Power Lunch - S&P paces for first down day in last eight 10/7/25

Episode Date: October 7, 2025

Senate Democrats released a report saying AI could erase 100 million U.S. jobs. The CEO of the largest natural gas producer in the U.S. joins to give his energy outlook.And why are startups staying private for longer? It's 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.

A topsy-turvy day on the street of dream. Stocks are lower right now, but after they were higher and making new records, all this is Bernie Sanders says AI is going to destroy the American job market. Welcome to Power Lunch, everybody. I'm the aforementioned Sullivan. Evans is off today. After being higher, stocks now lower, but more all-time highs being hit this morning as investors, at least right now, taking a pause to kind of maybe digest everything that is going on.

It is not just stocks. Bitcoin capping a new record at $126,000 in change. And the new gold, acting a lot like the old gold as gold shines above 4,000 for the first time ever. Oh, and we're going to speak with the CEO of that mystery chart, that one right there. It's a power player. It's up 25% in the past year. He is here and on set. So welcome, everybody. Good to have you with us. begin this hour talking about AI, but not just about how many zillions of dollars are being spent or how many stocks are rising because they're not today, but rather the risk that artificial intelligence wipes out tens or a hundred million of our jobs. Listen to this. A new report

led by Vermont Senator Bernie Sanders says that AI and automation could replace nearly 100 million jobs in the United States over the next decade and across so-called white and blue-collar industries from accountants to teachers, to office workers, to even truck drivers, all gone like Kaiser Soze. Ironically, the report is based on findings from OpenAI's own AI agent, chat GPT. It's scary stuff, but should you fear the future? Well, investment firm Toma Bravo, their founder, Orlando, offered a contrarian take this morning on CNBC.

Listen. The displacement of human capital, there'll be transformation in jobs, but this massive human displacement that people talk about, that's not going to happen. We always, and I think I said it in the past when I've been here with you,

technology and how it interacts with people and companies is evolutionary, not revolutionary. All right, so, Olanda, says AI job displacement is kind of a nothing burger. So is this just another overreaction to new technology and jobs? Maybe the same kind we had 150 years ago when the car began replacing the horse, or 40 years ago, 30 years ago, when personal computers and the internet became

dominant in the market. The doomsayers were wrong then. What about now? Let's bring in Jimmy Pethakukas of AEI and a CNBC contributor. All right. So Jimmy, this report is titled, Tech Olegore. Iraq's war against workers, Warren's AI could eliminate nearly 100 million U.S. jobs. It's coming from Bernie Sanders.

Clearly, it's political, but it's getting a lot of attention across many media organizations. What's your take? Yeah, it is getting a lot of attention when you start using big numbers like 100 million jobs lost. That's not surprising. But since Senator Sanders has so much confidence in Chat-G-PT to create this analysis, I decided to ask Chit Chat GPT if the report's methodology was sound. And it said that the report's methodology was not sound.

Maybe one of the biggest errors is reports seem to confuse the ability of AI to automate particular parts of a job with automating the entire job. And that's not a surprising finding. When most other people who have done this kind of analysis for real, you know, whether they're consultants like McKinsey or Wall Street banks, what they've determined is not that AI is going to replace 70% of jobs, but more like maybe 25% of job tasks. So it's a very different thing. It's a lot less scary, but unfortunately, that doesn't make for it as, you know, kind of a Halloween headline. So the machine screwed up. So I'm now wondering if we should put out a new report, saying that chat GPT, at least in this instance, should be replaced for the human.

Well, interesting. Though when you did get chat GPT, like, ask it to do and give it a proper prompt, it actually came up with, I think, a fairly good analysis of the Sanders report. I think the problem there was the humans and what the humans asked the machine to do. Listen, when a report like this comes out with a number that is such an outlier, you know, the problem probably lies with the human. And that's the case. I would blame the staff of that Senate committee rather than the machine.

