Closing Bell - Closing Bell: New Bull Market or Last Hurrah? 11/28/23

Episode Date: November 28, 2023

What is the state of stocks? Is it a new bull market that’s about to get even more steam or the last dash of a late-year push that will soon run out of gas. Sofi’s Liz Young and PIMCO’s Erin Browne give their expert forecasts. Plus, Evercore’s Roger Altman breaks down what he is forecasting for the fed and what it might mean for the possibility of a recession. And, Groundswell’s Jake Wood has dedicated his life to giving back. This Giving Tuesday he explains how he is working to democratize corporate philanthropy.

All right, guys, thanks. Welcome to Closing Bell. Scott Wapner live from Post 9 right here at the New York Stock Exchange. This make or break hour begins with a big question about stocks. How far can the runway for the rally go? Just to the end of the year, as some are suggesting, or can it go much further? Well, ask our experts this hour, including PIMCO's Erin Brown, who unveils her 2024 playbook in just a few moments. In the meantime, your scorecard with 60 minutes to go in regulation looks like that. It's mixed and it's not as good as it was. I mean, the most active part of the day was just before lunch. And that's when the Fed's Chris Waller suggested if inflation continues to fall, that rates could be lower.

Got a lot of people thinking about rate cuts because it sent stocks shooting higher, at least for a bit. Yields fell, the 10-year touching below 3.5 percent. So we're keeping our eyes all over that. It's at 433 in this final stretch. How about Micron, a big mover today after the chipmaker updated its guidance? Shares dropping on that news. They've been around that level for much of the day, about 3 percent. To the downside. Disney, it's lower, too. The CEO, Bob Iger, holding a town hall today after one year back on the job. And Boeing getting a boost today after a big upgrade there. And that stock is still hanging on to the green.

The market's looking forward to CrowdStrike as well. Those earnings a little bit later on in overtime. We'll have that for you, of course, as we make the turn into that next hour. It does take us to our talk of the tape. What the state of stocks truly is a new bull market that's about to get even more steam or the last dash of a late year push that will soon run out of gas. Let's ask Liz Young, SoFi's head of investment strategy, with me here at Post 9. Welcome back. Thank you.

All right. Is it time to get more bullish based on the momentum that we have, based on what Chris Waller said? The way Leisman characterized it was that Waller said, quote, the quiet part out loud, talking about cuts. Well, I think what I heard from that was that we're comfortable with where policy is right now. So it was really just more reinforcement that they're done hiking and we're on a pause. This pause period, and I've mentioned this before on the program, this pause period between the last hike and the first cut, markets tend to hold up pretty well. So if the question is what's going to happen between now and December 31st, I think that

there is room for stocks to continue going up. But I don't think it matters. December 31st occurs, we go into January and suddenly we give it all up. The calendar doesn't matter as much as how the data is going to roll in and how consumer spending, I think, is going to come home to roost in January and February. I feel people making it a calendar issue. It's like, yeah, well, stocks can go up for another few weeks. But then when it gets into 2024, it gets real. And then we're going to face a slowing economy and the data is going to be bad and all bets are off. Is that how you see it, too? Why does it have to be that way?

It doesn't. But we do this every year, right? We talk about the year end period and then we talk about January being seasonally strong. And you have the possibility of that Santa Claus rally, which is from December 24th through the first or so, the second of January, then things do usually shift, right? A new tax year begins. So you have people getting back into positions and you see sometimes a rally in the market. What I think is different about this year and how we're going to see it all coming in is that we've still got some big data points that are going to come in before the next Fed meeting. And we still have a next Fed meeting.

And we're going to find out from them if they are, in fact, transitioning toward the idea of cuts at some point in 2024. They're not going to say that in December, but we could get a sense that maybe they're getting satisfied with the way that the data. I mean, haven't we already gotten that sense? Right. I mean, they seem to be. Well, they seem to be suggesting it themselves. Right. They keep using patient. Waller goes on to say, I'm increasingly confident that policy is currently well positioned to slow the economy and get inflation back to two percent. That says we're done. That says in my vote, we're done. We don't need to do anything else. Economy's going to slow enough. Inflation is going to go back to 2 percent.

And you know what? We're going to be able to cut because we can, not because we're forced to by a further weakening economy. Well, and that's the bull case, right? The bull case is that they can start cutting because they feel like it, because things have gotten to a point where they're comfortable, and they can slowly bring rates back down to a more normal level. That's the idea of a soft landing, at least the way I understand it. And that the economy slows, it cools. We all wanted this to happen, but it doesn't actually tip over into contraction and give us reason to really get concerned. When do we give the benefit of the doubt to that, to where we say, you know what, that's not the bull case anymore. That's the base case. Sure, sure. And you're asking somebody what, that's not the bull case anymore. That's the base case.

