Power Lunch - AI's Long Runway, The Future of Weight Loss Drugs 8/7/25

Episode Date: August 7, 2025

CNBC’s Tyler Mathisen and Kelly Evans take you through the heart of the business day bringing you the latest developments and instant analysis on the stocks and stories driving the day’s agenda. “Power Lunch” delves into the economy, markets, politics, real estate, media, technology and more. The show sits at the intersection of power and money. “Power Lunch” gives viewers a full plate of CNBC’s award-winning business news coverage, plus a healthy dose of personality from the show’s anchors and the network’s top-notch roster of reporters and digital journalists. Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Thanks very much, Morgan, alongside Contessa Brewer. I'm Dominic Chu, and welcome to Power Lunch. Stocks are mixed at this hour. As you can see here, investors are digesting the impact of sweeping new tariffs that have just gone into effect, targeting imports on dozens of America's main trading partners, marking a substantial escalation in the ongoing trade tensions. With sectors from tech to manufacturing and focus, Wall Street is watching closely to gauge if there's any real economic fallout happening. one key area that the president is targeting is semiconductors, saying that he will impose 100% tariffs on imports, part of a broader push to protect U.S. manufacturing and reduce reliance on foreign chipmakers. All right, let's focus in on Eli Lilly. It topped estimates, but boy, is it getting crushed following earnings. Late stage drug trial data on its experimental obesity pill just underwhelmed the street.

And that is raising questions about future growth potential and the company's high. valuation. As you can see, the shares are down. Plus, the future of the Fed. A new report indicates Governor Chris Waller is emerging as a front-winter to succeed Jerome Powell as Fed chair. Waller's rise sparks fresh debate over monetary policy and rates. What his leadership could mean for the economy and for your money? That's coming up. All right, let's take a closer look at the semiconductor space. It's in focus after President Trump announced. The U.S. will impose a levy of about 100 percent on imported chips. He had to do. companies building in America are exempt from those tariffs, but the biggest names in the sector,

like Nvidia, Broadcom, Advanced Micro, all or mostly outsource their businesses for manufacturing overseas. Meanwhile, the president also demanding on true social that the CEO of Intel stepped down immediately, calling him highly conflicted. Intel shares right now, you can see down by just about three and a half percent in the session following that true social post. So let's on unpack everything with our panel of experts. So joining us now is Stacey Ragson, the senior U.S. semiconductor analyst over at Bernstein. And also here with us is our own Christina Portsenevelas. Thank you both for being with us. Christina, I'm going to start things off with you and just how we unpack all of these headlines coming out from tariffs to the calling of a resignation for a main

Intel CEO type personality. Yeah, I guess right now it's just there's a hundred percent tariff, but we take it with a grain of salt. As long as companies can prove that they will, or they're committing to spending and building on American soil, then they will be exempt. For example, you had Apple committing $600 billion. Keep in mind, back in 2021, Apple committed $430 billion. So there's some double counting there. A few months ago, InVedia said that they would spend $500 billion. A few years ago, Intel said $100 billion. So a lot of companies can throw out these headline numbers that are massive. And some have actually, started to build, Intel being an example, Samsung, Micron, etc. But the question is the follow

through. How many of them will actually follow through? And then how many of those companies will be exempt if they're even just spending just a few million dollars, let's say, here on American soil. So that is the bucket. And we even have some companies that have already delayed. Like I made a list, maybe we can bring up that list that I'm calling it a Silicon Setback. Several of these names, Samsung, Intel, SoftBank, even today, saying that that that are going to delay their Stargate contribution thus far. So the reason I'm bringing these names up is to take all of these headline numbers with a grain of salt because they are not concrete.

Just like this 100% tariff from President Trump, we still need details as to which companies would be targeted. Is it only U.S.? Is it American? If you use TSMC, Arizona, then are you exempt like AMD? So there's a lot of unanswered questions. And this is, I guess, the ongoing battle for chip analysts when they are trying to rate their stocks and trying to create models when you have to go back and forth all the time with these tariffs. All right. So, Stacey, you are a chip analyst. So let's go right over to you and say just how much.