Because again, it's such an outlier report that you have to assume that it's talking about some sort of super powerful AI that can pretty much replace all the jobs. And if it can do that, well, they will probably grow in 20% a year in GDP. And we act like AI is this one thing when it's probably just a series of a bunch of different things that we use to solve a bunch of different problems. And so why are we leading a business news hour with this story? Jimmy, I'll tell you why. Because Bernie Sanders is a powerful guy. Parts of this report are probably very valid. There's a lot of people that are really scared about their jobs. And if we start to see regulation coming out of Congress around AI, I don't

mean some, I mean a lot, because they hear reports like this, they overreact, they're going to start to do stuff, that puts at risk, I think, much of the AI growth model that we are talking about. Maybe the big risk to AI is not electricity or water, which those things are very valid, but also congressional regulatory risk. I think that's the case. If you look at that report, all the stuff about, you know, job loss and including a bunch of like, you know, scattered, scary quotes from tech CEOs talking. talking about super intelligence.

What it comes down to is there's an agenda there. And that agenda, in that report, they want to change the tax code to make, you know, more expensive to invest. To invest. And this whole economy is being kept up by massive, you know, AI infrastructure investment. It talks about robot taxes. So there's a real agenda that at least some people in Congress would like to institute to at least slow down this revolution, though my concern is that it would not, what

not just slow it down, it would stop it with all the economic impacts that you might imagine. Because when we go back through history, and this is where you're so, so good, Jimmy, and this is what's critical. We go back through history and everybody has heard the term, well, that's a buggy whip. It's now become sort of a euphemism for things that everybody used to have because they used to have a horse and would pull a cart, and they would sort of do this with a horse. And that's where that term came from. Every technological innovation of the last hundred years, there's been dire predictions of job doom. And by the way, some jobs like, you know, a horseshoe maker, they have gone away, right? The kid that used to light the gas lamps on the street, that job is

largely gone. Will AI be a net job ad or a job kill? I think what your baseline forecast should be, as this is a powerful general purpose technology that will have a lot of impacts just as the computer plus the PC did. Your baseline then should also be jobs will be lost, but more jobs will be gained and will become more productive. Like that should be where you start. Now if you're going to tell me that this technology is something far beyond that, that it's super AI, it's artificial general intelligence, super intelligence, that it's science fictional, well then we can have that conversation. But right now that's not happening. Two, there's no evidence that's happening.

There's forecast that might happen, but I wouldn't begin there. What I'd begin is that this is a technology of the sort that economics of the past 200 years has a lot to say about. And that result is disruption, but also plenty of creation. Yeah, in fact, I just asked Chat GBT while we're talking. Will artificial intelligence take jobs away from humans? And it says, great question. Thank you very. See, it's very complimentary.

I think AI is getting smart where it's actually acting like a human. Newman, please, thank you. Great question. Oh, you look so nice today. Some jobs will be lost, but many others will be transformed or created. And I think that's the part that we're underestimating, right? Jimmy, which is that there are jobs that will exist in 10 years that we can't imagine right now. And we can't talk about them because we can't imagine them.

Yeah, that's the cognitive bias here that's so harmful. It's very easy sort of look at a job or look at a part of a job and think, well, I can see how a robot. would do that. I can see how an algorithm would do that. What's almost impossible to do is predict what jobs those advances will create. And again, that should be where you begin. The assumption that there will be new things done before you begin, you know, getting into sort of these, you know, robo-apocalypse kinds of scenarios, like the one, unfortunately, was in that Senate Democrat report. Yeah, it's getting a lot of attention, by the way, as it should and maybe enables debate like this. Jimmy Pethakukas, AEI, always appreciated, Jimmy. Thank you very much.

All right, folks. So as we take a break, the market's taking a break. The S&P 500 has been up for seven straight sessions. It's not on pace for that today. It's down about one half of one percent. Maybe blame Oracle. Some new reporting on its AI costs rattling investors. Just a touch. That stock down 3%. But gold, golden, crossing $4,000 for the first time ever. In fact, gold, look at that. It's there again. Gold, 4,000 an ounce, one gold bar, $1.6.5 million. You can buy a house with that. We're back right after that. All right, we'll come back. And while markets are down a little bit right now, the NASDAX off about six-tenths of one percent, they were higher earlier today. And you know the day-to-day moves.

