Power Lunch - Dow crosses 48,000 mark 11/12/25

Episode Date: November 12, 2025

One of the year’s most popular ways to play crypto is cooling off. Joe Lavorgna, Counselor to Treasury Secretary Scott Bessent, joins the show and discusses the government shutdown.  And how much further can markets keep running?   Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

of the AI trade, Courtney. Yeah, very interesting. Leslie said, look, you're probably not going to get a lot of IPOs the rest of this year, but look ahead to next year, and maybe we will. Do you think, Dee, that there's a healthy understanding of some of the worry that is percolating around the AI trade there? I love that it's full of hope and opportunity, but, I mean, are they realist there, too? Yeah. You know what? I would say there is a lot of optimism here, of course, because everyone here is building in the space, and they're hearing from each other,

but there is a healthy dose of reality. I mean, Replit is a company, a vibe code and company that has been able to increase revenue. It's looking at a billion next year. But there are also many that will not make it, that are in sort of this price war. So there's both sides of this. And I would say here, there's a lot of talk, too, about, you know, the Gardner hype cycle. And how, yes, when you're at the top of hype, it's way up here, but it will level out somewhere that is more reasonable, more realistic where that is. That's what markets are trying to find out.

And that's what I think the private markets and founders here are trying to figure out, too. Very interesting stuff. Thank you for bringing us the pulse from the ground, dear Drubosa. That is it for today. Thank you for watching the exchange. We do have markets mixed. Tech again, the laggard on the session with the NASDAQ down about 3 tenths of a percent. Dow up eight tenths of a percent.

Power lunch starts right now. thousand going to happen any day now. It could. Welcome to Power Lunch, everybody. I am Brian Kelly. We'll be back in a few weeks and we are on record watch again. The Dow heading a new intraday high creeping back toward 50K. Goldman Sachs, JPMorgan American Express all pop into new highs. Plus AMD riding high. The CEO says AI demand is quote insatiable. Americans with an increasingly insatiable desire for the government to fully open back up. Could that be another leg higher for stocks when or if it does? White House insider Joe Devornia is here.

Talk about that and more. Plus, is it time to get ready to play a big Bitcoin bounce? While oil is sagging and one group, your guest says you may want to avoid right now. Welcome, everybody. The bond market is back trading after the Veterans Day break, which means there is more interest in stocks. And of course, you, all you really smart people out there, you won't. know the positive data points about stocks and the holidays, the Santa Claus rally, et cetera. But is that alone, some kind of random and semi-obscure reference to a certain period on the

calendar, a reason alone to invest? Probably not. But let's start with some and kick things off with Mary Ann Bartell's chief investment strategist at Sanctuary Wealth. Marianne, great to kick things off with you. It's great to be here. And all the data points are great. Markets tend to rally, best time of the year. I got to imagine for your clients at Sanctuary, it's nice. It's probably not the reason to invest, is it? Well, the way we've been looking at the market now for a couple of years is that we're in the digital era.

And the digital era means new innovation and technology. And this year we got AI. And I think it's taken a while for people to understand AI and what it means for the companies. We're talking about it and the build-out, but what does it mean for earnings? And we finally are starting to learn what it means for earnings. So, Mary, my question you know is, what does it mean for earnings? Well, this earning season, which we're getting close to wrapping up,

earnings are up about 15% year-on-year, 7% better than what analysts were forecasting. And the growth is really coming out of the tech companies. So there is a return on their investment. So semis are the leaders. And that's been a theme that we've had. If you studied the cycle in technology, you get the new development in the chip, and then everything else, the hardware, the software comes after that. But like what Lisa Sue said is demand is insatiable because we're upgrading all of our technology.

And this is going to take years. This is not something that's just going to happen one quarter, two quarters. I think this is a buildout that we're going to see over the coming years. And you referenced the AMD CEO. Listen, a lot of people have, when you say the word, trickle-down economics, not you, but anybody, it has like this political reaction. People are like, oh, that's BS doesn't work. But it sounds like when it comes to AI, trickle-down economics is the thing, because somebody pays a couple hundred million, couple hundred billion for something. That goes to

chips, which then goes to software, which then goes to, like, concrete and HVAC companies building the data centers. It sounds like it truly is kind of a trickle-down. It is a trickle-down. And the amount of money that's going into this build is really mind-blowing. There are estimates out there that the total build-out for these data centers and AI and electricity, you know, for the energy demand and everything, it's going to be $7 trillion. Those are numbers I've never used in my entire career. So that's almost double the federal budget of the United States. That's how big that is.

That budget's like $4.5 trillion. It's almost incomprehensible. But again, I think this happens in stages. But what I'm trying to tell our clients to focus on is that we're still on a secular bull market, meaning the trend in the market is higher. I'm very confident in my long-term targets for the S&P. We have $10,000 to $13,000 by the end of the decade.

