A $500 billion AI mega-deal... and whether Wall Street is getting Kevin Warsh all wrong 8/10/26

Summary

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CNBC Fast Money Podcast Summary

Episode: A $500 Billion AI Mega-Deal… and Whether Wall Street Is Getting Kevin Warsh All Wrong
Date: August 10, 2026
Host: CNBC (Mike Santoli in for Melissa Lee)
Featuring: Tim Seymour, Courtney Garcia, Guy Adami, Mike Schumacher (Wells Fargo), Becky Quick, Gene Munster (Deepwater Asset Management)

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Episode Overview

This Fast Money episode delivers a packed examination of breaking financial news, focusing intensely on a historic $500 billion AI infrastructure funding deal involving Wall Street titans—Goldman Sachs, BlackRock, Blackstone, Brookfield, Apollo, KKR—partnering with Nvidia. Other spotlighted topics include oil market shocks, Berkshire Hathaway’s new strategic posture under Greg Abel, an Apple sell rating, insights into telehealth disruptor Hims and Hers, and a provocative debate over whether markets are misreading Fed Chair Kevin Warsh.

The panel brings their characteristic candor, challenging each other's assumptions and drawing lines between private- and public-market dynamics, macro risks, sector rotations, and the rapidly evolving capital cycles driven by AI demand.

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Key Discussion Points & Insights

1. The $500 Billion AI Mega-Deal

Historic Wall Street/Nvidia Partnership

• [01:02] The headline segment features Becky Quick's exclusive with Jensen Huang (Nvidia), David Solomon (Goldman), Larry Fink (BlackRock), John Gray (Blackstone), and others on a half-trillion-dollar funding initiative for AI infrastructure.
• The collaboration aims to streamline financing for data center buildouts, leveraging both new and already committed capital.
• Each investment partner gains privileged access to Nvidia's ecosystem and their perspective on the most promising deals.
• The urgency is likened to a "race," with comparisons to national priorities and direct reference to US-China competition.
• Quote:
  • "By partnering with Nvidia, they get something out of the deal too…it's a clever way of pulling this together and getting that money targeted towards the players that they see as being the important players." – Becky Quick [04:28]

Private vs. Public Capital

• Private money is now acting as the primary accelerator, with public capital expected to follow as scale and political consensus rise.
• Quote:
  • "It feels like a national priority...this is important for these companies, it's important for America." – Becky Quick [05:29]
• The panel notes the opacity and patience of private markets, warning that conflicts of interest and limited mark-to-market disclosure could become issues if projects underperform.

Market Implications & Skepticism

• Market Reaction: Despite the headline, stocks of smaller AI infrastructure companies fell, hinting at investor doubts or simply the gravity of ongoing capex requirements.
• Gene Munster’s Perspective:
  • "It is an accelerant...but also an indication of how early we are in the AI infrastructure cycle...the market is saying, either I don't believe it, or if it does happen, the law of large numbers just keeps building." [12:40]
  • "This isn't Nvidia juicing sales—it's Nvidia responding to customers who need more capital to sustain the pace of AI infrastructure buy-in." [13:35]
• The Arms Race: National security and competitive edge with China loom as drivers.
• Longevity of Investment: The notion that, as AI becomes more “like electricity,” participation could become commoditized; however, Munster argues the top 10% of intelligence and AI models will remain highly valuable. [14:43]

Bond Market Impact and Capex Cycle

• Mike Schumacher:
  • "Capex expectations for this calendar year jumped from $480 billion to close to $800 billion...The impact on the bond market? It's negative—a lot of additional supply." [06:33]
  • Ten-year yields face upward pressure as private funding fills a void, but creates transparency/timeline challenges.

Potential Risks and Conflicts

• The structure creates circular dependencies (customers may also be investors/lenders), and there's risk of misalignment between private patience and systemic safety.

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2. Market Leadership, Rotation & Macro Challenges

Apple’s Downgrade & Valuation Anxiety

• Jefferies downgrade: A rare underperform ("sell") call on Apple, driven by high valuation concern, product pipeline uncertainty, and mounting costs as Apple seeks suppliers for memory chips.
• Panel View:
  • "The question is—do they have a product strong enough to keep raising prices? Or is the premium too much?" – Courtney Garcia [21:49]
  • "Not a reason to sell...This is more a valuation call than a product call." – Tim Seymour [23:55]

Berkshire Hathaway’s Strategy Shift

• New CEO Greg Abel is taking a subtle but notable turn—deploying more cash into stocks and buybacks, with Q2 operating profits up and insurance/energy units leading.
• Quote:
  • "Feels a little different...still a patience story, but starting to deploy that enormous cash hoard, which has been underappreciated by the market." – Tim Seymour [27:18], Courtney Garcia [28:59]

Energy Market Tightness

• The US Strategic Petroleum Reserve is now at lows not seen since 1983, yet oil prices have been tamer than expected even amid Middle East tensions.
• Quote:
  • "Being long crude on geopolitical stuff...is always proven to be a loser in the long run. But people may be underestimating what's going on here, both on commodity and stock side." – Michael Santoli [32:56]

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3. Federal Reserve and Kevin Warsh: Is The Market Getting It Wrong?

Misreading a Hawk in Dove’s Clothing?

