Power Lunch - Strong Jobs Report, “Roaring Kitty” 6/7/24

Episode Date: June 7, 2024

May’s surprising pace of job growth and wage rise added to the conviction that the Fed will stay on hold with interest rates through this summer -- and possibly beyond. We’ll discuss. Plus, Keith Gill, better known as “Roaring Kitty,” hosted his first livestream since the meme stock craze that took place three years ago. We’ll bring you the key highlights of what he said.  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 Lunch, everybody, alongside Kelly Evans. I'm Tyler Matheson. Glad you could join us. We've got two big stories on opposite ends of the financial spectrum. We've got the jobs report and Roaring Kitty. What's happening to stocks right now? Well, they are a little bit higher. The Dow industry is up 41, almost 42, S&P 500 up 7, and the NASDAQ up by 4. This comes after a hotter than expected jobs report. 272,000 jobs created compared to an estimate of 190,000. Indeed. And we saw a huge reaction in bond markets. popped after that report. Stocks also popped. We'll get to all of that coming up.

But first, let's start with GameStop. The stock is now down about 39%, just around $28 a share, halted for volatility more than 15 times, and the company moved up its earnings report and announced an additional share sale, which is part of what's weighing on the stock price. And the other part of this story,

a live stream from Roaring Kitty, the trader who started the game stock meme frenzy, Frenzy, Roaring Kitty or Boring Kitty, Dom Chu? What's the story? Today it was maybe boring kitty in terms of the content that was provided, because what we did not get was any real new developments with regard to what Keith Gill views about his GameStop position. What we did learn today was we got some at least reinforcement and positive confirmation of what his position in the stock really is. So there were maybe, I mean, there were a number of takeaways if you want to look at it this way, but three, of the main ones that happened to me while I was watching this whole thing. Number one, he still believes in GameStop from a fundamental standpoint. He thinks that Ryan Cohen is the guy

who can turn things around and that he generally has a more medium to longer term time frame on when it'll happen, maybe two to three years, maybe something like that. But then he also caveated it by saying, I could change my mind just like you could change your mind about this down the line. That was number one. Number two was we've talked a lot about the screen screenshots he's posted about his position, about just how much it was. Remember, at one point in the last couple of days, that screenshot showed a value of a portfolio worth $557 million. In GameStop alone. In GameStop, and that's split. That would be what share of the company?

So it's huge, right? Because, well, it's not like you're talking to five million share stock position, okay? And that you can see roughly 30 bucks a share, you know, you can kind of do the math here. It's worth about 150 million bucks, right? steps market cap eight and a half bill right a hundred and twenty thousand june twenty first that's in two weeks expiry call options with a strike price of 20 bucks a share quick math there 12 million share exposure 10 dollars in the money plus a little bit of time premium call it roughly 120 to 130 million dollars worth of market value there and a 29 to 30 million dollar cash buffer position all in total when he was doing the live stream he showed a live shot of it and it was

mark-to-market just around $350 million in terms of the movement, given the stock price and the options pricing that was happening. That was takeaway number two. Takeaway number three for me was... Was that more than people thought? Less than people thought he was on? It's exactly what people thought. But there were questions about whether or not that was really his position or not. He showed screenshots. They were posted out for the world to see. But in this particular instance, he actually showed us live what the portfolio was doing and claimed it was his. So at the very least, what you have is confirmation to a live studio audience out there for future people to understand that he claims this

so there could be no question that this is what he was trying to say. That's what we got confirmation of. The other thing that point number three was, he kind of knows what he's doing. During the course of the conversation that he had on his live stream, he caveated himself a lot. And probably just the right amount of times, I'm not sure, because I don't know Keith Gill personally,

I'd love to talk to him in person about this, but it seems like he was very well coached, or he knows exactly what he's doing. Coached so as not to run a foul of the SEC? Right, to not make fraudulent claims, to not pump the stock. Right, those types of things, right? And it was pointed out by many folks out there

that, you know, at one point he was a registered representative at a securities firm. I mean, he was licensed and everything else. I think he knows exactly what he can and cannot say to trigger the eye. of regulators or law enforcement at this point. So those were the three main takeaways for me. But again, nothing terribly new came out of this

other than the fact that he says, this is the position, this is what my exposure is. And by the way, we don't know whether or not he could change his mind, so to speak, as he said. Yeah, when the stock seems so tied up in the whim of an individual investor, that investor could change their mind in a hurry and unwind those positions tomorrow.

