Power Lunch - Markets & Investors Wait for Key Inflation Data 9/8/25

Episode Date: September 8, 2025

OPEC said it will increase production. The U.S. told Europe to stop buying Russian oil and gas. And Apollo's Torsten Slok noted that the AI adoption rate is ticking down for large companies, so how should you invest around that? We have it all here on Power Lunch. Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Thank you, Michael Santoli. Thank you, Melissa Lee. Welcome to Power Lunch. I'm Dominic Chu in for Brian Sullivan. The NASDAQ is back at record highs, by the way. Big Tech once again carrying that rally as investors bet on AI and growth ahead. Treasury yields are moving lower. The 10-year, now near five-month lows, giving equities a little bit of breathing room.

We are tracking two key inflation reports this week, the CPI and the PPI that will set the tone heading into next week's big Fed policy meeting. Plus, energy markets holding steady after OPEC confirmed they will keep production cuts in place through year end. Our own Brian Sullivan, speaking of, will join us live from one major international energy conference. And one of the hottest AI trades of last year, Oracle, reports tomorrow. We're going to get you ready ahead of that big print. But we are going to start with the markets, which are starting the week higher across the board for the most part. We've slipped into a slightly negative territory for the Dow.

by the way, hitting a new record as investors gear up for a big week of economic data, including two very closely watched readings on inflation. We have an all-star panel to talk more about the week ahead and how to position your portfolio. Nancy Tangler is the CIO and CEO of Laffer Tangler Investments. Brian Belski is the chief investment strategist at BMO Capital Markets. Both of you, thank you very much for being here with Power Lunch. So I laid out the state of play. All of those kind of macro and micro-specific factors that are going to be catalysts for the market this week.

Nancy, I will start with you from a CIO's perspective, from a portfolio manager's perspective. Is this any reason, whatever can happen in the next two weeks, to make wholesale adjustments to one's portfolio? I don't think so, Dom. Thanks so much for having you with my good friend, Brian, Belski, and it's good to be with you too. I don't think so. I think the Fed is priced into the market. So these numbers, whether they get revised up or down, and most likely the jobs numbers will get revised pretty significantly.

I don't think that matters at this point. We just came off a great earning season. We're going to talk about, I hope, some of the benefits of the one big, beautiful bill. I always feel so dumb saying that. We call it Obaba at Laffer Tengler. So that bill and the implications for the consumer and corporate cash flow, I think those are real benefits and tailwinds to this. market and that we're going to be focused once again on fundamentals, earnings drive,

stock prices ultimately. It doesn't worry you, Nancy, the jobs print that we saw just this past Friday, vis-a-vis some of the other economic data that may be showing, again, too early the call, but could be the initial tea leaves, if you will, of a broader, perhaps economic decline. Now, I say that because we've been prognosticating for such a decline for almost years now, with it not happening. So what exactly is the worry point now, given the data that you're seeing? Yeah, see, I think those numbers are also baked in.

I think, I mean, the administration told us that August is going to be revised up. I don't know how they know that. So we'll see. But I think AI and productivity enhanced growth is really what's going to drive this market. I've been drawing the analogy to the 1990s when I was alive and managing money. I don't even know if you were managing money back then. Mm-hmm, yes. Barely.

You guys are both young-looking, by the way. But so you can get, you can have higher inflation coexist with robust stock prices as we did in the 1990s. So I think that's going to be a solution. I'll just say one last thing and let my friend talk, but 400,000, more than 400,000 manufacturing jobs going unfilled. So we want to bring manufacturing back, but we can't even fill the jobs we have open. I think it's robotics.

I think it's AI. And I think the dynamic is going to change. is going to change. And you saw the PMI numbers where new orders were up, but employment was down. That may be the new world. All right. So the driver, Brian, you're not surprised by the reed I just had, the NASDAQ at record highs, what's been driving the action, because you've been bullish for quite some time now, given all those tailwinds. Are you at all maybe taking a breath, a moment of pause here with this new construct, given maybe a rate-cutting cycle ahead, weaker economic data, vis-a-vis-vis a record high NASDAQ? I think you'll be surprised to hear me say no. First of all, we were coined as

All-Stars. I'm still kind of looking around where the All-Star is. You guys are, you guys are. Just the Brian and Nancy show, and I'm very humbled to be with my very, very good friend, Hansi. So I would say this, Nancy and I are part of the last of a lost generation. And what I mean by that is all you're hearing about, all you're talking about on the network is macro, macro, macro, CPI, PPI, and employment. It's fantastic. We know that. But let me just give you some facts, okay?