• New Fed Chair Kevin Warsh’s communication style is causing confusion. The market is pricing in dovishness due to lack of concrete statements, though Warsh reiterates the 2% inflation target and refuses to recognize a "shadow" higher inflation goal.
• Quotes:
  • "He hasn't really said a heck of a lot about his own views...The market is leaping ahead of what Warsh has actually said." – Mike Schumacher [34:05]
  • "I think the market is backward—applying dovishness where he intends more caution and hawkishness." – Mike Schumacher [34:05]
• Rates and yield curve: Schumacher argues more rate hikes may be needed than the market expects, and that long-term yields (10-year+) should move north of 5% as capex surges and government deficits persist. [35:58; 37:26]

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4. Sector Focus: Earnings and Trades

Hims and Hers (Telehealth)

• Shares fall despite record revenue and subscriber growth due to wider-than-expected losses, acquisition integration (Eucalyptus), and regulatory/legal costs.
• Outlook: Market confusion persists on whether there’s recurring, sustainable growth post-GLP1 era. [39:59–42:27]

Retail (Dick’s Sporting Goods)

• Upbeat on Dick’s after a Wells Fargo upgrade; cited as a possible way to play a Nike recovery and benefit from record back-to-school spending.
  • "Value opportunities are emerging, especially in parts of retail/athleisure that were out of favor," – Tim Seymour [44:13]
  • "There’s a segment—active retirees—driving new demand that isn’t sensitive to higher rates." – Courtney Garcia [45:19]

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Notable Quotes & Memorable Moments

• "This is an accelerant...but it also makes clear how early we are...the market's not fully appreciating the longevity of this spending cycle." – Gene Munster [12:40]
• "Project financing has been around forever, but this feels like an entirely new urgency—inspired by China, inspired by national priorities." – Tim Seymour [05:08]
• "Private markets are patient...until they aren’t—and then you can’t look under the hood for the true loss." – Mike Schumacher [10:48]
• "Electricity is a commodity...but not all AI inference is created equal." – Gene Munster [14:43]
• "That massive capex surge—that's not going away this year, next year, or the year after that." – Mike Schumacher [35:46]

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Timestamps for Key Segments

• AI Mega-Deal Panel Recap – [01:02]–[12:13]
• Gene Munster Analysis (AI cycle, Law of Large Numbers) – [12:40]–[17:22]
• Apple Downgrade & Valuation – [21:18]–[24:47]
• Berkshire Hathaway Strategic Shift – [26:41]–[29:21]
• Energy Market Analysis: Oil & SPR – [31:12]–[33:38]
• Kevin Warsh & Fed Policy – [33:38]–[37:31]
• Telehealth (Hims & Hers Earnings) – [39:59]–[42:27]
• Retail (Dick's Sporting Goods Upgrade) – [43:09]–[45:51]

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Final Trades (Actionable Takeaways)

• 10-Year Treasury Yields to 5% — Mike Schumacher [46:08]
• CLF Resource Trade — Michael Santoli [46:14]
• Berkshire Hathaway: Bring Exposure to Broadening Market — Courtney Garcia [46:17]
• SLB (Schlumberger) & Thematic Endorsements — Tim Seymour [46:21]

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Overall Tone

Highly dynamic, skeptical but excited. The Fast Money desk grapples with capital cycle extremes, national security overlays, and the tension between old and new investment models. While lauding the sheer scale of the AI buildout and Wall Street's adaptation, there’s concern over transparency, market saturation, and the sustainability of premium valuations. The group captures the dilemma facing investors—how to balance embracing the new AI-driven era with practical discipline and macro caution.

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This summary covers all crucial themes, notable opinions, and pivotal moments, providing a comprehensive digest for anyone who missed the episode.

Transcript

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[Guy Adami]

Live from the NASDAQ markets out in the heart of New York City's Times Square. This is fast money. Here's what's on tap tonight. Backing the data center boom, a group of Wall street heavyweights from Goldman to Blackrock to Blackstone and more. Teaming up with Nvidia to raise half a trillion dollars to finance the build out the details and the market impact straight ahead. Bus crude on the climb. WTI and Brent surging higher as the strait of four moves remains closed. Also news that the SPR is sitting at levels not seen since Mad Eater from hauling oats topped the chart did not their best. I did not write that. We will go inside. Crowd numbers coming up. And later, what's behind the Berkshire breakout, the downgrade dinging shares of Apple and why one of our traders is making himself at home in shares of Airbnb. I'm Mike Santoli in for Melissa Lee today. Coming to you live from Studio B at the nasdaq. On the desk tonight, Tim Seymour, Courtney Garcia, Gaia Adami and Mike Schumacher, a former head of macro strategy at Wells Fargo Securities. Welcome to you all. And we begin with that groundbreaking deal, the huge news unprecedented, unprecedented roundtable interview that just happened here on CNBC with Our Becky Quick, Nvidia's Jensen Huang, Goldman's David Solomon, Blackrock's Larry Fink, John Gray of Blackstone along with leaders of Brookfield, Apollo and KKR all coming together to unveil a massive half trillion dollar funding package for infrastructure development for AI. Let's now bring in our own Becky Quick. Who Clapper.

[Tim Seymour]

And this is a rare and amazing visit. Thank you. Yeah, I'm rare all around. Rare day, amazing day.

[Guy Adami]

Obviously, you know, pretty unique set of folks here to talk about something that that seems like a big step in this whole capital raising financing of the boom. What jumped out to you from, from the collective conversation?

[Becky Quick]

You know, I, from the moment we started looking at the news and trying to feel through it, it's like, okay, why these companies? Why are these that are doing this? And is this money that's already been committed to spend or is this new money that's going to be coming in? And I think it's a little bit of both. These are some of the companies that are already putting a ton of money into the financing for these things. But I think by partnering with In Video, they get something out of the deal too. In Video obviously gets funding for its partners that it's going to be brought to bear. But each of these companies gets kind of a first look and first opportunity at the partners that Nvidia sees as worthy and the deals that are seen as worthy. I didn't quite understand it till the evolution of the conversation when Jensen pointed out, hey, even if there are companies that fail and those that fall apart, these are deals that are going to stand the test and if they're not taking it, somebody else will, that this compute power is necessary. And this is stuff that can be kind of plug and play for another name to come in.

[Guy Adami]

What these companies know how to do is to make securities or something ownable and tradable out of something that's otherwise tangible. And I think that was why a lot, guys, the conversation was about, well, you know, the life of these assets of these chips of this platform is a lot longer than we thought it was, that it was going to hold its value. We're going to be able to kind of put a layer of debt on top of these things for a while and it could be an attractive investment. So that was one of the things that I thought was, was unique. But to your point, it's not necessarily raising the amount of the build. Right. We already knew it's going to be three quarters of a trillion this year, trillion plus next year, but maybe it's going to be a smoother way of accessing financing for it.