Wow. And this is... You have $7,000 by the end of this year. Yes. So I think we can get to $7,000 by the end of this year. I think going into next year, I'm not sure it's going to be another 20% up year, but I do think the markets can go up. But I do think we'll have volatility from time to time, but to stay on the long-term target of 10,000 or 13,000. This is important because one of the greatest, I don't want to say it's a lie, because that's the wrong word.

But one of the greatest sort of misconceptions about the market is you hear this term that stocks double every eight or nine years. and that the historical average return is about an 8% gain for the S&P 500 every year. That's an average return. So you could have an up 40% year and then a down 5% year, and I'm making them numbers up, and then have an up 12% year and average 8%. Do you anticipate sort of a steady climb or like we've had in the past? I mean, there could be some gut-wrenching moments in the next few years. We had one back in April, by the way.

That was a bare market. It was 20%. In like three weeks. And that resets the cycle. I hear people saying that we're in year three of the bull market. No, we just reset it during Liberation Day. Really? You believe that? I believe we've started in another cycle and that this is year one.

But what I am seeing, Brian, is earlier in my career, we would get a 20 or 30% pullback every four years. That's happening more frequently. Well, it's happening faster, too. It's a lot faster. And part of this is technology, how we're pricing things faster. So you're correct. We could get a 15, 20 percent pullback at any point in time. But as long as the solid fundamentals are in place, the markets are going higher.

And now we also have the Fed cutting interest rates. I have never seen a market peak or have a major down cycle while the Fed was cutting interest rates. So to be clear, you got the 10 grand S&B target? 10 grand. By the end of this decade. By the end of the decade, maybe even higher. Maybe even higher, but again, this 8% thing, that's just an average. And if you know anything about basic math, averages can mean a lot of different things.

That's correct. They could be this another one or two gut-wrenching moments, a couple weeks. What people don't realize is the secular cycles last 15 to 20 years. We started this secular cycle in 2013. And that's why I think we're getting towards the end at the end of the decade. But then we go in a holding pattern for another 15 to 20 years. And that's when the average return tends to be low. But when you're in that secular up trend, the average return is higher.

But you take that over the very long term, you wind up with that 8%. Well, listen, you know, we all, if you got a retirement plan, you got to love those kind of numbers and those kind of expectations. And by the way, we'll let you go, Marianne, on Monday when we were at this big utility conference in Miami, the utilities alone are spending $1.1 trillion in just five years. years, that money's going to, dare I say, trickle down to other stuff. Marianne Bartels, really appreciate it. Sanctuary Wealth, Chief Investment Officer. Thank you. Thank you.

All right. Speaking of bonds, we are back trading after Veterans Day, and there is a test for demand right away. $42 billion in 10-year notes auction today. Let's talk about that and more. Rick Santelli, the professor, joining us now with the bond report. Dare we have a grade, Rick Santelli? Yeah, the grade was C-Fenselli.

for pretty much an average auction, that $42 billion came in, well, the higher yield than the one-issued market meant a bit of a lower price. If you look at the chart, you could clearly see. When do we make the low yield? Right as the auction results came out at 1 Eastern. And if you compare it to the Monday trade because we're closed for Veterans Day, this entire session is below that session. Why? Because there's a lot of optimism about pessimism about all the data that may come down the pipe when the government reopens. And if you look at a couple of weeks, you can clearly see we're revisiting the low end of the range.

As a matter of fact, should we close under a 407 yield intends? It will be a two-week low-yield close. But as we start to turn up again, there may be many issues. I know we had some data like ADP, but ultimately how all the data will fare when we get it over the next couple weeks? Well, it's a guess at best. Brian, back to you. Rick Sandtellie with a C, although, as I would say this, Cs get degrees. I found that out.

All right, now let's take a trip around the world because while the American markets here are rocking, we are actually not the best performing market in the world, not even close. In fact, and this is random and dare we say interesting. For the year, the S&P 500 isn't even in the top 30 of global stock markets. We're up 16%.

That's really good, but we have been trumped by nearly every country in Europe, Asia, and South. America. There is a lot to unpack here in our global journey. So let's bring in our global traveler, Dominic Chu, to talk about this big, I'm not taking anything away from this beloved country, but the rest of the world's re-inflating too. Well, you and I are both patriots. We love being here. We love investing in this market. And let's be honest, for most Americans, if you are invested in the stock market, you're probably invested in the U.S. predominantly. But if you take a look at just the European continent specifically, don't even need a passport right now. We're going to take you there in terms