Any macro investor that has been using macro factors to model out what the market's going to do, Dom, has been expressly and excessively wrong, especially since COVID. Okay. Now, one of our favorite sayings, and we say it all the time, I feel like Belski, you're Pollyanna, you're always bullish and da, da, da, da, da. We'll go about, we'll talk about my call in a second, but the stock. market is a market of stocks, okay? And I think we focus, we, meaning the investment world on Wall Street, focus too much on market levels and on valuation, on earnings growth, which, oh, by the way, the valuation metric that people comprise for the market and the earnings number they comprise for the market is an academic practice. That's why we said in April, when

everyone was very nervous, we said, market targets are academic. What is, what means the most is owning stocks. That's why we maintained all of our positions, changed nothing. in our portfolios and it really equated to the best portfolio performance I've had as a manager. Now we have the very great honor of managing over $12 billion on a sub-advisory basis for all of our great Bremow wealth clients and we were very humbled to have that performance. But on the market itself, we came out in 2010, 2010 and said that the U.S. stock market was entering a 25-year secular bull market.

People thought we were nuts. And so we've had several different rounds of this. in terms of a cyclical bull, a cyclical bear. I remember 1995. We were coming out of a commercial banking crisis. In late 94, the Fed pivoted. And we entered Goldilocks, and we had big cap stocks of running the show.

It's no different this time around. It's never different. And what we have now is the big AI and tech companies. Back then, it was consumer staples. The GE's part of that. But also stocks like Procter & Gamble, Gillette, Coca-Cola, Pepsi, all trading it like 50 times earnings. And so it's about liquidity, Dom,

and it's about people wanting to get back in the market and buying and owning these big cap stocks as they feel comfortable doing so. Okay, both of you, both of you, okay, and this is not because I was there, I started my Wall Street career at the dot-com boom. I came out in 1999 into one of the biggest bull markets ever in the history of the stock market.

You guys were both around for that. I know this, because I saw you guys, and I read you guys, and I was familiar with your work back then. My question then is now for all those people, and I'll start with you, Brian, for all those people who say this feels like 1995 to 2001 all over again, vis-a-vis the call that you made, starting in 2010, 25-year cyclical bull market, how exactly do you reconcile those people who say this feels like dot com

versus what the fundamental drivers are for even more upside over the next 10 years possibly? Great question. Between 95 and 2001, we had a couple different cyclical bulls, we had a very steep, secular bear. We had a bare market. We had a double-dip recession. We had 9-11. The first recession was caused

by a Cappex-led recession. Then we had a 9-11 recession. So I would say this. I believe that we have to combat this term bubble. I do not like the term bubble. Just because asset prices go up, Don doesn't mean there's a bubble. There's a bubble, brother and sister,

once everybody's making money. Not everybody's making money. What does that mean, Brian? Well, in the tech world, back in 99, 2000, we had business combinations, meaning M&A, done with stock, not with cash. We had financial services at all-time highs. And so you really need the financials to be playing along with this. And if you kind of take two steps back and look at the calendar with respect to IPOs and secondaries, where are they in tech land? They're not.

So we're not seeing a bubble in AI. We're seeing bottoms up, strengthen AI. The ones that don't have the product are not able to continue. So it's not as much of a throw a dart and go up in terms of AI, just like throw a dart with the Internet. It's very different. All right. Let's throw some darts, if you will, Nancy. I mean, you pick stocks.

You pick industries. In the context of everything we just talked about, where are the places that have the most attractive future return probabilities right now? I still think you want to be long technology. And I say this in light of what you just said and what others. are saying, we're listening to the company. So we own a diversified portfolio. We're listening to the companies, and they are making money from AI. They're either doing it through hiring fewer people, improving margins. We're at historic highs, again, for margins, cash flow for corporations, $4 trillion expected. That's an historic high. And so when you start to think about what's

going on under the surface, I think you want, our investing theme for the last three years has been old economy companies that are pivoting to the new technologies. Poster child is Walmart. And you see it in their margins, their earnings, their same store comps, their dividend increase. And then the suppliers of the picks and shovels. And so we like names, two largest names in our ETF, TGLR, Broadcom and Oracle. And we've been trimming both. We also are adding new names.

