Power Lunch - Uncharted Summit, Nvidia Struggles For A Second Day 6/21/24

Episode Date: June 21, 2024

Tyler Mathisen is live at the 2024 Uncharted Summit in the Hamptons. In this hour we’ll speak to some of the market professionals, investors and business leaders gathered at the event to talk about stocks, VC funding and the future of AI. Plus, Nvidia is lower for a second-straight day. Yesterday the stock hit an all-time intraday high. And at current levels, it’s just short of a 10% correction in just over 24 hours. We’ll discuss what that means for the broader market.  Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Good afternoon, everybody, and welcome to a special edition of power launch. I'm Tyler Matheson at the Uncharted Conference in the Hampton. They need to put a pool picture behind me at least or something. I'm Kelly Evans, holding down the fort back at headquarters here. And over the, oh, Tyler, over to you. Over the next hour, we're going to be talking to some of the market professionals, the investors, the people behind startups, the people who are funding startups who are gathered here at Uncharted.

We'll talk stock market, VC funding, and the future of AI. All on the billion set itself. We're looking forward to it. Tyler, thank you. Just going to do a quick check on the markets here to show you the major averages. Dow slipping two points. S&Ps down 11. Nasdaq is down 42. The NASDAQ has been higher in seven of the past eight weeks, but it's close right now. There you can see on the week. We're down just fractionally. And we'll check out shares of NVIDIA, kind of the fulcrum point of the market. The stock yesterday hit an old-time intraday high of 140, nearly 141. But at current levels, it's just short of a 10%. correction in little more than 24 hours. Well, it has been a good run for a lot of the big name tech stocks. I don't need to tell you that. And the tech-related ETFs, the QQs, if you're lucky enough to own them. But as you mentioned with InVidio, we are seeing some signs that that could be turning just a bit. So what should investors do with their big winners?

Joining us now is Doug Bonaparte, a financial advisor and president of Bonafide Wealth, also a member of CNBC's Financial Advisory Council. Doug, welcome. Why don't we start there? Let's say you're lucky enough to have had some of these winners, whether it's QQQs or Bitcoin or the individual shares in V-Vitia. And now they've become too big a portion of your portfolio. How do you sensibly reduce that?

Yeah, so we talk about concentration risk, right? When one particular issue or position starts to become too heavy in your portfolio. portfolio. What I like to do with my clients is figure out a threshold, like 10 or 20% of your overall investable net worth, that you're really comfortable holding a particular position in. For me, it's around 20. I don't like seeing more than 20% of that one thing, unless it's your personal reason. So you could have 20% in a single stock? Well, you have to keep in mind that if it's such a winner, you have tax consequences associated with really pairing that down. So you want to be really conscientious about what the tax ramifications are of pairing something

down. What if it's 40, 50% of your portfolio, and then you're going to pair that down 30%? That's pretty significant. So it's personal, it's individual, 20% for some, 10% for others, but you want to make that hard. So have a threshold in mind, and is the way to reduce that position to do sort of the opposite of dollar cost averaging, to sell a certain amount at a regular interval so that you're not selling at what turns out to be an intermediate trawl? Absolutely. You can reverse that aid old strategy of dollar cost averaging and start to exit on a periodic basis, whether that's over a shorter term period like three months or over the course of a year, you want to keep your time horizon in mind.

Let's talk a little bit about a big cluster of your clientele, and that is the people we call the millennials. I'm a baby boomer. I hate the millennials. What is different about them as investors from previous generations or from generations that are falling behind them? Yeah, I think they have been very interesting experience kind of embarking. If you're talking older millennials embarking into the world during the Great Recession. They have kids and they're hit with a pandemic. So there's actually a lot of caution, I feel, with this generation. They're really looking around the corner, looking over their shoulder a little bit. That might make them a little bit more conservative. Now, they do recognize that if they have a lot of time

on their hands, 20, 30 year investment pair, they do need to be invested in equities. But we see larger cash reserves. We see an appreciation for- So they're more conservative. And that's out of experience. That's out of their learned experience and having gone through some pretty interesting things over the last 10, 15 years. And I see it a lot really with cash. They really love having larger emergency funds than other cohorts because they've been hit with those very disruptive events throughout very pivotal times in their lives. Is this a bad thing? Do you advise them? How do you advise them? Absolutely. Too much cash can be a bad thing, particularly when you're young. You're missing out on the opportunity to invest. So you're scooping up what, 5% on your risk free