Wouldn't be smart. So what I would say is the options positions are curious, right? Because you've only got a couple weeks until expiration. They strike at 20 bucks. So they're deeply in the money right now, anywhere from $8 to $10, as you can see on the quote beneath the ticker right there. The $5 million share position also significant. But I would say and argue,

and some traders will say the same thing, that when a stock trades anywhere from 60 to over 200 million shares a day, you could throw a market order of 5 million shares in the market and have no market impact whatsoever on the stock, right? At any time. If you're trading at 200-some million shares a day, nobody really notices 5 million shares that just goes through. So the market impact at that kind of trading activity

may be a little bit more easy to mask. It's tougher, though, if you hypothetically want to buy, in a rising market or sell into a falling one because that could exacerbate the moves there. But the options, it'll be interesting to see how the options position plays up because, like I said, they expire on June 21st. You either exercise them or roll them into another contract, and that's going to be the kind of interesting moves to watch. Dom, stick around, will you? Need more. Need more from Dom, more on Roaring Kitty's return.

Let's get a take from two streamers and retail traders who've been following all this very closely with their online communities. Ryan Monoski, aka Stock Mo, has over 600,000 subscribers on YouTube. And Jason Frank, the Stock Guy, has nearly 300,000 on Twitch. Let's start with you, Ryan, if I might. What do you make of what took place today and what Roaring Kitty said? And what's your thought about GameStop? Well, first, I want to thank both of you for allowing me back here.

I remember the last time we had a comment. conversation and you brought up angry kitty and I told you you needed to get out there and trademark this thing. We got back to the community. They absolutely loved it. They loved you guys. But roaring kitty, as you came out, you said something about maybe boring kitty. I don't know what everyone was expecting out there when it came to this, but I did ask my community and they were very upfront. I said, why is a lot of you getting into this? Why are you guys getting into this. And basically, it was two answers. One, they want to see retail invited to the party. They want a piece of the American dream. They're tired of going to work nine to five, 40 hours a week,

maybe one week of vacation a year, and they're seeing people making millions and billions on Wall Street. They see Roaring Kitty as one of us who has knocked on the door and then kicked the door in. And they see this and they want to be a part of it. Now, the other has, is all about making money. They see this as a great opportunity to swing trade. They want to be a part of it. And they, some of them are. I can tell you over my discord, I had a couple of people saying they're up tens of thousands of dollars. It's pretty interesting to watch. But they're the two lanes that I have seen so far. So Jason, isn't what Ryan just described in part, just pure speculation, basically a form of a gamble? I mean, there are lots of ways to take part in the, in the, in the

capitalist markets. And you don't have to, it doesn't have to be through following an online person or a stock like GameStop. Well, I mean, absolutely. The thing is, is that as he had just alluded to, a lot of people are in this looking at it as though this is their chance to see the everyday working man. You know, there's never been a time where the gap between the ultra wealthy and the everyday working man has ever felt so wide in this generation as it does right now. And a lot of people look back at, you know, something, if you think about something like the movie Invincible, right, Vince Pauly, a regular everyday guy who made it to the NFL, right?

You know you're not going to do it, but you feel like one of you. He's one of us. He's there with the big boys and he represents us and it gives us hope. Some people are feeling that. But where I will counter with Stockmo is that I think for the retail trader, they're a little bit smarter this time around or a little bit more prepared. I think the first go around with GameStop, it was a new thing. The squeeze, the pump was everybody was there, everybody was on it. We saw dilution, not just from the stock, but from people either losing money or moving on to other

stocks or moving different groups. And I think people got burned. Some people, you know, held, looked for exiting this time, look for a reason to sell and weren't like this is going to a million. So I think you have a smarter, more resilient and more prepared retail trader this time around. And I think that's something that a lot of people went into this live stream looking at. I think there were some expectations that he was going to either pop the stock or was going to liquidate. But I think other people realized this is just him coming out. And for me, I think it was really just a, hey, this is me. This is really my portfolio and my Twitter account. I'm not going to say anything to get me in trouble because I know better.