Sure, sure. And you're asking somebody who's been skeptical of the bull case this whole time, right? So and I have to ask myself that all the time. When do I change my mind? The momentum in the stock market is one thing. And it's you can't argue with it, right? You can't fight the tape. The tape is the tape. So momentum has obviously surprised many of us, particularly the skeptics, all year. And I think it can continue because momentum is a very powerful force. When does the economic data or when does the cycle start to convince me that maybe we did skip past the graveyard, so to speak, and kind of completely eliminate the possibility of a real contraction? We have to get inflation down further.

Now, it's down a lot, but it has to be closer to their target. They're not going to act satisfied. The Fed isn't going to act satisfied until it's closer to their target. No, but they have to make a judgment at some point. So do investors and people do what you do to be satisfied that the trend, you don't have to get to target maybe, right? The market's going to place a vote well ahead of target once it's convinced that trend is heading to target. Right. And what Powell keeps saying is a sustainable path toward 2%. So it doesn't necessarily have to hit 2%. But we would need to be on that sustainable path. We need to hear from them that they were feeling comfortable with it.

And employment would have to stay stable. I'm not convinced that that's going to happen. I think unemployment, as it's risen, so far it's been a pretty slow rise, but a lot of times what happens is it slowly turns up and then it just takes off. The slope of the line changes and it goes up in a jiffy. What about a broadening market, which we've had of late? So, you know, in some respects I feel like it's getting harder to throw darts at the market because things that the bears have been suggesting seem to be falling away, like one by one, right?

It's like, well, inflation is going to be really sticky. I don't know. I mean, it's starting to come down. And even the housing component, which was more sticky, starting to come down. Well, rates are going to remain higher for longer. Well, I mean, we're at 433 now on the 10-year. Well, earnings are going to remain higher for longer. Well, I mean, we're at 433 now on the 10 year. Well, earnings are going to fall apart. I don't know. I mean, the economy seems to be hanging in. And Black Friday suggests that the consumer is, too. Yeah, well, let's start at the

end of that. Black Friday sales were up, but inflation is up. So revenue is up. People have to spend more if everything costs more. So the dollar amount of spending is less meaningful, in my opinion, this year. Also, you had consumers spending a lot on Black Friday, but you had all of this promoting that was going on, which tells me that companies are worried about having too much inventory. They're trying to unload their inventory. Not to mention, we also have a record amount of consumers buying on credit, right, or buy now, pay later. That's the kind of stuff I mentioned at the top of the show

that comes home to roost in January and February. So we could have a great holiday spending season, and it could seem like consumers are out there spending their money and that they're excited and they're confident. But then all the bills come in January and February, and you start to see a deterioration of credit. That could happen. A lot of the talk now, though, is that these retailers have spent the better part of the last year plus right-sizing their inventory. And almost to a retailer, they're talking about not discounting as much, to where margins would actually hold up and spending would hold up. Now, you can point to delinquencies ticking up. I get you there.

But at some point, we're going to get to a scenario in which we have to wrap our arms around the idea that they might actually pull this off. They being the Fed. Sure. Absolutely. It's it's possible. In my opinion, it's not probable. Right. And if you try to play the odds as an investor, we don't we don't know what's going to happen for certain in any scenario. But if you play the odds of we just went through the fastest and steepest hiking cycle in more than 40 years, it's more likely that you see a contraction after that, right around when cuts start, than it is that we just kind of get through it all unscathed. I know, but we also went through the fastest economic stimulus plan between what the government and the Fed did during COVID and then the piling on on top of that, what we did after COVID in history as well. Yeah. So that's why I've suggested in the past that, you know, maybe the mattress is so thick that you're not going to have that big fall. You know,

you bang your head. You are actually cushioned in that drop from the steep hike in interest rates and 525 basis points in 18 months. Well, I think that's why it's taken so long. And I don't want to be another person who comes out and says I was early, not wrong. I mean, the reality is that in 2023, if you were skeptical of the rally and skeptical of economic data, you were wrong. And I would be guilty as charged in that scenario. But I think that's why it's been more prolonged, because there was more cash than we expected to be there, because there was so much stimulus that went into it. But now some of that is coming out. I mean, we had a pretty weak seven-year auction today, right? We've got this debt load because of a lot of that stimulus, the