We pivoted to housing. So we own D.R. Horton. We own T.J. Max as another way to play. retail the right way. And it matters which companies you own. Totally. Target and Coles don't want to own. Walmart and T.J. Max. Home Depot, even Costco. Yes. And so those are, that's where we're focused. Bottom up research, valuation sensitive. And then we let them ride, as you can see. We were buying Broadcom in 2018 in the summer when everybody hated the CA Technologies transaction and it was yielding three and a half percent. We still like the name. It's still growing.

dramatically and it is an AI play but it's more than that it's software and it's a well-managed company with an excellent CEO there's the shopping list from Nancy so I from a PM's perspective on your side the top picks that you have in your portfolio well we're long technology we're underweight the Mag 7 we've been in Oracle for years just because of the cash flow in the product they've had we've been overweight Palantir but we've also started to that we really really like the small midcap universe so we love stocks like Steve and Ray J in the financial side.

But we also, a great analyst on my team, finally got me to buy T-Mobile. And I've been reticent to that, but T-Mobile is actually cranking up the dividend. And one of the things that we think is going to happen, Dom, is that as the market broadens, new strategies and new ways of looking at money, not just tech are going to work. So that's why value, small cap, but dividend growth. And that's where I think over the next 10 years of this next phase of the bull market, we're going to be much more broadening out in equities. All right.

So small mid-caps, stick with some. some of those big technology plays. Nancy Tangler, Brian Belski, All-Star panel. Thank you both very much. We'll see you again soon, guys. Thank you. Thank you. All right, we are just getting started here on this Monday, still ahead on the show, a boost in energy.

Our own Brian Sullivan is in Milan, where global leaders in the space are converging for the annual gas tech conference. He joins us for a preview coming up. Plus iPhone airification, a make-or-break event for Apple on deck tomorrow. Your trader lays out the case for the stock, and spreading the wealth.

Robert Frank taking a closer look at the fortunes of the richest man on earth, Elon Musk, and he made some surprising discoveries. Don't go anywhere. Keep it right here on Power Lunch. Welcome back to Power Lunch. Let's talk energy. There are two big stories happening right now. One in oil and another in natural gas. Both are on the rise right now, but for different reasons. Brian Sullivan is in Milan, Italy, getting set to cover the huge gas tech conference there over the next couple of days. He joins us now to talk about OPEC, the oil market, and the White House's big message to Europe. Brian, welcome from Italy. Good beyond with you, Dom.

Listen, let's go backwards one day if we can to start. Let's talk about OPEC at a Sunday meeting. They've raised production by about 157,000 barrels a day, but that is not what I want the viewers and listeners to take away from the OPEC news. Okay, two things about the OPEC news. Everybody hates oil, Dom. You know that. All the options market. the pricing. It's all tilted toward the bearer's side. Some people are saying we're going to be in the

40s, $50 barrel oil range. Not there yet. We'll see. What OPEC said was not about the increase in production. It was the fact that they used the F word. Flexibility. I don't know what you were thinking, Dom. Come on. Flexibility is a key word, right? Because what they're saying is we're going to add barrels now. But if something were to change later, they reserve the right and the ability to take those barrels off the market, to reverse it, to maybe cut again, leaving the market guessing. But here's also the key point. If the price of oil continues to go down, like I said, all the options positioning is on the bearer's side or a large skew of it is, it's going to disincentivize American producers to pump more oil. Drill baby drill, maybe not. Put those drilling rigs away,

put Saudi Arabia back in the driver's seat, not going to call a price war yet. but U.S. oil production may come down because prices, yeah, up a little bit today, but down overall. And if you're invested in U.S. energy and oil and gas companies, that is the news you've got to take away. All right, Brian, that's the domestic side and how it kind of tilts towards our domestic consumers here. How exactly overseas-wise do the Russian missile and the Russian drone strikes on Ukraine's capital factor into this whole story? We've seen those in recent days, along with the White House calling for Europe to get more serious about cutting off Russian cash and financing the war machine. How does all that play out in those prices for energy markets?

