Power Lunch - Power Lunch 11/3/23

Episode Date: November 3, 2023

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.

Welcome to Power Launch, everybody. Alongside Morgan Brennan, I'm Tyler Matheson, and today is Funflation Friday, folks. Live events are back in a big way in 23, and whether it was Taylor Swift or Beyonce attending a football game or visiting an amusement park. We were out there doing it, folks. But all that demand led to higher prices, aka Funflation. We're going to look at various parts of the live entertainment industry this hour to see whether these trends can hold or if this kind of spending could be the first thing people could. back on if the economy takes a bit of a dip, Morgan? Well, we've also got some big stories to cover throughout the show, starting with this morning's jobs report, 150,000 jobs created. That's fewer than expected. And the unemployment rate jumped to 3.9%. That's the highest in nearly two years. The jury reaching a quick verdict in the Sam Bankman-Fried trial as well,

convicting on all seven counts. That means the FTX founder could get up to 115 years in prison. Sentencing won't be until late March. And Apple reporting results. Earnings and revenue beating expectations. Revenue of nearly $90 billion, about half that from the iPhone. But here's the concern. Revenue fell for the fourth straight quarter.

And the company said revenue in the current quarter, which is key, it's the holiday season quarter, will be similar to last year. That's less than the street is expecting. Apple shares are only down about 1% today, but despite lackluster results from Apple, the markets are having their best week of the year. it has been quite the rally, Dominic Chu. Joining us now with more, break it down. All right, so as you point out, these are strong gains that we're talking about right now. If you take a look at a one week,

kind of that week-to-date basis on this Friday, the one-week change for the Dow Industrials is 5.5% in one week. Again, near the best of the year, if not the best of the year on pace for that. The S&P 500 is even better than that, up 6% on a one-week basis. And the NASDAQ composite

is up nearly 7%. That's just how strong it's been and today's gains on the heels of that softer than expected jobs report really kind of propelling this last leg of the rally so far this week. Now, keep in mind with that, interest rates, key part of that story. Remember at the cycle highs,

just back about nine or so days ago on October 23rd, the benchmark 10-year Treasury note yield was 5.02% at the highs. We got all the way down to 4.48 at one point today. We're settling just around 4.55 percent, but you can see that move lower there, precipitous in nature. We'll see if that provides any more of a tailwind for valuations. And speaking of valuations, two parts of the market to keep a close eye on with regard to that risk aversion

trade moving on or off or anything else. Look at the regional bank ETF as those interest rates have fallen and there is a little bit more giddy up in people wanting to take risk. That on a one-week basis, you can see over here, that little tick higher, is roughly 13 to 5%. 14% just in one week for the regional bank ETF. And one more place indicative, Tyler Morgan, that might be that risk trade being on there again. The ARC innovation ETF, it may be a while since we've been talking about this, but it's up 5.5% today, which means this move higher that you can see down here in one week, Tyler Morgan, is roughly a 19% gain in five days. A lot of movement here, guys. I'll send things back over to you. Yeah, and of course, some of that is that

rate repreview you talk about and what it means for growth stock. like you'd find in some of those ARC funds, Dom, but also some of those names that are held in ARC had really good earnings. They're better than expected earnings this week, and you saw big pops there, too. You talked about real estate. We also saw it with small caps with the Russell 2000 over the last couple of days and some of these other hard hit areas like real estate. The fact that these are some of the parts of the market that are being bid so strongly right now,

what does it say about the quality of this rally? It says that it's still very interest rate driven, right? If you're talking about real estate markets, you're talking about small cap stocks. It is really about interest rates and economic conditions. For small caps, they tend to thrive and outperform when the better, bigger global economy, macro economy is doing better. So if there's more signs of that positivity, those small caps outperform. You mentioned real estate. It's very much valuation driven.

You get to bid up more real estate prices the lower interest rates go. So if you're looking for a propellant here, the curious part will be whether or not this is a position. effect. How many people were so negative on U.S. government bonds going into the quarterly refunding announcement earlier this week showing signs that perhaps we don't need to borrow as much in certain types of securities versus others? If interest rates can find a way to at least stabilize at levels that we're currently seeing right now, you might be seeing a little bit more positivity in some of those interest rate sensitive sectors, real estate certainly wanted to watch, Morgan. Of course, that's going to be a big one. All right, Dom, thank you very much

for that good summary of the week in the markets. Let's turn now to funflation with the analyst who was among the first to write in detail about the phenomenon and naming the key stocks that are likely to benefit. As early as in September, she wrote Live Entertainment is currently the brightest star in the broader media and entertainment universe. Joining us now is Jessica Erlich, senior U.S. Media and Entertainment Analyst at Bank of America. Jessica, welcome back. Good to have you with us. We thank you. Thank you so much for having me. I absolutely couldn't agree more. This has been the year the experience, whether it was Beyonce or Taylor or whomever. But are prices getting so high?