interest expense going up. We have to continue issuing debt just to pay for the interest expense on the existing debt. So it just builds and builds and builds. And I think a lot of this is getting to that point where we're going to find out, did we manage to just cool the economy or will it tip over into contraction and be a problem? All fair points. Let's bring in Aaron Brown now of PIMCO to expand our conversation. Welcome back. It's good to see you. What do you make of what Liz had to say and how you assess this market as we approach the final stretch? Sure. So I see the world a little bit differently than Liz. I think if you thread a needle through the economy, it's holding up OK. Yes, you see you've seen significant, you know,

central bank hikes. But at the same time, when you look at financial conditions, they've eased pretty significantly since, you know, the third quarter. And they're really back at the same time when you look at financial conditions they've eased pretty significantly since you know the third quarter and they're really back at the lowest levels that we've seen year-to-date absent a brief flip over the summer and so you're starting to see financial conditions ease yes the unemployment rate has rate has risen but it's risen on the back of expanding labor force and so when you look at the employment to population ratio, you know, it's actually done very well. And so all of this, I think, is really supporting a stronger consumer.

On the margin, there are cracks. And I do think that you will see dislocations in certain segments of the economy. But I think what's really distinct about what we're seeing now versus prior. Slowdowns or recessions is that you're seeing these mini cycles these mini inventory correction cycles which are. Affecting maybe one part of the economy but the

rest and the whole of the economy is holding in. Pretty decently well and I think that that's really going to be the story continuing into twenty twenty four. Where you know the equity market will do just fine. But you will see dislocations in

certain pockets of the market which will you know materially underperform. What is just fine mean in terms of the kind of return that. Somebody can expect in the new year. Sure so you're not going to see the same explosive growth that we

saw in the third quarter where GDP growth was 5 percent on an annualized basis. You're probably slowing something into the mid 2 percent range next year, which is about trend, maybe slightly below trend, but still in positive territory. And that creates an environment where GDP growth can be sort of high single digits. So, you know, I think that the returns next year are going to be lower than what experienced this year for the aggregate S&P 500, but still in positive territory. What if the Fed cuts? What's that going to mean? Right. We always have this don't fight the Fed. Well, it hurts you on the way up when they're hiking. Doesn't it help you on the way down when they're cutting? Sure. So I think that the market right now is a little overexcited about the potential for Fed cuts. Market right now is pricing in three cuts by the end of next year and, you know, continuation of those cuts at a more accelerated pace as we move into 2025. And they're really expecting that the market's going to start cutting in June and do one a quarter thereafter through the end of the year. I think just given the fact that we're

not expecting a significant recession, you're not expecting a significant slowdown. There is a dislocation right now between what the fixed income markets pricing in, which is three rate cuts next year and what equities are pricing in, which is, you know, 15 percent year on year earnings growth in the fourth quarter of next year. Those those two don't really align. So I do think that the Fed is probably likely to be disappointed relative to what's priced into the market with respect to rate cuts and that they will be fairly gradual in their rate cuts next year just because inflation is going to be slow to come back down below the 2 percent threshold. We're probably not likely to experience that next year or until very late in the year. So if returns are going to be OK, they're not going to be negative, right?

We're going to do OK, just fine, those were your words. What's the composition of that going to look like? Is it going to be like it was this year, where it's still the top heavy names because of, you know, concerns that persist about the economy and growth? If you expect, on one hand, that growth is going to be slower from a GDP standpoint, then aren't I going to want to just stay with those names that I've danced with to this point? I think that's true. I mean, I do think that the large caps will likely outperform.

They're going to have better access to public market liquidity, better free cash flow generation, small caps, particularly ones that are really leveraged to the lower income consumer or really have high balance sheet leverage are probably going to continue to underperform, just given the fact that rates are still quite high and borrowing costs are still quite prohibitive for those companies. But I do think that you'll start to see certain pockets of the market, like the tech sector, I think will continue to be a leader next year. Homebuilders, consumer autos, I think will start to roll over. Homebuilders in particular have been a star performer this year, but I do think that that's going to become increasingly difficult. And largely speaking, you kind of want to stick with the winners of this year but I do think that that's going to become increasingly difficult and you know largely speaking you know you kind of want to stick with the winners of this year