They don't matter that much, but history can matter. And we have got a great RBI stat for you right now. Listen to this. According to bespoke investment group, the three-month period beginning today has historically been the strongest 90 days of the year with the S&P 500 posting a median gain of 7.7% from today through January 6th. But of course, history is the past. It is not the future. Let's talk about all of this with Emily Rowland. She is co-chief investment strategist Man U. Life, John Hancock, investments. Sorry about your red sox. I know. It was tough. It's tough. All right. Emily, outside of baseball, it's one historical stat, okay, but I like it. It's better than it. Markets usually fall 7.7%. Is the direction of this market

up? I mean, Brian, nothing can stop this market right now. It's all been about momentum. It's been about technicals. It's been about embracing the parks of the market. market that are up. And we've seen this almost relentless dip buying take place. And now we've got valuations at almost 23 times forward earnings. So markets are priced for perfection in a not so perfect world. That makes me nervous what you just said. Yeah. Well, the good news about it is that the denominator of the PE ratio is more important to us. That's the earnings. That's going on. And the earnings in the United States, the engine is on right now. And that's really important because we have the highest quality companies with the best earnings revisions here in the United States.

You think about speculation. Just go overseas. You look at the MSCI-EFA. It's up 30% this year in U.S. dollars on 1% earnings growth. Chinese stocks are up almost 40% on 0% earnings growth. Some of these European countries have negative GDP and they're sporting some of the best performance ever. We've talked about it. Slovakia, Slovenia, Poland, Austria, Germany, Taiwan, Japan, China, Taiwan, I said Taiwan twice. Those are all going up. Yeah. Why?

It is out. So, you know, as a market strategist, I never want to say we don't get it. But in a way, if you're somebody that focuses on the macro puzzle, it's hard to square with the performance. And we've seen this sell America everything trade since the height of liberation day, whether it's stocks, whether it's bonds, whether it's the U.S. dollar. Of course, the dollar being down nine, ten percent year today has been very. much accreative to the performance in some of these countries. But to us, it's the trend is your friend, and that's the best friend of a short-term investor. Well, trends, listen, stock market tends to go up, what, 70% percent of the time. So that's fine. Are you worried at all, Emily, that the E,

the denominator, as you say, is all based on one thing, that AI behemoth. Yeah. That's all we talk about every day. And without that, I don't know how much earnings growth there is. It is a concern. And, you know, frankly, without AI, the economy wouldn't be doing as well. And the market clearly would not be doing as well. But when I look for, you know, over time, we're huge believers that stock prices follow profits. And when you're looking for profits right now, you're finding it in United States technology companies. But what you want to think about doing right now is what we're drafting the market. So the equity investors are on a straightaway right now. They're in fifth gear, whatever you want to call it. We are right behind that lead car. We're participating. But

we're owning higher quality stocks with better balance sheets within the technology sector, up in market cap, staying away from those more speculative corners of the market, participating, but being mindful that some mistakes could be made. Did you bring all the racing references just for me? All the car straightaway, fifth gear turns? I did, and I was really nervous that I was going to get some of the time. No, it's great. Listen, as a 30-year car racer, I get it.

But here's a thing. I also know if you're going down in that tradeaway unless you're a dragster, even dragsters eventually slow down. Yeah. And there's stuff that happens to the race car and there's things in the road. What is a risk right now? What do you guys perceive? You're John Hancock, manual life, right?

Your job is, your risk-averse, as they might say. What are the risks to manage through right now? Well, I think the biggest risk in markets right now is that there is no risk. And that's what we've been talking about today. So the risk is that there is some type of froth, a bubble that gets burst. And it's a key reason that we're diversifying within equity exposure. midcaps are a favorite area right now. They have a completely different sector composition

than their large cap counterparts with areas like industrials and regional banks that are benefiting right now from M&A. They're trading at a 30% discount. Why does anybody care? Nobody loves Jan Brady, Peter Brady, right? Like, they've got things to offer too. But I was about to tell you that we like income and bonds too,

but definitely nobody cares about that. But why don't they care? Those are valuable parts of the market. We've got a guest on coming up later on. on the show. It's going to talk about investing in small and midcap companies with his buyout fund. There are great companies. Amazing companies. I talk to their CEOs. They're frustrated. They're like, it doesn't matter if I grow earnings 20% of year, Brian. Nobody seems to care. Right. That's a problem. It is a problem. But it's not a problem for investors that are looking

for something that's on sale. It's really hard to find anything that's on sale. I'm a big shopper. I'm always looking for bargains. Midcaps in the United States are one of the only places we're finding it right now. Everybody used to come on your show and say, buy international stocks because they're cheap. Guess what? They're not cheap anymore. U.S. midcaps are the place. Small caps were a little bit concerned because of some of the profitability and debt there. The midcaps in the United States are the sweet. U.S. You're up in Boston, right? Gloucester or somewhere up there? Mabblehead.