I was speaking to a person who tried to go to a Drake concert, and the prices were above $1,200. So she went to Toronto, where the prices were a mere $750. Are the prices getting so high that people are going to be sort of cut out of the market? Prices are a function of demand, and demand is really strong. People want experiences, and we're seeing more artists go on the road. And you're seeing it on a global basis. So it's U.S. or Anglo artists on the road in the U.S., Europe, you know, Latin America. But then we're seeing Latin American artists and Korean, you know, K-pop artists,

and now African artists are becoming more popular. And venues are being built globally. So, yes, prices have gone up dramatically, but that is a function of demand. And then there are offshoot to the concerts, whether it's merchandise, people have spent a lot of money on that. And, you know, there are other ways to bring money into the system as well, sponsorship, for example. Yeah, Morgan was out buying a lot of that Taylor Swift merchandise. Yeah, well, we were seeing it at the theater.

You were seeing it at the theater, yeah. So let me ask you this, Jessica. Is there a tenderness if the economy begins to slow? And how much might that tenderness take some of the air out of the balloons? of some of the stocks you follow? Well, of course there is exposure to the economy. We also follow Disney and Comcast, which owns Universal Parks.

And when there's a recession, the consumer spending pulls back, obviously. But what may be different about what's going on now, and it's not just the post-COVID, you know, like put, you know, come back. It's a global phenomenon. So you're seeing if we're, you know, and the economy pulls back here,

there may be a, areas of the world that are stronger and artists are touring longer and across the world the biggest concert last year actually was Bad Bunny who's really Spanish-speaking artists so that was the biggest tour I mean this year obviously it's Taylor Swift you mentioned a few Beyonce and and Drake are huge also but you two's on the road pink is on the road but but to your point at some point you would think consumers would pull back for now 23 was a phenomenal year and 24 looks very

very, very strong as well. Okay. I mean, Live Nation is obviously going to be a direct beneficiary of that. We saw that with results last night. We're going to be speaking to the CEO a little bit later this hour. But putting that name aside, from an investor standpoint, if you want to capitalize on this right now, what do you buy? What looks compelling? Well, you know, I know Michael Rapino will be on a little bit later, and Live Nation kind of sits at the nexus. They're in all parts of the business. But there are other companies that benefit in smaller ways because most of the money goes to either a live nation or the artists themselves. But other beneficiaries would be the record companies like a Warner Music

Group or the DSPs like digital service providers like Spotify. Then you have the talent agencies, so Endeavor or some of them are private CAA and UTA. And then there are other companies that that have some shows like IHeart. Serious has some live shows as well. But they participate, but it's obviously on a smaller scale than a live nation or the artist. What about a venue operator? Are they winners and beneficiaries here? Like an MSG that owns the garden and they own the forum, which is the biggest concert site, I think, in the country. MSG and also their sister company, Sphere, are huge beneficiaries.

So the risk in that is that there's this upfront cost, which, of course, they've already passed that. And then once you're past that, it's just filling the venue. And they are huge beneficiaries, huge. You know, they've got the food and the beverages and ticketing. So they obviously will, you know, it's extremely profitable business. And the fact is that events have gone up. So when we talk about funflation, we talk about the fact that prices as high as they are, a function of demand.

I mean, how much of this is still tied to that so-called revenge travel, revenge experience that consumers are looking for coming out of the pandemic? I guess at what point do we find a new state of normal? And if that means eventually lower prices, is this still going to be beneficial for the companies? Of course. So at some point you would think that's right, this post-COVID recovery will sort of level out.