[Becky Quick]

Right. And I think in particular it's great news for Nvidia because their customers are going to get access to this, which helps them with their pipeline. You know, it's a clever way of pulling this together and getting that money targeted towards the players that, that they see as being the important players. And look, you've got to hand it to Jensen Huang. He's been really good at seeing around corners for a very long time. He has a good idea of who some of these players are. But yeah, there's a lot of money that's needed. John Gray made an excellent point where he said right now it's the private money that is going to go to work for this because maybe the public money isn't quite ready to be there, but it will then pick up at some point down the road.

[Guy Adami]

Yeah, this is like project financing in a way, Tim, which has existed for a long time.

[Tim Seymour]

And when you, when you hear Apollo and Blackstone and kkr, I mean, you told you. And I guess my question is it seems like there's almost a fresh urgency underneath this. And it seems to me some of that is inspired by China. Some of this really feels like a race.

[Becky Quick]

That's what it felt like.

[Tim Seymour]

He showed that their capital markets are alive and well and it feels to me like we really. And this is a national priority. Is, is that some of the sense?

[Becky Quick]

I think so too. Both David Solomon and Larry Fink brought up this American exceptionalism also. Apollo brought that up to just this idea that this is important for these companies, it's important for America for how we can kind of promote ourselves and be the ones who are leading the race for all of this.

[Michael Santoli]

Becky, that was incredible. I mean that was. Must watch tv. But as many of the people that were here, is it notable the people that weren't included in this?

[Becky Quick]

Look, I asked Jensen why this, why these? And did you go to anybody who said no? The first thing he said was no. Nobody said no. But I get the feeling that this is not necessarily an end all, be all that. Maybe you'll hear more developments down the road. Other partners that they would bring in to do some of this financing because the need for money is just so great.

[Guy Adami]

Mike, how does this fit into the whole. I mean, it feels in many ways like everything about the investment cycle is outgrowing what we had before.

[Discover Card Narrator]

Right.

[Guy Adami]

It's outgrowing our ability to provide power, you know, how to build fast and then obviously making huge demands on the capital markets as well.

[Mike Schumacher]

It's really amazing when you think about the capex total people expected when the year began for this calendar year was something like 480 billion now. Yeah, seven 5,800 plus some chunk of this 500. What's the impact on the bond market? It's negative. We can talk about project finance, we could talk about how much is private, public, what have you. But typical bond investor is going to say that's a lot of additional supply, whatever that is. A 500 at the long, long duration stuff. Yeah, I think that's right. That's why the 10 year got whacked today in my opinion.

[Tim Seymour]

And part of it it seems to me because we're talking about maybe a lot of private capital as opposed to public capital. That's part of what also long duration choppiness in terms of transparency choppiness really in terms of timeline unknowns. And this is where private capital in the past is been willing to overlook things that public capital will not. And and again to me this is coming at a time when the private capital markets have never been more foremost in terms of what both our audience and cnbc, I mean retail and professional investors are looking at.

[Guy Adami]

You know David Solomon at one point throughout the there's $9 trillion in money market funds as if this is like a swap. You know I was going to just sit there and clip coupons on my cash but now I'm going to actually, you know, but I know what he's saying. In other words, we have and deep

[Becky Quick]

capital by the way those money markets keep getting deeper and deeper and people are wondering when and where that cash is going to be deployed.

[Guy Adami]

A lot of it's corporate, a lot of it is just, you know, people have the cushion. And you know Courtney, how are you thinking about this in terms of if we're going to be on alert for, you know, when things get a little bit stretched or over ambitious and when in fact the market says I'm sorry, we're not going to do that. We went through a couple of months where the market said we don't like these huge companies, the best companies in the world spending all their free cash flow on this stuff and then we got over it.

[Courtney Garcia]

Yeah, but then we had earnings season. Right. And I think most of these companies, well, the ones that did well post earnings were able to justify why they were spending so much on CapEx. And that is what you're seeing is this bifurcation here where if you can show some sort of path to profitability and when you're going to have real ROI on that money, investors are rewarding that. And I think seeing this discussion today is really important that, that, that the Capex is going to continue and as long as there is demand to back it and that's exactly what we're, it can be justified in the longer run. Investors are still going to question it but I think that demand is still there and that's what we're seeing.

[Becky Quick]

Let me just throw this out to the table because this is a question that I don't have an answer to. I don't feel like the question was answered necessarily by the panel even or the town hall that we have with all of these guys. I look at it and every once in a while there are these quakes in the market, right? You can go back to Deep sea in January of last year, in 25, where it's like, oh my gosh, we're going to get beat by the Chinese. They're going to be able to do it cheaper and faster. You can have Leopold Auschenbrenner and know situational awareness and not know what was really happening beneath the scenes. How much of those things like first of all, how important are any of those blips? Second of all, do you anticipate that there are going to be other moments like that and do you think the market kind of pushes through on a moment like that or do you think that there's that one that comes in and that it's much harder to overcome?

[Tim Seymour]

Well, my thought is this is coming at a time and you know, Mike can talk about this too, but we're within 15 basis point, 25 basis points of 19 year highs on the 10 year. This is all coming at a time when ceding for the most credit worthy companies in the world have doubled since January. So I think the debt markets are going to have something to say about this. Credit markets for sure. And ultimately a case where unknown ROIs are being financed into perpetuity. I think the market's been doing that for months and you know, the last couple of weeks it felt like they were okay, but I'm not sure if rates go above 5%.

[Guy Adami]

I'm not sure, you know, Mike, John Gray from Blackstone said invoked core week, right. And say, look, there was a time when they were kind of hand to mouth, they weren't able to necessarily finance themselves. Now they're a public company and cost of funding has come down. That seems to be the mental model for like some of these customers of Nvidia who on them on their own are not going to necessarily have attractive financing. This can do it in a private credit way, right? This would happen with private credit. You don't have to market in the moment and so, you know, the money's there but you know it's going on behind the scenes.