Mabblehead. You go to T.J. Max. Oh, it's the best. No, they're the one way. I know. T. J.X. We have also have the best T.J. Max stores. You do. We have the best everything. Dunkin' Donuts. Dunkin. Sorry, I shouldn't say donuts. It's dunks. I apologize. I can't do it in the accent. Emily Rowland, Manulife, John Hancock.

Thank you very much. By the way, married to a hokey football player. Turning out of the bond market, with Treasury yields lower, the government shut down now entering the seventh day. Three yields at 3.6%. All right. So, Rick, listen, we're not, we don't have any official government data, not a lot of it anyway.

Like, when does the bond market get a little bit jumpy? And what are we looking at? Well, I think today was about supply. Consider this, Sully. Today we had 58 billion three-year notes up for auction, and we could show that chart. Yields have been slipping all day from lofty levels, actually. Ten year early in the session could have had its highest yield closed since about the 25th of September, but that's in the rearview mirror.

We've come down. So I think supply is a big deal. And you're right. We don't have government statistics. have some statistics out over the next several days that don't go through the government. Tomorrow we're going to have tens followed by 30, so I think it's a very good time to not only watch what's going on with regard to supply, but how the interaction with bonds is going with the equity market. So equities make a turn down today after having a lot of record runs to the upside,

and interest rates start to slip. Make sense. Well, maybe doesn't make sense is how the dollar has such a strong day going. Now, if you look at a two day of three, Something else should jump out at you. We had a higher high than yesterday's high yield and obviously a lower low. And that's drawn the entire curve. Two's all the way out to 30 years have outside sessions today, which is unusual. It usually means a trend change, but I'm not so much looking for trend changes because we've kind of been in a range. Basically, the low 4% in a 10, kind of right around that 420 area.

And if you go to shorter maturities like a two-year, that 3-6. 60's been a big area to pay attention to the upside. Something else is going on. Let's look at that 2's 10 spread. It was such a big talking point early in the year. But as you look at a chart that starts in early 2024, what I notice and what everybody's noticing is the last couple of three months have been virtually sideways. Now, it's not a small range, basically from 42 basis points to around 60 base points. But it really is stuck.

Not a lot of volatility. out of that range. What's going on? Well, what happened in April? In April, we had our low yield close of the year right at 4 percent, and we had Liberation Day. So there's a lot of nervousness about inflation, and I think that continues to show up as a sticky aspect of that 210 spread. Brian, back to you. All right, good stuff. As always, Rick Santelli. Thank you very much. All right. Up next year on Power Lunch, the crypto rally. Today, hitting a little bit of turbulence, but your market navigator, not deterred.

He'll give us his top crypto plays next. All right, welcome back. It's time for the market navigator. Although some crypto stocks are pulling back today, they have been on an absolute tear in recent months, with Bitcoin hitting a record high on Monday. Now, if you've been on the fence, our next guest says now is the time to jump in to the crypto game,

and he's here to tell us how to play it, either directly or indirectly. Joining us now is Bob Lang. He's the founder-in-chief options analyst at explosive options. Bob, the Bitcoin trained, has caught a lot of attention, because of those record highs, but would you be using Bitcoin itself to take that view of higher crypto or some other trade? Great to see you again, Dom. So I really like Coinbase right here, Dom, and I think that Bitcoin's got a really good chance to run much higher into the end of the

year. There's been a lot of enthusiasm, a lot of bullish sentiment coming into Bitcoin, and the best vehicle to use to take advantage of Bitcoin, if other than ETS is probably Coinbase. And, you know, The Coinbase has come off of a recent high and it's pulled back a little bit. I think this is a good opportunity to buy the dip. All right. So if you're going to buy the dip with Coinbase, it's easy enough to mechanically just go and buy shares of Coinbase. You often look at some option strategies because they are more at least risk manageable around some of your kind of profit and loss expectations. What exactly would you do strategy-wise to express that view in Coinbase?