But what we're seeing are more artists, and because of social media, because of TikTok or even Spotify, which is a global service, and of course YouTube and Apple, et cetera, your artists are reaching farther and then you're you know and then new artists are kind of having more of a global reach and then you see these artist tie-ups like elton john with many artists so you know they're bringing in new artists so it's there will be prices across the board but the

demand there's is just like the yes they're established artists that are that are touring but then there are these new artists that that are becoming famous or filling venues faster because of the the reach of social media and these new platforms. Jessica Early, thanks for joining us. Thank you. Next stop on our Funflation Tour theme parks. Six Flags in Cedar Fair announcing an all-stock merger deal. Both companies reporting an increase in attendance in their recent earnings reports.

For more on this merger and the potential threat of an economic slowdown, let's bring in David Katz. He covers six flags at Jeffries, and he views this merger to be positive. So we'll start right there, this tie-up, why you like it and why we're seeing it now. Yeah, per the note that we put out yesterday on the news, we do like it because from the perspective of six flags, and we do only have formal coverage on six flags rather than Cedar Fair, they're a company that has really struggled to divine their value proposition, to stabilize their operating model over the past five, six years. They've been through three different management teams.

The stock's been quite volatile. And it's just really been a challenge for them to get the business on the right, despite what we believe are some very good assets and a very solid, albeit mature business. And I think that's the industrial logic or the institutional logic for putting the companies together. You know, historically, Cedar Fair has had a stable management team. Their people have been in place for a while. And they've been, you know, solid executors.

And so putting those together and building scale in a mature, solid business does make sense. And finally, with the math, and we touched on that in our note yesterday morning as well, that, you know, there are some arguments if it works out the way they've laid it out for considerable upside to six flag shares. So it sounds like it's a company-specific, or there are company-specific dynamics to this deal and why it works. How much does it speak to and reflect upon the macroeconomic environment in the state of the consumer? It's an interesting question, Morgan. And I think potentially one of the answers, if I'm to surmise some of the thoughts, looking at it again from Six Flags perspective, where they have struggled to stabilize the business, you know, staring down the potential of a recession would only make it harder to achieve that.

And going through a potential merger, which will take some time and laying out the synergies and merging the businesses during a recession. you know, maybe an opportune time to take that opportunity. And that's the way we see it. But, you know, again, they had, Six Flags has not spoken to us specifically or any of us about the deal. So, you know, we're making our own assumptions on that, Morgan. It's very interesting. As you point out, it seems to me like every time I look up, Six Flags is being sold. It's got a new management company. There has not been much stability there over the past decade or so. Who's going to control this operation? Is it Cedar Fair? It's a great question. And, you know, you're better off not being a covering analyst with that much change.

Right. It just makes all the much harder. The answer to your question, Tyler, is that the Cedar Fair management team is going to run the business and control 51% of the merge entity, as it's proposed right now. The current CEO at Six Flags would be executive chairman, so not a day-to-day execution role. And, you know, that is, in our view, a compelling, you know, positive here as well. Do you have a favorite choice in this universe that you follow? Well, so again, you know, we only cover six flags and not Cedar Fair. As you're probably aware, we also cover, you know, quite a bit in regional gaming. We cover sports betting. we cover hotels, and it feels to me right now as almost all of them have reported earnings

since Monday morning. And look, what I would say and what we have said many times over is that the sports betting category, which is a nascent business in the United States and still growing globally, does not require a view on the macroeconomy, which is one of the incredible confusions about my coverage today, our coverage today, and frankly all the consumer groups, across Jeffries. But for sports betting to work, you don't need a view on the economy, and that's why we have favored it. All right. Very interesting answer. Thank you, David. Appreciate it. David Katz. And coming up, we're going to continue our coverage of funflation with the CEO of Live Nation. That company got a boost from Taylor Swift and others this

summer. And so how can they keep it up, especially if the economy goes a little soft? But first, huge debate in San Francisco about driverless cars, so Deirdreboza decided to see for herself. She took a ride in a robo taxi. It was all going well until it wasn't. That's next on Power Lime. All right, welcome back, everybody. Self-driving cars are now a reality in San Francisco, but they have not come without issues.