[Mike Schumacher]

Yeah, it's a great point, right? I mean the big benefit of private is there's no mark. So yeah, it sits there at par, par, par. Some bad news comes out and all of a sudden it's 72 doesn't go from par to 95. It doesn't work that way. So it's tough to look under the hood. So I think it's a great thing as far as facilitating funding for a lot of the next generation of core weaves. I agree with that. But when you think about the broader implications of a lot more funding out there, that's simply not marked. If you're a regulator or if you're someone who's a little bit uneasy about certain aspects of your personal account, how do you look at that? You probably get a little bit nervous.

[Tim Seymour]

I think we have to talk about conflict too. I mean, if you think there's so much cross ownership or cross interest both in the people that are funding that also may have an equity stake, may have at least triggers on the equity side to, you know, the circular financing ultimately in video is, is an AI infrastructure company in addition to being the most sophisticated semiconductor company in the world. But they, you know, the, the inter reliance on their customers back to them. I mean that's what we've been talking about. So I just think again, private markets seem to have less need to make those in your face disclosures doesn't mean they're bad, doesn't mean it's evil, doesn't mean it's sneaky. It just means that could mean it's patient. Well, it's very patient. And when things are working, patience is great when things are not working, you

[Becky Quick]

know, but all of those companies have some experience with being patient when the market is not and getting kind of pummeled in the meantime.

[Tim Seymour]

Making a lot of money by being,

[Becky Quick]

making a lot of money by sticking out.

[Edward Jones Narrator]

Right?

[Guy Adami]

Yeah, no doubt about it. Well, we're going to have some more on all this with Gene Munster. He's with us of Deepwater Asset Management joining us now. Gene, you've been hearing it all. Hopefully you had the full hour to kind of digest some of it. So where does this bring you in terms of investment implications? Is this an accelerant? Is this just sort of. Okay, now we have part of the nut covered in terms of what we thought we were going to have to spend from here.

[Gene Munster]

I mean, the big picture is that it is an accelerant. It is an indication of how early we are. And there's a dynamic that is a little bit concerning in terms of the significance of this development, which I think just reinforces that we are in the second or third inning of the infrastructure build out. That just overwhelming endorsement that this 500 billion suggests to that that piece and Then the market reaction to a lot of these Nvidia trading off a couple percent. We own a lot of these smaller AI infrastructure companies. Coherent down 15% today. I mean, what you have seen is basically the market saying, either I don't believe it, or if it does happen, it just keeps building this law of large numbers. So, I mean, those are the two kind of orbits that, that kind of jump to top of mind. But if you just look at the substance of this and taking the conversation that you've just had and kind of putting my perspective on it is that we're just still so early. This is not about Nvidia trying to juice their sales in the future. This is about Nvidia hearing from their customers that they just simply want more and don't have access to capital to buy those chips. And I think it all plays into this simple theme is even though we obsess, we being tech investors about where AI is at, I don't think we fully appreciate how early we are and the significance of how long that this kind of spending can go on.

[Guy Adami]

It's interesting because there have been times when, when you say we're early or when, you know, Sundar Pichai says, we're early from Alphabet and the market says, great, we have a lot of Runway. But the other, there are other times in the market says, oh, no, that means the bill is going to keep growing and that the spenders are going to have to spend more heavily. And I really am interested in the destination here, wherever it is, however far it is in the future, Gene. And by that I mean when Jensen talks about, hey, this is the new electricity, why am I excited about that? Electricity is a commodity thing. It's a baseload thing. It's kind of a regulated market. Your electricity is the same as anybody else's. Why is it exciting long term to be the landlord, the provider of that?

[Gene Munster]

Well, I think the electricity analogy is similar to the kind of it's the petroleum of the future, it's the, it's the oil of the future. And I have long kind of disagreed with that view. I think what we see when it comes to intelligence is, yes, some of it is like electricity, some of this intelligence is commoditized. But there is a top end of this, a 10% end of the knowledge. These AI models that I think are extremely valuable. And some of those pricing, even though they've come down, we see the Jevons effect kick in and the usage goes up exponentially. And so my response to that is, I don't think it's electricity. Not all AI inferences created equal number one and number two, this whole concept as price does go down and they'll still be higher tiers, I think you're just going to see an explosion in the use of these tools. Keep in mind is that when we again the tech investing community looks at the use cases around AI there's still relatively limited, a lot of testing but it's very hard to point to some very definitive beyond Google search or cloud growth or maybe Meta's advertising business. And why that's so important is that ultimately is that if we are that early I think it speaks to or if those are the only the cases I think it speaks to how early we are and that what I think is going to be a spread in terms of the value of these tokens.

[Michael Santoli]

Gene, when Becky and her team convenes a group like that, which is historic in a word that means the statement Tim called it an arms race. That's right. There are people in China that watch that. So what are your thoughts in terms of what it means for this sort of global back and forth?

[Gene Munster]

I mean don't overthink it. Like I understand that there is the private, the private markets, the private debt markets do have a negative stigma associated with it. But the big picture is this, these are very sophisticated investors and we work with these type of investors and I promise you they're not doing this to try to play along and a hype theme and something that they think is short lived. They're doing it for something bigger. Some of the stuff that Becky talked about around kind of nationalism, what's going on between the US and China, the use of AI I think all this I still stand by. We're going to be early. I'll put a prediction out there. Over the last three weeks the expectations for hyperscaler capex growth for has gone from 24% for calendar 27 to 36% but it's going to be above 50 and for calendar 28 it's at 15% now it's probably above 25. We're just still early for all the reasons you talked about Guy.

[Guy Adami]

All right, well we'll see Gene, if if in fact the market likes that message that we are still early, I don't know what I'm going to do if I'm not overthinking it. But appreciate that sentiment.

[Tim Seymour]

What you do, that's what you do.

[Guy Adami]

We'll talk to you again soon Gene. Thank you very much Gene Munster.

[Tim Seymour]

Tim well we unfortunately started the Reference the show with the reference to Maneater by Hall Notes.

[Becky Quick]

And I've been.

[Tim Seymour]

It is unfortunate and everybody at home is. And that includes probably Hall Notes who love watching the show.

[Guy Adami]

But at night.