performance. Because if you look at the Eurozone overall, as represented by the Stock 600, kind of like their S&P 500, that index, the CAC 50 in France, in the IBEX 35 in Spain, are notably new highs in Europe. In fact, much more so that they're record highs in Europe right now. And even if you take a look at some of the other markets like the Futsi MIB in Italy and the Futsi Ireland Index, those are at new year highs. So 50-week highs for those indices. A lot more of that positive sentiment is flowing through to those parts of the market. There are a lot of drivers as to the reason why. There's a mean reversion trade. The U.S. has been outperforming for such a long time that there's this move

a little bit away from there. But what I want to do, Brian, is highlight some of those moves in particular, because what we want to show is the side. Well, come on over here to do that. Why are you so far away? I want to be over here because I like the conversations that we have. One of the reasons why you are seeing a little bit more of that sentiment shift, one reason why, is because there are some moves in the currency that are making the U.S. U.S. a little bit less attractive in terms of the way things are developing from investor sentiment versus the European side of things. One of those issues is whether or not maybe that whole U.S. outperformance trade, which has been in place for such a long time, is now starting to just lose

a little bit of shine relative to other parts of the market. Okay. So I want to talk about currencies and I know you got some other cool stuff you want to look at, but let's quickly back it up on Europe, okay, because I get it. You go to Europe. Europe, I love you. You got great museums, great food, Some great companies, but not a lot. The entire German stock market combined is smaller than NVIDIA. We know that, a lot of energy policies, whatever. But talk to us about the difference in valuation. That is slow growth as some of those companies and countries are.

It just came down. I think the valuation got so cheap you couldn't ignore it. That was one of the main reasons why a lot of strategists from a global perspective were saying that the U.S. markets deserved a little bit less attention relative to the European markets and other markets in Asia. because the price to earnings multiples in those parts of the market, they don't have NVIDIAs and they don't have Palantiers and some of these other high-growth companies out there like we do.

So that's the reason why their valuations are not as high. But if you want to look at the mean reversion trade, that's big. The other one that I want to pay attention to, you mentioned the currency side of things. If you're a U.S. investor, you express a lot of these views in ETFs, right? I want to put up a big one for you because the I-Shares Eurozone ETF has been on a tear. It's up 34% over the course of the last one year. period. And I'll show you the chart. What I want to also show you is the orange line there, which is the same exact ETF, but currency hedged. It takes away the movements of the euro versus

the U.S. dollar. It's only up around 24% in the exact same time period. It's lost 9%. But that's the currency underperformance. That's the outperformance of the euro versus the U.S. dollars. So unhaged currency ETFs, right, that track the Eurozone stocks, are doing better in part because the currency is doing better. That's translating to returns. If you take that currency appreciation out of the mix, it's only up about 9% and 10%. That's not small. Like I know, I don't talk a lot about currencies because, frankly, I don't understand them that well.

I'm not going to lie. We don't know everything. But I know that 9, almost 10%, is a lot of, a big difference. A thousand basis points is a big deal. That's this year. It's 11 months, nearly 10% difference because of currency hedges. So that just goes to show you over the course of the past year. how much the dollar decline has factored into some of the investment theses around the U.S.

versus Europe. You know what I love about that? We also just made people smarter. I hope we had. And by people I meant me. I hope a lot of our folks out there are. Well, that's important. Currency here.

It's not a 1%. 9.5 or whatever percent that was. Domchew, great stuff. Really appreciate it. You got. Thank you very much. All right, we got some breaking news out of Washington, D.C. Let's find out what it is with Damon Jabbers at the White House.

Yeah, Brian. This coming from the Supreme Court just in, the Supreme Court saying they're going to hear oral arguments on the president's effort to fire Fed board member Lisa Cook. They're going to do those oral arguments on January 21st. Remember, the issue here is the president is allowed to fire somebody for cause, so to speak. And the question is, what does for cause actually mean in the statute? Can the president use unproven allegations as a cause to fire a Fed board member? The Supreme Court going to look at that. hear all the arguments on January 21st.

Also, we just had a press briefing from Caroline Levitt, the White House press secretary, and she confirmed what a lot of people have been suspecting for a while now, which is that that October jobs report and CPI number are likely now not ever going to come out because it's going to be too difficult to go back and recreate that data,

even if the government shutdown is able to be concluded today. So some of that data will just be a black hole in the history books as people go back and look at this period of time, Brian. All right, two things. Number one, as soon as you went on air, of course, like the lawnmower comes by. I mean, that's what has to, that's like TV 101. When I go live, somebody with like a helicopter or a fire alarm or a leaf blower is going to come by. Number two, and there it is again. Number two, you just brought up, you answered a question we asked the other day of