For today's tech check, our Dieter Boza looks at the battle over autonomous vehicles in the city by the bay. Deirdre. Yes, so, Tyler, the promise and the chaos of self-driving cars has been on display in San Francisco streets. For a few months now, The two major players are James, Cruise and Alphabet's Waymo. I went for a ride along to see for myself, and I talked to execs from across the industry,

but it was definitely in the backseat of a cruise ride that I had the most dramatic experience. We just went around a car with its emergency lights on. It did it pretty smoothly, but now we're, ooh, now we're behind a car that's trying to park. He got out. Oh, my gosh. And he kicked it. I'm going to put up my window. So this guy just kicked the car

and now we're calling support. This is stressful. Oh my gosh. He just sat on the car. Those were the most stressful few moments I've had in a car in a recent memory. As the number of driverless cars on the road

increased, so too did the problems. There have been 75 plus incidents, and so to me it's like playing Russian roulette. We are the last line of defense for most people. Seconds matter. If it takes us a minute to go around the block because there's a vehicle in the way, that puts the people in that building more at risk, it puts that building more at risk, and it puts my firefighters more at risk. We have a hotline for first responders.

That's one of the things we've built in response to feedback. So both police and fire department, call a number, and we can very quickly use things like we locate a vehicle that's in the way. Data about every collision is reported both at the state and federal level. We've shown video footage with first responders and things like that when it's appropriate but that's got to be very carefully controlled in order to maintain the privacy of our customers. We tried out Waymo as well. While Cruz had more robo-taxies on city streets, Waymo has been testing longer. Both companies say they've logged more than one million driverless miles. That's

interesting. It took the opportunity to squeeze through a pretty narrow space and did so fine. actually doing better than the drivers around us. I got to say, one word to describe this ride. Unremarkable. We didn't get honked at once. There was one incident where I thought maybe we cut someone off. It was uncertain, but it's been really smooth.

So what happened to us in the cruise robo taxi? It was nothing compared to the incident that led to the suspension of all of its operations. A few weeks ago after our ride, a cruise rolled over a pedestrian that was struck by another car and a hit and run. and then dragged her 20 feet. And that has raised a lot of questions about the future of this industry. But on the flip side, guys, if they can get it right,

and Waymo, as you saw, feels a lot further ahead here. There's the promise of safer and less congested roads. Be sure to check out the whole piece on CNBC's YouTube channel and CNBC.com. Big thanks to producers,

Andrew Evers and Laura Batchler, who really put this together and even acted as stunt drivers for part of the shoot. It was really fascinating to watch your test drive of this, Deirdre. And I was curious.

You mentioned crews and what's happened there with their licenses, but I was curious about what the demand picture is looking like in a city like San Francisco. I mean, I was speaking with one person whose daughter, apparently, you know, is part of a wait list to be able to have access to some of these autonomous rides, especially at night because of the safety factor associated with that and not having to interact with a human driver from that standpoint. How are citizens and residents actually responding to this? Right. So it's been in service since August, but many, many people have to be on a wait list.

Although a lot of people I know are actually off the wait list and using them often. So I was on the wait list until this shoot. And it seems that there's high demand. But again, regulators are trying to find the right balance between having a certain number of rides on the road and balancing the safety of it and a more, you know, more wise rollout, you know, more of a balanced rollout. crews, though, now are not able to operate without the driver. So that's going to slow down their race. But you bring up a good point, Morgan. You think about, you know, if you're going to put young kids in an Uber or a lift, you don't necessarily know who the driver is.

This kind of solves that problem. But you have to balance that with a danger that they might pose on the roads to pedestrians. You know, dear, I'm sure the moment where that guy got out of the car and confronted you was unsettling for you. But I loved how unsettling it was for him when he came back. And he was getting ready to yell at the driver. And there was no driver. There was no driver. That is what I remember most.

His face, when he got out and approached the vehicle and saw that there was no driver. And then his eyes immediately went to me, and I was completely helpless. I think I put up my arms and said, I don't know what to do. I can't move this car. I can't do anything. And you saw the wheel move, but the car didn't move. And that's, you know, what a mistake. It didn't make contact with his.

He wanted to back up and we just wouldn't move. But I have to say, when I was in that cruise ride, we were honked at, like, at least five times. So there's a lot of close calls. And this was, I should say, through the Tenderloin District, which is one of the most, if not the most difficult area to navigate in the city. Well, the car did come in contact, it seems, with his foot at the very least. Deirdre, thank you. Thank you for your courage. Thank you for what you do for CNBC and our viewers.

Glad to. It was important lessons learned, though. I will say, though, just as an end note, the cruise was wild, but the Waymo was really an indication that some of these are ready for prime time. It was uneventful, therefore, boring, and probably ready for the roads. Dear Jibosa, thank you. Even with prices for travel and events remaining high, demand hasn't slowed down yet, at least in the case of Expedia. We'll explain why that name is surging. It's up almost 18% right now when Power Lunch returns.