January is always a reversal mark a reversal month rather I wouldn't get scared but beyond January I would you know stick with your winners because I think that those companies that are up in quality that are able to generate free cash flow in absence of a high GDP environment are likely the ones that are going to be winners next year as well. The old proverb, dance with who brung you. I mean, that's essentially what Erin is suggesting. Does that composition of the market look like that as well to you? If I had to make the bull case right now, no. I would want there to be more participation from other parts of the market. And if we're going to try to be consistent through, all right, cuts are going to start,

the Fed starts cutting because they want to, because they can, they want to normalize, that would actually indicate that we went from late cycle and we're trying to transition back to early cycle without a recession, which, again, I would say possible, not probable. But if we're transitioning back into early cycle, that's where you usually see leadership from things like small cap, the cyclicals, the typical cyclicals, industrials, energy, financials. So I would expect those to start to come up. We talked about this all year. Will the bottom line of the rest of the market come up to meet those magnificent seven? It's a mean reversion, right? You think that's going to happen or no?

Well, if it were a bull case and we got back into early cycle behavior, those laggards should come up to meet the top ones. But I don't know that that's not my base case right now. Yeah. Erin, what about you? This idea that these lagging places in the market and maybe the biggest question mark of all are the small caps at this particular time. How do you feel about those? So I don't think that we're going to be in an early cycle environment next year.

If we were, I agree that early cycle environments, small caps tend to be the ones that outperform. But I actually think that this is going to be almost an elongated late cycle environment next year where we're not tipping over to recession, we're staying in a low growth environment. And in that type of environment, you really want to own quality. You don't want to own, you know, sort of the more junkier credits or the small caps. And so, you know, to me, I think it's going to continue to be an environment where small caps, which have less liquidity and oftentimes less access to credit, they're going to continue to be constrained and continue to underperform. I mean, the other idea, Liz, is that if the labor market doesn't roll over, maybe we're not as late cycle as some want us to believe we are. Because if the labor market holds up, then theoretically, consumer spending's gonna hold up.

The economy at large for a two-thirds, you know, discretionary spending economy is going to hold up. Maybe we're not as late cycle as some want us to believe. In which case, it would be elongated late cycle, right? And the other thing is, the labor market- Well, unless we're elongated late cycle, right? And the other thing is the labor market... Well, unless we start... We're just not nearly as late cycle as some want us to believe we are, right?

Maybe. I think we're also just used to an unemployment rate that's so low. That's not a normal unemployment rate. A frictional or sort of regular unemployment rate in the economy is four, four and a half percent. The average is actually above five percent. So I think we're just so used to it being so low that it's uncomfortable if it rises above four. It's not necessarily indicating that we're in a recession, that we've got some wiggle room. Erin, last point to you. The other idea being that you definitely want to stay in the U.S. versus other areas of the world, Europe included? That's absolutely right. I mean, I think Europe is having challenges and I think that European

growth is slipping. You know, look at the data that's coming out of Germany as an example. I think that that's going to be a much more challenged market for positive equity returns. And so the U.S., which typically screens as, you know, up in quality anyway, is definitely going to be where you want to invest. I would, you know, Europe has done well the last couple of years. I think this next year is going to be the U.S.'s chance to really outperform and shine. All right. I appreciate it. That was fun. Erin, thank you. We'll talk to you soon. Liz, of course, I'll see you back on the desk soon.

I know that Liz Young of SoFi. Let's get a check on some top stocks to watch as we head towards the close. Kate Rooney joins us today with that. Hey, Kate. Hey, Scott. So watch the buy now, pay later space. Installment payments hit an all-time high during that record Black Friday and Cyber Monday as consumers look to more flexible ways to pay and try to avoid some of the higher rates that come with traditional credit cards. Jefferies upgraded a firm and increased its price target as a result of that demand. And then some of the improved credit performance. Square and PayPal also have competing buy now, pay later offers, and they're both higher today as well.

And Crocs is moving higher as Raymond James upgrades it to strong buy and adds the stock to its favorites list. Analysts say they're more confident in the footwear giant's business structure heading into 2024, and they think the stock's price-to-earnings ratio is now discounted given their revenue growth expectations. Ray J is also hiking its price target to 115 from 98. Scott, back over to you. All right, Kate, appreciate that. We'll see you in just a bit. We're just getting started right here on Closing Bill.

Up next, the road ahead for the Fed, Evercore founder Roger Altman. He breaks down what he thinks Mr. Powell's next move could be, what he thinks that could mean for a potential recession, of course, for the markets, too. Just after the break, we're live for the New York Stock Exchange. You're watching Closing Bell on CNBC. Our back stocks rising after Fed Governor Chris Waller signaled possible rate cuts if inflation continues to fall the way it has. The commentary comes two weeks before the Fed's next policy meeting. Here to discuss is Evercore senior chairman and founder Roger Altman. Roger, welcome back. I hope you had a nice Thanksgiving.