We've been talking for years about this. Is there anything that you can remember in your coverage universe, in the time that you've been doing this, that rivals the kind of catalysts that we are seeing right now with regard to this industry? I mean, it's certainly like more, probably more dynamic than it's ever been in my career. And even before Trump, the industry itself has become a lot more dynamic. It's become increasingly clear, not just functionally but strategically how important it is. And then, I mean, with Trump in office, I mean, it's just fuel on the fire, you know, because it's every day there's new stuff going on. And you have to remember, like, it makes it very difficult for my clients who are out there

trying to invest in this environment. From a sell site perspective, from my own perspective, it's fantastic, right? All I need is I need interesting things to write and talk about. I've got no dearth of those. Like, there's always something, like every single day there's something news. Stacey, if you've got Trump calling for CEO Liputon at Intel to resign immediately, one, what would that do to the company?

Is there someone who could step into that shares? Could you see, I mean, we saw with Apple, as soon as it looked like there was going to be a more promising relationship between the company and Trump shares popped. Could the same thing happen for Intel? And look, I think it's clear, like there's a lot of tech CEOs that have managed to build relationships with Trump. Intel and Liputan, they do not seem to be one of those. I mean, you know, they were absent from Saudi Arabia.

Like, we haven't really seen him in public. Not that I like that sort of thing is necessary, by the way, but I mean, in this environment, I guess it is. And Intel really has not at least outwardly shown that they're doing that. And so, yeah, I saw the tweet or the truth or whatever you want to call it this morning. You know, but Lipu's China activity is not a secret, right? He's been around for many, many years. You know, he's involved in venture capital. His venture capital has had a lot of investments in China.

None of this is news. Yeah. It's gotten attention before. It is getting attention now. And clearly in this environment with this administration, and to be clear, like, I don't think he's conflicted, but it's a bad look, right? And you couple that with the idea that he doesn't seem to have any kind of personal relationship. It's probably, even if Trump can't get rid of him, and I don't think Trump

can, but it's probably not good to have the president of the United States painting a target on your back. Christina, what do you think? What's your reporting telling you? Well, two points. When Intel is, I guess, this time around, not as friendly towards the media, because I'm still waiting. I email them quite often just to get statements, and so we're not hearing anything from their side. In terms of Liputon, the other, I guess, big question mark is that he used to on Cadence Design. So when he was in Cadence Design, he was the CEO, they were found, well, they were essentially busted for sending illegal exports of their chip design software to China. And specifically to a Chinese military university. Last week, they pleaded guilty.

They said that they were going to pay a massive fine. But that all happened under Lip Button. So that is part of the argument from Senator Cotton. He is the Republican that sent a letter to Intel's chair, Frank Yerie, questioning, why did you hire the CEO if you knew that this went on? But to Stacey's point, Liputon is pretty well respected in the chip space, given his presence over the last several decades, given the amount of money that he's invested. And again, hats off to Reuters, they went through all of his investments, and they claimed that none of them were on the blacklist for the United States.

So I'm just wondering what stance does President Trump have when he says that he's conflicted if none of those investments were wrong. All right, Stacey, you're going to cover all of this stuff. And it's not necessarily that you can model these things. You can put these into some kind of a spreadsheet or a model to give you a target price or a rating. But you've got to try your best. If you know what you know now and you kind of have to fudge around some of these, I guess, you know, fringe dynamics with regard to X fundamental type factors, is there any kind of a clear outlook for any of these chip companies to become your quote unquote top pick or the one that's the presumptive one that's going to

win the chip race given all of these factors? Let's be clear. We don't actually know anything right now. So we have a Trump speech from yesterday. Now, Trump talks a lot. And I would say charitably when he talked, you know, his statements often lack detail and nuance. We don't exactly. We don't exactly. know what the regulations are really going to be and how it's going to be implemented. We won't know that until the two, three, two, this whole thing is part of what's called a two three two investigation. Once that report is released, which hopefully will be soon, we will be able to go through that and actually figure out like who's winning and who's losing and how this is implemented. Right now we don't really know anything. We're just trying to interpret some of

the statements that he made. And quite often when he makes statements, you know, when things actually like come to light, they're not necessarily the same thing. So I don't know yet. I mean, if he take what he said at face value, the reason the stocks are all up today, though, is because you know, the 100% number sounds scary, but it doesn't look like he's necessarily trying to bring a hammer down. There does seem to be a lot of loopholes and exceptions, and he is trying to incentivize behavior and giving time for it to happen. In terms of, though, within an environment, like if U.S. manufacturing is important, who's win? I mean, companies like Texas instruments would probably be viewed as a relative winner. They're actually investing a lot of