And here I am, and now let me just enjoy the moment. Dom, I think the stock sales are really interesting angle on this by GameStop. So they're being opportunistic. They announced it when the stock was up significantly this week. And they can obviously raise a bunch of capital, try to execute the business turnaround, but it also puts a big dent in the short-term gains that Keith Gill could be enjoying from this. So this is the struggle and debate that's going to happen with the meme stock community with regard to GameStop specifically. And the reason why the Ryan Cohen illusion and references so key in this whole process is because there is a possible turnaround play happening at GameStop.

Now, we talk about this idea that physical games and the retail of such is a dying business. It's a runoff business. Many people have talked about it. But what, in essence, you've done, though, in this process, is you've raised a ton of money over the course of the last month, month and a half or so, that Ryan Cohen at the helm of the helm of the... GameStop has a lot of free discretion over. The board of directors has given him a fairly open mandate with regard to what you can do with this money that has been raised. So does GameStop look like a video game retailer in the next 6, 12, 18, 24, 36 months? Maybe, maybe not. It could look like something completely different and reinvent itself if it's something else. Those are all

hypotheticals. But when people in the fundamental community talk about what's going to be the GameStop end game, it doesn't necessarily have to be as a video game retailer. And that's probably one of the reasons why you have a lot of folks talking a little bit more about this notion that GameStop could have a fundamental story behind it. Now, I don't know what that is. It's net sales dropped almost 50 percent, you know, year on year. They were $1.2 billion last year, first quarter, $880 million this first quarter. They need to use this capital to execute some kind of kind of turn around fast. And not just that. I mean, to run a business, you need cash. There's cash flow that needs to be generated. You cannot burn that much without doing something with it. You have to demonstrate that it can be used for something good for the return. I don't know if that GameStop thesis plays out with the existing business model that they have. It has to be something different. And people just, people who are buying into this now, many of them probably are looking at this as what could the future be as opposed to what it looks like now.

Ryan, how do you react to what Jason said? And I'm going to try and clumsily paraphrase it. And that is the idea that there are a lot of retail investors out there cheering on a roaring kitty or who I called Angry Kitty. Or cheering them on because they see it as the little guy's way to kick down the door. And I guess my call me, put me down. down in the skeptic column because there are lots of ways you can kick down the, kick down the door called Apple and Nvidia and Lily and so forth that are that, you know, maybe they don't do this and this and this and this and become the kind of trading vehicle that that GameStop can be,

but there's certainly other ways to get in the, in the parlor here. Yeah, and they're doing that. And they're not all in on GameStop. You maybe have some Yolos out there, or they're, you know, you're going all in. But for the vast majority of all the people out there, the retail people, the people who follow us, streamers, they are doing the wise decisions. They're getting into the treasuries, the short-term treasuries because they know the cuts are coming.

They're getting into the AI plays, and they've been up hundreds of percent on Nvidia. When you talk retail, it's not all or nothing on a play-like GameStop, but it is something where some people who have never been in the market, they see it on the news. The news is talking about it now. They never heard of it. I had my 81-year-old dad ask me, who is this kitty roaring guy? And he called me up. And I said, when my dad, 80-some years old and calls me and asking about roaring kitty, that's all I need to know. Everybody in the United States is hearing about this guy. And a lot of people see him as the Robin Hood. The person they can

get behind, he's fighting against the powers. But for the, like I said, for most of the investors out there. They are playing a lot of smart plays. And some, like I said, half of the people I was talking to, they see this as an opportunity to do a good swing trade. And the other half just want to be a part of it. Maybe dumb money, too, the movie? Who knows? Jason, quick last word to you. Do you think he's going to end up profiting his followers or losing them big bucks? You know what? I think that we're putting too much importance on one individual here. I realize that he is kind of like the beacon for retail traders, but, you know, he's making a play, and it's his play. If someone decides to follow along with the play and they make money or they lose money, it's really on him. He has never come out

and said, this is going. He's not saying that it's going to go up or down when he's doing anything. He's making a play. I'm sure he understands his importance in this. But again, he's making a play for himself. He's showing it to the world, and he likes the stock. Gentlemen, thank you very much. And Dom, thank you as well. Stock Mo, stock guy, all you guys, and roaring kitties and everything. Angry kitties. Angry kitties. Psycho kitties.

