Closing Bell - Closing Bell: What 2026 Will Hold for Your Money 12/22/25

Episode Date: December 22, 2025

What could be in store for your money in the new year? We discuss with Fundstrat’s Tom Lee, Hightower’s Stephanie Link and CIBC Capital Markets’ Chris Harvey. Plus, Jeff DeGraaf from Renaissance Macro tells us which three sectors he is avoiding right now. And, Former Dallas Fed President Richard Fisher tells us what he thinks is next for rates.  Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

All right, guys, thanks so much. Welcome to Closing Bell. I'm Scott Wobner, live from Post 9, here at the New York Stock Exchange. This make or break out begins with another stellar year for stocks. The third in a row begging the question, can this bull market stay strong again in 2026? We'll ask our experts over this final stretch. In the meantime, we'll show you the scorecard here with 60 to go in regulation. We're green across the board, as you see, pretty good day, led by the Russell 2000,

financials, materials, industrials, among the best sectors today. And how about some individual names? InVIDIA, Tesla Micron, all having a pretty good one. Citigroup is leading the banks higher. Bitcoins up, gold and silver hitting new record highs. So a lot of positive stories as we begin this holiday shortened week, which leads us to our talk of the tape. What 2026 will hold for your money?

Let's ask our panel. Everyone here at Post 9 today, Fund Strats, Tom Lee, I Tower, Stephanie Link, and CBC Capital Markets, Chris Harvey, Tom and Steph both CNBC contributors. one and all. It's good to have you right in front of us on the desk today. All right, Tom. So, 2023, we turned in 24%. 2024, we turned in 23%. Pretty good this year, too. 17%. Next year, we fill in the blank with what sounds reasonable to you. I think it's still possible to have a double-digit year.

There have been 12 times in the last 100 years where markets posted three years of 20% gains. This year hasn't finished yet. globally, half of the time, markets do even better in the following year. So I think next year is a year where the debate's going to be, is the bull cycle over or is it going to extend? I think it's going to create quite a lot of volatility in the first half, but I think GDP growth stronger. We have a devilish fed. Valuations are reasonable, so I think we end up exiting very strong. Why a lot of volatility in the first half then?

Part of it is the Trump tariffs could get overturned. There is a possibility of an extended government shutdown. The nomination and then confirmation of a new Fed chair is going to take three months. That could be very controversial. I think all of that happens in the first half of next year. How does that sound to you, Steph? I mean, I think that sounds really great. The economy is on solid footing.

We've been talking about that all year long. Last week, we've got some really encouraging data with regards to weekly jobless claims. Inflation came in a little bit better. We've talked about the H-8 Federal Reserve loan growth, lending. That's actually at a nine-week high, all-time high for loan growth. That's very bullish for activity overall. The industrial metals are at all-time highs. And you have global central bankers, including the Fed, getting more and more closer to the neutral rate.

That's a good thing. And Fed cuts take a while. There's a lag impact, and I think that's going to bode well forward next year. And then you have the one big beautiful bill, $150 to $175 billion going into the consumer's hands, going into corporate America. So CapEx continues. You add it all up, and I think you have double-digit earnings growth. There are some numbers out there that are a little high, like 16, 17 percent in earnings growth.

I'm not there, but I do think you're going to see low teens. Mr. Harvey. I think high single digits is reasonable. Single. Single. Single. I can't get to 10%, 12%, 15 just yet. Right?

One of the things that Tom said, I agree with wholeheartedly. The first half, you're going to see a lot more volatility than you have seen it in a while. I think people are sleeping on the macro risks, be it at USMCA, be it the transition with the Fed. If you listen to Powell, now he wasn't cocky about this. He was very humble, but basically what he said is, I'll see it the book signing. We have growth higher, we have inflation lower, we're back to neutral, we don't need to do anything from here. And six months, if you don't cut rates for another six months, that's an eternity in the financial markets. And then the last thing is, I think corporations are going to, after a good year this year, they're going to manage down expectations.

As you manage down expectations, that puts a little volatility to the marketplace. And lastly, risk is priced very, very expensively, either in the equity markets or the credit markets. It doesn't take much to upset the Apple Card. You want to respond to that? Because it seems like if not a step-by-step counter in some respects to your view, it certainly is enough of one. I mean, there's going to be more volatility. We're underestimating maybe too complacent about macro risks that are out there, among other things. What do you say? I mean, I feel good about the macro environment, all the things I just said. And I think it is a consumer that has been resilient. We've been talking about the consumer forever, how they have hung in there. Yes, it's the high end, not the low end.