Well, I want to go with a straight call play here, Dom. And normally I might take a look at spreading the trade. In this particular case, I'm looking to go out to about December, the 430 call, which is about 50 bucks above the current price of Coinbase. This is about 8 to 9% of the price of the stock. Now, why am I going out to December? I'm looking out to December because this includes an earnings period as well, too, at the end of October.

When the earnings move is expected to be about $68 to $70 for Coinbase, and if that stock moves, at least that much to the upside, we're going to go through those old highs, and this option trade is going to be pretty profitable. That option, the 430 call, is trading at about $31 to $31 right now. It's about a 40 delta, which means it's about a 40% chance of the stock getting to that strike and maybe above it by the December expiration. So giving us about two and a half months time to let it work. We're not in such a big rush, and of course we have that earnings play to work through it, too. All right. So if the earnings is a potential catalyst, even the fundamentals of cryptocurrencies and their trading a catalyst as well,

are you comfortable just letting this ride all the way through that? Or would you risk management between, risk manage it between now and the end of the year? Well, I'm always looking to manage risk, as you know, Don. So yes, I would probably manage the risk. If the stock gets a good pop after earnings or maybe possibly a good pop, if Bitcoin takes off, you know, don't forget last couple of months, Bitcoin's been on a roll and went up from about 112. 12,000 up to about 125 to new all-time highs. Coinbase rode right along with it. So I think that managing that risk is really paramount. If we get up to about 40, 50 percent gain on that thing, I'm going to sell some upside calls against the call or possibly just roll it up and keep

running. Momentum in this stock is extremely strong when stock is going up and the bullish to the upside. And these calls can really move. All right. Bob Lang with the trade on crypto, using Coinbase, thank you very much. We'll see again next time soon. Brian, crypto and Coinbase, I'll send things back over to you. All right, Dominic Chu, and Market Navigator, thank you. All right on deck. AI Dreams, they're going to be largely powered by natural gas. So is the gas going to be there? We're going to ask a real power player with the CEO of that mystery chart.

Next. Tesla announcement that we have been hearing about since yesterday is finally out officially. It is a lower-priced Model Y. The Tesla website showing a rear-wheel drive Model Y priced at $39,990 for, as Philibos said earlier, the standard version Tesla trying to kind of juice sales in the face of rising competition from China's B.YD and the end of the federal EV tax credits at news not helping stock a Tesla stock. All right, time now for a power play. Nice animation where we highlight the biggest and best across all energy. And while your next guest company's name may not resonate at first, it should expand energy as the largest natural gas producer in North America.

The company is the expanded combination from the merger of Chesapeake and Southwestern Energy and their assets in Texas, Louisiana, Pennsylvania, West Virginia, and more make them a national powerhouse. The company is closing in on nearly $1 billion in net income. It has returned $595 million back to shareholders just this year. the median target price of analysts about $130, about $22, above where expand energy is now. Nick Delosso is the CEO and joins us now for PowerPlay.

Nick, thank you for coming on set. We do appreciate it. Thanks for having us, Brian. Okay, the hardest words in TV are, I was wrong, and I said erroneously the other day that there are no natural gas plants under construction. There are, they just won't open this year. We talk about all this demand that's coming for AI,

this demand for natural gas, much of it's yours, to sell to Europe. But I'm looking at a natural gas price that's just over three bucks. How do you see supply and demand in coming years? We're really excited about the supply demand growth for natural gas in coming years. We've never really had quite the visibility into demand growth that we have today. We see demand growing about 20 BCF a day between now and the end of the decade. That's comprised of LNG. It's comprised of PowerGen, which is a function of data centers and AI, and it's also industrial demand. It's really exciting to think about all of that and how they interplay with each other, and then to think about our portfolio being spread across Appalachian Basin through Louisiana and how uniquely positioned we are to serve all of those

growing markets. We talk a lot about pipelines as well. You could use very helpful in getting your gas to where they need to go. They're hard to get built. Can you get all of your gas to market efficiently and effectively and price competitively right now? You know, we can. We can, We have an investment in a pipe called NG3 in Louisiana. That pipe is coming online right now. This is a really important piece of infrastructure and really exciting for us as a company. It's going to deliver our supply in the Hainesville directly to the jumping off point for LNG at a place called Gillis in South Louisiana. This kind of control of access of our supply directly to a growth market is really valuable to us and puts our supply right where customers need it in South Louisiana.

and we can continue to meet customers' needs with the growing supply we have. What is NG3 going to mean for revenue, for earnings? It means that we can better deliver our product where it's needed to the customers in South Louisiana. So over time, we expect that prices in South Louisiana will continue to rise. They'll rise relative to the rest of the market because that's where the demand growth is. You have a huge portfolio up in upstate, Pennsylvania as well, sort of lower New York State. Where does that gas go? You went to Boston College.