I love it. I love it. Apple's Worldwide Developer Conference kicks off on Monday, and the company is expected to reveal a slew. A slew of new AI features from an improved Siri to a potential open AI partnership, but we don't know much about the man behind Apple's AI strategy. Our own Steve Kovac is here to share what he has learned about the person helping usher in Apple's next chapter. Steve. Hey there, Tyler. Yeah, there's just enormous pressure on Apple to deliver that gangbusters AI announcement on Monday. And we could talk about what we're expecting in a bit like that reported Open AI partnership.

But first, the quiet Apple executive behind Apple's AI strategy. That's John Giann Andrea. Everyone calls him J.G for short. Don't hear too much about him. Apple poached him from Google six years ago. But within eight months, he was already promoted to Apple's leadership team reporting directly to CEO Tim Cook. His team's work is going to be on full display Monday. So I caught up with some folks to know him, former colleagues and people who talk to him a lot. They like things like that. Giandrea, he comes off as a humble, unassuming executive, Jeffrey Hinton.

He's one of the godfathers of AI and worked with Gian Andrea at Google. He said he's a rare combo of great researcher and great manager. Emil Michael, a former top Uber exec who co-founded a startup with Giann Andrea decades ago, he told me he still goes to Gianrea for advice and wisdom. And a few other folks told me they wouldn't be surprised if Gianna Andrea isn't part of the big keynote on Monday. He's just not a showman like other Silicon Valley executives. But it's the products that's going to be the most important that we see there. And it's really what they do on the AI front and what they can do in the next iPhone with artificial intelligence to spur up

That's what's most important for investors, guys. Yeah, I thought a fascinating reading the journal as well today, Steve, about some of the choices made about Siri over the past decade. We'll be reading it ahead of this big event. Thanks for your time. Steve Kovac, we appreciate it. Coming up, the Fed still seems stuck between a rock and a hard place, aka investors and the data.

Traders want a rate cut, but the data keeps casting doubt on Powell's ability to do that. We will dive into that next. All right, folks, welcome back to Power Lunch. Right now, stocks are really just flat, hovering around the flat line. But bond yields are holding on to earlier gains. Let's bring in Rick Santelli for that story. Hi, Rick. Hi, Tyler. Indeed.

We saw a big pop at 8.30 Eastern when the stronger than expected jobs report hit. I'm going to concentrate on the wild fours. We're up 4%. Of course, in the unemployment rate, we're up 4 tenths, average hourly earnings week over week and year over year we were up 4.1. These are important. Let's look at average hourly earnings year over year, shall we? 4.1.

And you can see from that chart that if you look to the left side pre-COVID, we weren't getting up to that level. On the right side, we're coming down, and it seems to be holding around and above that 4% level. We want to pay close attention to that as it cross-fueled some of those inflationary pressures. Now, right now there's only one maturity that is actually higher in yield,

on the week. And that's the two-year note, most sensitive to what the Fed may or may not do. All the other maturities, of course, are up significantly on the day. That's the only one up on the week. They closed it 487. They've been hovering at that level. Tens, on the other hand, closed at 4.5%. They've been toying right in the low 420s, excuse me, 440s, still a ways away from 4.5. And as you look at the dollar index on that chart as well, it just zoomed. It was at a 2.5. half month low close yesterday and it has turned around to put itself up on the week. I can't stress how important it is to continue to pay attention to some of those strings that seem to play throughout the economy continually depicting pressures in pricing. Kelly, back to you.

We will watch them closely. Rick, thank you, Rick Santelli. Our next guest thinks the strong economic data will ultimately be better for stocks and corporate earnings. She says the S&P could rally 30% from here. Mary Ann Bartels is chief investment strategist at sanctuary wealth. Mary Ann, it is great to see you again. How are you? I'm fantastic. Thank you so much for having me, Kelly, and you look great. Thank you. Hanging in there. So is the market, by the way, more than hanging in there after this morning's payroll number. In fact, we thought maybe it would sell off sharply on the news, and instead it seems just fine with the result. What does that tell you? Well, what's wrong with