chip capacity in the U.S. They've committed to it and they're executing on it. You know, Intel, I would say is building, although again, they've been dialing back and now you have this other dynamic with Trump and the CEO, so I don't know how that goes. There are other companies, you know, in my coverage that maybe they're building out massive amounts, but they have, you know, a fair amount of capacity here in the U.S., some of the other analog names and what you have You've got guys like NVIDIA who are invest, they're fabulous, but they're investing a lot of money here in other things, which is a positive. My fabulous companies that are reliant on TSM, you know, they can go at TSM, Arizona. And there's a certain read of Trump statements that suggest that maybe they'd still be okay to use it in Taiwan.

Sure. And then the semi-caps, if we have to actually build more capacity here in the U.S. at the margin, that's probably good for the U.S. semi-caps as well. All right. It's a lot to unpack. Stacey Raskin and Christina Parts of Nevelis. I don't even know where to start or begin. at this point. Thank you guys very much. We'll see you again soon. Well, let's go from chips to the credit markets.

Wall Street's watching closely as the Treasury hits the market with its latest 30-year bond auction. Investors are parsing demand for long-term debt amid rising deficits, shifting rate expectations, and of course the economic outlook is uncertain. Rick Santelli joins us now from Chicago. Rick, what do you have? Yeah, you know, there is a lot to unpack there. Let's start at the beginning and let the charts do some talking. If you look at twos, and tens since this morning about a seven-hour chart. You can clearly see that at 1 o'clock Eastern, rates went up, and they went up much more dramatically in the tenure

than they did in the two-year. And that was the 30-year bond auction. Now let's go right to the 30-year chart. You can see how it shot up. It tailed two basis points, which means higher yield at the auction, means a lower price for the government selling against the benchmark or the auction set up called the when-issued market.

We don't want to get too much in the weeds. Suffice it to say deficits, they're really nothing new. However, we did see that inflation metrics on a variety of fronts seem to be moving up a bit. Next week, we have both metrics, CPI and PPI for inflation. And today, initial claims, even though they were up a bit, $226,000 is very tame. Productivity did have a negative revision, but still 2.4 was solid. So you can say that the short end is paying attention to data that maybe makes and a little less aggressive.

And if you go and look at Fed Fund futures, they're a whisker lower in percentages, still 90% for September, but it did come down a bit, so it makes sense that yields in the short end or a little bit higher. And finally, the dollar index. The dollar index, this chart starts on Job, Job, Jobs Friday.

We could see the big break. Today is one of the few days that's slowly turning up on the right side. But do keep in mind, even with interest rates, kind of being buoyant, Although in a range to some extent since the jobs report, it isn't getting any bounce to the ounce of significance.

The dollar index, the benchmark that traders are looking at is as long as it keeps closing under 100, it's finding little love in the speculative community. Dom, back to you. All right, Rick Santelli, live from Chicago with the Bond report. Thank you for that. Before the break, checkout shares of Firefly, the Texas-based rocket maker going public, opening significantly above its original price of $45.

per share. We're going to continue to monitor any changes in that price there. Currently $62.55. Now, here's what's on the menu for the rest of the hour. First, a tough pill to swallow. Investors not impressed by Eli Lilly's weight loss drug, plus a new Fed Share frontrunner and a potential new option for your 401k plan. We're going to dig into all of those menu items when Power Lunch returns after this commercial break. Welcome back to Power Lunch. Eli Lilly's shares are dropping weight faster than its customers. On pace now for the worst day in 25 years. The company announced disappointing trial data on its new weight loss pill.