money here. Good. You got two and a half percent halfway through the year. S&P 500's up 14 percent. You missed the boat there. So if you were over allocated, you really didn't do yourself any favors. When it comes to protecting yourself, look, three to six months living expenses and cash, that's rule of thumb. I like seeing six to nine months, maybe up to a year for your more, you know, protective people, but no more than that. I, too much cash is a bad thing, I heard you just say. I can't imagine that. Too much cash would ever be a bad thing. Are the millennials more purpose-driven in their investing? They can be, right? They're looking to invest in companies that have missions that maybe benefit more than just the bottom line, and you're seeing that, you know,

classic companies like Warby Parker and other companies that actually have a big give-back component to them. That's become more and more popular from founders of companies these days. What is your view of the overall position, valuation of equities right now? And what are the questions you're being asked by your clients, whether they're millennials or not? Absolutely. So people look at all-time highs in the market and they wonder, is there going to be a pullback? Is now a really good time to be investing in something that perceived to be overvalued? But the reality is you always need to be buying. You always need to be averaging in and getting your capital to work, especially if you have a lot of time on your side. Money is not going to

compound itself. You have to invest that money. Dollar cost averaging is a great way to get invested. Those contributing to their 401ks are already doing that, being conscious of how much cash you have on hand. I don't think too much cash is necessarily a bad thing. You want to find that right amount. But having way more than you need, you're missing out on opportunity. I'm interested in your views on the timeless argument or discussion about indexing versus active management. Where do you come down? My philosophy is on passive management. You want to be able to come down. I'm looking for discipline and I'm looking for people to stay consistent with their investing. Investing is hard enough as it is, whether it's active or passive, because we're asking people to do things we're not good at, which is doing very boring stuff for very long periods of time. Passive really lends itself to that, and it keeps costs low.

We are at a conference of startup people. What do you tell some client who says, I've got this startup idea. How do you advise them? I'm all for entrepreneurs and sometimes you really just got to go all in on yourself. The whole tagline of our firm is invest in you. I personally believe there's no better asset that you can invest in to get yourself the greatest return than yourself. So if you got that idea and you're able to execute and it's planned out and you got the great to go for it. Go for it. All right, Doug, we've got to leave it there. Doug Bonaparte.

Thanks very much for your time today. Kelly, we'll see in a little bit. I feel so seen by that interview and that discussion about millennials. I really, he nailed it. Absolutely. Thank you both. Let's dig deeper into whether markets may be starting to turn so that we can all freak out, Tom Lee, like Doug was just telling us not to. My next guest says stocks have risen in June for the right reasons.

Softer than expected inflation. And he is seeing more positive signs ahead, and he's sticking with the big names in AI. Tom Lee is here. He's Fundstrak Global Advisors, co-founder, managing partner, and head of research, and he's a CNBC contributor. It's great to see you. I want to start in a little bit different way than normal because Doug just made a really interesting point about millennials and how they're so conservative in their positions. And whether you've experienced this phenomenon firsthand or not, what do you say to those who need to be coaxed into a market that is ever at record highs

after a run in stocks like Nvidia, like we've rarely before seen? I mean, is the water, is a water still safe? You know, I know investors generally aren't comfortable buying things at a high, but if we're mid-cycle, which we probably are, then we're going to be making a lot of new highs over the next five years anyways. And I think there's a lot of statistical support showing buying at new highs actually has a better win ratio than buying than attempting to buy it lows. Well, it's also true that for all of our lifetimes, the stock market has generally gone up. So yes, there are pullbacks.

Yes, there are corrections. Yes, there are financial crises. Yes, there are pandemics. But is there any reason to believe that the fundamental nature of the beast has changed for the worst? I mean, I read this research sometimes. I'm sure you've seen it that says, oh, we're going to have permanently lower stock returns now. 4% of years the most you should expect and things like that. We've pulled forward gains.

I mean, do you believe there's credence in any of that? I've heard that exact statement about the new era of lower turns since 2008. Right. And stocks have compounded at the pretty much the historical average since 2008. I think as long as there's skeptics out there, that means there's a lot of fuel for upside. Mm-hmm. So is Nvidia the thing that you look at and go, well, this could spoil the party, i.e., it becomes too much of a good thing. It really starts to lift into some kind of bubble, draws people into the market, really extends valuations, then we have to clean up the mass.