Yeah, it's terrible story over the weekend, Russia letting an attack on Kiev, first attack on a direct government building for Ukraine, just absolutely horrendous. And it's eliciting a response from the White House to your point. Okay, President Trump and the Secretary of Energy both said, listen, Europe, if you want to really shut down the Russian war, machine, you're going to have to actually starve them of cash. Now, I understand a lot of our viewers and listeners may be a little bit confused because I thought, well, wait a minute, I thought there were already sanctions on Russian oil and gas. There are. There's a price cap, but that just actually enables Russia to sell more oil at a cheaper price. They're still selling a lot of oil, maybe not

making quite as much money, but oil is not the game for Russia. Gas is the name of the game. The North Stream pipeline was blown up, yes, but as we've reported for more than four years now, even from Europe, Russian liquefied natural gas sales are at a record high. They're making about $8 billion a year, $8 billion with a B, billion U.S. dollars per year selling gas. And even Scott Bessett, the Treasury Secretary, was on Meet the Press with Kristen Walker yesterday, and he talked about how the U.S. and the EU need to respond. Listen.

If the U.S. and the EU do this together, we are in a race now between how long can the Ukrainian military hold up versus how long can the Russian economy hold up? And if the U.S. and the EU can come in do more sanctions, secondary tariffs on the countries that buy Russian oil, the Russian economy will be in full collapse, and that will bring President Putin to the table. So, if the European Union got serious and said, you know what, we're not going to buy any Russian liquefied natural gas. We're going to starve Russia of another $8 billion. Eight billion, by the way, not a lot of money. It's a lot of money to the Russian dreams. Starved them without money. Then you not only cut off Russian sources of funds, but you also

have to get that energy, that gas from summer, which conveniently would be the United States, something the Secretary of Energy is going to talk about here in Milan's because something the Secretary of the Interior, it's going to talk about here in Milan. We're going to talk to some LNG natural gas companies about that here in Milan. So that's the next couple of days, and whether or not that sheeners of the world, the venture global of the world, the private companies the world can ramp up their production and exports to updom to sell that much more LNG to Europe so they can cut off Putin and Russia. All right, Brian Sullivan, a big couple of days for you coming up, thank you very much for bringing us the state of play in oil and gas. And as he mentioned,

be sure to tune into power lunch both tomorrow and Wednesday, because Brian Sullivan will have some of the biggest interviews that you will not want to miss coming from that conference. He's going to talk to Interior Secretary, Doug Bergen, also U.S. Ambassador to Italy, Tillman Fertita. And then on Wednesday, he'll bring us Energy Secretary Chris Wright. That's all on power lunch throughout the course of tomorrow and Wednesday. So keep it right here. Well, the 10-year The Treasury yield is at its lowest level in five months. Is it foreboding trouble ahead? We'll discuss in the bond report coming up next.

Welcome back to Power Lunch. The move in Treasuries is front and center, with the 10-year yield falling to its lowest levels since April 7th. Following a recent disappointing jobs report, investors are pulling back ahead of two key inflation reports this week that could set the tone for next week's big Fed meeting. Rick Santelli joins us now with the bond report out in Chicago. Rick, just how important are those rates heading into next week's Fed meeting? Oh, absolutely.

You know, it's been all about the labor market, but all these moves that we had, of course, are going to be evaluated through the prism of inflation. We know the Fed's very concerned and has been mostly right about the deterioration in the labor market, but they're also very concerned, think Austin Goolsby and others, about the inflation implications as well, which could really balance their easing strategy. Let's take a look.

If we look at four-day charts of twos and tens, these are important because they encompass jolts, which is weak, ADP, which was weak, and, of course, the August Jobs Report, which was weak. And you can see how it looks. But it's much more than that, Dom, because really it was all kicked off on August 1st with the July jobs report. Look at twos and tens since the July jobs report.

And you can see that really changed everything. And we're just adding on in terms of all the other week metrics. However, if you do look at a September start, September 22, this is three years ago, this is where the two-year will close if it stays in its current three and a half percent yield. The lowest yield close in three years. Now, the tens, they're not quite there yet. We're still competent, as you pointed out, to the seventh intraday on a closing basis to the 4th of April. Why does any of this matter?