jobs, Kelly? That's a good thing. And we saw a little bit of an uptick in wages. What's wrong with that, nothing. That actually is a positive sign for the consumer. Now, we've seen the consumer become a lot more selective, but we still have a consumer that's spending, and that's very, very important. But what's more important is what are we projecting for earnings for the market? And when you look at what analysts are projecting for the second quarter, their numbers are going up. And that's counter to the seasonals. Normally, they start taking their numbers down, but they're actually taking their numbers up. When we look at estimate revisions,

they have the highest correlation to the direction of stock prices. So we're still fairly confident that the fundamentals are very strong, and strong job growth is just another sign that the economy is strong and the consumer should stay strong. You are steadfastly bullish on the semi-names, the leadership, Nvidia, but others as well. Why? Well, believe it or not, Kelly, this is a pocket of the market

I've been bullish on for a number of years. And part of that was the technical picture was just so strong. But the technicals remain extremely strong. In fact, they've improved greatly. And now you have very strong earnings. And obviously, we all know about Nvidia now and the power of their earnings. And so when I take the fundamentals of the earnings power,

combine that with the picture of the technicals, it suggests that the semiconductors will continue to be leaders within the tech sector and can continue to go significantly higher. Doesn't mean we don't get periods of a pullback from time to time, but I think people are going to be quite surprised how much higher this segment of the market can go up. Marian, I took part last night in a panel discussion for my alma mater on the markets. And a questioner asked, why aren't you all at CNBC and why aren't more people talking about the demand for electricity that is coming?

And I see that one of the areas you like is utilities. So let's talk about the demand for electricity and what it's going to mean for utility stocks over the next decade. So it's not just about AI for electricity, and you're bringing up a very important topic. We've been talking about the shortage with utility just with EV cars. So when you start adding on electric cars, you start adding on the best. power that AI will need and the infrastructure that we have today can't support all of this. And we're not even talking about Bitcoin and the miners and the power they need. So when you take all of this together, there's going to be a significant increase in demand.

So we're going to have to continue to build out our grid. This is part of the infrastructure story. And so we think the utilities, which normally do well in a lower interest rate environment, we're starting to see select utilities actually now trade like growth stocks because the market is waking up to the demand. Which ones are trading like gross stocks? So if you look at this drug, VST would be one. Right now it's coming down very sharply. But I think on pullbacks, that looks very interesting.

So believe it or not, the market is gravitating towards nuclear because we're going to need 24-7 electricity. for AI. And nuclear power can provide power 24-7. So you're seeing uranium prices go up. You're also seeing copper go up because if we need to build out new grids, we don't have enough copper. And trying to get copper in terms of up in supply is going to be challenging. So these are themes that are going to actually probably play out over the next three to five years. Very interesting. Marianne, thank you so much for your time today. Have a great weekend. Thank you. You too. Mary Ann Bartels. Coming up, we will dig into an often overlooked sector of the labor force. We'll do that when Power Lunch returns. Welcome back to Power Lunch. I'm Contessa Brewer with your CNBC News Update.

We're getting a look at the annual financial disclosures for the Supreme Court justices. Clarence Thomas declared a trip to Valley. We see multiple big advances for books, but none larger than the $894,000 advance, Justice Kintanji Brown, vaccine reported for her upcoming memoir. She also declared concert tickets from Beyonce worth $3,700. Secretary of State Anthony Blinken is heading back to the Middle East. The State Department says he will push for the adoption of the U.S.-backed ceasefire plan on his eighth trip to the region since Israel declared war with Hamas. And Mike Tyson's return to the ring against social media star Jake Paul has been rescheduled to November 15th. The fight was initially set to air on Netflix, month. The promotion company says Tyson needs to get more time to train and prepare after he had

an ulcer flare up next month. But Tyson says, the result will still be the same on this new date with Paul getting knocked out. He's very confident, Kelly. This is expected to be a big one. Yeah. Yeah. I'll ask my brother. Contessa Banks, Contessa Brewer. Still to come, Moody's putting U.S. Regional Banks on downgrade review. They're fearing the worst is still not over in commercial real estate. We'll talk to the CEO of one firm about that Kim Co Realty joins us next. Welcome back. High interest rates and inflation have been weighing on the retail space with more than a dozen retailers, saying they'll close stores after entering bankruptcy proceedings so far this year, like Red Lobster, the latest to file Chapter 11. But in spite of this, empty space is actually hard to come by, as new tenants have been emerging fairly quickly.