Steve Leesman, which is what's going to happen to some of this back data? You just answered it. It's not going to happen. We're going to have multi-month or at least one month that sounds sounds like gaps in some of this critical data. Yeah, look, and as you pointed out, the grounds here at the White House are very well manicured, and that's an all-day affair sometimes. So that's happening. But yes, you're right. It's just going to be a hole in the record books, right? I mean, you're not going to have that data. They can't go back and recreate it retroactively, especially when they're trying to move forward and create the new data and have everybody come back from the shutdown and continue to do their

jobs, you know, in the weeks to come. We'll get some more guidance on when exactly federal workers can come back if this bill is passed on Capitol Hill. And if the president signs it tonight, as Caroline Levitt said from the briefing room just now, she expects that he will do. I think the line is, if there's a bustle in your hedgerow, don't be alarm now. It's just the spring clean for the May Queen. But whatever that is, you rolled right through it. Amen Javers. Thank you. I'm going to go help them bag some leaves over here. Talk about unhedged.

There we go. Heyman, thank you. Coming up. All right, we just got the fundamental view on markets. Now we're going to go to the charts. And we're going to find out what Mark Newton has to say, not just about stocks, but some hot commodities, too. And speaking of, can you identify this less than hot mystery chart?

Kind of a weird intraday graphic. Good luck. There's a hint on the screen. We're back right after this. All right, time to reveal our very quick mystery chart. It is oil, crude, crushed under $60 a barrel. It's under $59 a barrel, $58.41. A lot of concerns out there about oversupply, simply too much oil in the world, though,

but could that be good news for the equity markets? Let's talk about that and more joining us now. Mark Newton, Fundstrats, Global Head of Technical Strategy, and as by the tie, you can see a fellow VATEC hokey. to have you on set, Mark. We actually overlap for a couple of years there. Quickly, oil, are you looking at it as a benefit to the equity market or just kind of its own thing? It's its own thing.

It's completely a supply-demand story. OPEC plus flip the script. They went from, you know, deficit to surplus, so a huge decline today. You heard from IEA, though, there's no more peak oil. So they said that's going to be ongoing demand for oil over the next 25 years. So that's a different story for the long road. The IEA is, you know, I talk about it's a lot of. That's right.

They've done a quick turn. We're wrong, but I'll give them credit for kind of admitted to our long. Yeah, look, I think in the near term, the next couple months are really going to be negative for crude and for energy. Even though energy's been the top performing sector over the last one week, one month, and three months, beaten technology. Now it's going to start to decline, I think, in December. So I think crude gets into the 40s, honestly. And it's going to be negative for crude, I think, in the next couple months. If we get crude oil in the 40s, we're going to have gasoline in parts of America under two bucks a gallon.

That sounds like a good thing for the consumer and maybe the stock market. Yeah, it certainly should be a good thing to combat inflation and those that are worried about that. And look, we need energy for AI and the whole buildout for power generation. So we're going to continue to need to obviously have fossil fuel and investment there in the years to come. Yeah, it's, we're going to demand for oil and gas, whatever people think about it, is going to continue for our lifetimes. Let's talk about, though, pharma, you know, listen, it's its own thing kind of dominated by the GOP1, the so-called weight loss drugs. What are you seeing technically in the pharma charts? Look, it is a little bit of a defensive sector, and we've seen really good outperformance in health care over the last month.

So along with energy, health care has also done quite well. My thinking is that pharma continues to do well. It really is starting to look better and better. The longer-term charts, though, are not great on health care, but it really is more of a defensive balance, and I think that continues into month end, likely into December. this mean reversion trade that starts in November, some of the worst performing sectors start to bounce and do well. We're certainly seeing that. Why is that? Just fund managers trying to find a bargain somewhere? Yeah, people look at the laggards. They think they should go from,

you know, being the worst performing sector into the best that I don't necessarily always buy that, being a technical analyst, of course, as you know. The Hokies can't go from being the worst team to the best. That takes time, right? Look, in general. If it just happened at all, I would be, I don't care how long it takes. Either way, we've needed in Hokie Nation a lot of coffee this year. Coffee prices are at record, record highs. But now the White House saying they're going to try to, like, cut tariffs on coffee. Why are you looking at coffee as a technician? Coffee is for closers only. You have to look at coffee, obviously. We've seen coffee show really, really good signs of strength.

The entire Bloomberg Commodity Index broke out to the highest level in more than the three years this week. So coffee is one of those that certainly could benefit. But my thinking is if what they're saying on tariffs is correct, it probably will cause at least some short-term jitters. Coffee's on about 5% today. So Besson's comments did cause that to move down. But technically, you know, there's a number of commodities are starting to look quite good. Soybeans and many of the grains, for instance. So you're a way aside from being a soybean trader, by the way, like Scott Bessett used to be, he actually was a soybean farmer.

Is there a way that you at Fundstrat are recommending playing any commodity complex? Is there a way to do it? Yeah, some of the energy, some of the commodity ETFs are a bit thin, so they lack the liquidity. So you have to tread lightly there. They can have big moves either way very quickly. That's correct. And you're often trading against a producer who actually grows or sells the stuff, unlike the stock market. You're not really trading against like Jensen Wong.