Why is Boston? By the way, home of our former guest, Emily Watson, Roland, who was just on, why is that guest, why is that gas, rather, still being shipped in from Trinidad on a ship versus piped in from you guys 300 miles away? That's a great question. And we really are supportive of all the new demand growth pipeline projects that could feed New England. And there is some talk of some new pipelines being built into New England out of the Marcellus play. There needs to be a lot more, though. This is the most logical solution for what is an energy short market throughout New England. When we think about all the AI demand growth that's happening and you hear about it in Pennsylvania, you hear about it in Ohio, you hear about it in West Texas and in Louisiana, you don't hear about it in Massachusetts. We could hear about a lot more of it in places like that if we had more supply that was delivered to those markets.

Well, they don't have enough trash and trees to burn to power the data centers. Pardon my snark on that one, you get my point. So as a CEO of the largest natural gas producer in North America, you're in your office, you're watching CNBC. You see Sam Altman come on with Jensen Wong or AMD, and they're talking about 5 gigawatts here, 10 gigawatts of data center demand here, another 5 over here. What are you thinking? Because that largely says to, if I was you, I'd be thinking they're talking about me effectively, meaning expand energy. Yeah, that's right. They are. When you think about all of that power gen growth that has to happen, natural gas is going to be the most important fuel source for that growth. We think between now and the end of the decade, that's about four to five BCF a day of the 20 BCF a day growth of the total market. And so it's a really important driver. You can get there by increasing the utilization of existing power plants. You can get there by building new power plants, which will happen. Those will come online more towards the end of the decade. Those are happening, apparently. Yes, they are happening. Not right now, though.

Yeah, more towards the end of the decade. But existing power plants will see their utilization go up as well. And that does happen right now. So when does the demand? Should investors expect a demand pop or just kind of a slow, I guess, for lack of a better term, burn higher over the next number of years? Yeah, it's going to be a little bit of both. The biggest step changes are going to come from the LNG facilities. Because, again, the LNG capacity growth is about three times the power gen.

growth story. So when you think about four to five BCF a day growth and power gen, again, you're about 14 to 15 BCF a day growth in LNG capacity. So when those facilities come online, which are often two or three BCF a day facilities in one. Billion cubic feet. Billion cubic feet in one facility, that represents a step change in demand. So when we see a natural gas exporter, a venture global, a cheneer, a commonwealth, they're all over the place. And they're growing. Exxon's got one coming up in your hometown, south of Houston. Is that going to add, does that incrementally add to expand energies gas demand? Because everybody's kind of competing to put their gas on that ship, but it's a lot of gas.

It is a lot of gas. And while there is competition to get gas to those markets, we are really well positioned. We are the largest producer in the Hainesville. You'll see a lot of gas come out of the Permian and out of the Hainesville as your two primary growth areas to feed all this LNG export capacity. And so everything that's in Louisiana is going to be mostly met out of the Hainesville, which most of these projects are in Louisiana. There's some in the South Texas coast as well. We're really excited about what that means to us.

And we have the infrastructure and the diversity of transportation to get there to feed several of these facilities. Because you said in G3 is coming online like right now. I mean like today or so close. That's exactly right. Nick Delosso, he is the CEO of Expand Energy EXE is the ticker. We appreciate you coming on, Nick. Thank you very much. Thanks for having us.