This seems to be the thing that investors are just totally focused on. And yet, Eli Lilly raised guidance and beat earnings estimates. Our pharmaceuticals reporter Angelica Peebles is joining us now with more on this. I mean, it just seems like it doesn't matter what they report in terms of earnings because it's all about the pill. Exactly. Nobody cares about this earnings report, which is interesting because just yesterday, we were so focused on it after we saw that big guide down for the rest of the year from Novo No Risk. Everyone wanted to see, was this just a Novo problem or was it a Lilly problem? Well, now it's all about the pill because that is the next big thing for Lily, right? They have

their shot Zep bound that's doing so well, but people want to see the pill. How disappointing is the pill data really? And put that in context for us. Yeah, I mean, it depends who you ask, right? So people wanted to see about 15% and why 15%? Because that's what we see with Wagovi. And the whole premise of this pill is that you could get a pill that's as good as a shot and it's just a daily pill. And it's easier to manufacture. It's, of course, easier to take. And so the question is how much does it really matter, right? Just a few percentage points. 12% weight loss is about what we saw. And so if you're a doctor, most doctors I talk to you said that's not really a big deal. You know, we, still want to prescribe this. We will still use it. However, investors are now concerned that this isn't good enough. And the really, the quick caveat that I would mention is that doctors are excited about this because the whole idea is that this will be cheaper than the shots. And so if it's cheaper than the shots, something is better than nothing. But that's still a big if. And of course, we're not going to find out exactly how much this pill does end up costing

until it's launched next year. I think one of the big concerns or the questions I had was not just about the Novo and Lilly competitive dynamic, but just how the competitive dynamic is shaping up elsewhere with other people who are trying to develop similar types of drugs. Is this just a two horse race at this point? There are other companies that have pills in the pipeline. We actually heard just yesterday from another company's structure therapeutics. They're developing a pill. They had a little bit more to say. But right now, it's all about Lily and Novo. And so what's interesting is that people had written Novo off in the oral category. They have an oral version of Wagobe that's expected to launch at the end,

or it's supposed to be approved at the end of this year and launched next year. But nobody was paying attention to it because everyone thought this was Lilly's market. And now that's a concern. And so the other thing that I want to call out is, yes, the weight loss is a big focus, but it's also the discontinuations here. So we saw about 10% of people at the highest dose stop taking the drug because of side effects. But even higher, almost a quarter of people, stopped taking the drug for any reason. And yes, there was about 29 people in the placebo group, so it's lower than that. But that still raises a big question. And we asked Lily's CEO, Dave Ricks, about that. Here's what he had to say.

You had almost 30% of the people on placebo dropping out. That's probably more a function of the study design. And people, you know, after a year and a half, don't want to continue in a study. Again, it was a global study. And so there are cultural things, et cetera. What we really want to see is that the medicine dropout rate is lower than placebo. And that's what we saw here. And so we will get more results next year when Lilly presents the full trial at a medical meeting. So there's more to come.

But for now, the question is what exactly happened and how competitive is this? We're going to try to answer that question right now. Angelica Peoples, thank you very much for the state of play on Eli Lilly. All right, let's get an analyst take on this with this Eli Lilly story and the future of the obesity drug market

really hanging in the balance right now. David Risinger is a senior research analyst at Lerink Partners. He just, by the way, downgraded Eli Lilly just today to a market perform from a prior outperform. He also lowered his price target from $944 down to $715, two very significant and notable moves. David, we just heard Angelica's report. It basically sets you up to take us into some more detail about just how competitive this dynamic is. And whether or not this is going to be reason for both. Novo and Lilly to really have to rethink how they pursue obesity going forward.

Yes. Well, first of all, thank you so much for having me. You know, and it's not fun actually to be commenting on a stock downgrade because, you know, this company, Eli Lilly, is an exceptional organization and we hope for the best for them. But basically, our downgrade was triggered by the disappointing Orpraglipron results. We took our 2030 Orphaglipron sales estimate down from $22 billion, approximately to about $14 billion. So we still expect the drug to be a mega blockbuster. But that balance of lower efficacy than we were hoping for and still tolerability and discontinuation issues drove us to lower our forecasts.

Now, I mentioned the trigger, but there are two other points that we made in our note that I would add. first is the competitive dynamic, and you brought this up with Angelica. So there is a wounded competitor out there, Novo Nordus, that has struggled, and this is a duopoly. So that's not the healthiest situation in a duopoly to have a wounded competitor that may have to use more price in the future under its new leadership. In addition, there are emerging competitors with novel therapies that will make the market more crowded, not in the next few years, but by the end of the decade. So the competitive landscape is very dynamic. And the third thing I would briefly say is that we are concerned that employers have not been expanding coverage of anti-obesity medicines over the past