[Tim Seymour]

Yeah, but I think it's. I'm worried about Capital Leader that's, I mean really. I am worried about low cost models versus high cost models. I'm worried about a Zuckerberg manifesto where he's talking about funding small towns and handing out checks to school teachers, which is a great concept. And it's also. There's a lot of politics in that. So we're totally early. We're absolutely early. This is exciting. The question really is who is investing in. In the right channel. I would follow Apollo and Blackstone and Blackrock and, and Brookfield. I follow these guys to the end of the earth in terms of being smart enough to do their own diligence. But it's all about capital. How much capital is necessary here and how much is being wasted because we know there's capital being wasted.

[Becky Quick]

Do.

[Guy Adami]

Yeah. I mean, Becky, it's a whole flip of the world from what we were thinking about let's say a few years ago when it was all about look, what could Microsoft, all of its asset

[Becky Quick]

lies and not having to be the one who was putting out that capex spending. Now it's about Capex spending and are you going to be the ones that survive through this? And I will point out both David Solomon and Jensen Huang were very quick to say, hey, there are going to be some losers. David Solomon said there are going to be big companies that lose out on this. There will be other big companies that, that, that win at the end of the day. But this is not a everybody wins and everybody gets to go home with a medal trophy.

[Guy Adami]

Yeah. On the bright side, at the end of it, you do have that much more capacity built. Whether somebody's doing it profitably or not, society can, can make use of it. So we'll see. We'll end on that. Becky, thanks so much.

[Becky Quick]

Thank you for sticking around everybody. Thanks.

[Guy Adami]

Clap her out.

[Becky Quick]

I'm going to come here more often.

[Guy Adami]

Coming up, Apple under pressure. The rare sell rating hitting the stock today and whether the iPhone maker can climb its way back to recent Plus Berkshire's buying spree. Inside CEO Greg Abels pushed to put more cash to work and where the company's next big bet could lie. As we got to break, we want to show you beat the streets. Chicago ringing the closing bell at CBO out there ending the regular trading day for office fast Money Back.

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[Guy Adami]

welcome back to Fast Money. Apple getting a downgrade today from whole to underperform. That's basically a sell call. Jefferies analysts saying the company may no longer debut its all glass iPhone next year and that is casting doubts on their ability to command more cash from its consumers for premium products. Apple shares in the red today. It is the stock's first down day in five. It was off a percent and a half Courtney. Look, it got to a premium valuation. It was a port in the storm when the rest of tech was was for sale. But how do we think about this call?

[Courtney Garcia]

Yeah, I think valuation really is the biggest thing here because this is trading over 33 times forward earnings and when you're paying that kind of a premium to evaluation, I think you want some sort of justification as to what you're paying for and I think they don't have the kind of AI story monetization path that some of the other competitors do. But you're also looking here and they have the memory chip costs and this is going to be a real problem for them where a lot of this call had to do with the fact that they were going to have some glass, all glass iPhone, which I think the question is was that the case or not? But the bottom line is like do they have a Good enough product to raise prices and our customers actually going to be willing to pay that. I think that's the question here. I think the bigger question is just the valuation. What are you paying for at this point? That's, I think, where you want to be.

[Guy Adami]

Yeah. Worth mentioning, the company's never kind of said we intend to make an iPhone. This is all a kind of channel check and, and checking with suppliers. But you know, Guy, I feel like there are sometimes you have an analyst that just kind of has a feel for how the stock might be leaning. Now I should also say Jefferies has not had a buy on the stock for like a couple of years. Right. They've been a hold or an underperform. So the point is it's not somebody who is all bullish on the way up. And just so I wonder how, you know, I think that's a great call.

[Michael Santoli]

So the playing a little stock market, to your point, I think what the hope here is it gets to a level where they can then turn and pivot, which makes sense. And you know, Courtney mentions valuation. She also mentioned as Apple's talking to 6Mt, which is a Chinese memory chip maker, in terms of all the things we're talking about. I mean their costs are going higher. They're looking for a way to assuage some of those concerns. You wonder what happens with Micron in this. Now I was fortunate enough to be off stage when you walked by and you said Micron should be higher on all the news we just heard for a little bit. Yeah, but not as much as you would think given the sell off it had today. So there's just something to watch there for sure.

[Guy Adami]

Yeah. And I guess that also is the market is not moving fast to sort of price in anything fresh in terms of new money from this, from this Nvidia financing type agreement. Tim. Apple. You know, it's funny because it, it does act as defense when necessary. And you know, if you just look at it versus like Microsoft, they've just gone in opposite directions in like the last 10 days.

[Tim Seymour]

Well, the question is, is this kind of a market call? I mean, I haven't looked to see the other names in his sector, but, but if you're, if you're getting, let's just say less optim on Apple. By the way, as you said, any, any underperform is equivalent to a sell in the markets these days. And that's actually not mailing it in. I mean, that's, you know, I'd like to see a lot more of that. I almost feel that this is a market call though because as you said, port of, port of, you know, lighthouse in the storm, that kind of thing. If the headline is the all glass is not is not ready in time, that's the wrong reason. It's the Aspen. Remember, Apple's had three down days of significance in the last six weeks and they have been the ASP announcement. So sorry. The, the, well, the price increase based upon a memory cost increase. It was an earnings number that was fine but wasn't good enough and it's, and it's a downgrade or two. I wouldn't be selling on this news.

[Guy Adami]

Yeah. And going into of course the whole fresh upgrade model, all the rest of it. We'll see how that fits in.

[Napa Narrator]

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[Guy Adami]

Up next, shares of Berkshire Hathaway hitting their highest level since Greg Abel took over from Warren Buffett. How's the new CEO putting the company's cash to work and driving? You're watching FAST MONEY live from the NASDAQ market site in Times Square. We are back right after this.

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[Guy Adami]

Welcome Back to Fast Money. Berkshire Hathaway shares closing out the day up 1% after reporting earnings on Saturday. Newly minted CEO Greg Abel starting to put the company's cash stockpile to work. BERK buying nearly $20 billion in U.S. equities on a net basis. Operating earnings for Berkshire rose to nearly $13 billion in the second quarter, with Berkshire Hathaway Energy leading the gains in their holdings. So Tim, you know, it's not a huge move in the scheme of things in terms of how big the cash pile is, how big the market cap is, but also, you know, maybe it's a new mode because it wasn't as if there was some dislocation in the market and and Abel came in there as a buyer.