You know, there's a lot of people trying to top-tick NVIDIA, you know, saying that they don't want to own it because it's expensive, but it's a 30-pe stock that sells something that no one else actually produces in the world. The one thing it's not is expensive. Yeah. So I'd say I'd feel very differently if this, if we were discounting, uh, inviedia being larger than global GDP and at 100 PE, and everyone's saying there's no way it can be stopped. But because everyone wants to sell NVIDIA and try to call a top, I actually think there's still a lot of up. When I hear anecdotes, like I heard at a fundraising thing the other night about how all the local kids own NVIDIA, what should I think when I hear that kind of information? Well, you know, it makes sense.

I mean, Vivida is the largest stock, so, I mean, everyone should own it. It's almost like if someone said, I'm selling because everyone owns the S&P. I mean, everyone should own some S&P. It's really a bearish sign when someone says the S&P won't ever go down. And I only hear people saying the S&P's topping right now. I do remember people saying stocks never go down a couple of years ago. Then we finally had a correction. I think we've had a couple maybe since then.

What kind of paradigm are we in now? We hear people saying like Mark Zandi did well, you know, the Fed needs to cut because otherwise the economy could take a turn for the worst. We know rates are probably higher than they need to be. Do you need to have a view on Fed rate cuts in order to support stocks continuing to move higher? I mean, to an extent, I think that the big lesson for the last two years is the S&P has endured some pretty severe rate hikes. So we know companies are managing this really the cycle well.

If the Fed turns neutral or dovish, that's even more positive for stock. So I think that the environment for equity still is good because they survived a stress test. It's only bad if the Fed has to raise rates. What makes you think we might be mid-cycle and not later stages? Well, there's a lot of things. First of all, leverage is still quite low. If you look at debt service ratio, I mean, it's not associated with business cycle peaks. It's actually more early cycle.

If you look at the ISMs, they've just turned positive. That's generally an early cycle sign. I think the only thing that's late cycle in people's minds is that we made an all-time high. But S&Ps are going to make all-time highs mid-cycle, and they're going to make it all the way through late cycle. Did AI bail us out? Because sort of thinking back to this dispersion that we've seen, okay, so the biggest names have all the earnings growth, the biggest names have a lot of the market growth, and everything else is a little bit more lacklester. And you just think, okay, if you rewind the clock 18 months ago, if we hadn't had the arrival of chat GPT and we were still working through post-pandemic gluts, I mean, you know what's been going up manufacturing sector. It's been a recession for two and a half years. So did we get bailed out by AI? Is that what's extending the cycle? I think people are doing some fake math. Also, 45% of the S&P has more than 10% earnings growth right now, which is the highest ratio in three years. One in six stocks is up more than 20% this year. One in four stocks is up more than 15%. I think people are distorting the fact that there's negative earnings coming from energy, basic materials, and health care.

That's how you get that negative 7% growth outside the top 10. But health care is flipping in Q2, positive. Energy is flipping positive in Q2 and materials. So the number of companies with double-digit earnings growth is going to really sore, actually. So final question, to sort of ask the what would make you bearish question? I mean, does the trend have to break significantly for you to say, okay, fine, maybe if something, like a mid-cycle correction is here? Or does the economic data have to change or some exogenous shock? Well, I think that three signs of a peak are when incremental return on capital is zero.

So when we are at a peak, KAP-X cycle, I don't think we're anywhere close. I think when we are extended on leverage, so whether it's debt service ratio or margin debt, margin debt's still 20% below where it was in October 2021. And I think when sentiment turns, what you mentioned, when people say that this market's unstoppable and won't ever go down, then I think we'll have a big drawdown. But we are not there yet. Tom, great to see you. Thanks to your time.

We appreciate it. Tom Lee, Tyler. AI companies carry insurance. Oh, I'm sorry. I'm talking here to my next guest, but coming up, the risks and rewards of AI and its rise came in fast and furious,

leading to some big gains and some small speed bumps too. We're going to dig all into it when power lunch returns. I can't wait to start with our next guest. We'll be right back. Welcome back. Back to the Uncharted Summit, the race to dominate the AI space has been quick, but it has also been messy.

