtics ownership group, this is what you do. This is what the Celtics deserve. They deserve pride and they deserve support and investment and they deserve to win championships. There's a picture of you and Jason Tatum with the trophy. I read in an article that one of your partners, Steve Palyuka,

who I think our viewers are quite familiar with from his career in finance, has suggested that he'd like to be a part of the bidding process. Have you had conversations with him? Yes. And Steve has been a terrific partner, really lead partner, a lead co-owner, I would say, in many ways, brought Danny Ainge to the table back in the day when we first were thinking about hiring a general manager. So Steve has been great and is a great person. And we welcome him in, obviously, for sure, in the bidding process. What about John Henry? Another name I've read. I can't comment about anybody else really, but I know John is a good personal friend.

There will be great bidders and we will be really—I think we're going to make it so we're very proud how it ends up. Would you prefer that it's somebody who is Boston-based? Well, you know, my friend Rick Heitzman is Philly-based, and, you know, maybe he could do it. You know, he's part of the Yankees. Maybe he'll—but, no, we would like to find, we haven't even begun the process, but the families agreed to find a new ownership group coming in that will make everybody proud of the Celtics going forward. When I throw out a number like I did with the Commanders going for $6 billion, is that number significant to you? Do you expect that this franchise could go for

at least that, if not more? I have really been focusing on the championship because it's been a blur and it's been so much fun in the parade. I haven't thought much about going forward, but I am a competitive guy. Why not? I mean, if you're going to keep score, keep scoring everything. Do you think valuations can sustain this path? I'm very bullish on the NBA. We have a great partnership with our players. We do work together. And that's just a true statement.

The Celtics showed that this year. The teamwork, but it's a unified league and great players. It's global. And we're just getting started internationally. We're going to be bigger internationally than we are today. Three of the top picks of the draft all came from France this year. I mean, this is an international league. 35% or so of the league are international players. So there's growth in the NBA domestically and overseas, and it's a great sport and a great partnership. So I'm very

bullish about the future. So you don't feel in any way that you're getting out at what might be a top, right? We've seen five teams trade in the last couple of years. I mean, I think the most recent one was the Mark Cuban deal. Right. Here's what I think. We put in $200 million of equity 22 years ago for this. I mean, it really was literally 200 of equity. It's been a crazy ride. We won't repeat that in the future, but I'm bullish about the NBA going forward. I think it's a sound investment. You should own this team if you love trying to be the best. You should own it for reasons of community and competing on the court. But you know what? The finances can also work out. Well, I mean, when you see the rights for the new TV contract, which are going to be probably

76 billion over 11 years, that in and of itself is going to send the salary cap soaring, is it not? Right. But so we split that. So it benefits the players. It benefits us. It benefits the entire structure of the NBA. I want to talk about another sport, and that's golf, because you were part of the strategic sports group that invested in the PGA Tour. We're still waiting for a deal, a potential deal with PIF, the Saudis, and Liv. Is this going to happen or not? I'm not at that table and not really allowed to comment too in depth. I would say the general vibe is there, and it's been discussed publicly, that the vibes are positive. There have been productive conversations, I think is the word.

I think the general intent is, over time, legally, with the approval of relevant authorities, to unify golf. Bring golf packs so you can just play golf and not worry about this other stuff, and maybe golf has new formats. I'm really proud to be part of the strategic sports group. I'm really proud to be now partnered with the PGA players. They are now equity owners in golf, in the PGA. So it's a lot like the NBA. That's why it sort of makes sense to be involved because we have a partnership in the NBA and I can bring some of that thinking to the PGA. How has your view on sports as an investable asset evolved over the years? We see it. We just had our big announcement last week of this new vertical for us, CNBC Sport.

No accident. I might be free to join it at some point. You might. No accident that it happens when it does because we see the power in sports as an investable asset. We did this 22 years ago. We did the Celtics as, let's just not go broke and let's go win. This is for the love of the Celtics. Now, years later, nothing's changed. I just didn't expect the investment to perform like this. It wasn't

the point. And I'm amazed. Now my view of it is it's actually, there's reasons it's trading for this kind of thing. You know, the enjoyment you can have from owning a team is so intense. You can't get it anywhere else. So that's why they trade so high. But everything's evolved. Everything's changed in investing in sports. I still think there's room to be a bull and to be successful. But it's been it's been a great run so far. Well, congratulations. I do have one more question.