That tends to be the case on a regular basis, unfortunately. I don't think the AI infrastructure CAPEX cycle is going to change in 2026, and that's fueling about three quarters of the GDP growth. And I do think that we always have a wall of worry. And I've said, you've heard me say it, Scott, I worry when I don't worry, because that means that we're complacent. I think there's a lot that people have on their minds. I think we're going to be able to get through it

because fundamentals at the end of the day, they run the show. And if you do have an economy that grows 2.5%, 3%, we're growing north of that now. But if you have an economy that's growing 2.5% 3%, typically that's been a 10% earnings growth. And I think we're going to be a little bit more. And you have lower interest rates. By the way, you have lower gasoline prices.

You have more egg prices for that. But address the valuation issue, that stocks are, you want to go there? Well, it's all about earnings, though. So if I think double-digit, if earnings are growing in double digits, then I do think the valuations are very attractive, especially in other sectors beyond tech. Yeah, and we have to keep mind the equal weight, S&P 500 PE is 17 times. It's lower than it was five years ago. So the market actually has derated in the last five years because of these black swans of the shutdown, inflation surge, fastest Fed hikes in history, et cetera.

So actually, the equal-weighted market is cheaper. I don't think risk is actually that expensive. Listen, so let's turn it to small caps for a second, just talk about risk. There's two indices for small caps, Russell 2000, S&P 600. Both small cap, they should perform pretty much in line with each other. Russell 2000 is outperforming by 8% this year. Russell 2000 is outperforming by 8% because S&P 600 is a high quality index. The things that don't earn money, the things that have excessive beta,

all really driving that marketplace. So I see, if you look at IG credit spreads, less than 80 basis points, if you don't know that market, that is tight, tight, right? If you look at the S&P high beta index, it's up 35%, 34, 35%, double of what the S&P is, I see a lot of, I see a lot of froth, right? There's a price for risk. It's here. I think the price for risk is down here.

Interesting. I mean, it is one of the key questions, no doubt, is whether the broadening story that we've been talking about has legs. And what do you need to reach some of the loftiest targets from strategists that are out there? I mean, the top one's 8100. Dom Chu joins us now. I mean, it's a nice range, Dom. But 801's the top, as you show right there.

Yeah, that's right. 81's the top. That's John Stolspis over at Oppenheimer right now. So that implies a pretty decent size gain. And the lowest is still bullish, only but maybe four or five percent higher than current levels right. now. But that's Savita Supermanian over at Bank of America. So 7100 is the low end of the 15 strategists that we've surveyed here at CNBC. 8100 is the high end. The middle, 7629, actually implies upside of just about 10% or so from the current levels that we're at right now.

So generally speaking, we could get to if we get to the average target price, a double digit gain for the S&P 500 by the end of next year. As for whether or not we can see the contributors for that move higher. Yes, it's always been about Mag 7, but these days we're seeing a little bit more relative strength in other parts of the market that imply maybe a broadening out trade. Check out the small cap ETF, which is already up 21% on a year-to-date basis. The mid-caps are up about 11.5% underperforming, though, the S&P 500 at 15. So the small caps getting some legs and some steam that could bode well for the broadening out trade. As for the sectors, that could be interesting here as well, check some of these out. Because over the last three months,

it has been health care, financials, and industrials that have been among the star performers on a three-month basis. So do they carry some relative strength or momentum over the last three months into the early part of 2026? That's going to be key as well. As for some of the individual industries that are leading the way higher, speaking of the broadening out trade, the XME is the spider metals and mining ETF. That's already up about 89% so far just this year. The ITA is aerospace and defense, which is 51% higher. and the NASDAQ biotech ETF has been a standout of 30% so far. So as we talk about the broadening out trade,

some of the best performing industries and ETFs out there that track them are not tech or comm services related. There are other parts of the market. So that's going to be a real key for that trade in 2026, Scott. And by the way, for more on that story, just head over to CNBC.com slash pro subscribers get all the context and detail around those big calls out there. I'll send things back over to you, Scott.

Yeah, that was great stuff, Dom. I appreciate you for that. That's Dominic, too. So you've already had a good amount of broadening. The idea that the market hasn't been broad is a fallacy, really. I mean, yes and no, because when you look at three are stacked, it's still Mag 7. And so I think it makes sense to not just look at 2025 by itself, but how have stocks done since the end of 2022.

To me, there's a lot of room for cyclicals to really outperform, including financials, because the ISM's been below 50 now for almost three years. years, that turns, hopefully turns up above 50 next year, and we get a pretty, I think, what I consider a cyclical broadening of the market. To outperform tech? Yes, and Steph and I were talking about this, that I think tech earnings visibility is still good, but the multiple expansion story isn't as, doesn't have as much upside as industrials or financials or energy or even basic materials.