Let's talk more about this with someone who knows directly about it. Connor Flynn is CEO of Kimco Realty. They're a leading owner and operator of more than 500 grocery anchored shopping centers across the U.S. It's great to see you again. Welcome back. Nice to see you. And things actually sound like they're pretty good for your space right now. Just explain what the fundamentals are showing.

Yeah, so shopping centers are having like a quiet revival, if you could call it that. It's amazing. Vacancy rates are at all-time lows, and you're seeing new store openings, outpacing closings, nearly two to one. And what's happening is a lot of like retail 1.0 is being replaced with retail 2.0. So if you think about red lobster and who's going to replace them, you've got the raising canes, which is a new concept doing quite well, you've got Chick-fil-A, you've got some of the in-and-out burger, if the burger wars, all these quick-service restaurants, and they've integrated a lot of drive-thrus to their business and the delivery as well. Are the footprints the same, though? In other words, I think of a red lobster as a larger footprint than a chick-fil-a. Exactly right.

So Red Lobster on average is right around 10,000 square feet, which is quite a large restaurant for today's because most people grab and go today. or do a drive-through. And so what's happening is when you look at the red lobster real estate, it's in high demand, and you can actually take down the building and get two locations instead of the one. And the rents, or Kimco anyways, are so significantly below market that one replacement tenant will actually pay more than just the existing red lobster. So your second tenant's going to be all gravy on top of that. Very interesting.

Very interesting. What about those big, well, let's see, bedbath and beyond? Who's going in there? Yeah, that's another great case study. Again, for where we are in the supply and demand cycle, nothing new has been built for over a decade in retail. And so what you're seeing is the demand side really picking up and absorbing all that retail 1.0 space. So bed bath and beyond is a great example of that. We've got a number of tenants that have replaced over 30 bed bath boxes at 40% higher rents than what bed bath was paying.

And it's a combination of, if your favorite, T.J. Max. Marshalls, Home Goods, Sierra Trading Post, Burlington, Ross, Dress for Less. You've got Planet Fitness in the gym space, to your point, they're doing new stores. Dick's sporting goods and they have a great concept called House of Sport that they're rolling out. You've got grocery stores, the traditional grocery stores, the discount grocery stores, the specialty grocery stores. We were talking about Whole Foods earlier. You've also got those medical, quick serve medical, I guess, as well. The urgent care facility.

Yeah, urgent care, yeah, that's what I mean. Pediatric urgent care. Yep, yep. That's, there's a lot of, like, there's a lot of medical health and wellness is coming into the shopping center in a big way, and that's driving a lot of occupancy gains. Would you see any, so if we say, okay, you actually probably have this amazing barometer of the entire consumer economy right now. And to your point, kind of the cost of direct-to-consumer the past decade, the internet-heavy approach, that's also now giving way to people realizing they need brick and mortar. Do you sense any signs of a pull-down in some kinds of stores, a pull-back and some kinds of shop bars? I mean, how would you just describe the spend, broadly speaking, right?

now? So I think what you've seen in the inflationary environment that, you know, inflation for retail is actually mother's milk if you're able to pass it on to the retailer, if the consumer. What's happened, I think, is in a lot of cases, the lower demographic has felt the brunt of it, and you're seeing a lot of retrenching right now in retail. And so what's happened with Walmart and Target and a few others is they've squeezed the lower demographic to a point where they have to retrench. Whereas the middle to upper shopper, then that's really the Kimco focus because we're first

ring suburb, grocery anchored. in the top 20 major metro markets, we haven't seen any patterns yet change. And actually, traffic is up 4% year over year. So there's still that, you know, that we supply essential goods and services, right? So you're going to the grocery store, and then you're typically either buying something else from a service provider, a quick service restaurant. And we haven't seen that change in terms of there. So I think still the brunt of what's going on in the patterns are in the lower demographic.

Yeah. Connor, always good to have you check in with us. Great to you. Appreciate it. Good to see you. Have a good summer. Coming up, despite a tick higher in the unemployment rate, the labor market is still tight, yet adults with disabilities continue to face a lack of opportunity, and we'll speak to some folks who are trying to change that when we return. Welcome back to Power Lunch, everybody. This morning's May jobs report showing the U.S. added 272,000 new jobs more than expected.