And that is about what has become another love of yours. That's the tequila business, which we discussed the last time. We try not to sit still at my house. Obviously not. Sincoro is the brand. And it's evolved to the degree that you've now welcomed in other well-known investors. Serena Williams among them, Derek Jeter. I could go down the list because there are several, and they're're very well known to our viewers. What's the end game here?

Well, we started it. It's sort of like the Celtics. We started with Michael, Jordan, Jeannie Buss, Wes Edens, Amelia and I, Amelia Fazalari and I started it with the goal of having a great tequila and giving it to our friends, really. And then we rolled it out. We sold two million bottles now um it is a business and it is not the easiest business it is a business where you got to keep slugging it out you got to go to every restaurant you see in every bar and say thank you and bring samples and you know you got to work it well you got to elbow out other celebrities who have their own tequila right celebrity tequilas um but but with the new people coming in and investing and bringing their insight and their star power, the future is bright for Sincoro.

Well, we congratulate you on this great success. Thank you, Scott. And we wish you well in whatever your next act is. Thanks, my friend. And I have a feeling we'll be covering it, too. That's Wick Grosbeck here with us exclusively today on CNBC at Post 9. Up next, navigating the crypto crumble, Bitcoin getting slammed, falling nearly 12 percent over the last week. Skybridge's Anthony Scaramucci is back. He's breaking down how he's

playing that space on the back of that big Bitcoin move. He's at post nine next. All right, welcome back. Bitcoin retreating again, down nearly 20% in the past month, well off record highs north of 70,000 that were set earlier in the year. Joining me now post-9 for his crypto outlook, among other things, is Anthony Scaramucci of SkyBridge Capital. It's good to see you. Welcome back. Good to be on. What is going on?

I know I ask you this every time, but it's such a volatile asset class that the question needs to be re-asked because it was at north of 70 and now here we are. Just promise me if we get to 100,000 at the end of the year, you'll invite me back. I definitely will. Promise me. I definitely will. I won't have the basketball trophy, but you have a lot of things going on at the same time. You had the German government selling some Bitcoin. You have the Mt. Gox bankruptcy, which has been a 10-year drawn-out affair,

is now going to be releasing about 140,000 Bitcoins. And so SkyBridge, alongside of Fortress, participated in that. And so you have a combination of these things going on at the same time that there's been some selling pressure in the ETF. And so when that happens, Bitcoin is a volatile asset. You also had a halving, not to get into the Bitcoin jargon with you, but I think the viewers are well versed on that. OK, so every time you have a halving, a result of which it forces the miners to sell some Bitcoin, keep up their revenues, which puts temporary pressure on Bitcoin. But we still love the fundamentals of Bitcoin long term. And I do think, as I said, it'll be one hundred and seventy thousand post halving, but I think it can get to one hundred

thousand by year end. But it has to chug through this slog right now. One last quick point. FTX is going to be releasing shortly sixteen billion dollars roughly of cash to investors that had their accounts at FTX. And so that's very good news for Bitcoin holders, I believe, because a lot of that was in Bitcoin. It got frozen in the bankruptcy. It got dollarized, unfortunately, at low numbers for Bitcoin. But it's going to go back to those account holders shortly. And we think a lot of that may flow into the asset. I was going to ask you that. Do you think, at least for those people, right, in their minds, there's some tarnish on the story enough that they won't want to assume the risk again in crypto because of what happened to them in the first

place? Yeah. I mean, yeah. I mean, you know, we call these things life chips. You know, if you get a windfall back like that, you're counting on not getting that money back now that you're getting it. You may buy a car, you may buy a house, you may buy a summer house. But I do think 40% to 50% of that will go back into the asset class. I mean, these are hardcore people. Remember, they're early adopters, too. If you have an account at FTX or you have an account at Coinbase, you're considered to be an early adapter in the digital asset space. And so early adapters, you know, have typical loyalty to the asset class.

You raise another interesting point when you mention the German government selling. How big of a risk do you think sovereigns in general are to the story? We have to figure that sovereigns are large players, right? And the ebbs and flows of government and things that happen. Is that a longer term risk than more so than people have thought about? I don't think so, Scott. And I'll take you back to the situation, the early days of Uber. No government wanted Uber. No administrator wanted Uber. No mayor wanted Uber. All the regulators said no to Uber, but the people wanted Uber. And one thing that just happened today in the GOP platform, they're going to have their convention next week.