[Tim Seymour]

No, in fact, this may be a slight, I would call this style drift, but I would, I would call it, you know, feels a little different. And meanwhile, when you're buying Berkshire and this is the same Berkshire that's in the financials, xlf, I mean you're buying banks and you're buying energy. And I think this is a market that obviously has rewarded those two sectors over the last 12 months, but I think will continue to based upon the trends we have.

[Guy Adami]

Company also bought back four and a half billion in stock. You know, that's been a big element there of like, you know, some investors want him to do a lot more of that. It's not as if the stock's super cheap, but I guess cheap enough that people are happy to know the cash

[Michael Santoli]

hoard got you probably have in front of you, Michael. I think got up to $380 billion.

[Guy Adami]

360.

[Michael Santoli]

360. Which against a trillion dollar company is obviously significant. And the word you all used earlier in the show was patience, which is something I think that Berkshire Hathaway pre

[Tim Seymour]

this song by Guns and Roses, by the way. Really, I mean it was, you know, they had to put that one out. They needed to get one was off

[Michael Santoli]

that off of use your illusion now

[Tim Seymour]

in between Appetite for Destruction and use

[Michael Santoli]

what I'm saying, Michael.

[Guy Adami]

No, this is much more important.

[Michael Santoli]

It is actually what I was to say was so now they're putting money to work. Are they doing it at the right time? Are they doing it historically with that Buffett indicator at levels we haven't seen maybe ever, they're doing at the wrong time, rewarding them today, I would say

[Guy Adami]

even Warren Buffett has said, listen, that Buffett indicator thing was an observation in time. It's not as if he feels like it's determinative of whether stocks are in a bubble or not. But corny, if you look at Berkshire Hathaway, it's got a lot of housing related, it's got the energy. Insurance is on a little bit of a downswing just because of underwriting profits in the industry. You see things like Progressive in Allstate, not doing that well. But it is this collection of look, if the economy's good, Berkshire should capture a lot of that.

[Courtney Garcia]

Absolutely. And I think there's been a lot of talk about that. You still want to own the air trade, but there's been broadening that's happening. I think Berkshire is a really good way of doing that. And if you look at the stock, it actually has been underperforming the s and P500. Today it outperformed the S and P. And I think what investors are liking to see is them buying on, on that underperformance and they're finally starting to deploy some of that cash. I think investors are going to continue toward them.

[Guy Adami]

Yeah, they never did get credit in the market really for all that cash. We'll see if it, you know, it does represent a change in, in strategy. All right, coming up, gaming out the Fed's next move, what the latest uptick in treasury yield yields is signaling. And when one of our traders says markets could be getting Fed Chairman Kevin Warsh all wrong. Fast Money back at missed a moment of fast. Catch us anytime on the go. Follow the Fast Money podcast. We're back right after this. Welcome back to FAST MONEY Stocks with a muted session to kick off the week. The dow losing just 60 points. The S and P Hending virtually unchanged and the NASDAQ off by about a third of a percent. Trade desk dropping 3% for a fourth straight down day shares have now lost two thirds of their value this year. Airbnb Meanwhile, jumping almost 4%. Building on Friday, 17% gain. The company handily beating estimates and giving a strong forecast last week. Stock up 3.7%. The space X also rising over 4% on the day. Today's move move bringing the stock back above its IPO price of $135 a share. So Tim, let's hit Airbnb here a little bit of a perk up.

[Tim Seymour]

It just, it just feels like the poster child for all that were not software companies that became software companies when software is being sold. And all those trades that actually have been extraordinary, especially they shouldn't be related but kind of correlated to the Microsoft earnings print. Now Airbnb was based upon their print and their print where not only did they show double digit back to back night gains and kind of, you know, up, you know, 25% year over year, up almost 30% in revenues, but they talked about the features of their offering and how that's allowing people to do things on Airbnb they never could have done. By the way, where else are you going to go? I mean, it does kind of feel like they're one of those places.

[Guy Adami]

Yeah. I mean, obviously there was a line that said all the booking services and anything that was a walled garden is going to get penetrated or kind of competing way from AI but it's not happening just yet. Meantime, let's get to some energy. Oil in the US Strategic Petroleum Reserve falling below 300 million barrels at its lowest level since 1983, as the Iran war continues to put pressure on global inventories. Energy stocks pushing higher today, along with the commodity price. So, Courtney, on the one hand, it's obviously getting toward critical levels. On the other, this is what was kind of authorized when the President said, we're going to, you know, use up to 175 million barrels get released.

[Becky Quick]

Yeah.

[Courtney Garcia]

And I think the big question is where the energy prices go, because this is part of the inflation story. This was part of the reason the markets came down earlier this year, because if oil is high, that can lead to higher inflation, higher interest rates. I don't think at these levels as necessarily concerning. I think that the energy companies can do well. I don't think this is going to be too problematic for inflation here, but it's going to continue to be a question. And even now, we're still much below the levels we were at the peak of the geopolitical concerns. So I think we're just still waiting for a resolution there. And I think you're going to see things stay at a certain level until you actually get that. Keep almost having one, and then it's not going through. We'll probably stay here, but ultimately, I don't think it's going to. It's going to be an issue moving forward.

[Guy Adami]

GUY at every step along the way, since February 27, since the Iran conflict began, oil arguably has undershot what people thought might be a likely reaction.

[Gene Munster]

Right.

[Guy Adami]

Whether it was the risk of the closing of the strait. Inventory is getting worked down. There's no more cushion. I mean, I guess one, why might that be? Is the market just kind of whistling past the graveyard, or are we finding ways around the tight?