Well, the issue for investors is the role to the futures, and sometimes that can be really problematic by trying to buy these commodity ETFs when they go from the front month of the second month. And so it unfortunately can affect the... Very quickly, macro market, great stuff. But what is the... I know you're a chartist. What's the next most important or the most important next thing you're looking at from the charts?

Look, the bottom line is we need to get other sectors to start to participate. It's really only been technology in recent months. So there hasn't been this broadening out that we thought would happen. That could be a problem early part of the next year if that does not happen in December. Tech, as long as it holds us up,

the markets can be fine. Right now, there's still logging net. negativity. And so Tom Lee's been absolutely correct on that point. If that comes back in December, then, you know, we'll see about next year. My thinking is trends are intact. They're fine. We're sort of lacking the buying. It's people have been on the sidelines all year long. Want to see the Russell 2000 breakout? Or what do we need to see? Well, that did happen briefly. I did. We knew eyes to see. Briefly, one day or whatever. Yeah, not long. Look, we need to see small caps start to participate. We need to see financials,

which have been, you know, under the gun based on a few of these, you know, are true, is this going to be metastasized across the financial sector, all this regional bank where it's my thinking is it's just isolated to a few cases and financials are going to be just fine. They're actually coming down to levels that make a lot of sense into next year. So I love financials. I like tech, but tech's a bit overdone. You want to look at industrials. If crude gets down to the 40s, it is going to be time to look at energy into 2026. For now, I would put on the brakes and really use some of these gains in energy to try to lighten up on that sector heading into because I will add on top of that, there is a massive underinvestment and energy. A lot of

people want to say, well, oil is 40. It's here to stay. I've been covering this now 20 years. I will say this. No commodity stays in a current price range for long because low prices beget high prices and vice versa. Well, IAA's statement is a game changer. And crude's been in a three-year bear market. I don't think that lasts into next year. So if crude gets down lower, I want to be a buyer and energy in the first half of next year. Mark Newton, really appreciate it, fun strat. Mark, great to have you on. Thank you very much. All right. Coming up, a big one from the White House, and we are joined by Insider and Counselor to the aforementioned Treasury Secretary Scott Besson, Joel of Bornev, your guest next.

All right, welcome back to Focus Now, turning to Washington tonight because this record long and, frankly, embarrassing government shutdown could end in days or a day. The House now set to vote tonight on a bill that would end the stalemate. Eight Democratic senators put country and of party and voted with the GOP to pass a short-term funding bill. Now, it comes down to the House vote tonight. Needless to say, it is a pivotal moment for America and the overall economy. Joining us now with Moore's Joe LaVorne.

He is counselor to Treasury Secretary Scott Besant. Joe, your expectations of that House vote tonight? Well, thankfully, the Democrats, as the Secretary mentioned, came over on our side, Brian. We didn't have the votes. It wasn't our fault. but the Democrats finally, some of them, cooler heads prevailed and they came over. The Senate passed the resolution, the House will as well. Unfortunately, there's been some damage done from the shutdown.

Current quarter GDP isn't going to be the booming quarter we thought because of what the Democrats did. But I do look for the government to reopen. We expect it to happen. The economy will be good going forward. But unfortunately, there was needless hardship, hardship and pain along the way. What would a reopen mean for the macro-American economy? Will it change anything, make it better, make it worse? What?

Well, as Caroline Levitt said earlier today, we're going to miss some economic data because we don't have the people able to capture that data. We want data because data is necessary to make good policy. Interest rates are too high, in my opinion. If you look at what the Fed has said and done, rates are still restrictive. Arguably, there wouldn't even be a debate on what the Fed would be. doing in December if we had more of this data. So it does impinge upon policymaking. The economy generally is pretty robust. It was grew up 4%. Plus, if you strip out the federal sector in the

second quarter, it's growing up 4% in the third quarter. So Trumpian economy was doing well. But the fact the government's going to reopen will give us data. It will give people confidence that the U.S. is functioning again in a proper way. I mean, if you look at the polling by the various entities on the consumer side. I mean, the confidence in the government effectively plunged to an all-time low because the Democrat-led shutdown. So these things will repair themselves over time. I don't think there will be a lasting economic effect. In other words, I think we could be very bullish on 2026 real GDP growth given what the president's put in place. But, you know, thankfully, this, you know, the shutdown is over. That's the key point. Thank God it's done.