And it promises to get maybe even messier, whether it is massive companies like Microsoft and Alphabet or emerging startups. Firms are fighting tooth and nail for the massive investments that are pouring in to the AI industry. However, amid that urgency we have seen, Google, Open AI, and others make mistakes, raising moral concerns around the future of AI. AI. Joining us now to discuss further is XIE, an award-winning AI expert and CEO of AI consulting firm Malo Santo. X-WOLCO, good to have you with us. Welcome. It's a pleasure to be here today, TIEA, XIA, XIA, like, XIA. You also get the award for coolest sneakers. We'll pan down. You say your company's goal is to make sure that AI helps more than it hurts. Do you think that the leadership of the companies that are leading the way in artificial intelligence

are doing enough to follow through on that? I think that it's a very tricky thing to balance, right? When you look at leaders of companies like Google and Microsoft and Amazon, you have to remember that they're driven just as much by their passion for this technology to drive innovation as they are by fiduciary duty, which requires them to prioritize making money. And what I've seen in the last 12 years that I've been in artificial intelligence is sometimes there's a trade-off between slowing down the pace of something that you're building inside of an AI system or hurrying it to market and being able to make money faster. And so there's an inherent tension between doing the right thing. Are they hitting the sweet spot in that or not?

I think that there's a recent example that makes me concern. Okay. So recently Google used a large language model inside of its AI overview. It released that feature, which use generative AI to answer search results. Well, Google number one is the company where the research paper came out of that created the transformer architecture, which is basically why we have large language models. Now, large language models are not intelligent systems. They're basically big math calculation engines that take your prompt, your text, convert

it to math, and then guess what words should come next. And because that's how they operate, they basically are always at risk of doing something something called hallucinating, which is making up facts that aren't true. Now Google as the company who produced the researchers who created this technology, knew that their AI overview feature was probably going to hallucinate. But they still turned it on anyway. So I saw search results for things like, how many rocks should a person eat in a day? And authoritatively responded, well, according to a research study at UC Berkeley, humans

should eat three to four rocks a day. Now, while that answers somewhat full, funny. It's terrifying when we think about what happens if someone you... What happens if it's really a serious question or an important question and you get that kind of hallucination? Yeah, or you see Modaner turning on 750 different custom trained chat beat GPs, including for things like determining dosages in clinical trials, knowing that those large language models have the ability to hallucinate and you cannot eliminate that place.

Are there companies or leaders who are doing it better than others? Name them. I would say definitely, Ila. SSI, the Safe Super Intelligence Institute that he was launched. I would also say that Anthropic is doing a much better job because their intention is to build this kind of technology in a way that aligns with society, not necessarily aligns with Shervarez. Let's talk about the U.S. versus Europe. There's the digital act that has just gone into effect or just been passed in Europe.

Is Europe ahead of the U.S. in what you think needs to be done to create a more responsible sort of rule set of rules of the road for AI is Europe ahead of the US so two things one yes Europe is absolutely ahead of the US when it comes to that and I think the word responsible comes with a little bit of a moral charge to it I think the way I like to think about it is this is how these are the boundaries we need to put around these AI systems to align with our American values and the rights guaranteed to us in our constitution right and so essentially Europe has just passed the EU's AI Act which takes a very intelligent approach to how they consider AI dangers. So for example, if Netflix recommends a movie that I don't want to watch, that's not really going to cause me a lot of it.

Doesn't matter. However, if a AI system recommends that I should get a medicine that it's actually going to harm me, or it recommends to a judge that my sentence should be longer than it should because of my race or my skin color, or it recommends through a CPS child protective services that a child should be separated who's not in danger, that poses big risks. And I say those things because all of those are real use cases that are turned on right now. They're really happening right now. Absolutely. So how do you, with your company, Malo Santo, how do you get buy-in from the big dogs in this world to do what you think they should do as a matter of making a good moral choice? Well, I think a huge part of it is that it's all about scalability, right? Businesses want to grow, they want to have growth.