It's funny, because you just bought more meta. I did. Like this morning or yesterday, right? This morning, yeah. I still like it very much. It's still down 6% from its highs. I still think that they win from AI and what it's going to mean for their ad business

and for their messaging business and customer apps business. The Metaverse cost cuts are $5 billion in savings annualized gives them $2 a share, again, annualized in earnings. I think this company can actually deliver $36 to $38 a share by 2027. That puts this thing at 18 times earnings, and it's growing earnings at 20% and revenues at 26%. All that being said, so it's a big position, top five. All that being said, I am underweight other mags. I really only own Amazon, very small Microsoft, but I do think that

financials are going to be the sector leader next year because we're not pricing in on a valuation point of view. We are not pricing in all the deregulation that is going to come, and the excess capital that is going to be returned to shareholders and, by the way, lead to loan growth, which is why I look at the H8 data. It's really important to see what banks are doing. If the banks are lending, that's going to help the entire economy as a whole grow, and these stocks are not expensive. Capital One is 12 times multiple. Even Morgan Stanley, expensive, right? 17 times. Bank of America, 1.4 times book. I think that there's a lot of runway left to the financials, and that's the sector that you know I've been overweight for a long.

time than I continue to be. You agree with that? We like parts of the financial. We really like the financials about a year and a half ago. Now we're just being a little bit more selective. I agree with some of the broker dealers, some of the credit card companies relatively cheap, think there's some upside. But not the big banks? Big bags are fine. I just don't think they're overweight at this point in time, right? They performed exceptionally well. Actually, JP mortgage outperformed a big section of tech over the last three and five years. So it's performed, right? But why don't you, why wouldn't you be overweight that group?

I mean, if you think that, you know, earnings are going to stay strong, the economy is going to be good, you're going to get more deals, you're going to get more IPOs, all of that, deregulation and everything, that feels reasonable to expect all of that. It's reasonable. I think a lot of it's in the price. I think they need to either pull back or consolidate. And if they do either one of those, we'll take a look at them.

But I agree with Stephanie. The deregulation story has more to play, but in the banks, I just don't think it's the right time to do it. They perform so well. Valuation is fine. The underlying fundamentals is fine. But there's nothing undiscovered there where we're saying, got to own the banks. Well, we haven't had a net interest income cycle in about 10 years, and the steep yield curve will be very beneficial for that. Yeah, but I thought you talked about yields coming down.

We're seeing a steepening in the yield curve. I know we are now, but I mean... That's very positive for that. Because the front end of the curve is coming down because on expectations of rate cuts. That's okay. I mean, rates are coming down on the short end. Probably 10 years kind of sits here. Maybe it goes down a little bit.

But I still think you're going to see a steepening yield curve. And that will help a big part of the bank's earnings, which is almost 50 to 60 percent in some big banks cases. That's their revenue generation. So I think earnings estimates are going much higher, and that's why I want to be overweight. All right. Well, yeah, you guys are sorry. I was just to add to Stephanie's point, I think tech forward banks, that are using AI, also are big margin stories, because employee compensation is their biggest

expense. I think banks are going to look more like tech stocks in the future, where they use AI to reduce employee dependency and earn the same money, and their multiples go up. All right. Well, speaking of AI, one of the critical questions is, can we get past all the bubble banter talk? Well, bubble banter, really. Kind of redundant if you say banter talk. Deirdre Bosa joins us now with that critical question, because we're obsessed with it now. under what early 26 is going to bring. We're probably going to be obsessed with it for some time, right? Scott, I mean, the AI trade for now at least the last few days back on its feet,

but none of the big questions actually went anywhere. This data from some of the little webb gets at one of the most important questions in the whole trade, OpenAI versus the Google AI universe, not just on models, but across the stack and what each one represents. Now, from January to November of this year, Open AI gave up a little bit of market share. Google, though, grew its market share from about 6% to 15%. This suggests that Google has the momentum and is finally converting distribution into real gains. Now, it's also quietly challenging Nvidia on the hardware side with its custom AI chips known as TPUs, and that could impact the entire cost structure, what we know of it today in the AI trade.

Now, going into next year, there will continue to be questions around whether OpenAI can meet its own ambitions and obligations while competing with an incumbent Google that controls the entire pipeline. Something else I want to mention, Scott, there's this really interesting, debate going on at the very highest levels of AI right now. It's playing out on X between Deep Mines Demis Hussabas at Google and Jan Lekun, who just left Mata. These are two of the most prestigious people in AI. Hesabas is arguing that today's scaled models, they're already on a credible path to

general AI, while Lekun is saying the current approach is a dead end without a new architecture. So if Hesabas is right, scale chips, infrastructure, those things keep winning. But if LeCUN is right, a lot of today's CAPEX is going to look premature, and the payoff gets pushed out. And that is really the central question on the bubble, right? Can we justify all of this spending? Yeah, yeah. And maybe we don't know the answer for a while.