The unemployment rate rose to 4%. First time it's been that high in a couple of years. But one area where unemployment remains disturbingly high is in the community of disabled persons. The unemployment rate for this demographic sits at 80%. Joining us now is a familiar face, Bill Strasullo. He often joins us to talk technicals, but today Bill joins us to talk New Path, an organization that prepares adults with intellectual and developmental disabilities for private sector jobs. Also joining us is Elder Suarez, Director of Day Services with NewPath. Welcome to both of you. Bill, what led you to this passion of yours to help people from the disabled community, people with developmental or other disabilities, find employment?

Well, first of all, I wanted to thank CNBC for this great opportunity to come on and advocate for adults with developmental challenges, things like people on the autism spectrum, people with Down syndrome, and most importantly, address the business community. As you said, we had a great non-fant payroll number today, very strong. And as you and Kelly have reported on for months, tight labor market, particularly at the lower end, a lot more demand for entry-level jobs than supply. And what we want to get out myself and elder and the people New Path is that there's a whole hidden pool of labor out there, millions of people in this country that would love those entry-level jobs. that, you know, for them, it's a life-changing experience. And for the corporations that hire them, they're going to get somebody that's hardworking, loyal, trustworthy, and somebody is not going to jump for job to job.

And so I saw an opportunity as a business person to step in, and I looked at the disparity in the unemployment rates among the disability community and the population as a whole. And I said it just doesn't make any sense. I knew I could tie the two together, that the business community, would love to have a whole new pool of labor, particularly at the entry level. I work myself with a charity in Northern New Jersey with which Kelly is familiar,

that we have a large presence in housing and helping people with developmental disabilities. Elder, so this is a passion of mine as well. Elder, what percentage of the people with developmental or other kinds of disabilities are truly employable in the kinds of jobs bill was just, describing, and there are probably some percentage of individuals for whom employment is not really a legitimate option. Yeah, like Bill said, thank you for having us in the opportunity to give this presentation. You know, I think the numbers, you know, it's hard to define a clear number, but I feel like the numbers could be a lot higher, you know, through the programs that we're having,

you know, really getting people trained, you know, out in the community, volunteering, working, you know, and having job coaches to the capacity. So, you know, the numbers, right now probably around 70% of our people could definitely be employable. You know, we do deal with a bunch of variety of challenges when it comes to people with medical needs, one-to-one support. So they really require more intensive staffing supports. So yeah, the numbers can definitely increase on our part just with the job that we're doing here at Newpath and other agencies alike. Elder, let's say you had, you know, a child with autism, a female asking for a friend. And you wanted to think about, okay, to explain how exactly does this camp work? What are the

options available when we're talking more of the intellectual disability and not the kind of physical disability side? We know these numbers are on the upswing. So I'm curious how you can play a role in transitioning people to what kinds of work exactly. Yeah. So for us, too, it's getting the word out there into school systems, you know, the turning 22 population. So myself and the crew, we've been really going out to the schools and educating the schools on what it's going to look like. You know, and then And Bill and his team with the job coaches, you know, this is up the 11th year with the job camp graduation. So it's really an eight-month course. It goes through skill building, interview, resume, how to dress, money banking. So it really coaches our people how to get prepared

to, you know, venture out into the business world. A lot of our people, you know, going way back, they haven't had these opportunities. So really just getting, you know, we provide job coaches. So these coaches are helping people. They're not leaving them out at the job. They're helping them, support them one-to-one at the job until they feel comfortable with their employment. If you don't mind me asking, how much would something like this cost? We're talking eight months for people whose care might, you know, be, require low, high ratio, you know, say a lot of professionals working with them or what have you. I mean, that sounds like a pretty big investment.

Who is making the investment? And what kind of investment is it? Yeah, Kelly. Sorry, I'll go ahead. Go ahead. You know, for us, so we're funded through the Department of the Delamontal Services in Massachusetts. You know, so a lot of the funding comes through them. We do have fundraisers that we raise money to, to support the cause to be able to prevent, you know, have initiatives like Job Camp because the money isn't always there at the state level.