With AI systems, it's not the same scaling as it would be just. a regular mobile app or website because it takes so much data to train it that when something goes wrong with your AI you have to get enough data for it to unlearn that pattern and then enough data for it to learn the new pattern you want so you essentially are rebuilding it so by slowing down enough at the start they get to speed up and be able to scale their AI across different geographic regions so a lot of times when I talk to companies I talk to them where they care about which is their pockets if your AI works well in the United States that

doesn't guarantee that it's going to work well in a European market, where their values are different, or that you're going to be able to deeply penetrate India, or that you're going to be able to even touch the continent of Africa. So being able to think about how well your system performs across different social contexts, how transparent it is, meaning that you understand why it makes a decision that it makes, as well as how secure it is, is really going to be the key enabler for your business being able to take their algorithms outside the U.S. Are you hopeful about AI or more frightened than hopeful about AI? I am excited because I truly believe in the power of the collective.

And whether or not artificial intelligence turns into a superhero or a supervillain should not be left up to the AI leaders we currently have alone. It's not just up to Elon Musk or up to Saanadella or up to, you know, different folks over at Anthropics. It's up to us collectively. So whether AI turns into some boogeyman that destroys our society or whether AI becomes the thing It becomes an equalizer? Do you think it could? I think that it could if it continues to go and check.

We've seen many use cases in the U.S. Where AI systems have been extremely harmful. I mentioned earlier, the Child Protective Services algorithm that was deployed. That was found to be extremely biased, was kicked out of the state of Illinois, but is still used in over a dozen states in the U.S. You have Michigan, way back in 2013, created an algorithm called Midas that was supposed to detect fraud and unemployment system. It was wrong. 20,000 people suffered as a result. You have a government agency that just had to issue a warning to all of the health insurance companies and say, stop using AI to decide Medicare claims or eligibility because they had kicked two million children

off of it inappropriately. There's a lot of room for improvement, obviously, a lot of opportunity and so forth. XIA, thank you very much. I appreciate your time. Kelly, back to you. We saw the shoes. they were worth it. Tyler, thanks very much. Coming up, we'll have much more on the bond market and the day's market moves. Power Lunch live from Englewood Cliffs and the Hamptons. We're back in a moment. Welcome back to Power Lunch as the Dow fluctuates between gains and losses. It's up 50 this afternoon, while the S&Ps down 5 of the NASDAQ is down about 20.

Let's get a check on the bond market now with Rick Santelli out in Chicago as we head into the weekend, Rick. Yes, indeed. You know, if you look at a one-week chart of twos and tens on top, of each other. It's been mostly a sideways week, but what was interesting this morning was is that we're nearly unchanged on the week until the service S&P Global PMIs hit. At 55.1, they were the best since April of 22, and that put the extra three basis points were up on the week right there on the tens. And for next week, we have auctions, twos, fives, and sevens, cumulatively 183 billion. Issuance. We learned a lot of important.

Important information this week. Let's go to the Whiteboard. Issuance for 2023 versus 2024 year-to-date, 8.9 trillion on this pace in 23 were already over 13 trillion for 2024. A record year in the offing again. Is that a good thing? I'm not sure it is. But here's what we learned on Tuesday, the 18th, that the budget deficits for 2023 were 1.7 trillion. You know, trillion, 12 zeros? Well, now it's approaching $2 trillion for 2024. I know it's an election year, and we're all going to hear a lot of malarkey about these numbers and what they don't mean, but I'll tell you what they do mean. They mean your kids and your grandkids are going to have to deal with the red a lot more than we are, and these are huge, huge numbers. So when we look at markets and we try to synthesize all the important information of the day, well, these are the types of things you can't really say every day because they don't change that much. But believe me, this is probably the most important dynamic if you're trading interest rates because they're not going to matter until they do.

Think France. Think all the empires of the past. But this will make a difference. And my guess is it's going to make a difference this year. Kelly, back to you. Thank you, Rick. Over to Contessa Brewer now for the CNBC News Update. Contessa.

While Kelly, a new Treasury Department rule is taking aim at Chinese tech development, the proposal released today would restrict and monitor U.S. investments. in China for artificial intelligence, computer chips and quantum computing. It specifically targets American investors funding Chinese AI systems that could be used for military applications. Amtrak disruption stretched into a second day on the East Coast, affecting service from Boston to Philadelphia, trains running on delays this afternoon after suspending service for about two hours this morning because of overhead wire issues. New Jersey's busy train commuter system, which shares tracks.

with Amtrak also affected and then just, you know, lay on the heat on top of it. Crazy. Las Vegas police removed a mysterious monolith that appeared without explanation in a remote mountain range north of the city over the weekend. We just have the Twitter shot of it, apparently. Police were concerned that the monolith would encourage people to venture off marked trails and pose a danger to delicate environmental areas. Look at this.