Welcome back to Power Lunch, everybody. As the markets are rallying once again today, you see it right there. They're now up 263. This morning's Goldilocks Jobs Report lending a little more credence to the idea that the Fed might be done argument. Now let's get a look at the bond market. Rick Centelli is in Chicago for us. Hi, Rick. Hi, the color is green this week, whether it's the prices of treasuries, which have been moving higher, pushing yields down,

or as you just talked about, Tyler, all the green and the three major stock in the three major. If you look at a two-year and 10-year on one chart today, we could clearly see the jobs report push yields down. And even though long-dated treasuries like tens and 20s and 30s led the way, boy, the two-year caught up quick. And if you look at the week, well, twos and tens on the week, tens win. They're down in the neighborhood of 30 basis points. But on the day, the short end is winning. Right now, twos are down close to 16 basis points. tens are down about 11.

But when you look at the comp from history, the short end has definitely been a little less reticent on downside. It's been more stable, actually. But look at this two-year, it's on pace for a three-month low-yield close. Here's tens. They're on pace for a little over one-month low-yield close. And maybe the most un-talked-about story of the week, because interest rates have had such big ranges, because stocks have been shoot to the moon in terms of its direction is the dollar index. From low to high over the three days from the Fed meeting to now,

it's had a range of very close to two cents. To the downside, that's nearly 2% drop since Wednesday, and it's on pace for the lowest close in nearly eight weeks. Morgan, Tyler, back to you. Rick, it's been totally amazing. And I just want to dig a little deeper here in terms of these moves we're seeing in the Treasury market with the yields. Because you had the removal of that Treasury refunding overhang taken away in the middle of the week. You've had softer macro data.

You've had a more doveish pal potentially based on how the markets responded, takeaways there. But then also this less hawkish BOJ policy tweak. I mean, is it just a perfect storm of dynamics that's pushing yields lower or is it something else? Yes, I think it is a perfect storm, but to be quite frank, I think if you're working for the Treasury Department, you're more apt to say the main reason is they tweak the refunding a little bit. There's some policy issues going on, but as a trader, I would tell you that the failure on Monday, the 23rd of October, by one shot up over 5%. If you blinked, you missed it. That failure brought the Tina crowd in.

Yes, there is now an alternative, and it's called long-dated treasuries. How much longer it lasts does anybody's guess? But right now it certainly looks like when you have such a round number at 5% be a high. That's very important. And today, virtually 4.5% is the low. We might have outlined the extreme range for the next several plus weeks. Love the trader talk from Rick Santelli. Thanks for bringing it.

Thank you. Let's get over to Leslie Picker for a CNBC News update now. Leslie. Hey Morgan, I'm Leslie Picker, and here's your CNBC News update. The Supreme Court agreed today to hear arguments on whether a Trump-era ban on bump stocks violates federal law. The gun attachments make semi-automatic weapons fire like machine guns. The ban happened after the mass shooting in Las Vegas, where a gunman used a bumpstock and killed 58 people. The justices will hear arguments early next year.

Royal Caribbean is reportedly taking Israel off its 2024 international cruise schedule because of the war. That's according to Reuters, which says the Miami-based cruise schedule. line is modifying its itineraries through at least next October. Norwegian cruise lines announced earlier this week that it was making similar changes. Direct TV is being told to change some of its ads featuring Kansas City Chiefs, standout, Travis Kelsey, after the NFL blasted them for being deceptive. The ads claim all DirecTV gives customers access to all games, but this season YouTube has the rights to the Sunday ticket package.

Direct TV said it would make the changes. But still a Kansas City Chiefs fan over here. here hasn't tainted my view, Morgan. Leslie Picker, thank you. I had a head on power lunch, Sam Bankman Freed facing a sentence of up to 115 years after being found guilty of fraud. We've got those details coming up next. The crypto fraud trial is over. The verdict is in Sam Brankman Freed convicted on all seven counts. So what happens next? Let's bring in Kate Rooney. Kate, I guess some people thought he was the wizard of crypto. He is the Wizard of Oz. Tyler, that's right. Sam Bankman-Fried, it's not over for him yet.