Dee, thank you. George Obosa, you know, Chris, you say that the tech bubble does not pass our litmus test. Yeah. So, again, it gets back to something like JP Morgan Banks, which is Alperfer. We go back to late 90s and the banks really underperform. Here, the banks are actually leading the way. Multibles that we're seeing, still not excessively high. You go back to late 90s, whether it's Oracle or Cisco, you're not seeing it.

More importantly, let's go to can you fund these risky endeavors? If you go to the credit markets, anything not named Oracle, you can go out and you can still fund. And so this market is still rather healthy. Valuations are not high enough at this level. We don't see the frothiness that we saw back then. And the commercial aspect is so much better now than it was in the late 90s. in the late 90s. So you think the Oracle situation or issue or whatever is idiosyncratic to itself? That's what the market's telling you. The market's telling you that Oracle is very idiosyncratic.

If you look at the credit spreads, if they came to the market, you'd be questioning how much can you bring to the market at what spreads. If anything else, any of the other hyperscale has came to the market, the market would probably not really think about it and digest more or less anything that they brought to the market. You think we continue to have dispersion among these stocks? You know, yes, Alphabet is up 63% year-to-date. NVIDIA is up 37. Microsoft is, you know, an underperformer slightly to the market, as is meta, as is Apple, as is Amazon.

Does this continue? Scott, I'm going to say something that's not very popular, but I still think they trade as a basket. because they do all have linkages to the same theme, but at different points of time, some will lead versus the others. And so I have clients that do mean reversion among the Mag 7, but I think that they're largely one complex. Okay.

I hope we get mean reversion in the names that I own because Meta obviously has a ways to go, but Amazon does too. Out of all the Mag 7s, that one to me has been the most surprising that it just can't get out of its own way. You agree with what he said, though, that you're going to get back to trading like a group, because the stocks would suggest otherwise?

Yeah. No, I actually think that at any given point, you have a couple of leaders and a couple of laggards. And I think, I'm hoping, I'm betting on that the fundamentals are strong enough in the laggards that they will mean revert next year. That doesn't mean that alphabet is going to fall 50 percent, but maybe it just trails for a little. Maybe it takes a pause. Same thing with Broadcom, as you know, I've said that before, that maybe it just takes a pause because it has crushed NVIDIA over the last year.

And that's okay that the fundamentals are still very, very strong, sound. Estimates are going higher. And when estimates go higher, no matter if these stocks take a pause, eventually the stock prices catch up with the earnings revisions. Last point to you. How will these trade? We like the software space. We think it's more selective.

It's not over. And we think the best risk reward is in the software space. All right, guys. Good holidays to everybody. Look forward to many conversations in the new year. Thanks for being here. Thanks, Scott. Let's send it to Steve Kovac now for a look at the biggest names moving into the close.

Hi, Steve. Hey, there, Scott. Yeah, shares of Tesla, they're gaining almost 2% after the Delaware Supreme Court ruled on Friday that Elon Musk pay package must be restored. Also, this weekend, Musk said those robotaxies were unaffected by the power outage that disrupted Waymo operations in San Francisco. Meantimeon energy shares sinking over 3% after the Trump administration paused the leases of five East Coast wind projects, including Dominion's coastal Virginia offshore wind project.

Interior Secretary Doug Bergam said the move was due to needing some time to assess possible national security risks. And shares of Paramount Skydance up about 3% after the company said it guaranteed Larry Ellison would pay back an amended offer for Warner Brothers Discovery, sending those shares also up 3%. WBD has already accepted an offer from Netflix, and Peace Guy notably did not increase its bid as part of this latest development. We see Netflix shares. They're down about 1%, Scott. All right, Steve. Thank you, Steve Kovac. We're just getting started here.

Coming up next, Renaissance macros, Jeff DeGraph. He's flagging three sectors that he says, don't touch right now. He'll join us right after the break. Welcome back. The charts are telling a bullish signal for stocks. We're joined now by Jeff DeGraph. He's chairman of Renaissance Macro. It's good to see you, Cowboy. Good to see you, Scott. Thank you. Nice backdrop. I'll tell you, if you're coming out west, don't come to ski. I'll tell you, it's better to sun tan than it is to ski this year. So I heard, actually, there was no snow, but there's beauty. That is for darn sure. Indeed. All right, so I painted this as a bullish signal in the charts

for stocks. How so? Well, look, I think there's a couple things that are happening that's bullish. And the first is that real yields are contracting off of the inflation print last week. And I think one thing that investors historically underestimate, even though certainly it's on the radar, it's just the importance of inflation. Inflation is far more important than growth. And so a contraction in inflation, if we're going in that direction from the trajectory of the data last week, certainly sets up bullishly for 2006.