I did, Scott. I hope you did, too. I did. Thank you. So what's Powell's next move, you think? Is it a cut? Are they done hiking? I think the answer to that is most likely yes, they are done hiking. I don't think, however, there are going to be cuts until well into 2024. If I had to make a guess, it would be mid-2024. That obviously depends on the flow of data between now and then and how much progress or lack of it we see on inflation. But I don't think anybody expects that in this upcoming

December meeting that the Fed will move. It will be steady as she goes, unless there's some shock in the interim, which no one expects. So if you say cuts may be mid-24, you know how the markets work, right? They try and get ahead of that by a significant amount of time, whether it is six to nine months. So should I buy stocks now? Does this momentum have legs beyond the end of the year because of that? Well, I think the giant question over the markets, Scott, is not the Fed, because it's so likely that the Fed will rest on its horse for the time being and then in a few months begin to ease. I think the giant question is whether the shifting narratives in financial markets four months ago looks like a recession. Now looks like a soft landing, no recession. Which of them is right?

Now, I listened to your previous guests. It was a very interesting discussion. My own two cents is it's too soon to declare victory over recession risk. I think the odds favor that we avoid it. We do have a soft landing, but I don't think it's sure. You can see some weakening in data, credit delinquencies, the excess pandemic savings among the lower half of the income cohort has gone. That's depleted. And you see the comments, for example, recently from Walmart suggesting that we're beginning to soften. And I would remind everybody that the U.S. economy grew 4.9 percent

this last quarter. It grew almost exactly at that rate in the third quarter of 2007. And corporate earnings have been tracking at about 5 percent up year over year based on the latest reports. That's about exactly what it was in early 2008. Now, we're not going to have a repeat of the great financial crisis. Please don't get me wrong. But at the same time, I don't think it's time to pop the champagne on soft landing. A little too soon to know. There was a stretch of, I don't know, it felt like a couple of weeks, Roger, where every day it felt like we talked about the deficit and rates were going to be higher for longer and the funding of it, et cetera, et cetera, and the charts being horrible to look at as you move out years

ahead. I don't feel like we're hearing about that much these days. How are you thinking about that issue? Well, yes, the recent resilience of the economy has been remarkable. A few months ago, half the forecasts out there envisioned a negative fourth quarter, the one we just began, the one we're in now. And now everyone sees the economy growing around 2 percent this quarter. So the resilience is a big story, and it's amazing. But again, I think it's too soon to be sure that the economy, in the face of the fastest monetary tightening in 40 years,

will sail right through without any serious softening. And too early to say that these many months of an inverted yield curve, which historically has been an unerring signal of recession, won't mean that this time. Well, it doesn't always. Of course, it doesn't always mean you're going to have a recession, but you never have a recession without it. Well, most of the time that you've had an inverted yield curve for this long, you've had a recession. It may not be 100 percent, but it's much more likely than not, or common than not. Scott, I'm not suggesting we're going to see a recession.

I'm just saying that it's amazing how the narrative has been completely reversed, and all the concerns of four months ago now seem to be gone, because the interim data on growth, especially growth, on corporate earnings, and on inflation has been reassuring. And it has. But do I think it's 100 percent likely that next year we won't see negative growth? No, I think there's about a 25 percent chance we'll see a negative quarter or two next year. Not not a majority, but far from trivial. No, it's all good. I wouldn't ask anybody to predict 100% of anything. I mean, that's a big leap.

But, I mean, you know, you look at money flows, and they can be predictors of where people think we're going to go. In the seat in which you sit and your colleagues, obviously, at Evercore, what about dealmaking? Are you getting a sense that that thaw has really, really softened even further? It's hard to know. Right now, we're at a moment when activity levels are definitely up, but actual completed transactions are not. So we looked at this this morning internally, and global M&A volume over the last 12 months measured in dollars as a percentage of total global market capitalizations is at the lowest level in 40 years. Now, that's probably a little exaggerated because markets have been up strongly recently, but in any event, it's low. So there's

the seeds right there of recovery. But it's really hard to know when you're going to see that in the actual flow of completed transactions because it hasn't happened yet. Everybody in the business will tell you, and they're right, that they're busier and that whether it's engagement letters or whether it's backlog, activity levels are up. But it remains to be seen exactly when that shows up in the actual level of completed transactions and announcements. Well, we're going to count on you to let us know. I can tell you that. It's always a pleasure. Roger, I appreciate your time so much. Thank you. All right. That's Roger Alden joining us, of course, from Evercore. Up next on this Giving Tuesday, Groundswell co-founder and CEO Jake Wood is here, and he's made giving back a key part of his life.