He faces another indictment next year over campaign finance violations. Last night, he was found guilty of what the U.S. attorney calls one of the biggest financial frauds in American history. The verdict coming almost exactly a year after his crypto company filed for bankruptcy. Bankruptcy was convicted across the board on seven counts of fraud and conspiracy on lenders, investors, and customers. It was an emotional scene in that courtroom last night, Banking Fried's father, with his head in his hands. when the verdict was read his mother crying as well. The defendant staring straight ahead, though, Bankman Fried. In all of this, the jury came back with a verdict in around four hours.

That actually included their dinner break. Very fast verdict there. In their month-long case, the prosecution called FTCS a pyramid of deceit with evidence showing Bankman Fried knowingly stole customer money. The defense team saying Mr. Bankman Fried maintains his innocence and will continue to vigorously fight the charges against him. No official word on an appeal yet. Bankman-Freed will remain at the Metropolitan Detention Center until sentencing in late March.

He also faces that indictment over campaign finance violations. That is also in March or earlier in March. He spent about $100 million on political donations in the 2022 midterms. There is a chance prosecutors might drop that after last night's verdict, but we will see Tyler and Morgan. All right. Kate Rooney, great reporting. Thank you for bringing all of it to us for many, many months now. coming up, our fund inflation special continues.

We speak to the CEO of Live Nation. Power Lunch. We'll be right back. Welcome back to Power Lunch. Continuing our Funflation Friday, shares of Live Nation are higher today, up about 4% after reporting earnings above street expectations. On the backs of concerts like Taylor Swift's Ares Tour and Beyonce's Renaissance Tour, the company reports its strongest quarter ever due to pent up demand and higher ticket prices. For more, let's bring in our very own Julia Borson with Live Nation CEO,

Michael Rapino, Julia. Morgan, thanks so much. And Michael, thanks so much for having us here at Live Nation headquarters here in Beverly Hills. We are coming off of a massive year for a concert going so far. Two huge quarters of big beats for Live Nation. And just looking at ticket sales so far this year, 140 million tickets sold from 120 million in all of last year. My question is the success of the last two quarters. How much of your beats, both in terms of top and bottom line,

down to some of these big tours like Taylor Swift and Beyonce. Yeah, it's been an incredible year. But our business is very spread from kind of the top to the bottom and across 40 countries. So any one artist is only about 1% of our business. It's not really like the movie business where you have these big blockbusters. It's diverse, spread across amphitheaters, clubs, theaters, and stadiums. So our business ongoing all the time is kind of this diverse portfolio across a global portfolio also. There is a lot of talk about pent-up demands still from the pandemic and the idea that some of these big artists, and yes, I'm going to mention Beyonce and Taylor Swift again, could really get people out and get them to spend a lot of money on these tickets.

What is your insight into what's going to happen in the fourth quarter and next year? You don't give official guidance, just some sense of deferred revenue, but what is your expectation for Q4? Yeah, we're obviously on our pace for a record year. We've sold 140 versus last year, $120. for the full year. So we're going to have a record year. But, you know, there's a lot of debate. Is this a pent-up kind of post-COVID or is this a structural new beginning? And we really look at all the data. Jessica did a great job earlier, I heard, that we really believe this is a cultural, behavioral change with consumers, especially from the bottom up. We see that across the globe, that 19-year-old, that 14-year-old on TikTok that understands that Drake dropped a single this morning

and wants to go see that artist. It's really a behavioral change. change we're seeing. So demand on a global basis, we believe, for the next decade, is going to be very strong. This is an industry that you put together the global streaming, Spotify, the global social, the connection these artists have. You know, Bad Bunny has a hundred million followers. He's a medium moment himself. So we look at all of those factors to say this is an industry that's going to grow for a long time. You know, they were throwing around the term funflation, and obviously ticket prices have gone up. There is concern about economic uncertainty. What if we don't have a soft landing, are you concerned that consumers won't want to pay so much for tickets

anymore? And what does that mean for the business? Yeah, I mean, listen, we got to do a better job PR-wise because, you know, this is a business that's still a very affordable entry. First of all, consumers will rank concerts at the top social event they want to go to. 70% say it's one of their greatest memories in life. It's still only $35 to get into a concert, although there's always, you know, the PR around the top ticket. It's a very affordable event still versus sports, versus going to Disneyland versus going out for dinner. So overall, this is still a very affordable an event. Consumers can get in at any price point. Yes, at the very top end, scarcity does come into play in some of these top artists at the very top. But you look at a, you know, a Beyonce