So we're hopeful. We're not in the zone yet where it's, you know, it's really a lock, but certainly the trajectory is going in the right direction. And we're hopeful that that is the tailwind for 2026. You know, when gold had been going up so consistently, it made people nervous. Like, what's the message in that? Is it something to be worried about? You're suggesting that global metals looking good as a bullish sign. Are you talking about another record today, for example, in gold and silver? Are you talking about those as well? as some others? Yeah, it's everything, Scott.

And I'll be honest with you, in terms of squaring that with the inflation picture, I'm not sure, you know, we totally understand what exactly is going on with that narrative. But I would say look at aluminum, look at steel, look at copper, obviously look at gold silver, look at palladium. They're all bullish breakouts, and most of them are just coming out of these big bases. So I think there's more to go there. Certainly I think it's as much about most likely what we're seeing from an improvement in global activity.

you hit the nail on the head, which is these are global in nature. This isn't just Freeport breaking out. In fact, I'd say Freeport's one of the laggards. We were seeing a lot of bullish breakouts in China. We're seeing it in Europe. And obviously, we're seeing some of those here in the U.S. as well. You know, software has been an underperformer. We talk about it all the time because the relationship that it has not only in the AI trade, but to the underperforming relative to semis, for example, it still looks bad, according to you. Yeah, it does. We had, you know, confirmation. We had a bearish signal that took place back in July, and we had confirmation of that this just this last week. And, you know, I know all the news circling around Oracle, but it's

far greater than that. And so, you know, until we can see the whites of their eyes that we think that there's some type of pause or some bottom forming there, we're just staying away from those names. And I think refreshingly, the semiconductors have stayed firm. They look good. Com equipment names look really, really good. They're actually leadership in the tech space. So we'd focus our efforts there. It's also an interesting message because we're seeing exactly the same thing, not just in tech, but we're seeing it in everything, where I can show you charts that are actually outright bearish, not relative laggards, but just outright bearish charts. And I can show you at the same time outright bullish charts within the same sector.

That's everything from discretionary to industrials to tech to staples and the like. So it's really a bifurcated market. I don't think that's bad, but certainly there's opportunities on both sides. What's Bitcoin telling you? It hasn't looked good to say the least. But what do you think the charts are saying? Well, I think all the crypto is under pressure. Bitcoin's actually the best one out of all of them.

So, you know, we keep our eye on that. Obviously, it's a little bit more established. Look, you broke the qualitative uptrend line. I think that's bad news. The 50-day cross-term of the 200-day. You have to take some artistic license to call it an up-trend still. So we think at best it's a neutral trend. We'd actually put it in the downtrend camp.

The good news is the ETF flows, as we've seen them, and as we feature them, have gotten excessive outflows, I should say. And so usually you find some type of relief on a very tactical basis there. So I think we're set up for a decent year-end rally in Bitcoin. I don't think it trades much higher than $100,000 if we can even get that. And we'll be using that as an opportunity to lighten up on positions and, frankly, get short some of those. Can you have a durable equity market rally if Bitcoin remains sketch? Yeah, it's a good question.

I mean, it's far more correlated to the NDX. And I think, you know, what we're seeing is kind of this broadening. So I do think you can. it probably doesn't have the same type of fireworks that it would otherwise, but I think you can still have, with the broadening of the market, a decent equity market in 2026 without having to have Bitcoin. Now, if you're going to tell me Bitcoin is going to trade to 50,000, then I think we've got a problem. If it's going to trade down into the mid-70s and stabilize, I think we're okay with that. All right. We'll see you. Have a good job. Happy holidays. Yeah, you as well.

We'll see you in the new year. Enjoy yourself out there. That's sun and maybe no snow, but nonetheless, beautiful country. All right. Still ahead. former Dallas Fed President Richard Fisher. He maps out his forecast for rates, who he thinks maybe should be the next Fed chair. See what he says next. Welcome back. Two of the most anticipated questions of 2026 are who will be the next Fed chairman

and how many times will they cut rates. For some clues, let's welcome in Richard Fisher. He's the former Dallas Fed president, now a senior advisor at Jeffries. It's good to see you. Welcome back. Thank you, and happy holidays to you and everybody at CNBC. We appreciate you. Thank you. All right.