He'll join us right here at Post 9 with how he's making strides to democratize corporate philanthropy. Just after this break, we'll do that. Closing bell comes right back. We're back on this Giving Tuesday, a perfect occasion to introduce our next guest, someone who's made giving a central part of his life. Jake Wood spent four years in the Marine Corps as an elite scout sniper. He then founded Team Rubicon, a nonprofit that recruits veterans for disaster relief all around the world. He's also the co-founder and CEO of Groundswell, a venture-backed company designed to democratize corporate philanthropy. He's here with us at

Postline. It's good to see you. Welcome back. Yeah, thanks for having me, Scott. Especially on this special day. For people who don't know you and your background any more than, you know, I read off a couple things of your life's resume, where does this thirst for giving back come from for you? That's a great question. You know, I grew up very blessed. I grew up in the Midwest where I think giving back is just a little bit of part of the community and the spirit of the community. And, again, you know, I've been able to go around the world. I've seen a lot of interesting places. I think I can reflect back on my life and see just how fortunate I was to go to

great public schools, live in a, grew up in an amazing family. Played football in college, right? Yeah. Had the opportunity to go play football for the Badgers. You know, all reasons why I feel the need to give back. Enlisted in the military as part of your life story as well. And then Team Rubicon, which still you're active in today and remains an incredible organization. How many people do you have working for you? What are they doing all around the world right now? Yeah, so Team Rubicon is this amazing nonprofit. I'm still fortunate to be the chairman of the board.

They've got about 150,000 volunteers throughout the country, both in the United States and Canada, doing disaster response, humanitarian relief missions both around the world and in all 50 states and Canadian territories here in the United States and Canada, doing disaster response humanitarian relief missions both around the world and in all 50 states and Canadian territories here in the U.S. So explain to us how this works. Let's say a hurricane is going to hit some part of the world where you think you can get to reasonably quickly. Yeah. As an example, what happens next?

Yeah, well, Team Rubicon mobilizes these men and women who've raised their hands and said, hey, I want to continue to serve my country. And we will move them into the disaster zone with the equipment, the necessary training. We work in coordination with all the local, state, and federal authorities. And we get to work helping people, as we say, on their worst day to get back on their feet following these storms. Majority of the people who work for Team Rubicon are veterans or the entirety? Oh, not the entirety. We have, I think, about 70 percent of our workforce is military veterans, 30 percent didn't serve in the military. Many of them first responder community. Some of them have never worn a uniform in their life. Groundswell is a really interesting

idea that I'm not sure enough people have heard about. Explain to us what that is. Yeah, so Groundswell is a software company I started back in 2021 with a couple of colleagues. And really the intent there was to democratize corporate philanthropy by building the first of its kind donor advised fund platform that allows companies to roll out these personal giving accounts to employees and then automate donation matching programs through them. You know, about 70% of Fortune 500 companies offer to match employee donations. We saw an opportunity to expand the number of companies who could offer that type of benefit to their employees. Comcast, by the way, our parent company does that, to your point, as well as a number of other companies. It's kind of like a, can you say it's like a 401k sort of thing where you get the corporate match about the, like say if I want to devote a certain, you know, amount of my pay or

whatever to whichever philanthropic organization that I've decided to, you'll enlist companies that will match that on the other side. Yeah. And that's, that's actually a really interesting analogy because just like a 401k, what we offer these employees through our platform is something called a donor advised fund, which is a tax advantaged charitable giving account. Historically, only high net worth households have had access to these. We've democratized access to them by building the world's most modern and affordable donor advised fund. How have the number of companies that have gotten involved in that grown? What sort of growth have you seen there? This year has been pretty incredible for us. We've nearly tripled the number of companies that we have on the platform. And we're seeing tremendous success, both at the small business all the way

through the enterprise. We've got a great company out of Wisconsin, Whipley LLP, a top 15, top 10 accounting tax advisory firm. They've had 62% of their employees participate in this program. Collectively, they've given away over a half million dollars just in the first nine months that they've rolled it out. We said it's venture-backed, correct? Yeah. We've got some amazing investors. So what does that mean for the big picture, for that, for Groundswell? We absolutely think that... People who obviously want to, you know, are thinking maybe at some stages about some kind of exit or return on their initial investment. How are you thinking about that?