18 months and may not do so over the next six months for January of next year. You're especially looking here, you know, when you're looking at U.S. government, the U.S. government is not making up for U.S. employers approving this drug? Well, a couple things. So employers have a choice whether to cover anti-obesity medicines or not. Lily said on the call today that about 50 to 55 million commercial lives have coverage. The issue is that high-margin employers are offering coverage. many cases, but middle and low margin employers just don't have the money since, you know, there's a large percentage of the American population that's obese. David, I want to bring this question up to you as well because your coverage universe

encompasses many of these names. If this is beyond just Novo and Eli Lilly, what are the next companies that have the most promising pipelines to address this particular GLP1 or obesity? slash diabetes paradigm. And is this type of paradigm going to be the one that carries us into the next two or three years, or should we be looking elsewhere for the next big trade within pharma? Great question. So there are a number of companies bringing obesity assets into the late stages of clinical development. So they're very large companies ranging from Amgen to AstraZeneca to Roche. and then there are emerging companies ranging from structure therapeutics, ticker GPCR, Viking therapeutics, MetSera,

which is a recent IPO this year. So there are a range of companies that have been developing new agents, a number of which could launch by the end of the decade. Okay. There's the state of play. David Risinger of Lering, Partners. Thank you very much. We're going to all look out for what the next GLP wants.

trade could be. Well, between AI, quantum computing, robotics, blockchain, this is just kind of a new industrial revolution. Which stocks are leading the way we explore in Market Navigator? Next. All right, welcome back. Turning now to today's Market Navigator. We're going to talk a lot about valuations on this show. And the debate gets even more layered and nuance. And we look at the explosion of AI, quantum computing, cryptocurrencies, blockchain. So just how far can all of these themes go, our next guest thinks that some of these companies still have plenty of room to run for decades, in fact, and she's here to share some of the names that she thinks are going to outperform. So joining us now is Rebecca Walzer, President of Walzer Wealth Management. Rebecca, at this point,

I think a lot of folks believe this is a secular play. This is going to be long term, AI, power generation, all of these things. But why exactly do you feel that are certain players out there that are going to outperform all of the other players? Well, I mean, it's just like with anything. There's always going to be winners and losers, right? But when the audience looks at this, we do have some real big concerns about the aging kind of financial situation of fia and debt currency. Putting that aside, we really are at the precipice of the Fourth Industrial Revolution.

And when I say that what I'm talking about is not just artificial intelligence, everyone has heard of AI, but what does AI do? We've got quantum computing. We've got robotics. You know, we've got the blockchain. What are all of the use cases for those technologies specifically? And when you start to think of how the future will look differently, then you can start to see companies that are really going to plug in and be winners.

And that's what we're looking for. So, you know, when you're talking about, like, for example, SpaceX, right? Everyone has heard of Elon SpaceX. But you look at the rocket labs, you know, they have NASA contracts. They have Department of Defense contracts. And this is a year-over-year company that's, you know, growing by leaps and bound. So when you think of the Fourth Industrial Revolution, think of space. Think of those kinds of things. What are the winners in their rocket labs, I would suggest, has been incredibly done incredibly well

and will continue to have a very long runway. The other thing we can think about is energy. One of the scariest charts I've seen is the U.S. energy production going back historically overlaid with China's energy production. And this is one of the biggest problems that we have, because we are going to have no AI Industrial Revolution without the energy, power it. And as you know in the U.S., we've really shied away from nuclear, we've really shied away from fossil fuels, and we don't have an alternative, so nuclear is going to be the alternative. But if you look at like a Vistra, that is a company that has got different energy interplays with the government, with private corporations for the long term to see that we really can power.

This is about not having the same computing capacity as China. And if we don't have the computing capacity, your companies will have to go where the energy can be produced. And we've seen that with, you know, Bitcoin and all kinds of harvesting. We've seen them go all over the kind of the world to where the energy is. You know, and then finally, when you look at, you know, where can we see additional opportunities for, you know, quantum, people don't even understand what quantum is. You're taking an algorithm, they don't know what an algorithm is. An algorithm is just a multivariate statistical regression formula. And quantum is just multiple of those being. done all simultaneously. This is why the computing power is so energy laborious. And yet, we are