Would you cut rates in 26 if you had the vote? Depends on what the numbers show. We got some rather dodgy inflation numbers recently. They're incomplete. You're hearing if you talk to business leaders that they're going to try to move prices a little bit more aggressively next year, at least the ones I talk to. And we also hearing that we're getting a lot of... A lot of propelling coming from the AI Cappex investment, which seems to be carrying a lot of GDP.

All that needs to be settled out next year. So I would wait and see. I don't think there's any hurry. I also don't think, under the current structure of the Fed, there's a predisposition under Chairman Powell's leadership to necessarily commit already to moving next year. Other than Myron, I doubt you're going to see people advocating until we get better data. We just haven't had a full set of data. The last inflation data we got is only good from the 14th of the month onward. So we didn't get a full month view, and certain sectors were left out.

It looked good. We'll have to see if that's true. You referenced Mr. Myron, who said in an interview, that the Fed risks recession without more interest rate cuts. Do you not buy that? He said, you don't buy that? No, look, he is a, by the way, a very nice man. and conduct himself from what I understand at the meetings very respectfully, but he's just carrying the water for President Trump. So I don't buy it. And I do think the president would

like to have, if it doesn't work, and I pray to God, his economic program does work from the standpoint of deregulation, et cetera, and the good stuff he's doing, I hope the economy continues to grow. But it would be nice to have a fall guy, and obviously they're setting up the Fed to be a fall guy, which I don't think is fair. I think the Fed's done a pretty good job here, particularly after cutting rates recently. But as you saw Scott on your previous interview, the yield curve is steepening. And we're not seeing the tenure come below 4%. That's a question of treasury auctions and who feels comfortable with the way the balance sheet of the government's running, income and expenditures on interest. So I don't think it's fair to blame the Fed.

as he seems to be predisposed to doing until you actually see what the outcome is. We don't know what the outcome is yet. The challenge, I guess, certainly one of them, is the idea of letting the economy run hot, right? Run it hot is out there, sort of in the zeitgeist around the market and what the Fed might be willing to do, because if you're going to get a tremendous productivity boost from AI, you can, in many ways, offset the idea that you're going to have some runaway inflation by letting it run hot, a la Greenspan in 96, in which we're on the cusp of the 30th anniversary of that. And I should also mention one in which Steve Leesman is going to explore in much deeper form

tomorrow. Versus... Go around. You described yourself the last time you were on with me, quote, I was, I am, I always will be a hawk. Right. So versus this inherent feeling that you... you have of always feeling that way because you're afraid of what would happen if the effects

of inflation were to get out of control once again. I mean, how do you square both ideas? Well, first of all, Scott, remember, I also said, and half-chokingly, but jokingly, that doves are members of the pigeon family. You did? Ornithologically. So I don't want to be a pigeon for anybody. And that's what my reference was to being a hawk.

I want to make sure the Fed does its job to make sure inflation or deflation doesn't raid its ugly head. And every president, as I've said to you many times, every politician worries about jobs over anything else. The job of the Fed is to keep the balance. We do still have very low unemployment, but we keep hearing that things are getting worse, No hiring, retaining, but not hiring new numbers. The numbers have not been strong.

So we're just going to have to see what the balance has got. I mean, the Fed wants to do what's right. And that dual mandate makes their job, as the chairman has said, and everybody says it serves on that committee. It's a tough decision right now. So I wouldn't pre-commit to anything as we go into the new year. Until we get more reliable data and we don't have it yet because of the shutdown.

But what if I said to you, what seems clear in some sense is we're going to get a massive productivity boost. We're already seeing signs of that. Some of it, yeah. Inflation has already come down a tremendous amount, is going to continue to do so. And maybe it doesn't necessarily have to get down to 2% because of the productivity boost you're going to get on the other side. And there is reason to be a little concerned over the displacement of jobs related to AI and some

of the softness that you're seeing. So it seems clear to lean heavily towards the labor picture and you can figure the other one out because you're going to get some boosts that you may not fully realize the magnitude of yet. God, businesses do not depend on Fed funds to finance themselves. Operating businesses depend on credit cost. And they borrow in the markets, particularly the large ones or the smaller ones borrow from banks. That's related to the longer part of the yield curve. It's not related to Fed funds. It's a small portion of how it affects the 10-year treasury, for example. Mortgage is key off the 10-year treasury. This is key off of what they can borrow in the marketplace. And it does help that we've had very narrow spreads,