All right. Let's get out of Kate Rogers for a CNBC news update. Brian, a military official reportedly says about half of the 200 Texas National Guard soldiers the president ordered to Illinois to combat crime have arrived. The remaining troops are expected to make it to Chicago later today and will deploy to locations around the city no earlier than Wednesday, according to the New York Times. It comes as officials in both Chicago and Portland, Oregon, are in court trying to block deployments. Kentucky is suing Roeblocks, alleging it is.

the quote website of choice for child predators. The lawsuit accuses the online platform of creating a hunting ground for predators and permitting an environment of exploitation. Louisiana filed a similar suit in August and Roblox said at the time it does not comment on pending litigation. And some 200 hikers stranded on Mount Everest will reportedly be rescued today. That's according to Reuters. Roughly 550 people were trapped on the Himalayan Mountain this weekend after an unusually strong sudden blizzard caught hikers off guard. There's been no word on the remaining hikers conditions. Brian, back over to you. Wow, 550, 200 to be rescued. That is scary stuff. Kate Rogers, thank you very much. Right, coming up back to the markets. We're going to name some names on smaller cap stocks that have been

rather quietly rocking. Plus, meet a company trying to help small companies grow without debt. Stick around. All right. Let's get a quick check on smaller cap stocks because it's not up right now, but earlier today, the Russell 3,000 hit a new record. high, the Russell 3 and the Russell 2000, some of the indexes that were pretty much ignored by investors for much of the year. But now they're finally starting to get some love, the Russell 3,000, of 8% in the past three months. And look at some of these gains in just over one month. In one month, Clean Spark up 94%, Sandisk, 76%. Pee body energy, 69% and Lumen Technology of 46%. There are a lot of really interesting companies out in America, and good to see getting finally a little investor attention.

And speaking of, let's stay on the small cap story because there are thousands of great, smaller, often family-owned or run companies across America that could use an investment to scale up. Your next guest company wants to help them do that, but also not saddle them with loads of just crushing debt. Ryan Pettycourt is a CEO of Tide Rock. They invest in smaller businesses, but do not leverage them up with tons of debt. Ryan, good to have you on. Thank you. So your job is to hunt companies. You find companies that want to grow. They need money. They need advice, maybe. They need management strategy, whatever it might be. Are there still good companies left in America? Good, smaller, family-owned companies? There are so many good companies. You think about private equity where

the most of it plays kind of that 10 million plus EBITA. There's a lot of companies there. There are exponentially more companies that sub-10 million EBITA, and a lot of them are great companies. So what do they need and what do they want? And what does Tide Rock give them they can't get elsewhere? So we're an unlevered buyout firm. We look for companies that are founder run in that lower market. And when we work with them, we are giving them the resources, the growth team, a playbook to really move from that founder run, one person doing most of the work, into a more professionalized organizations. So unlevered, that's a fancy word for not a lot of debt or no debt in some cases. So how does your model work, versus the, I'm doing air quotes, traditional private equity model.

Yeah, so very different from traditional private equity funds. We're closer to our holding company structure. But instead of taking all the profit we generate to redeploy to buy more equity, we distribute that profit out to investors to create yield. And that yield allows us to then be permanent capital because we don't have to sell the companies to be able to make money for our investors

and allows us to be unlevered. So we can take all that profit rather than paying debt and we can distribute it and we can focus on growing the companies the right way. So it's interesting because I have a lot of friends in the private equity world, okay? And so with all due respect to them and everybody else, listen, they're always looking for an exit, right?

I mean, that's the idea is I'm going to invest in you, but you're going to either go public or you're going to sell or some other kind of event where I get all my money back plus a lot more. That's how private equity gets rich. So why choose your model over that? It would seem to be a, does that help you at Tide Rock? Well, private equity, there's one way to make money, and that's equity appreciation.

A lot of smart people to figure out different ways to extract that. But in business, there's actually a lot of ways to make money. And the profit that you generate, the equity appreciation, the portfolio companies within that, we're unlocking all of that. So we can focus on the growth and the operational excellence of the companies, and we hold companies for decades. And sometimes we grow them so fast that we're no longer the best person to be managing them, and we'll pass them to somebody else.

But that flexibility to be able to have different levers to make money and to grow the businesses allows us more consistency in our returns. Yeah, because there is, you've heard the, I'm sure you've heard the theme. And you and I, you grew up in pretty much the same area, San Diego area, that you can't build a company in America anymore. Forget about it. Don't start a company. I think that's garbage, right? I mean, there's lots of great companies out there that probably just need a little bit of help to hit that next level. Absolutely. There are so many great companies out there. We find the companies where you have are these amazing tradesmen and the tradesmen founders are able to build a super high quality product service. But they don't know how to go or they haven't chosen to build the sales organizations to take them to that scale. Like seafood.