on this massive precedence. And I love that you said that investors are expecting this to be a long runway. Because if you look at dot com, you can see what happened. We had new technology, the internet, and it wasn't yet fully monetized. And so we did get that nice couple of year pullback. The dot com crash, we call it. And obviously, this time we know it's going to take time to actually monetize all of these new technologies. All right. One quick follow up before we let ago. As a wealth manager, how exactly do you position your clients for that? Do you take bets and put them all in it at one time? Do you allocate to these things over time? Is it kind of like a dollar cost averaging situation? What exactly is the construct by which you put people into these types

of investments? Well, it's really interesting because we have to mirror of traditional financial planning and what their income needs are and when those income needs seem to start with their risk tolerances with the fact that we have this fourth industrial revolution that we want to get involved in and really have a long-term growth runway. So it's a mix. You still have to take into their current needs and their income planning needs. But at the same time,

we want to be in that AI frontier space because it's going to be long-term, one of the largest growth we've ever had in the history of the world. All right. Rebecca Walzer at Walzer Wealth Management. Thank you very much. We'll see you again soon.

Thank you. All right. Send it back over to you, Contessa. All right. Thanks, Dom. Up next, a game of musical chairs. A new frontrunner could be emerging for the seat at the head of the Fed.

We lay out who is in the running. When Power Lunch returns. Welcome back to Power Lunch. A new report is out that Fed Governor Chris Waller is emerging as a top candidate to replace Jerome Powell as the central bank's next chairman. Bloomberg cites people familiar with the matter saying Waller has met with members of President Trump's team, though he has not met with the president himself yet. This is the latest update in the ongoing search for the next head of the Federal Reserve, as several other names still remain in the mix. Joining us now to discuss CNBC senior economics reporter Steve Leesman. What say you, Steve, about Christopher Waller?

Before I get there, I want to just remark on the last thing you said about Waller, which is that he has not yet met with the president. That's probably the most important thing. And it's really hard to say that somebody is a frontrunner with this president until he has met with him. It's a very important part who would appear of how the president does such pick. So I think Waller would be a relief to markets. I think Waller has operated on the Federal Reserve for a long time. He's made a couple very good calls about going heavy and then not going. And I think there are people like Paul McCulley, who's on this network quite a bit,

who said that he's got my vote, not that Paul gets a vote, but in terms of he has made a strong case, I don't know if it's the winning case, for that rate cut in July. Okay? And he's also made a strong case that the Federal Reserve, as other central banks have done, should look through the potential inflation from tariffs. It says that's the normal way that we do think.

So I don't know that this Fed is ready to do that, that Jerome Powell's willing to do that because of the prior inflation. But he talks in the language of things that like monetary policy people get. What about Michelle Bowman? Because she's also called for earlier rate cuts. She's sort of been out backing what the president has said he wants to see happen. Is she also consider to be a potential replacement for Jerome Powell? If you got a guy on your staff, Contessa, who does a good job with economics, you don't move him someplace else because you got a guy doing the economic stuff, right? Michelle Bowman, I think, is just exactly who the administration wants in that regulatory position.

And I don't think they would move her away from there because she is, in a way, executing the administration's policies in that regard. It's an interesting place. The Fed is independent. and the extent to which it's independent on regulatory policy is a different question. Monetary policy, yes. Regulatory policy, they have to work with the other bank regulators to get there. And she seems to be the person that the administration is relatively happy with and executing their policy. How much of this is about, and forgive my kind of simplicity in this, how much of this is being in the right place at the right time? Because when you select a Federal Reserve head, they're there for quite some time. and it is very difficult, if not impossible, to fire them.

We've gone through this exercise in the hypotheticals over the course of the last several months with Jay Powell. At one point, Jay Powell was the right person at the right time for President Trump. So how do you reconcile that with the person that ultimately becomes the candidate for this position? Well, you just have to get lucky, I guess, being the right place at the right time. I mean, there's people who believe that Waller took his position because he wanted to get the president's attention. and certainly that help, but I'm guessing Chris also believes in what he's been saying about the need to cut rates. I'm laughing and amused because I'm interested in the other question that you're sort of applying down,

which is that how do you make sure you have the right person in for the next time? And that was so interesting that Bernanke was there at the moment that we needed this creative use of monetary policy tools. And the balance. And a banking crisis and the balance sheet that the guy had studied his whole life. I'm pretty sure he was not appointed for that reason. But when it came around, he was the right guy for the job. I don't know what the next crisis is. And you also raise another, I think, important question, which is Chris Waller now, I think, is kind of serving as the vice chair.