Well, absolutely. We think that the philanthropy sector from a technology standpoint has been vastly underserved over the course of the last 20 years. We see an opportunity to build a unicorn in that space, building world-class technology, purpose-built for charitable giving and for the nonprofits that they're supporting. You must have a pretty good front- seat in terms of giving itself and whether that's a reflection on the current state of the economy or not. I mean, what do you see in that regard? I'm thinking of things like inflation impacting people's ability to give just because we're obviously paying more for everything, takes a bite out of what you would otherwise may want to give someone

else. Yeah. Listen, the last 18 months have been really hard in the charitable sector. 2022, we saw a decline in individual giving for only, I think, the third time in the last 40 years. Adjusted for inflation, individual giving declined 13% last year. I think we're on trend to see that again in 2023. Now, we just had a blockbuster Black Friday. Cyber Monday crushed it. Today is Giving Tuesday. We're hopeful that individuals and families across the country are going to rise to the occasion today and support the nonprofits in their community. We are so proud of the work you do. I've told you that both privately and I'm glad to have you back here. Just keep up the great work. Awesome. Thanks,

Scott. Yep. That's Jake Wood joining us right here at Post 9. Up next, we're tracking the biggest movers as we head into the close. Kate Rooney's back with us for that. Hi, Kate. Hey, Scott. So we're taking a look at a Chinese holding company that's up double digits today after earnings. And an activist investor is building a 50 million dollar stake in another company. We're going to tell you who we're talking about. That's next up after a quick break. We're about 15 for the bell. Let's get back to Kate Rooney now for a look at the stocks she's watching. Kate? Hey, Scott. So let's start with PDD Holdings at its highest level in over two years after the e-commerce giant handily beat expectations on earnings and revenue. The parent of Chinese shopping sites like Pinduoduo and Timu saw its revenue nearly double year over year.

Those shares are up 18 percent today. And Twilio also getting a boost as activist investor Anson Funds builds a $50 million stake in that company. That's according to a person familiar with the matter. The firm is pushing the cloud giant to either sell itself or divest its data and applications business. Scott, back over to you. All right, Kate, appreciate that very much. Thank you. Coming up, Amazon's AWS cloud unit announcing some big changes at its annual conference today, including its latest AI push. You want those details? And we'll give you a rundown of all those highlights just ahead. Coming up next, we're drilling down on Disney today.

That stock is up nearly 7% this year. CEO Bob Iger holding a town hall this afternoon, marking one year since his return to that company. We'll bring you all the big takeaways, what it could mean for that media giant coming up. When we take inside the market zone. The moment you've been waiting for we are now in the closing bell market zone CNBC senior markets commentator Mike Santoli is here to break down these crucial moments of this trading day. Plus, Julia Boorstin delivers the headlines from Disney's Town Hall.

And Steve Kovach with the announcements from Amazon Web Services Conference. We begin, though, with Mike. What's your takeaway from this day as November inches to a close? Yeah, it doesn't get much steadier than this. And, in fact, it's one of the more painless ways you can take care of a market that was running a little bit hot. So we got to this level a week ago, Monday. We're flat on the week. Yield's much more benign. I think everybody would have looked at a 10 percent gain in the S&P in three weeks and said, we could back off three or four percent and no harm done. We're not doing that at all, kind of not giving it in. So all to

the good, I think basically the market managing to hang on to those gains. I'm completely sympathetic with the idea that we need something else, some further reassurance that things aren't slowing too much. Maybe we're waiting for PCE and Powell later this week to give a little more clarity. But in general, credit's not giving you a reason to worry. We're through earnings season and volatility is drained to the degree where people are starting to complain about it. What do you make of what Waller had to say in this idea? I love just the ways that Steve Leesman put it, right? He said the quiet part out loud.

Right. Just acknowledging what sort of has been the undertone, if you will, of this market now. Yeah, they have not been trying to get the notion of further tightening on the market's agenda in any active way. And this was much more explicit. I mean, if you go back to the September official outlook that they gave for next year, they said most likely they would be cutting rates next year even without getting inflation to target. So that's not novel. But the fact that he did say we're pretty restrictive right now, I keep going through the 1995 script, which was the magical soft landing, which was Greenspan, hinted, by the way, after the last hike,

the next move might be a cut. Months later it was. There were just a couple. They didn't really have to slash things. Very different environment. They didn't have to go chasing inflation that time. They really preemptively took care of it. But I do think that that's the ideal scenario that hovers out there if everything breaks. Right. So we'll keep talking about 95. All right. I'll