although some of them have widened out a little bit here. But the base rate is not the Fed Funds rate for operating businesses that commit for CAPEX, et cetera. So I don't think what you really have to worry about here is our government finances. We're taking in a little bit more revenue. Everybody's now beating their chest. We took over $5 trillion in revenue, but we're spending over a trillion dollars in interest costs on the U.S. government debt. That doesn't seem to be reining in as much as we all hope it will. Okay. And let's determine that will influence the way businesses look at the credit markets in my view, for what it's worth. I have one last question for you. When you're at those fine cocktail parties down in Dallas, and I know you're

are, and people ask you, Richard, who should be the next Fed chair? Who do you think it's going to be? Right. You tell them what? Let us into the room. Well, who is it going to be? Well, I tell them that whoever it is is going to have to be careful because they cannot get this job unless they commit to the presence agenda. So I do have feelings about all them. I like them all. I like them all. I do think Waller probably is better experienced at the Fed itself and understands how it works, better respected by the rest of the committee. Reader, nobody knows fixed income markets better than he does. He's brilliant, and he's a friend, by the way, so I'm biased. And then if you look at the other two, I've served with Kevin Warsh.

He's matured a great deal since he left as a young man on the board of governors. And then, of course, we have Mr. Hassett, who's been very close to the president. So what I do worry about, I want to see somebody who's strong enough to just stand up to the president if necessary. And I don't think anybody's going to get the job unless they've committed to follow his agenda, at least initially. So do I have a favorite amongst the four? I don't. But that's the way I look at all four of them. And other than nominating you, Scott, I don't favor it. everybody. All right. Which would be a disaster. Very diplomatic. That's probably why you get invited

to all those fine cocktail parties in Dallas, as I mentioned. Richard. We are growing, but, you know, we are growing like Topsie down here, and four percent of interest is not hurting the Texas economy. I know that. Happy healthy, and we'll see you in the new year. I look forward to you. Happy holidays, Merry Christmas to everybody. Thanks for having. Yeah, that's Richard Fisher. Up next, we track the biggest movers as we head into the close today. Steve Kovac is back with us standing by. What do you see? Scott, yeah, we have a space stock skyrocketing on a new satellite contract and a fresh bid sending a uniform supplier higher. We'll give you those moves and more coming up when closing bell returns after this.

We're about 10 from the bell. Let's get back now to Steve Kovac for a look at the stocks he's watching. Top of the list, today's what? Yeah, Scott, Rocket Lab, those shares are popping over 9% after the company said its new $860 million deal to build satellites for the U.S. Space Force. is its largest single contract ever. Space stocks rallied last week on news of that potential SpaceX IPO, as well as President Trump's executive order that aims to create a permanent U.S. base on the moon.

Also, shares of uniform supplier universe soaring 18% after CENTUS, a big maker of workplace products, submitted another offer to acquire it. The total value of the offer amounts to $5.2 billion, and the fresh bid follows offers by CENTUS in 2022, and again earlier this year. And finally, Stanley, Black and Decker, hired by about 3% after the toolmaker agreed to sell its aerospace manufacturing business to how met aerospace for $1.8 billion in cash. Stanley will use those proceeds primarily to pay down debt.

Scott? All right, Steve, thank you. Up next, Bitcoin losing some steam as we head into the close today. I'll tell you what's driving that action. Plus, Capital Area Planning Groups, Malcolm Etheridge, standing by. Hill-up was break down the final moments of this day. Market zones next. We're now in the closing bell market zone.

CBC senior markets commentator Mike Zantoli and capital area plannings. Malcolm Etheridge are here to break down these crucial moments of the trading day. Plus, McKenzie Sagalas is watching the volatility in crypto. Deerja Bosa is here with what is driving the moves in Uber and Lyft. Mac, do you first and crypto. Scott, Bitcoin and all coins like XRP and Solana are in the red. Ether slipping below that 3K mark in Bitcoin trading under 89,000. It's about 30% off its October all-time high.

Spot Bitcoin ETF still aren't offering much support. Institutional flows remain soft. And even with the Fed now cutting rates, risk appetite is cautious in the crypto markets. That whole Bitcoin as digital gold story isn't really showing up either. The safe haven bid is going to metals with gold in another record high today. But crypto-linked equities are bucking the dip in tokens. Circle, bullish, Coinbase, and E. Toro are all trading higher.