Yeah, but here's the, yes. Well, we let's, whatever, happens. Let's say we get the bill passed. It sounds like we're just going to do this again, Joe, in a couple of months, because isn't this just, wouldn't this be a short-term sort of patch? Are we going to end up doing this whole dance again in a couple months? No, I don't think so, because we've got a few parts of the government that will be funded for the full fiscal year. Leader Thune has talked about giving the Democrats a vote on one of the things they want, which is what the Republican has said all along. I anticipate the House passing, the CR, the continuing resolution tonight, and I do not expect there to be another shutdown in January.

This just gives us some more time to negotiate, as we believe is necessary. And again, this could have all been avoided had we done the clean CR back in September, and then we would have done what we were going to do anyway to extend it past that November 21st deadline. The two sides seem pretty far off, right? I mean, the Democrats asking for $1.5 trillion. You look at ACCA subsidies alone. Obamacare at 340 billion. Do we have any idea where the extra money is scheduled to go to? Well, I mean, on that bill, Brian, keep in mind that, you know, some of the subsidies are at 3 to 400% of the poverty level,

and there's been numerous instances where people were actually rejecting their private sector insurance to get the Obamacare because the government subsidized it in a way that made it more affordable. And, of course, there were illegal immigrants that were using the health care system to a significant amount. So the $1.5 trillion was basically scored from the one big, beautiful bill. And it's important, as you know, to get spending under control, which in the last two quarters, federal spending was down year on year. 74% of last year's fiscal deficit was effectively under the Biden administration. And the fact that right now from the fiscal side, the spending numbers look good and the Republicans want to hold the line on that is important, Brian, in lowering interest rates, mortgage rates are basically at 52-week lows. that's how we're going to increase affordability by getting interest rates down and make things like home buying more affordable for people. Let's talk about that. I know it's mostly coming from FAA, FAA Director Bill Pulte, but the 50-year mortgage.

Joe, you're a bond guy in your former life. They call that, you know, duration risk. Are you in favor of a 50-year bond or a 50-year mortgage? Because the only thing I would say is that, yes, it's going to probably make it a little more affordable, but that's like permanent renting, is it not? There's no question that takes longer to build out the equity. It's good that the administration is trying to think about all different ways of trying to improve affordability. We can improve affordability, Brian. Your earlier guest talked about oil prices going down, a supply gut. That's because of President Trump's abundant oil policies, less regulation. That's going to lower the cost of energy.

That will lower break-even inflation. That will push down the interest rates. if the Fed and when the Fed cuts more aggressively, that will help lower rates. Certainly there's things we're doing on the supply side that will get rates down. So I think there's things we could do beyond a 50-year mortgage to make housing more affordable. And that's what the administration is going to do. People are going, this is important. You know, in this bill, one of the reasons the President Trump wanted the bill,

the one big beautiful bill signed in July 4th is so that the IRS could do all the guidelines for the full expensing of capax and structures, that will lead to a big boom-neck year building boom that will lift nominal wages so there's a lot of things that i think are still coming on the affordability side and of course lower interest rates will help yeah almost half the country is now below the the national average of three dollars a gallon in fact oklahoma's at two 55 that's an average according to triple a very quickly big wall street dinner at the white house tonight you got jamie diamond of jp morgan dina friedman in the nasdaq steven schwarzman you got Ted Pick of Morgan Stanley, Larry Fink of Black Rock, David Solomon.

Did you snub Brian Moynihan? There was a New York Post article that he wasn't invited. Well, Brian lives in Boston. Maybe it was, you know, I don't know. It could have been a commuting issue. Honestly, I'm sort of making a bad joke. Honestly, I don't know, Brian. I'm in New York.

I was with the secretary earlier. I'm not sure who does that guest list. But it certainly seems like a great group of people, and I'm sure they're going to give the president some good advice, and he'll listen, and he'll be smarter because of it. And apparently Jane Frazier was invited, but could not make it as well. I didn't get, I guess my invitation was lost to the mail, Joe, but I'll look forward to the next one. Joe LaVorna, counselor to Treasury Secretary Scott Bessett.

Joe, thank you. Appreciate it. Thank you, Brian. All right, coming up, another day, another multi-billion dollar commitment from an AI company to spend on infrastructure. But where exactly is all that money coming from? Where's it going to go? Talk more about that with McKenzie Sagalas. Thank you.