ticket at $400 for the front row. The Lakers is $25,000 for courtside. There's 80 of those a year. So it's still a very affordable business. And we look at secondary $10, $12 billion industry continually shows the scarcity of those tickets still has a lot of price and power left. Morgan, your one jump in here? Yes. Julia, thank you. And Michael, it's great to have you on the show. I mean, you're talking about the structural behavioral change that you're seeing in the way consumers are interacting and looking for the live events. I mean, we're also talking about generations that are growing up and are digital natives. Does that mean that there are opportunities potentially for a live nation to offer things differently, to think about things

differently or create new revenue streams in terms of the way these consumers are going to continue to interact moving forward? Well, I think, I mean, your first point is the most relevant. I have three young boys. They live on all social medias. They discover bands that I don't even know where they've heard of them through YouTube, TikTok. So we think digital has, is the greatest marketing discovery tool that has helped live music in general. So overall, that kind of appetite. Now, the other part that is really great about it is 70% of fans go to shows and have to have that Instagram moment. So it is a real fomo reality where going to a live show, especially in this digital world,

is that escape, is that social outing where you get to come together and share that moment. So we're looking at lots of live streaming, ways to share concerts, loyalty programs, We have a lot cooking on how we can do more and more with consumers and a digital platform for sure. And certainly we've seen that Instagramable moment really drive a lot of attention to things like the sphere. And that's a whole other conversation. But I want to make sure to ask you about the Department of Justice. There have been a number of reports recently about the DOJ's investigation into Live Nation and different practices. There's also talk about legislation, sort of a regulatory push that would really impact the way the ticketing industry and the concert industry works.

What can you tell us right now about the latest in the DOJ investigation and what it might mean for your business? Yeah, I would say, listen, today's world, being a market leader means you've got to get better at regulation and government relations. So we've got a big year. We see most of the legislation in the pipe. We like it. We like the BODACs. We like any legislation that's going to help the consumer get an on-sale ticket easier than today. And we need help in that front.

We need BODACs. We need some scalper regulations. That's the biggest pain point for customers. On the DOJ front, from what we understand, it's still, you know, or mid-season of the investigation, we believe it's around our practices, not the actual business model or the breakup, as others would fear. So at some point, we'll sit down with them. They'll tell us what they think those practices are,

and we'll adjust or fight, and we don't think it's going to be something that affects our overall business. We're very confident in our business model, and it's lawful means. Well, we have so much more to discuss, but we're out of time. Michael, I hope we can have you back on after further earnings, after other earnings, but also to talk about this DOJ situation as it evolves. Thank you so much for having us here today.

Michael Pino, CEO of Live Nation, guys, I'm going to send it back over to you. Michael, Julia, thank you very much, both of you. We appreciate it. Coming up, speaking of ticket sales, how will sales for sporting events hold up in a slower economic environment, if that's what's ahead for us? We'll speak to the NFL's Executive Vice President of Communications next. And they're time to nominate a leader for CNBC's Changemakers' List of Women, transforming business.

The deadline is two weeks from today on November 17th. You can submit your innovation, or your nomination, excuse me, by scanning the QR code on the screen or going to CNBC.com slash changemaker. Welcome back to Power Launch, everybody. As we continue our funflation theme, it's not just concert tickets that have been soaring. If you've been to a football game this past year, NFL, you likely paid a bit more, particularly if you bought on the secondary market. According to an analysis by tickets smarter,

the cost of an average NFL game ticket is up by more than $100 this year, from $2.35 last year to $3.77 this year. So if there is an economic slowdown, will people cut back on going to games? I doubt it. Here to discuss that. And much more, Jeff Miller, the NFL's executive vice president of communications and public affairs.

You know, prices are moving up. I think that's a healthy sign for you on the secondary market. my numbers indicate 435, 23, 2020, versus 358 last year. This is a healthy sign for you and your business, isn't it? Well, first, thanks for having me. But it's been a great season thus far. And when it comes to tickets, we've seen season ticket renewals at an all-time high. I think last week we sold more seats than we have in any one week since 2010.

So fans are coming to the stadiums. Ratings are up. And all of that is because the games have been great. We've seen about 70% of all of our games decided by one score in the fourth quarter. So we see a lot of drama, a lot of really good competition, and, of course, a great game of football brings a lot of viewers. I was in one of those seats. Sagi, though it was at Giant Stadium on Sunday, I must say. And it was a very close game, very competitive game.