be back to you in a moment. Julia Borsten on these headlines from Disney's town hall today. What's Bob Iger saying? Well, Disney shares moved a little bit lower during Bob Iger's town hall today as he played down his interest in selling Disney's linear assets. He said that no decisions have been made. You see, Disney shares are now down over 2.5%. Iger saying, quote, I feel that we've just emerged from a period of a lot of fixing to one of building again. And I can tell you building is a lot more fun than fixing. He and ABC anchor David Muir were joined on stage by entertainment chiefs Dana Walden and Alan Bergman,

along with ESPN head Jimmy Pataro and Disney's parks chief Josh Tomorrow. They did start off this joint conversation with ESPN discussing potential strategic partnerships, including leagues or tech companies, though Iger made it clear that they could go it alone when it comes to ESPN. Iger and Alan Bergman also talked about the importance of improving Disney's film studios, which are under scrutiny after several disappointments. Now, Iger was not asked about his battle with Nelson Peltz, although I'm sure that will come up on future board meetings. Back over to you. Yeah, you think it probably would. Julia, thank you.

That's Julia Boorstin. Now to Steve Kovac, who's following this Amazon event today. And we got a little, I don't know, I guess a little feeling of their own co-pilot, so to speak, didn't we? Yeah, and some chips, too. And despite all these AI announcements, Scott, we're seeing shares down about half a percent. But here are the announcements that we're looking at. Amazon has a new AI chip. It's a new version called Tranium 2.

This is going to be used, you know, help wean off NVIDIA a little bit. Very similar to what we heard from Microsoft a couple weeks ago at its cloud event saying, you know, we have our own chip here. We're also going to use NVIDIA. We're also going to use NVIDIA. We're also going to use these AMD GPUs. But look, you're starting to see these tech companies and these AI leaders go on their own and kind of separate themselves from NVIDIA as best they can. In addition to that, like you said, a new AI assistant. They're calling it Q. That's the letter Q. This is mostly for developers and information technology professionals. It's going to cost 20 bucks a month or $25 a month with some more

advanced features compared to that to what Microsoft is selling Copilot for that has more features and more consumer-facing for 30 bucks per user per month. Also going to compete with ChatGPT Enterprise and Microsoft's Bing Chat Enterprise. And then it's the holiday shopping season. Amazon boasting record-breaking sales it's the holiday shopping season. Amazon boasting record-breaking sales over that long holiday shopping weekend. We get these announcements from Amazon, of course, every holiday season. No real numbers in there. We're going to have to wait for their earnings report next year to see how the holiday actually turned out for Amazon. But Adobe Analytics saying today Cyber Monday sales yesterday, $12.4 billion in the U.S.,

Scott. Amazon shares down half a percent. A bit of a feel of, you know, anything you can do, I think I can do, at least just as good when it comes to these big mega caps chasing each other about AI, right? Yeah, that's exactly where we're at right now. It's just interesting to see there's not as much of a shine on these Amazon announcements. Usually, for example, when Microsoft announced like co-pilot pricing, for example, and availability, we saw shares move on that, move up on that rather. Not seeing the same thing with Amazon. So it's going to be curious to see. Next hour, be sure you should tune into Overtime today because we have a first on CNBC interview with AWS CEO Adam Slipsky. He's probably going to answer a lot of those questions with our John Forscott. Oh, good stuff.

All right, Steve, thank you. That's Steve Kovac. Do you want to turn back here? I mean, again, it's where the action is for good reason. And nothing is going to be quite as clear to the street as Microsoft's, you know, $30 per seat or whatever they're going to charge. I mean, that just makes the analyst math too easy. But to me, the suggestion that we're in the game. Amazon recently regained the one point five trillion dollar market cap level.

These giants seem like they kind of hold the cards when it comes to the investments that are needed. AMD, for as big and great as it's been, is a 200 million billion dollar market cap right now. So it just shows you the tearing effect that we've gotten here with its sort of NVIDIA, the other FANG giants, and then all the rest. I'm thinking of Micron, as you were saying market cap. Speaking of market cap shrinking today because of this updated guidance, we'll take a look at that stock I mentioned at the very outset of the show today. So it's not all rosy and chip lanes. No, no, and I mean, look, memory and Micron is used to the bucking bronco of the supply-demand cycle there. But it does show you that for as much as the company has tried to over the years

get away from the commodity trap and try to value add and get into the next tier, it's just tough. And obviously they have to move fast and develop even when the demand isn't there. All right, so Marcus is going to go out green. And another reminder about that AWS interview coming up in overtime. I'll send it there right now. The bell rings. John Ford, take it away.