A major move in America's AI arms race today with Anthropic. It launched a $50 billion national infrastructure buildout plan, and it's all beginning in Texas and New York. McKinsey Sagallo is joining us now from San Francisco with more. And I guess the question I asked, Mac, is pretty simple. Where's the money coming from and where's the money going to go? And that's a question that I've been asking Anthropic all morning, and we don't know yet. So $50 billion. This is pretty notable because it's the first time that we're seeing Anthropic.

get into the business of building its own data centers, which is very much taking a page out of OpenAI's playbook. Up until now, they've relied almost entirely on Amazon and Google for compute, but this marks a shift toward actually owning the infrastructure behind their models. And what we do know of Anthropics' financial picture is that it's pretty solid, right? So even though they're not laying out what their debt financing plans may be, we do know that they just closed that $13 billion round back in September. They've been all in on enterprise from the start, which is a much higher margin business than consumer AI. And while that like $50 billion headline number does sound massive, it actually lines up with internal projections

that reportedly show Anthropic hitting 70 billion in revenue and 17 billion in positive cash low by 2028. So that's what we're trying to square right now, Brian. It's basically where it's going to go. I mean, you could issue debt. You can have, you know, venture capital, private equity put in money. I guess there's They probably have internal stock. They could sell to raise some money. But it sounds like the debt way of raising money is probably the most likely. Do we know?

Right. Well, that's the entire story right now on the AI beat. You've got Michael Hartnett, for example, of Bank of America actually shorting hyperscaler bonds, calling it a top trade idea for 2026 because credit spreads have widened. Cash flow just isn't keeping up with the cost of the AI buildout. And so there are a lot of concerns right now. now that a lot of these players are over indexing on debt. We know that that's something that meta has taken on for Hyperion in Louisiana.

That's their big hyperscalor buildout. We also know that other names like OpenAI have talked about taking on additional debt to fund their $1.4 trillion-plus worth of compute buildout. And then you've got some of the smaller guys. You know, Cori, for example, there are concerns there about potential cracks in their balance sheet and compressed margins. You've got investors like Jim Chano's flagging that as a concern. McKenzie Sigalos, another $50 billion here, $50 billion there.

Pretty soon it adds up to real money. McKenzie, thank you very much. All right, let's get over now to Bertha Coombs for a CNBC news update. Brian, FBI director Kosh Patel just announced at the White House press briefing that the Chinese government has agreed to a plan to stop fentanyl precursors from being produced. Patel traveled to Beijing last week to speak with his Chinese counterparts, which reportedly led to the country's anti-drug authority tightening oversight of the production and export of drug-making chemicals. A federal judge ruled today that more than 600 people detained by ICE and Border Patrol in the Chicago area over the past several weeks must be released by Friday. The decision came in response to a lawsuit by civil rights groups after the arrests of thousands of.

allegedly undocumented immigrants. According to NBC 5 Chicago, 85% of the arrestees have no criminal convictions. And the FAA says flight cancellations have fallen sharply over the last 24 hours as more air traffic controllers return to work ahead of the House vote tonight to end the shutdown. 900 flights were canceled today so far. The fewest in almost a week, as the feds required 40 of the busiest U.S. airports to cancel 6% of their flights. Hopefully things will get back to normal soon. Brian? Hopefully things will get back to better than normal. Normal's not great at Newark. Bertha,

thank you very much. All right, one massive automaker does not think the end of the road is here for EVs just yet. Phila Bow on that company's name and Big Bet. Next. EV sales, electric cars, they have slumped. The expiration of the EV tax credit is not going to help demand either, but it's not stopping companies from investing. Toyota actually making a big bet that EV demand will come back. Phil O'Bow joining us now with more. What exactly is Toyota doing, Phil? Well, today they're marking the beginning of production of EV batteries as well as hybrid electric vehicle batteries.

at a plant in Liberty, North Carolina. This is really more about the hybrid market than the EV market at this point. But the bottom line is they're going to need more batteries, and they know that that market will eventually return. In addition, Toyota is making a $10 billion investment, a new $10 billion investment that they just announced today for investment of activities in the United States, spread over the next five years.

They say the focus is future mobility. That's a catch-all. There's going to be a number of areas where they can, deploy that money. Bottom line is this, Brian. You know, a lot of people sit there and they said, well, you see General Motors or Ford rethinking how much they're going to be investing in EVs in terms of production here in the United States. Not all automakers look at this and say, cut it off or scale it up. GM and Ford are both making educated bets in terms of what the demand is going to be for some of those electric vehicles. In Toyota's case, Brian, they don't really

sell many electric vehicles in this country, but they sell a heck of a lot of hybrid electric vehicles, and those vehicles need batteries. That's what this plant is going to be providing. Look, they dominate the hybrid market. That's not expected to change anytime soon, especially when you have a vehicle like the RAV-4. You cannot buy a standard internal combustion engine vehicle of the RAV-4, a version of the RAV-4. You can get a plug-in hybrid, a gas electric hybrid or, you know, all electric at some point. But that's, that's where they are right now. My guess is Toyota and Honda are probably feeling pretty, pretty smug. I mean, Honda's got the prolog, which is a beautiful car, by the way. That's, that's an all EV. But these companies have

largely been more hybrid than straight EVs. And that appears that might be the right strategy. It's paid off. There's no doubt about that. And they believe that hybrids will continue to be in heavy demand and growing demand over the next several years. Phila Beau, a really interesting story there on Toyota. Listen, any time there's an investment in America? I'd like to see it. Phil, thank you. All right, up next is one of the most profitable trades of the year over.