Because the twos are really stoked for the rate cut series to begin. And in many ways, you look at a two, looks like a quarter point at every meeting. We'll have to wait and see. If inflation's warm, we might get a September cut, but it might stop there. It's huge, Dom. Back to you. All right, Rick, if I could just follow up with one quick question here. As you look at things playing out on the 10-year-longer side of things,

just how much do traders think it could go lower if the right? set of circumstances are in place, given where the Fed policy is expected to be over the next three or four months? I'll tell you, this is an easy one to answer, but the outcome is not going to be easy. Traders are looking for a breach of 4% on a closing yield basis, something we haven't had all year and a 10 year. And if it occurs on an intraday basis, look for a pylon of buying to continue to push it lower. But it might be a fake out. I still can't. contend that at the end of the day, no matter what the Fed does, a steepening yield curve due to debt and deficits is going to have an effect on the long end, and it might pop it right back

over that 4%. So it's going to be a multi-day event after we get to CPI and PPI data. All right. Rick Santelli with the Bond Report on Chicago. Thank you very much for that. Let's now get over to McKenzie Seagalos for a CNBC news update. Good afternoon, Mac. Hey there, Dom. So the Department of Homeland Security says it launched an immigration crackdown in Chicago today called Operation Midway Blitz. DHS officials say the operation will target undocumented immigrants with criminal records. Chicago has had sanctuary city policies in place for 40 years. The city's mayor signed an order last week, prohibiting city police from working with federal

agents. President Trump said today the Education Department will issue new guidance on protecting the right to prayer in public schools. He made the announcement during remarks at a meeting of the White House religious Liberty Commission. The president didn't give details on the changes. Public schools have been barred from leading students in classroom prayer since 1962. And court officials say a new mural by the mysterious street artist Banksy will be removed from outside London's historic royal courts of justice. It shows a judge beating a protester who's been knocked to the ground.

Banksie posted a photo of the work to his Instagram and security officials quickly covered it up. Don, back to you. All right, McKenzie Seagalas with the CNBC News Update. Thank you very much for that. Still ahead on the show here, Apple, the second worst performer among the Mag 7 stocks today and the year. Can a new, thinner, lighter iPhone turn things around for the souring stock? We've got a trader's take coming up next. All right, welcome back.

It's time for a power check on the state of the technology sector. Apollo chief economist Torsten Sloc is out with a new note with recent data that shows that AI adoption has been declining among companies with more than 250 employees. So what does that mean for those AI adjacent tech companies? Investors will find out soon enough as MegaCAP tech name Oracle is set to report first quarter results after the markets close tomorrow, Tuesday. Joining us now with his outlook for the company, as well as some other tech names traders should keep an eye on is Peter Anderson, the founder of Anderson Capital Management. Peter, this is a big deal. Let's start with a name that a lot of people know because of the event tomorrow, and that's where Apple is set to unveil possibly some new products.

What do we think about the Apple trade overall, and what exactly does it mean in terms of the overall tech landscape? Sure. Well, first off, I have been continuously disappointed in Apple and its products and its positioning. You know, I hate to be so critical, but a company like Apple that seems to be trying to pivot on investors' focus, from say AI and software development to hardware development, that's what we're hearing a lot about tomorrow's update, seems to me kind of a head fake. And ignoring the elephant in the room, frankly,

which is where is Siri? Series results have been awful, and Apple intelligence development has really been lacking. So it's quite an embarrassment, I think, in terms of AI efforts, but they're trying to reshift that focus. onto their hardware development. Now, from the hardware side of things, we're still talking iPhones, right?

This is the kind of bread and butter for Apple. Does it really matter about, I mean, yes, I know it matters for artificial intelligence. But when it comes down to it, isn't this important to show just how much more iPhone can be a driver of the financial results in bulk at Apple? I think so. And, you know, the incremental developments,

I mean, one could argue, if you're really a critic of Apple, you could argue has there been any innovation other than these incremental developments, you know, some people just about, well, they're adding five lenses now as opposed to four lenses on their camera. So I think they're very vulnerable to that kind of criticism. And as AI continues to develop, they are obviously standing in the background. So they will attempt to focus the fact of new penetration and that the hardware offers new innovations. But in the long run, I do really think they have to focus on the software development. Now, one solution, of course, is you can buy a new iPhone and just download chat GPT on it if you want.