Right there glaringly in the GOP platform is the protection of digital assets and the protection specifically of Bitcoin. So I think that's a huge mistake by the Democrats. I feel like they're fumbling the football on digital assets. It's not a niche business anymore. You could go by Mike Novogratz's discussion where he thinks there's 85 million wallets. I think Coinbase put out something like 50 million wallets. Let's cut those down.

Let's say there's only 20 million wallets of eligible voters in the United States. And let's say 10 percent of them are single issue voters. We've got two million potential voters in a very close, very narrow election being resolved by six or seven swing states that could be single issue digital asset voters. So to me, I think it's an overwhelming conclusion that this will be an acceptable long-term asset class in the United States. And if that's the case, I'm not worried about the other sovereigns. You're obviously well-connected in the political arena. You're probably thinking about, not probably, you are, I know, thinking about what many are

thinking about what's going to happen leading up to the election? What do you think? What do you hear? What's the story? Oh, listen, I mean, you know, I think President Biden is obviously dug in, had a poor debate performance, but it appears like he is going to be the nominee. The swing state voting right now has former President Trump in the lead. I'm a markets guy. You're a markets guy. The poly markets are favoring Donald Trump right now. But these things are close elections, and there's a lot to be decided right now. You have the VP process, which will come up this week. You've got another debate on September the 10th. If President Biden is staying in the race, I think he really has to demonstrate what he's been trying to do over the last couple of days. He was on Morning Joe this morning,

our sister network, and it's very articulate on Morning Joe. But he's having problems putting sentences together. And I think that has to worry people. And so we'll see how all that unfolds I think they'll have to make a decision one way or another by the end of this week what do you make of what's happening globally on the political front some of the results that we've got both out of the UK and France yeah okay so I believe that that's encouraging for the Democrats I think when you look at those numbers you get a lot of scatter on social media that's right-leaning, and everyone thinks that the election is going to go that way as a result of the prism of social media. But then when you come out of that, you see that Labour won in the U.K.

It was a left-leaning win by and large for France. And if you really follow the agenda of what the Americans want, I don't think it's consistent with things like Project 2025. I think it's more of a mainstream agenda. And so, you know, the incumbent is usually favored. I think if President Biden wasn't 81, it didn't fumble so severely on the debate. I think he'd be favored. But it's understandable why President Trump is in the lead right now. Let me ask you one more question back to what we've been talking a lot about, obviously, rate cuts. And I know you

have thoughts on what the Fed may do and when they may do it. We're going to hear from the Fed chair starting tomorrow for two days on the Hill. It ties back to my Bitcoin questions to you. Right. What's the significance of rate cuts to the performance of Bitcoin, if any? Well, I think it is significant because Bitcoin is still in that category. You know, it's actually decoupled from the Nasdaq recently. It's decoupled from things like NVIDIA. But I do think it's viewed as sort of a speculative technology asset, if you will. And if they cut rates, there's a lot of short interest in Bitcoin.

I think people will rush out to cover. And I think you'll see some price appreciation. But again, why am I in Bitcoin? It's a forward-thinking asset. It's an asset that I think we will be using over the next 25 years in the investment world. But it's not just about me. It's what other people think. And I'll just point out for the Fed, if you go to trueinflation.com or maybe it's.org, they aggregate inflation very differently than CPI. And that number is closer to 2.23%. So I think that the data that the Fed is using, you know that there are lies, there are damn lies, and then there are statistics. I think that the data is overstating the inflation anywhere from 90 to 120 basis points. And so the Fed is being reluctant because they don't want to have that 70s-like situation. Sure, they cut too soon.

But they've got to also be careful they don't set off a disinflationary cycle, too, which is in a debt-laden society is super dangerous. So I think they're still going to cut rates. have a disinflationary cycle, too, which is in a debt laden society is super dangerous. So so I think they're still going to cut rates. I think they're going to surprise people with the amount of rate cuts that they do by the end of the year. All right. We'll leave it there. Anthony Scaramucci, good to have you back. Good to be back. Joining us here post nine. Up next, we're tracking the biggest movers into the close. Pippa Stevens is back with us once again. What do you see now? Hey, Scott. Well, one unleved AI play could be due for a turnaround. We've got all those details coming up next. Well, less than 15 from the bell.