This is crazy. the latest discovery in a series of mysterious columns that have popped up around the globe since at least 2020. Why not? I'm fascinated. Get global media coverage, put a silver monolith out. How do you do that, though? Like get a bunch of drones, tie them together, like lifted?

I mean, who's out there? It's not like they have ancient Egyptians, you know? I should be more concerned than I am. Instead, I'm like, maybe I should start putting them around New Jersey. I don't know. People waiting for their train. It's the new style of lawn ornament. Yeah, exactly. Thank you, Contessa. Coming up, a massive cyber attack has crippled thousands of car dealerships across the country. Yeah, with no end in sight, we will get you the key details when Power Lunch returns.

Welcome back to Power Lunch, a cyber attack shutting down auto dealerships across the country, in some cases making them unable to process transactions and instead relying on the old-fashioned pen and paper. Amen Javvers has more on this hack. Amen? Kelly, that's right. Today is the third full day of Fallout for August. dealerships across the country after a cyber attack at retail technology and software provider CDK which makes that software that powers so many dealers across the country. CDK says this was a two-tiered attack hitting the company on Tuesday and Wednesday. The company told the Reuters News Service it's working to reinstate its services and get dealers business back to normal soon. The company says it works with more than 15,000 retail locations across North America. Not clear right now exactly how many of those have been affected,

but celebrity motor car company owner Tom Maloney described what dealers are facing here. It's a disaster. I have to tell you, customers are coming in, consumers are coming in. You know, we're selling cars where we can't book the deals, we can't finance the deals, we can't get them to the banks. In a statement, the National Automobile Dealers Association said dealers are very committed to protecting their customer information and are actively seeking information from CDK, to determine the nature and scope of the cyber incident so they can respond appropriately.

So far, no word at all today from the company on who may have been responsible for this attack, whether any ransom has been demanded, or when dealers might see their services restored, Kelly. Back over to you. Wow. How would you compare this severity of this one aim into others this year, whether it's involved health care systems, municipal governments, and so on? Well, I mean, because there's not human life at stake, I mean, you'd say this is less severe than some of the health care incidents that we've seen. But this is enormously frustrating for the dealers because they're relying on this outside vendor to provide them the software.

And there's nothing they can do. If this is a ransomware attack, the dealers can't negotiate directly with the ransomware attackers to pay a ransom. They have to wait for CDK to do it. So they're sort of at the mercy of both this outside service provider and these hackers who are, you know, God knows where somewhere around the world. So it's got to be enormously frustrating on the dealership floors. Oh, absolutely. All right, Amon, we appreciate it. Amon Javers following that for us.

today. Tyler. Hello, Dale. All right, he's still ahead. We're, there you go. Still ahead, we're following the money. We've got Alan Patrick off, a legend in the world of venture capital. Where's the money going today? Where's it coming from?

We'll talk to Alan Patrick off when we return. Welcome back to Power Lunch in the Hamptons. This year marked the return of the IPO after years of duds hitting the market. Instacard. Stera Labs, Reddit, all hit the ground running, and the explosion in the AI space could lead even more public debuts in the years ahead. Here with me now to discuss the IPO market. The startup space is a legend in the world of venture capital, Alan Patrickov. Alan, welcome. Good to have you with us. Nice to be here. Most famously known for Greycroft, I suppose.

You had little companies like America Online, Apple Computer in that portfolio. But now with prime time partners, you are focused on longevity-related startups. Explain what that means. Obviously, we get the idea of a big market out there. It's actually the most exciting area I've been involved within my 50-plus years of the venture capital business. Because everybody wants to live longer. Everybody is either taking care of a direct relative, a husband, a wife, a grandparent or they are no someone else they're taking care of. Everyone realizes that the fastest-growing part of the population is over 60, and they have more money to spend.

50% of the kids that are born today are going to live to over 100. So, I mean, you read the paper yesterday, when we got an MBA at Stanford at 105. The oldest man alive last week was 110. I walked three miles a day before he died. I walked every day. I did a marathon two years ago, and I'm going to be 90 October. 90 in October and still firing away.