And that's an end around for their embarrassing absence in AI development. But I don't think that that's a long-term solution. All right. Now, Peter, we're going to take a step slightly down the market cap ladder to Oracle. Big results coming out. Of course, a huge name when it comes to not just software. And these days, cloud computing and AI as well. So what exactly are we expecting out of Oracle's results after the close tomorrow?

Well, I think we have to tie in your lead in, which was that latest report about how people are observing that the adoption rate of AI might be slowing. That is a major factor in all this, especially with Oracle's earnings, because Oracle, although they don't disclose it, about 80% or so is estimated of their revenues to be AI related in their cloud infrastructure, AI infrastructure. So if there is a slowdown in AI adoption, then we will definitely see some narrative from the company about maybe the spending rate will not continue at this ferocious pace that it has been year to date. Oracle is also going to have a halo effect on other companies in the ecosystem that dabble or even are totally adjacent to things like AI. What other companies could be caught in that halo or ripple effect from Oracle if the results are over bullish or Uber bearish?

I would say any of the mid-cap companies or the large-cap companies, and frankly, even the larger companies that are poster children for AI development, this could be the canary in the coal mine where others start to focus and say, well, maybe all these other companies have been spending so much are CAP-X on the, their AI development, maybe they also will strike a pause. Now, I'm not saying that this will happen tomorrow. I mean, they might, listen, at this point, if the company even vaguely hints that there is a slight slowdown, that can be enough, in my opinion, to cause quite a panic sell in any of the companies that are related to AI development. All right, and two more stocks to kind of focus on as we cap things off here, Peter. Robin Hood, App Lovin, both being added to the S&P 500, just how much of this is indicative of where the S&P is heading these days?

Well, first off, you know, you do have the index effect. So we do have to comment on the performance of the two stocks today. I mean, it's an incredible upside performance. And I think you're right. You know, as the S&P looks to add new membership, certainly they want to stay relevant to today's investor. And so these two companies are probably extremely relevant to some of the investors out there that are focusing on crypto, for instance, you know, Robin Hood has a great presence in promoting

crypto. And I would actually say maybe pushing the envelope on the tokenization of public companies that are, well, frankly, companies that have not gone public, but have some kind of representation. So I do think it is a sign. However, we don't know. I am predicting that in the next year, there will be more of a slowdown in AI spending. And we should see then how that impacts new membership of the S&P 500, because I would expect if there is a slowdown in AI spending, then there also will be a shift of focus. I mean, I think it would be nice to just have a regular manufacturing company added to the S&P 500, but I think we'll have to wait to see if that will actually happen over the year. All right. Peter Anderson, founder of Anderson Capital and Management.

Thank you very much. We'll talk to you again soon, sir. Thank you. All right, coming up on the show, a closer look at the fortunes of the world's richest man, who could become the world's first trillionaire after this short break. Crypto watch is sponsored by Crypto.com. Crypto.com is America's premier crypto platform. Welcome back to Power Lunch. How do you keep the attention of the world's richest man? That is the question Tesla's board was asking prior to proposing the $1 trillion pay package

on it unveiled on Friday. Now, the number is eye-popping, staggering. but one interesting nugget to chew on. That number is modest compared to the projections for the total addressable market for AI robots. That's according to Morgan Stanley's Adam Jonas. He writes that the wages of the entire global workforce is $40 trillion, and that the humanoid robot market will significantly exceed that amount. He then goes on to say it's a good deal for Tesla shareholders. Here to give us the breakdown of where Musk's expansive wealth comes from, and just how much is actually from Tesla is CNBC's own wealth editor, Robert Franks. So take us through the ins and outs of this.

What exactly are we talking about with regard to the real drivers behind Elon Musk's net worth? Yeah, Dom, when we think about Elon Musk, the world's richest man, most of us think of his Tesla steak, which of course is valued at around $140 billion. That's the company we all talk about every day because it's publicly traded. And then we think about his side hustles, SpaceX, XAI, Neurrelink, boring, all his other stuff. Well, in fact, according to the board, the side hustles now account for a larger share of his wealth than Tesla. In fact, that was one of the reasons that they said they had to give him this big pay package of Tesla was because he, quote, had more attractive options today than ever before outside of Tesla. So let's take a look at that.