What is the vice chair at the Fed? I like to consider them the economic intellectual pulling guard for the chair. What does that mean? It means that when you have an idea and you want to explain something to the markets, kind of in depth, you send out like a Stan Fisher, you send out like a rich Clarede, these were recognized globally monetary policy experts. Chris is kind of been in that position, though not necessarily working for the chair, but he has this idea. He was the research director at St. Louis, so he really gets this stuff in a really important way. He would get it as the chair, and the question is, would there be

also a vice chair who is studied and schooled in this monetary policy discipline? Pulling guard or a full back either way, right? Same thing. But I think, well, which one is more flexible? That's true. And how absurd is it to use a football metaphor for economics other than that? Not at all, I don't think. No.

Thank you, Steve. Appreciate that. All right. Now, let's get over to Bertha Kuhm's now for a CNBC news update. Good afternoon, Bertha. Hi, Dom. Hamas responded to Israeli Prime Minister Benjamin and Yahoo's insistence that Israel take full control of Gaza,

calling it a coup on the ceasefire negotiation track. Nanyahu said earlier on an interview on Fox News that Israel does not intend to keep or govern Gaza. The Trump administration is now investigating a K-12 school system for anti-Semitism. The Education Department announced a probe today into Baltimore City schools. The Anti-Defamation League previously accused that system of ignoring incidents of discrimination and harassment. And a Confederate monument removed from Arlington National. Cemetery, once described as, quote, problematic from top to bottom, will cost roughly $10 million to restore and return to its original site. Defense Secretary Pete Hegeseth made the announcement

of the Monuments Restoration earlier this week. Congress approved its removal back in 2023. Once it returns to the cemetery, the Pentagon says it will feature panels nearby that offer context about its history. Dom? All right. Thank you very much, Bertha Coombs for the news update there. Still to come on the show. President Trump may be opening the door to alternative assets and 401K plans, but who will benefit the most? That answer coming up next.

CryptoWash is sponsored by Crypto.com. Crypto.com is America's premier crypto platform. Welcome back to Power Lunch. Big news for your money. President Trump is expected to sign an. executive order today allowing alternative investments and assets like private equity, like cryptocurrency, real estate and others into 401k retirement plans. Joining us now to break it all down as CNBC's senior finance and banking reporter Leslie Picker, I have particular interest in this because I would like to know just what I could see

different in my 401k plan offerings in the coming weeks and months. Going to add some crypto and private credit to your 401K dumb. you know, technically you could be doing that now. There is no major prohibition that would prevent plan administrators from including alternative assets in 401Ks at this current juncture. Now, there have been significant impediments to doing so, and here's where the executive order could be helpful. The biggest of which we've heard from Black Rock and Apollo has been just the litigation risk. This idea plan sponsors are going to invest in alternative assets. They're going to be paying high fees, therefore making themselves more vulnerable if they were to underperform in some of these assets due to the high fees that they're paying.

So that's kept a lot of people on the sideline. So in order to get more ubiquitous uptake of alternative assets in 401Ks, you really need to reform the litigation risk here. So it's unclear exactly what is being directed on that front. Essentially, the executive order is expected to direct the Labor Department to, evaluate guidance, as well as clarify the government's position as it pertains to fiduciary responsibilities in investing in alternative assets. However, it is seen as a step forward on that front. Leslie, the entirety of my previous life on Wall Street and financial services revolved around a construct by which certain types of investors with certain annual incomes and certain net words

were the only ones that were allowed to invest in these types of things. I'm of course talking about the accreditation process. How much do we have to reconcile that kind of previous construct, if you will, against what this new executive order could look like? Well, I think the argument to be made for private assets in 401Ks comes down to a few things. Number one, there's a clear duration match here, this idea that you do have illiquidity with alternative assets, but if you're looking at something for retirement,

if you're Dom Chuse age, you may be able to be patient and wait until that illiquidity is no longer an issue when you get distributions from your fund and so forth. Additionally, when you look at alternative assets and kind of just the way the market is moving, a lot of companies are staying private. There's been a boom in private credit. So the liquid assets are seeding some ground to the private markets. And for investors, they feel like they're missing out on a lot of VC-backed companies, open AIs and talks to, you know, sell some shares at a $500 billion valuation, for example.