As I look at the list of companies in your portfolio that you are backing one way or another, it's 15 or 20 of them. Give us some idea of what they do. Well, every one of them is helping someone in some way to live longer, whether they're doing remote, telemedicine, whether they're doing, in some way related to the caregiving economy. I'd give you one idea, one company we have called Safe Ride, which is contracted by the health plans to deliver people who have to go to a medical appointment of one degree or another hospital or a

doctor office. And you think about it and you say, well, why can't Uber do it or Lyft? This requires precision. I think they have a 99% reliability. It's amazing. Different business. Let's talk a little bit about the overall state of venture capital, of funding for businesses.

How would you characterize it? How have higher interest rates affected it? Well, you're here today, uncharted and it's got 800 people. I think that's a very good indication. The startup business has never been better than it is today. But the truth is it's always been good. There is an entrepreneurial urge in this country to start businesses.

The people have great ideas, new technology, and as you mentioned, AI is only one component of it that is going to feed the whole industry, and it's going to permeate every area, including the companies we've invested in, and every one of them is finding a way to use, starting to find ways to use, faster development that will reduce costs and increase productivity.

So you give it a very healthy grade at this point? No question about it. I've been through every technology revolution from the PC to the cell phone, the internet. Nothing comes close to AI. Where we are right now. It's going to permeate everything. I mean, really it's a regular... Alan, you are an inspiration.

Thank you so much. Thank you for having me. A little bit out of time. We appreciate your being here. Alan Patrick Hall. Kelly, back to you. That was great. Great to hear from one of the legends. Tyler and Alan, thank you. Still ahead, we'll ask our three-stock lunch trader what to do with some of 2024's biggest gainers.

Welcome back. Time for today's three-stock lunch. All hour, we've been discussing what to do with some of the big winners in your portfolio. Nice question to ask. Here with our trades is David Bonson, Chief Investment Officer at the Bonson Group. And David, it's great to have you with us. Let's start with the obvious candidate in Vida, whose shares are struggling again as semis have turned lower. but it's still up 160% this year. What would you do with it? We would sell it, and the reason we would sell it is because it's overvalued. It has nothing to do with the fact that we don't think it's a huge company that's going to be a major player in AI for years to come,

but when you're trading it 60 times forward earnings that's already priced in, and the Cisco of 1999 narrative is very much what we believe in. Not to split hairs here, but I don't know if we can show the forward multiple. I thought it was more like 40, although I haven't checked in in a couple of weeks, so maybe it is 60 now. Well, I think it depends on what projection you're looking at. It was about 56 times at its peak the other day. The stock has come down a little. It was well over 70 times trailing. But a forward multiple on a company like Invita is impossible to perfectly calculate because it assumes certain projections that are not quite as well known with this massive order flow growth that they're dealing with with chips. That said, I remember one of our guests pointing out that last year, it turns out, and VEVIDIA was trading it six times forward earnings because the earnings estimates were so much

understating its true earnings power. That's right. And if anyone believes they will grow earnings 2,000 percent again, then they should not sell the stock. All right. Let's move along to Eli Lilly. Maybe it's a controversial. I don't know. It's up 51 percent this year amid this GLP craze.

What would you do with this one? We would sell this as well. And again, this is a pharma company that, unwelcome. like a big tech company is used to being a good dividend pay or dividend grower, which is what we care about. And in Lilly's case, unlike Merck and unlike some of the other great pharma companies, they have not chosen to continue growing the dividend as their cash flow has grown. And that reflects to me, Kelly, management's low confidence in the sustainability of what they're doing. They've had a huge peak in earnings out of the weight loss drug success. Now they face competition from that.

there will be more products coming online that compete with Lilly. And I think that ultimately the fact they haven't grown their dividend, that you're yielding half a percent as a big pharma company makes no sense to me. That's really interesting. And maybe the onus is on them. Love to hear maybe the CEO talk about that and whether that could change. All right. And then Chipotle, those shares are up to 40 percent this year.

The stock will split 50 to one next week. And it's been a high flyer for, you know, I feel like as long as I've been on the planet. What's your trade? Yeah, it has been a high flyer. And there's been a couple times that you and I have been on the planet where Chipotle had a big drawdown. And then it rebounded from that. And so it is a name that is hard to bet against in terms of the success it's had. The reason we're a sell with Chipotle is a 0% dividend yield.