Tesla stake valued at around $140 billion. Then you've got the SpaceX stake, which is right now he's got 42% stake in SpaceX. That's a $350 billion company right now. So that would give his SpaceX stake a value of $147 or $150 billion. So that alone is worth more than Tesla. Then you add an XAI. So that's a company that he has a majority of recently valued in a share. share sale at $200 billion. So let's call that $100 billion worth of wealth in XAI. You add in

NeuroLink, boring, all the other stuff. 250 billion dollars inside hustles right now just for Elon Musk. In fact, dumb, just to round it out, his non-Tesla companies alone would make him the world's fifth richest man. All right. So Robert, if that is the case, I alluded to it in your intro here. If this is the case, there is a real case to be made that there are competing, I guess, factors for Musk's attention. So does a pay package like this need to happen in order for Tesla to stay in the mix for all those companies? Well, it's a question for the Tesla board. In fact, the shareholders, is it their job to make sure that Musk is making as much or more wealth from their companies? as his other companies. They make it clear in the proxy that, number one, he's going to continue

and can continue to start these other companies and work on them. And number two, they say that it's their job to incentivize him to stay at Tesla, to build the future of AI at Tesla rather than these other companies. I just think it's a novel approach to pay someone based on where their wealth is coming from while at the same time allowing him and, in fact, encouraging him, to go off, build, start, grow these competing companies. All right. Robert Frank, with the latest there from Elon Musk and Tesla, thank you very much and be able to be sure to sign up for the Inside Wealth newsletter with Robert Frank. A fascinating read, week in and week out for all that great high net worth content.

Coming up on this show, though, an AI startup is buzzing with excitement right now. We'll tell you which one of it is coming up next. Welcome back to Power Lunch. We tend to think about bees in the spring, but these workhorses are critical. for ensuring an abundant food supply all year round. Unfortunately, the bee population globally is in big trouble. Diana Oleg has more details in her continuing series on climate startups. Bees, Diana, they're critical.

What exactly is being done? Well, Dom, as you said, more than one third of the crops we eat are pollinated by bees, but 40% of bee colonies are collapsing each year. One reason is climate change, specifically stronger hurricanes, more frequent and the need for more pesticides because of all of that. Now, one startup is taking on the traditional beehive with AI and robotics. Behold the wooden beehive, invented around 1850 for commercial pollination. But these basic boxes are not very protective and not at all nurturing.

Enter the bee home, a robotic, AI-directed beehive that growers can rent from California startup, Bee-Wise. A robotic beehive is essentially like a traditional beehive. It's completely backwards compatible, so it uses the same frame, same bees. And in that robotic beehive, there's cameras that monitor the bees. The cameras then connect with AI software that monitors each individual bee and identifies its needs. The robotic apparatus can then treat the bees according to those needs. So if there's not enough food in the hive, there's a food container inside this robotic beehive,

and the robot will take some food applied to the bees. Same thing with medicine. Thermoregulation, too cold, too warm, there's a storm. We can keep the bees comfortable in their home without them being harmed by external weather patterns. Just last year, Hurricanes Helene and Milton damaged or destroyed 200,000 commercial beehives in Florida, Georgia, and North Carolina alone. The bee home costs the same as the traditional wooden beehive and can robotically manage up to 10 hives each, saving growers on labor costs. Gen products could scale that up dramatically, a feature particularly attractive to investors. So you'll be looking at a bee home in a few years that can not only manage 10 but go up to 40 or more. And that's where you get a lot of operating margin and operating profit off of the same investment. In addition to Corner Ventures, Bewise is backed by Insight Partners, Fortissimo, Lul Ventures, and APG.

Total funding so far, $170 million. Safra says the bee home results in 70% lower bee colony loss and healthier hives. There are already thousands of these operating in the field. And revenue, device, and consumer growth, he says, has been enormous, adding that the devices are seeing gross margins of 40%. All right. So, Diana, these are much more resilient to storms and adverse weather. But what about those fire hazards and fire zones? it doesn't seem like even something like that can hold up to that kind of a catalyst.