Sea wins? Yes. Yeah. Like Sea wind. Yes. Yeah, they have this great product and service and we're able to come in and help them show how to scale that with some sales talent, some marketing and some infrastructure to continue to support that. now a sudden everybody learns about this amazing company that was there, people didn't even know existed. Yeah, and I think we're going to wrap it up, but I think the lesson here, too, is that you can do it a different way, but also there are, you can still start and grow a company in the United States. I know people say you can't, Ryan Petticoord and Tide Rock are proof of that. Ryan, thank you very much. Thank you. Appreciate it. All right, new public company, but old story. Speaking of this topic, we're going to stay on what some might call the aging IPO market right after All right, kind of goes to what we just talked about.

For years, the sort of prevailing wisdom was private companies. They grow and then they get public as soon as possible. But some new data shows that that strategy, going public quickly to IPO, whatever, is going by the wayside. Let's find out why. Here now, CNBC wealth editor, Robert Frank, who writes about this in Inside Wealth, Robert. Brian, great to see you. So if you look at IPOs so far this year, the good news is there's been a lot of them, but they're means. median age is now 13 years old. That's up from nine years old back in 2019. And if you go back to

the 1980s, they were averaging or median six years old. So a big change over that period. There are now more than 1,200 unicorns, so that's private companies worth more than a billion dollars. And they're staying private longer, so they're maturing longer. The revenue of companies that are going public has nearly doubled over the past two decades, from $110 million back. in 2005 to $218 million last year. That's all inflation adjusted. Now, the big question, Brian, is whether those older companies means

that there's lower returns for investors by the time they go public. You hear private equity venture capital firms saying the early years for startups generate the highest returns. But I spoke to Professor Jay Ritter at the University of Florida. He told me that the larger firms that go public

actually fare better over the long run. You look, Brian, at the big IPOs this year, whether it's Corweaves, Circle, Figma, Klarna, they've all done pretty well since going public. So it's true that companies are staying private for longer, but it doesn't appear to be as true that they're therefore worse investments by the time they go public. Well, to your point, there's so much money in the private markets, right? Yeah. I mean, you look at institutional money from sovereign wealth funds to private equity, private credit, family offices, they don't need to go public anymore for that private capital.

And even if they just want liquidity without going public, you've got forged global equities in that can give individual shareholders equity to sell their shares if they want. So they've got liquidity for employees and they've got capital for the company to grow. So if you don't have to deal with all that compliance and the short-termism of shareholders, why would you go public? Well, I guess to pay the employees, that would be the main reason, right? Like, you've been here for a couple of years, humping it out. You're not making a lot of money, but you're going to get rich when we go public, I guess.

Yeah, and again, you look at Open AI. Those employees just sold $6 billion worth of stock to pay their mortgage, buy homes, all those things. So that liquidity portion that you just mentioned with the rise of these sort of private marketplaces has taken care of that side of it. Yeah, Robert, Frank, it's a heck of a topic. It kind of goes to what we just talked about in the previous segment. Robert, thank you very much. And, folks, be sure to check out Robert's Inside Alt's newsletter for more insight just like this. All right.

There's a big stock pop for this company on news this morning. Who could that be? We're going to show you after this. We'll do two stories in 58 seconds. The first thing is the mystery charts trilogy medals. We showed it to earlier. It's up 246 percent. after the White House saying it's taking a stake or might take a stake in the minerals company

invested more than $35 million. Just be careful. We had a stock move yesterday, surging on a report that later on kind of got debunked. The next big story is around Polly Market, because the parent company of the New York Stock Exchange is called the Intercontinental Exchange, better known as ICE. And it said today it will invest up to $2 billion into Polly Market. Polymarket, by the way, as well as prediction markets where you can bet on outcomes like who's going to win this election, how long the shutdown is going to last, whatever it might be. Kalshi, by the way, also a big name there. And Robin Hood making a play as well.

My how things have changed the prediction markets. Suddenly, all the rage. Who knew? We'll see tomorrow. I'll see you on Fast Money tonight. Closing bell starts now.