Where is the free cash flow going? At this point, if they're not in a position, like you look at McDonald's, Kelly, that is up 67,000% since it went public. They've been one of the great dividend growers of all time. Chipotle is far past the phase where they should be there. So to us, it's a cell. We think that it just eventually falls to the law of fads. It cannot be as popular with that kind of smart, casual Mexican food through time. Now, of course, I could have said that five years ago.

I would have been very wrong. But again, I'm taking my peas and cues for management here. Why are they not paying a dividend? They're generating the free cash flow to do it. That would be an interesting next chapter for some of these names. In the meantime, David says, sell them. Book the Gains. David Bonson. Thanks for joining us. Appreciate your time. Still ahead. We'll head back out to the Hamptons. Tyler is with Katie Couric.

Tyler, you better tell her. I love her. I follow her on Instagram all the time. Her to make, I could go on. We'll have more after the break. Well, you know, one of the cool things about being able to get out of the office, the studio, is you never know who you'll see at a conference like Uncharted. Joining us now, Katie Curric of Katie Curric Media. Katie, it is so good to see you. Nice to see you. Katie and I actually go back a long time. We don't have to say how long. We don't have to say how long. But junior high, high school, college. Katie's brother, Johnny,

is one of my best and dearest friends. And my mom worked with your mom. They did flowers for wedding. They did flowers for wedding. They called themselves the flower ladies. The flower ladies. And you mentioned them in your book. Yes, exactly. And you mentioned your dad, John Senior. It was a wonderful, wonderful man. Thank you. Let's talk about Katie Couric Media. You're now a founder of a company. What's that like? It's been really exciting, you know, Tyler. I was watching how the media landscape was transforming and how so many people were now getting their news and information on their phones through digital platforms. And I decided after having a wonderful career in broadcast television and I loved every minute of it, that I wanted to go, I wanted to be where the puck was going. So we started this company.

I started it with my husband who has had a career in finance. And we now are sort of a thoroughly modern media company with newsletters. We have four now. We have obviously a podcast. I'm giving birth, not literally, to other podcasts. And then of course I use social media to do a lot of newsmaking interviews because I started in my career at a time where you could kind of establish yourself. yourself and build a household name. So I do interviews with prominent people who I think trust

my methods and my credibility. So it's been really fun and interesting. And so it's all across the waterfront, it's social media, it's podcasts. Is there any, are you doing long form work as well? I'm doing some documentaries. I have a documentary I executive produced called For Love and Life, no ordinary campaign on Amazon right now. I have one on Max about the Oklahoma City bombing called an American bombing. I'm developing three others. I have a scripted show that's being developed for Netflix based on a book I loved. And so I'm really trying to do storytelling in a whole sort of panoply of, you know, avenues. So what's it like to go from being a television personality to being the CEO of a company.

Well, my husband is the CEO. I'm sort of the chief creative officer. He, you know, has such a strong financial background, and he knows how to write investor letters, and I'm learning. And he says I have a much better business sense than I give myself credit for. But, you know, it's really great.

We have almost 40 employees. You know, we're job creators. Didn't George W. Bush say that? And, you know, I'm able to mentor a lot of people, give them opportunities and really help them navigate the changing media landscape. And you have to be so, you know, adjustable and adaptable because, as you know, Tyler, it's just changing so dramatically. It really is. The business that you and I as grew up in.

As fossils. It's okay. Yeah. It's different. It really is no more in a lot of ways. It is. and you have to be where people, you've got to meet people where they are. And that's really the lesson of business, right?

Yes. You've got to meet the customer where they are. Definitely. And you have to adjust and you have to just really be flexible in how you see the world. And you have to be keenly aware of changing trends and consumer behavior, right? And you have to then, you know, step up and maybe forget some of the ways you used to do things. If you want to stay, yeah, learn new things. And it's so fun.

Tyler, for somebody like you and me who are insatiably curious and want to be lifelong learners, first of all, I still get to interview people and talk to people, but then I also get to learn new technology. Katie, thanks for doing this. I just talked to you five minutes ago. Thank you. Very gracious of you to come by. Great to see you. I'm always happy to be back on NBC.

Thanks for watching, PowerLug.