How exactly are they powered and how are they protected? So they're protected from fire because they're made out of metal. So they might get charred on the outside, but they remain intact on the inside. And the bees are protected even from a forest fire, at least according to bee-wise. How are they powered? Like everything else in the clean space, solar, Dom, all solar. Oh, clean energy sources. Solar.

All right, Diana Oleg with the bee state of plate. Thank you very much. Still ahead on the show, what other viewers are closely watching right now. We're going to tell you the most popular stories and the stocks on the climb from CNBC.com coming up next. Keep it right here. Welcome back to Power Lunch. We've got a quick programming note. Our colleague, Leslie Picker, will sit down exclusively with Morgan Stanley's chairman and CEO, Ted Pick.

That's coming up tomorrow right here on Power Lunch from Morgan Stanley's Global Healthcare Conference. Must Watch interview Ted Pick of Morgan Stanley, a CNBC executive. exclusive power lunch 2 p.m. Eastern time tomorrow. Before we go, we want to highlight the most read story on CNBC Pro so far today. That is Nvidia, coming off its fourth straight week of losses and now facing a price target cut from the analysts over at Citigroup. Those analysts trimmed their target price to 200 bucks a share, warning that Nvidia's dominance and AI shifts is under a growing threat. Broadcom just announced a $10 billion order for its own custom AI processors from a mystery customer. A MoCity says could shave billions off

Nvidia's future sales profile. Shares of Nvidia have fallen about 7% over the course of the past month and the next big test for that stock is CEO Jensen Huang's keynote at the GTC conference on October 28th. That's a good amount of time between now and then. Despite the risks, City is sticking with its buy rating, noting long-term growth in the so-called neocloud spending and sovereign AI projects could still power Nvidia shares higher. Now, to read this story and many more, just head over to cnbc.com slash pro where subscribers get the full story on the big upgrades and downgrades each day and all those big pro calls in the marketplace.

Also, another CNBC story is catching my eye as well. Private equity is now back on offense, but not necessarily in dealmaking, but with regard to jobs and hiring with fundraising roles tougher than ever to fill the industry's raiding Wall Street and sparking a global war for talent in those types of roles. Private equity recruitment accelerated in the first half of 2025, according to Magellan advisory partners, led by roles in fundraising activities, investor relations, and marketing roles. After two years' worth of hiring freezes, firms are now spending heavily to secure the people who can actually bring in the capital to manage at these firms,

even overpaying at times because survival depends on that lifeblood, bringing new funds in to manage. The timing is critical. Buyout activity picked up earlier this year, but quickly lost steam as tariff turbulence rattled investors. Global deal value in April dropped 24% from first quarter levels. Bain and Company reports that number. That's left firms with nearly $1 trillion in dry powder,

waiting for rate cuts to re-ignite some of that deal activity. Now, to prepare, mega funds like Apollo, like Carlis, and Warburg-Pinkus are ramping up hiring in Asia, particularly in places like Japan, while also expanding in Southeast Asia, in India, Europe, and North America as well. Recruitment is happening earlier than ever. Some firms are locking in junior bankers even years before graduation, but the talent wars are creating some kind of friction. J.P. Morgan and Goldman Sachs have introduced new rules to curb poaching, even requiring some

loyalty pledges from their employees, especially young analysts. The stakes are high. Investment banking salaries may be competitive, but private equity offers something that banks cannot, which has carried interest, a profit-sharing windfall that can turn million-dollar paychecks into tens of millions of dollars in comp over time. As one recruiter put it, deal flow may be cyclical, but raising capital is permanent and private equity is betting its future on the people who can actually deliver it, those funds to manage and make those particular fees off of. Now, one last thing, on CNBC, we focus a lot on the U.S. markets, but we're still seeing bullishness in international stocks. The emerging markets, ETF and I shares China ETF, both hitting new 52-week highs today.

And the returns have been impressive from the April lows. Both of these ETFs are up roughly roughly 30% in those levels. Now, one reason for the outperformance, it has to do with the decline in the U.S. dollar. It's down more than 10% so far this year alone. So keep an eye on those international markets, and thanks very much for watching Power Lunch. Closing bell picks up the coverage starting right now.