So it's a lot of advocating, you know, to the state level, to state reps, you know, representatives in different facets to be able to get the money to provide these top of the line services, you know, to our people. All right, gentlemen, thank you very much. Bill, let me figure it with one quick question here. I assume that you not only coach the individuals with disabilities, but you must coach the families as well, quickly. Yeah, I mean, for a lot of the people who have come through the program, working is a totally new experience for them. So we really welcome the support and collaboration of the parents

and let them know that, you know, it takes a while, but we will eventually get them in a job. And these are life-changing. events, Tyler, for these people. And so we've had a lot of amazing transformations here and a lot of job placements of people that we were told never that that would never happen. So we're in our, we're almost done with 11 years and we hope to have many more years to come. It's a great program. Bill and Elder, thank you for sharing your story with us today. We appreciate it. God bless. Yeah. Coming up, we'll trade three big movers of the day. We've had plenty of big movers today.

Which ones will they be? Three stock lunches on tap. Welcome back. It's time for today's three-stock lunch. Chris Grissanti is here with our trades today. He's chief market strategist at MAI Capital Management. Chris, it's great to see you and thank you for playing along. We're going to start with 3M, which got an upgrade from B of A and has continued to be kind of a darling stock. Increasingly, new CEO, a lot of fans there. Would you be a buyer here? You know, Kelly, it's nice to be back, of course. I do like 3M. You know, I'm a value guy. It's new management coupled with the needed dividend cut a few weeks ago. The story is not for the faint of heart. There's a lot of litigation risk, but there's also a lot of profitable high cash flow vertical. So, you know, I think it's a good

value speculation in a market that's pretty expensive. You're getting it about, I think, a third discount of what I think the true value. So I like. All right. All right. Let's move on to our shares of Lyft. Those shares are higher. Multiple analysts upgrading the stock to buy following its investor day. Chris, what do you think are you going to give it a lift or a pass? I am not, Tyler. I am going to say I think you should avoid here. And the reason is I think that expectations were pretty low going into Investors Day yesterday, and I think they exceeded those.

But I think those aspirational goals of, say, 15% bookings growth. And remember, bookings isn't revenue growth. They can be different than revenue can be lower than bookings. I would say even that wouldn't be enough to justify the current valuation. And I think, you know, Lyft is Burger King to Uber's McDonald's. And they're not a price setter. They need drivers. They have a driver shortage.

So I think there's a lot of things that could go wrong. And you're paying a price that says nothing will go wrong. So I don't like it. All right. No lift. Let's move from that to Reddit then, which is at the heart of the GameStop drama lately. But now that itself is public, it seems to kind of trade with the GameStop. It's down 5% today.

No other news you can discern. What's your take? You know, this is a tough one, Kelly, because it's like a baseball player facing a knuckleball pitcher. You don't know what's going to come down the pike because Reddit is a unique business model. It can easily morph into a meme stock, which I'm somewhat afraid of, so fundamentals go out the window. So I would hold it if I had it. It's done decently since the recent IPO. The other interesting thing about Reddit is that it's data.

It's got tons of data on all the people that are on the... conversation boards can be valuable to AI firm. So that that may be a hidden asset. Yet I'm just unclear on the business model. I'm just not comfortable with its uniqueness yet. I think we need a few more quarters of earnings reports and learning about the management. All right.

I'm surprised you're even looking. I thought it was just going to be an instant, you know, no way, Jose. Welcome back. After payrolls this morning, you see how stocks started negative on the session, but quickly moved to session highs. The S&P moving to all-time highs, really.

We're now kind of with the Dow up 40 points, a little bit in the middle of that range. Yield, by the way, much more decisively moving higher, 10-year yield today, Tyler, up 14 basis points. And it wouldn't be an hour without a mention of NVIDIA, so here you go. The stock is splitting 10 for one as of today's market closed. So don't be surprised when you tune in Monday. Shares have been trading on a split of justice basis at the market open on Monday. The decision to split came following NVIDIA's blockbuster earnings last month. Some say it could clear the way for the stock.

to join the Dow. Invita briefly topping the $3 trillion market cap level earlier this week. It is down a little bit. But when you see Nvidia at $120 this year, not $1,200 on Monday, it's going to feel so different. Don't feel bad. You haven't lost money. You're actually okay. Don't worry. Boring kitty didn't get to it. No, boring kitty didn't get to that one. Thanks for watching Power Lunch, everybody.