Let's talk about your initiatives in Europe. You know, I think the NBA has been brilliant at how they have played the international card. They have attracted a lot of international players. you have a big game this weekend in Frankfurt. Miami is playing. I forget, who is Miami playing? Kansas City, Miami and the Chiefs, two of the most high-profile, attractive teams going.

How is the international initiative going? And what is the ultimate sort of end game for you? Is it a team in Frankfurt or London or both? Well, right now, it's a major strategic priority for us to become more and more of a global sport. And we've been playing games in London for about the last number of years and selling them out regularly and very quickly. We started games in Germany last year, playing two. And we'll repeat that again this year, as you mentioned, with one game in Frankfurt on Sunday and then the Pats and the Coles the following week. And what's remarkable is the demand.

We've had between about four and a half million people looking for tickets for those games in incredibly short order. So it's a great atmosphere. about 18% of, I'm sorry, about 18 million people in Germany identify as NFL fans. And so we're looking to bring the best product to our fans across the globe increasingly. And we'll look for more and other markets in the coming years as well. So since we're on the topic of the Chiefs, I am going to ask the question. Has there been a Taylor Swift impact? How are you thinking about that? Have you quantified it?

Well, I did notice that the sales of Travis Kelsey jerseys increased, I think, by about 400% after the first time that she was at a game. So we'll take that as a plus. As far as ratings go or fans in the stadiums, those have been incredibly high throughout the year. And we believe it's because it's a great game and because we bring great value to our fans. But if fans are interested for any number of reasons,

including Taylor Swift attending the games and they're new to football for the first time, then they're welcomed in. And I think once they're in the game, they're going to stay with it. You got a big media move off-season Sunday, at moving to YouTube from DirecTV. How's it going so far? How did the audiences compare? It's been great so far. YouTube has been a terrific partner, put a lot of emphasis on it.

Both they and Amazon for our Thursday Night package, where you saw the games last night, have really driven audiences up and younger. And that's part of what we need to do because we need to find our fans where they are. Our incumbent broadcaster, CBS, Fox, NBC, have always done a great job and most of our fans still find the games that way. But increasingly, younger fans, more demographics are interested in streaming and being able to watch a games mobile. And so we need to be where they are. The YouTube relationship is off to a great start. The Amazon games are going gangbusters. And so we're really excited about both of those new avenues for the league as well. I do want to ask about a topic that's been getting a lot of attention lately. And that's NFL

officiating. Whether you think there's actually a problem there and if there is what the solution could be? Well, I don't think a year goes by where people aren't concerned about certain calls, especially if they go against their own team. It's an incredibly difficult profession and one that our officials, I think, do a terrific job at. We'll always look to get better. There will always be questionable calls in a game. And that's why we've used new technologies and replay and added different protocols in our games to make sure that we can get as many calls as we can correct. And our officials do a great job of that. But is that ever going to to stop somebody seeing something on television a little bit differently, maybe based on who

they're rooting for, than what we see, what our officials see in a stadium. That's been the case for years and years. We'll always look to get better, but it's always going to be a point of conversation. Jeff Miller, thanks very much for your time today. We appreciate it. Jeff Miller with the National Football. You bet. We're going to get a final check on the markets, which are in rally mode. That's next. Plus, join me on closing bell overtime at 4 p.m. Eastern. And we're talking with Redfin CEO Glenn Kelman. That stock is up 25% today after earnings. We're going to talk about that and the state of the housing market.

In the meantime, we'll be right back. No wonder he's smiling. All right, let's look at the markets for today and week to date. There you see the kind of move we've had. This is either the best or the maybe second best week of the year. The Dow Industrial is up five, six for the S&P, almost seven for the NASDAQ. And how about the Russell, as Morgan points out? The Russell's up 8% and yes, I will confirm it.

It is the best week if we hang on to these gains of the year for all the major averages. It's the best week for the S&P since June of 2022. Every sector is in the green for the week as well. And of course, we've seen this as yields have fallen in as macro data, including the jobs report this morning, is coming softer. Came in, it was really a kind of Goldilocks jobs report. Folks, been great to have you with us today and this week. Hope you made some money. Thanks for watching Power Lunch.

Closing bell starts right now.