[Michael Santoli]

I'll answer the first part of the question. Historically, being long crude on geopolitical stuff, as you know, is always proven to be a loser in the long run. So I think commodity traders have sort of figured that out, and any sort of semblance of resolution, you see how quickly people sell the commodity. But the flip side of the coin is where you're going. I think people are underestimating what's going on here and I agree with that. Not only in terms of the commodity but in terms of the stocks. And say what you want, but actually is held in like a champ. Despite crude oil being sold off in a material way. Oh continues to bounce off the 200 day moving average really well and these refiners continue to make all time highs. So people are not realizing, I don't, I don't think what's going on with these energy stocks, I still think they're biased here.

[Guy Adami]

Yeah, I mean it's comfortable level for crude and then refining margins are fat as can be at this point. So I guess the companies can, can do fine. Well now to the markets and the Fed, there may be a major disconnect between Fed Chairman Kevin Warsh and the market. So Michael, you said earlier on our call you think the Street's misreading the new Fed chair. And you know, I guess there was a lot of kind of conflicting kind of takeaways from the last press conference. What do you, what do you think the market's messing?

[Mike Schumacher]

I think the markets are actually applying things to wash that he hasn't really said. He hasn't said a heck of a lot in terms of his own views. Next to nothing, frankly. He's talked about the committees, the task forces, etc. But as far as Kevin Warsh, his own views about monetary policy, the thing that I keep hearing is he says, look, we've got one target on inflation, it's 2% period. There's not a shadow target, there's not a fake target. We don't have a pizza and talk about two and a half percent. We don't do that yet. So that to me sounds like a fairly hawkish guy. Now he's just not ready to move quite yet. And the market said no move last month in July. Therefore somehow it's dovish. I think that's backward.

[Guy Adami]

Well, he certainly has said 2% is the target. Absolutely. And then he also said, yeah, PC is still our target, but maybe it's not the best benchmark of what inflation is doing. And then when he said, yes, we have to, you know, kind of move policy to make sure we get price stability, he then questions in the press conference, maybe the policy rate's not really the thing we have to go to for, you know, so you understand why the market can basically see whatever it wants. Right. You're looking through a narrow window. It's kind of dim out there. Dust can Be mistaken for dawn and vice versa.

[Mike Schumacher]

That's right. So the market said we want to see somebody who's not really as hawkish as we thought when we're going dovish. And I think you make a great point, Mike. When you think about the tradeoff between fed funds and balance sheets balance sheet. Warsh's balance sheet views are pretty clear. But he said several times we don't really have a good way of trading off those two tools. If we change our balance sheet size, how many basis points is that in fed funds?

[Guy Adami]

We don't know.

[Mike Schumacher]

Yeah, Fed doesn't know. I don't know. You don't know. It's just not clear. And he'd like to have a much better idea with some rigor behind it what that might be, I think before taking a big move. So I think the market is leapt ahead of what Warsh has actually said.

[Guy Adami]

So if you think there should be maybe more hikes in the market at this point point, what does that mean for longer end? Because last time we put more hikes in long and yields came down a little bit.

[Mike Schumacher]

Yeah, I think that's not going to happen this time. I mean, you think about what the market price is now, let's say to the midpoint of next year, 40 odd basis points of rate hikes, give or take. I think it probably should be 75 plus or minus. You can look at various mathematical tools and say up might be 25 basis points in the two year. But to your point about the 10 year, maybe it's 15, maybe it's 20 economy. But the thing that concerns me about the back end is it's a compounding series of events. You've got this massive capex surge. We've talked about that at length. The last panel was amazing. That's not going away. It's not going away this year, next year, the year after that. That's out there. Defense spending, that has not come up today and yet that's out there too. That's not going away either. You've got government deficits growing pretty substantially. I don't see a lot of restraint. And on top of that we've got this issue of inflation. It was low last month in the US Is it going to be low Wednesday? I hope so. That would be nice. But I wouldn't count the eyes through the roof though.

[Tim Seymour]

I mean, on a relative basis. And is it just one good print?

[Mike Schumacher]

That's not a trend in my opinion.

[Tim Seymour]

I also think we're forgetting, you know, we talk about the two sides of the Fed mandate. How about the two sides of what causes inflation? I mean the global economy hasn't been this strong in unison in a long time. You just saw GDP numbers coming out of Europe. I think second half China is better. I mean we have a world that can not only take take higher rates except for credit that's gone wild and we could bring it back to the A block. But, but I think we're in a place here where you have to understand that that the economy on top of liquidity conditions, markets are all time highs. The Fed's behind the curve. They are.

[Mike Schumacher]

I agree with that 10 year treasury long rates he asked about. That should be north of 5% pretty quickly in my opinion.

[Guy Adami]

All right then it sounds like everyone thinks where we should behave as if we're in overheat mode.

[Tim Seymour]

I can't go for that if no candidates.

[Michael Santoli]

Nice job by

[Guy Adami]

all of those. All right, a quick news alert. New York Mayor Zoran Mandani's tear tax has been temporarily halted by a state court judge in Staten Island.

[Courtney Garcia]

Bummer.

[Guy Adami]

Judge Wayne Ozzie granted a temporary restraining order to a group of homeowners who argued that City Hall's publication of a list of homes that could be affected by the tax caused mass confusion. City is now blocked from taking further action until the August 31st or in August 31st court date. All right, coming up, shares of Hims and hers on the move after second quarter results. We'll dig into the numbers and state of play for the telehealth giant. Fast Money returns. Welcome back to Fast Money. We have an earnings alert on Trump Media. Eamon Jabbers has the details and hey there, Mike.

[Eamon Jabbers]

That's right. First ever earnings call for Trump. Trump Media and Technology Group here today. The company reporting a net loss of more than $238 million in the second quarter on revenues of less than $2 million. Remember, this is the company that owns the President's Truth social social media platform. And officials from the company there on the call answering some questions they said they'd received about this new API product. We talk about it a lot on cnbc. That's the high speed trading product that allows customers to buy high speed access to Truth social posts, including the President's post. They said that they've got more than 10 clients now for that product and they are selling that service at between 60 and $100,000 a month. So they defended themselves from criticism, Mike, about this, saying that a lot of the information out there is misinformation about it. They said this is an established business practice this and said effectively this is what they're doing. It's the same as what other companies in the space doing and they're going

[Guy Adami]

to continue to do it. All right. Yeah, I guess, you know, Even with just 10 customers, that's a material revenue number based on what they've been producing here. Still a two and a half billion dollar market cap at Trump Media. Eamon, thank you very much. Let's get to another earnings alert on Hims and hers. Shares falling despite the company beating on revenue as well as subscriber count growing by nearly 2.9 million up 19% year over year. CNC's Brandon Gomez has more.