The last time we saw an IPO in the U.S. that even came close to that size was Alibaba, which I recall was around $125 billion valuation. So companies are staying private, and some would say that 401K plans should have access to more of the private markets. It's going to be a fascinating forecasting conversation about what it could look like in the future here. Leslie Picker, with the story on 401Ks in private assets. Thank you very much. Pretty sure she just gave you a compliment. I think she did. She called you young. I have decades of runway.

As we had to break, a power check on Crocs, tumbling more than 20 percent. Tariffs hit sales and revenue. We highlight some other key movers when Power Lunch returns. Welcome back to Power Lunch. We're watching for earnings after the bell from a couple gambling heavyweights. When resort shares higher by almost 30 percent over three months, the global casino company gives us a picture of shifts in Macau, where one, we've seen visitation increase, but market share shifting.

In Las Vegas, visitation is lower, and there's been a real summer slump in international travelers, especially Canadians. Investors will be eager to hear whether those high-end customers give win a boost above its Las Vegas strip competitors and what the trajectory is for Macau. And remember, before the pandemic, Macau brought in about three quarters of wins profits. And there you're seeing some of its competitors' MGM resorts down today by, or year-to-date half a percent. Las Vegas stands up. Look at Melco. Melco was a real roller coaster, up 50% year to date. We'll also get second quarter results from Fandul parent Flutter. Fandall is the leading sports book in the United States. It's revenue fueling growth for the parent of Flandle, rather, which is Futter. State taxes are a real headwind in the U.S. and competitor, Draft King spent

some time on its earnings call today talking about that. Draft King's also reported slowing growth in handle. That's the amount wagered. So we want to pay attention to whether some of the fervor around sports betting is calming just a bit and whether some of that is shifting to excitement over eye gaming or online gambling and can that fuel some new growth in spite of the limited number of states that offer it. But it's incredible to see as a percentage of overall revenue what eye gaming is doing for draft kings and seizures and the like. It's all about making that total addressable market that much bigger. Absolutely. Yeah, absolutely.

All right, so we got some final thoughts coming up after the break, so keep it right here on Power Lunch. We'll be back after this. All right, amidst everything else happening with the news flow today, I've got an eye on shares of both Akushnet and Top Golf Callaway brands because most of our viewers and listeners on Sirius XM 112, no, I am an avid golfer. It's news personal to Dom.

Yes, it is. Both are on the move, as you can see on the heels of earnings reports. Tidless and Footjoy parent company, a Kushnet is lower on the day after profits came in lower than some estimates, while revenues topped expectations, driven in large part by higher average selling prices for its golf clubs and higher sales volumes for balls over the last 12 months, the stock is up 12%. Then there's Top Golf Callaway, which is the parent of both its namesake brands, but TopGolf is in the process of being split off and sold one or the other. Shares are higher after profits

and revenues both came in better than expectations. It also raised its full year forecast for its core businesses. A big part of the forecast raise was due to what it sees as an improving golf equipment business. It also saw improved traffic trends at its Top Golf Entertainment venues. Shares of Top Golf Callaway have lost 24% over the last 12 months. Now, both the Cushnet CEO, David Maher, and Top Golf Callaway CEO, Chip Brewer mentioned a couple of things I want to point out. I asked both of them for a comment. Chip Brewer over at Top Golf Callaway said that these results at Top Golf Callaway reflect continued consumer strength in our golf equipment business, the benefits from our gross margin and cost savings initiatives and Top Golf's value initiatives.

David Maher, over at Akushnet, said that our core customer, the avid, dedicated golfer, is showing resilience and healthy engagement in spite of macro uncertainties. This is helping to fuel the company's strong first half, which was driven by tidalist golf equipment, which increased 5 percent, and our positive outlook for the first. for the second half of the year. Now, of course, with all of the golf talk today, it's also the start, by the way, of the PGA Tour's FedEx Cup playoffs

with the first event, the St. Jude classic FedEx St. Jude in Tennessee. You can, of course, catch all the action throughout the next four days on NBC, golf channel, and streaming on Peacock. I had to get the golf plug in there. I mean, it was all good. And also it shows how those higher-end consumers

still have money to spend on entertainment. And they still want to. Yeah, they do. All right, thanks very much for watching Power Lunch, guys. Closing bell. starts right now.