Caput. Done. Greg Zuckerman will join us with that next. One of the hottest trades of the year has stalled, at least for now, Bitcoin, down about double digits in the last couple of weeks and also taking down some well-known stocks with it. Your next guest wrote about it for the Wall Street Journal. And when he writes, it's kind of a big deal because Greg Zuckerman's one of the best writers out there. He's author of six books, two of which were co-written with his sons. So let's talk more about the story and crypto and more

with Greg Zuckerman's special writer at the Wall Street Journal. Greg, whenever you do something, it's a big deal. Why are you turning your laser focus to Bitcoin? So, Brian, to me, this kind of trade is the most interesting one. other than AI out there, meaning the companies, the stocks that sold shares and turned around and bought crypto with it. They're the marginal buyer in the crypto market lately. So what happens if they don't buy? What happens if they start selling? Does it impact the whole economy if crypto gets affected? To me, this is the most interesting thing going on out there. You look at stocks, too. A lot of our viewers, maybe they don't own or trade crypto. Maybe they

will, but you look at like a strategy, formerly known as a micro strategy, Michael Saylor, the form, when it works, it works. What he did is he took a software company, basically became a crypto repository with the price of crypto goes up. His stock goes up, but his stock is down 50% size in the month of July. But other companies, too, Greg, right? Other companies are copying this. I looked up an industrial company on Long Island the other day. It's been around for 60 years. And now the website says Solana Repository. Yes. So back, you know, we remember back in 99, 1999, everything when was putting a dot com on a company and it started soaring. You know, a lot of these companies are serious. They're believers in crypto. They think it's going to go higher. There are all kinds of ways they can amplify the gains. But at the end of the day, they're levered bets. These are stocks are levered bets on crypto. And if crypto goes down, they go down even more. So far, these small investors that we've talked to, individual investors have been hanging in there. They're confident. They think, they believe, especially Michael Say, is a good salesman. We will see if the pain gets worse, what happens? Yeah, they call it HODL, right? Hold on for

dear life. And you see that a lot, you know, to the moon, all the memes or whatever. Because here's what I know about Bitcoin. It's gone down 80% at least 10 times. These wild swings for Bitcoin are not new. They're, in fact, if you're a crypto investor, not just Bitcoin, you're kind of either used to them or you have to get used to them, right? Yeah, they kind of mock people like me. Oh, wow, we're down 30 percent. Greg, you're all excited. Hang in. They're relaxed. We're used to this. We embrace it. They buy more, more power to them. It's worked. You know, those of us have gone through some crises, financial crises in our lives. We think, well, maybe this is the time actually gets crushed. Then the question is, does it affect the economy? Does it affect the

broader market? Back when S. Sandbank & Freed's company fell apart a few years ago, it didn't really have an impact. Will it be interesting to see if something happens like that in the future what the impact will be? Do we know at all how many people may have held on, like bought Bitcoin at 10 cents and still own it? I got to imagine most people sold along the way, right? I mean, unless you're either you forgot, you owned it or you're just nuts. You know what I mean? If you're up 10,000 percent at some point people sell, do we know? Yeah, you don't really hear too many of those people. They don't like to show off that they bought so low. The real question is, this year, because a lot of people piled it in. These companies sold a lot of billions,

tens of billions of stock, and then they're down a good 30, 40 percent in the last few months. Do those guys hold on as the real question? That is the real question. And maybe we look forward to a seventh Greg Zuckerman book. You never know, because this is probably this is going to be the trade of the decade. I just had that feeling along with AI. Greg Zuckerman, really appreciate it. As always, my friend, thank you. Great seeing you. All right, great seeing you as well. We'll be right back.

All right, a couple quick headlines before we go. Another company is following Elon Musk's lead by moving out of Delaware. Coinbase saying bye to Delaware and moving to Texas for its incorporation. An op-ed in the Wall Street Journal, the company's chief legal officer said the move comes after what he called unpredictable outcomes in Delaware's corporate legal systems. To read more about the story, you can just scan the QR code on your screen right now or simply go to cnbc.com. Also, quickly, we're going to watch Cisco Systems today,

near session highs, earnings after the bell tonight. Cisco stock of more than 20% this year. Cisco has done very, very well in the markets. Speaking of the markets, with our few remaining seconds, here's how things look, because we are on Dow 50,000 watch. We're probably not going to get there today, although you never know, but it would be unlikely. We've got an hour to go.

But the Dow, which is kind of ignored for technology for the longest time is up again is a 48-270. We have Dow 50K hats. Maybe. We'll see tomorrow. Thanks for watching. Closing bell starts right now.