Back to Pippa Stevens now for the stocks that she is watching. Hey, Scott, ServiceNow is under pressure after Guggenheim cut the stock to a sell, saying that while the company expects an uptick in Gen AI businesses in the second half, Guggenheim's fieldwork indicates it's not likely until 2025, if ever, with the firm adding the valuation looks stretched. And Intel is the best performer in the Dow with a gain of 5%, pacing for the best day of the year. Melios Research noting that Intel could be a catch-up trade

and had a strong second half of last year, but selling off in the first half of this year, meaning it's one of the unloved AI plays that could be due for a seasonal bounce. Those shares up 6%. Scott? All right, Pippa. Thank you. Pippa Stevens up next. Cruise stocks are sailing higher today. We're going to tell you what's behind those moves on your screen right there, what it might mean for the travel space in the months ahead. That's coming up on The Bell. All right, coming up next, we're going to tell you what's behind the big bounce in the cruise names today, what it could mean for the rest of the travel space coming up. Plus, NASDAQ trying for yet another record close. Obviously, watching

that too close into the bells, Market Zone is next. All right, we're in the closing bell market zone. CNBC senior markets commentator Mike Santoli here to break down these crucial moments of the trading day. Plus, Angelica Peebles on some big moves in health care today and Seema Modi on what's behind the rebound in cruise stocks. Mike, I'll begin with you. Looks like we may get yet another closing high for the S&P and the Nasdaq and that ahead of the Fed chair tomorrow. Doing just enough, getting help from unexpected corners of the market, actually, to get it done today. The things that stand out to me, you know, we have a fairly expensive, pretty well-loved market rally in this moment, I would say. Not to say it can't keep carrying higher, but I feel as if it keeps having to pull these tricks to stay elevated.

What I mean by that is Intel up 6% today, Chipotle down 6% today. That's pure anti-momentum. We're going to unwind the stuff that's run a lot of 30% year to date like Chipotle, and maybe we'll pick up some of the stuff that's down 30% this year like Intel. So I don't know if it's that much intention around it, but it shows you there's money willing to stay in the market and willing to get lucky when it comes to the CPI and Powell and soft landing and all the things that we're hoping for. But I do feel as if positioning is kind of predicated on things going right in that direction. You have to respect the market action,

but I do feel as if it's trying to draw strength from areas that maybe you can't count on, you know, in a persistent way. All right. Back to you in a moment. Angelica Peebles, talk to us about these stocks you're watching in the health care space. Yeah, Scott. Shares of Morphic are up 75 percent today after Eli Lilly saying it'll acquire the biotech company for 3.2 billion. Morphic has a pill in phase two trials for inflammatory bowel diseases, Crohn's, and ulcerative colitis. The company was founded by Harvard's Tim Springer, who helped discover another successful IBD drug that's now a blockbuster for Takeda. We're also watching Ideia Biosciences. They're having a big day. Those shares are up about 15%

right now on promising results from a small phase two trial of its experimental cancer drug. Scott. OK, thank you, Angelica. People see Mamadi. Talk to us about these crew stocks today. Yeah, well, Scott, crew stocks sold off hard last week on news of Hurricane Beryl. But however, Carnival, Norwegian and Royal are all staging a comeback today. The hurricane, while significant, did not seem to be as bad as expected. Plus, cruise operators have gotten a bit better at changing and updating itineraries as needed. Royal Caribbean, you'll see shares are hitting an all-time high today, just one week before its second biggest cruise ship, Utopia, hits the seas. I'll be on that one.

Argus Research updating its price target on RCL to $185 from $178, pointing to strong occupancy trends of 107%, and is betting that margins will continue to improve as new ships come to market. But other analysts argue that the broader cruise market could get oversaturated over the next one to two years, and that's why this demand story has to stay strong, Scott, to justify where these stocks are trading. Appreciate that, Seema. Thank you. That's Seema Modi. Back to Mike. Got about a minute left.

You know, I'm just looking at Tesla again. Yeah. It's up again today. It's up 43% in a month. It, to some degree, falls into that category of, you know, stuff that basically not only didn't participate, but went the other direction. I don't know what else to necessarily make of it besides that.

You know, there was a larger than normal short position in Tesla in the last reading, but it was less than 4% of the float. This is a massively heavily traded stock. You can't tell me it's purely a squeeze, but it is an area where people are underinvested if volumes have bottomed, maybe in the short term. So, again, it's a noisy tape. The S&P is up like 2% in three weeks, even though it feels

like it's been going to the moon, because it's no downside volatility whatsoever. The market's a little broader today. So, so far, hanging in there, finding a way. And we'll see what the Fed share introduces into this market mix over the next couple of days. Mike, thank you. That's Mike Santoli. That bell marking another closing high for both the S&P and the NASDAQ. We'll see you tomorrow.