And strategy, the biggest Bitcoin treasury name, sold a batch of shares last week and added another $750 million to its U.S. dollar cash reserve. That's a sign that they're building a cushion in case this turns into a longer crypto winner, Scott. All right, Mack, thank you very much for that. Dear Jabosa, Uber, Lyft, Blackouts, Waymo, tell us more. All the things. Yes, they are higher today, the ride sharing complex. them. Investors are maybe reassessing the autonomy trade a little bit. There was Waymo's weekend

gridlock here in San Francisco, and that really kind of makes the contrast pretty sharp. Uber and Lyft, they aren't carrying the regulatory or the reputational risk of running their own fleets. Instead, they're partnering with many different players positioning themselves as the aggregators. Now, the latest partnership is China's Baidu to test Apollo Go robo-taxies in the UK next year. Of course, Scott, this has proven to be a volatile trade. The ride shares, stocks, they typically fall, we get progress from a Tesla or a Waymo that doesn't include them. Today, though, it's in their favor. All right, Dee. Thank you. Dear Jabosa.

Malcolm's good to have you join Mike and myself here. What's your thought here as we close out this year? A few trading days left. Yeah, I think it's interesting that as much as we've had conversation over the last couple months about whether the broadening trade is meaningfully going to actually do something, I saw the entire A block and that was one of the themes you guys were discussing. Yes, it was a good year for small caps. and others through the last couple of months. But it's interesting that the last few days

toward the end of this year, it's Amazon, it's Nvidia, it's Microsoft that have gotten up off the mat and done 2, 3% in just the last couple trading days setting up for the Mag 7 to carry us toward our third 20% return in a row for the S&P 500. What about into the new year? Does it just remain that way?

I think it does. I think the IPO market is probably going to keep enthusiasm where it is heading into 2026, especially in the tech space, We're talking about Anthropic, we're talking about Open AI, which both may or may not actually make it out in 2026, but there's probably a ton of other tech names that will, and so that enthusiasm will continue to flow through the MAG 7. Mike, I like that thought, that there's going to have so much activity around that that we're just going to be focused on this no matter what we want to believe. I do think that's true.

I mean, it is sort of the beacon that's out there, that the rest of the market's been chasing. I mean, I think you can still have it be a market that periodically does allow us. some catch-up moves today. You are seeing the industrials do pretty well. Banks again, leading. But what's fascinating, first of all, Malcolm thinks we're getting another 20% up year. I think we've got to do 3% in the next six days, at least without dividends. But hey, anything is possible. Because the market is kind of acting right now, kind of the way it's supposed to, when we've gotten through this news slalom of the last few weeks in terms of the jobs report and all the big earnings are out of the way. And now it's just kind of about year-end flows tacking on VIX at 14

tells you the market's going to be closed almost as much as it's open in the next week. I think that's all a decent base. But I do want to remind folks, we were trading at this level October 29th. And so it's not as if you've kind of really had a run away to the upside. And that might be good going into next year because I do see the makings for people to start get overexcited again. The space stocks are going nuts, as you were mentioning just a little while ago, the quantum stocks.

And so I do think it doesn't take much for the market to go into silly mode here. You know, what about the risks, Malcolm, into the new year? What's the most pressing one do you think? Frankly, I think the financing structure of the data center buildout that has been underpinning so much of this AI trade is probably where a lot of the risk is. I think it's really telling that the likes of Microsoft and Alphabet and Amazon and others don't actually want to own that debt on their, I don't want to own those assets on their balance sheet, and they're passing off the leases, the leasing structure to other companies, these neoclouds that have been coming. coming along. And frankly, I think there's a chance that a lot of that will start to unravel in 2026. Well, I mean, if that starts to unravel, that's going to be a problem for this

trade. Let's not kid ourselves, right? It should. And again, those companies are somewhat insulated by their core business, but you do have this risk out there that the appetite for capital is going to be so voracious that at least at times overtakes the market's willingness to give it on friendly terms. I do think the other thing going on with the hyperscalers is there's started to look cheaper on a P.E. basis, but they're kind of spending down all their free cash flow. So it's a different equation. It used to be, oh, they seem expensive, but all their earnings are free cash flow. And that's the other way around. They're looking not as expensive, but that's because they're on this treadmill of spending. So I think it's just one of the

wildcards into next year. Most exciting part of the market outside of tech for you, Malcolm's what? Yeah, I think financials. I think if you look at the names Goldman Sachs, Morgan Stanley, JPM. All three of those companies have participated in all the big M&A transactions that have happened this year. They've really been the ones to help to organize those deals. And so I think that those three names, which I don't own any of the three personally, I think they continue to do very well in 2026. All right. Well, they're going to ring the bell. We're getting closer to 26. We've got a few trading days, obviously, left to go. It's a holiday short and week. Started this one out pretty strong. Nice games across the board. Russell, bottom, you know,

screen on the far right there is the one that is doing great today. A better than 1%, Mike, thank you as always. Malcolm, be well. We'll see you soon. Does it for us. I'll see you tomorrow. Into O'S-T.