[Brandon Gomez]

Hey there Mike. Yeah, the beyond subs was particularly interesting, especially since there was some concert of melt off with the removal of compounded weight loss drugs. This was one of the biggest subscriber growth quarters. But that was in part because subscribers from Eucalyptus, an international telehealth platform, are rolled in after that acquisition. Now it's likely weighing on the stock a significantly wide loss of 37 cents. I asked the company's CFO about that. He mentioned several one time costs, the close of that Eucalyptus, Eucalyptus acquisition, restructuring, business expenses, legal parameters set aside for a new FTC litigation, looking into the company's use of member data and cancellation practices, the company planning to defend itself vigorously. And then you also have a $30 million investment to learn about peptide manufacturing. CEO Andrew Dudham on the call saying they are awaiting clinical guidance on peptides but will offer access to already allowed peptides. The company's next next hedged blockbuster raising Q3 revenue guidance significantly and in turn fiscal year guidance to north of 3 billion. Mike?

[Guy Adami]

All right, Brandon. I mean Tim, this is this a stock with a beta of three. It swings around all over the place based on what people think their, their next little bonanza is going to be and how they're sidestepping the regulatory.

[Tim Seymour]

And then when you get some of the granularity around numbers, it's, it's not all that great. I mean talking about peptides and wanting to be there, I mean this seems to be where everybody wants to be. It's certainly a place that taps you into the same kind of euphoria that was around glp. So I, yeah, look, if I want exposure to this stuff, I think there are world class drug companies. I'm a little more worried about those folks that are in the fringe of the GLP market.

[Guy Adami]

On the other hand, Courtney, I mean if we do have kind of a regulatory approach, that's the Sort of allowing people to do a little more than they did before. Hims and hers probably as a marketing engine probably can make some hay with that.

[Courtney Garcia]

Yeah, that's probably true. But I think when it comes to this company too, I mean, they keep trying to reassure people that their compounded GLP1s were just a fraction of their business. But people are really still trying to figure out what is going to be their next revenue source, that that's not going to be the GLP1 story anymore. And so I think until they can really show that and prove that, I don't know if they're going to have the same kind of demand that they

[Michael Santoli]

have in the past $40 million profit this quarter last year they lost basically $90 million this year on higher revenues. So the market says, wait a second, your revenue is going higher, you're losing more money, which is obviously never a good thing. So we could talk about the bells and whistles, the relationship with Novo Nordisk. The bottom line is more revenues, less profit is not a winning strategy.

[Guy Adami]

Yeah, and of course we're showing the stock down 42% over the last 12 months. Coming up, Dick's Sporting Goods laces up the bullish call on Wall street giving shares a bull lose today. And the next leg for the retail trade. That's next. More fast Money into. Welcome back to Fast Money. Shares of Dick's sporting goods rising 2 1/2% today after Wells Fargo upgraded the stock to an overweight. Analysts growing more confident on the company's long term trajectory driven by recovery in Foot Locker. Well as his $240 price target, implying 12% upside from today's close, also said it's maybe the best way to play Nike recovery.

[Michael Santoli]

I agree, first of all, yes. Second of all, valuation despite the run the stock is at is very reasonable given their EPS growth. So good on them. I think the average price Target analyst about 255. I think it goes there very easily.

[Guy Adami]

Mike, the consumer, I think it's another eye of the beholder situation in terms of whether it's purely case shaped, whether it's hanging in there. Obviously unemployment, still benign. But what's your, your take about the trajectory of consumer spending in general?

[Mike Schumacher]

Where it sits pretty good but very concentrated. So I think that's the risk. I mean if you're long assets, if you're long, take your pick of any of the hot stocks out there for the last few years or real estate. It's been a phenomenal run. But the risk I think is that if there's A little bit of a downturn. The economy goes pretty quickly. So the concentration risk I think is a big one right now.

[Guy Adami]

You know. And Tim, if there's one area that really is outside the AI trade obsession, it seems to be traditional retail. Obviously they can utilize and all the rest of it. But I wonder if that means it's kind of being neglected and people are overlooking a little value there or is it just like, look, it's safe to ignore it.

[Tim Seymour]

I think there have been parts of retail that have done really well. You know, the part of retail and discretionary spend that I've been very critical for the last year and a half has been in the athleisure footwear part. And while that's probably been the right call, I actually think that some of them are starting to look somewhat interesting here. That's why this call on Dick's is interesting because is the dynamic on the outlook for Nike of which used to be at their peak was 75% sales and now it's a little bit less. But in North America if Nike outperforms Dick's will, or maybe it's the opposite I think is kind of what they've said but it's a margin story for a lot of retail. So back to value meets meets retail. I just think you have to be very careful about where what street you're on. And I mean you can't invest in a bad neighborhood in retail either. I think they tend to be very highly correlated. And even though overall the market has really been a great stock pickers market. So it's a long way of saying I actually think there are some value opportunities in there and I think in the discretionary spend in the Athleisure space after being bearish for a long time, some of those charts are also starting to turn.

[Guy Adami]

And Courtney, I guess we got, you know, tariff refunds coming through, you know, other elements that maybe are going to allow some of these companies to deal with a more inflationary environment.

[Courtney Garcia]

Correct? That's exactly right. And I think also when you talk about the consumer here, back to school spending is expected to be about $150 billion, which is one of the records there, which I think will benefit something like a Dick's as well, something like a Target. We are asking who benefits here. One thing was interesting about Dick's is you're seeing a more active retiree who's spending more Dicks and also spending on their grandkids and that's actually a cohort which isn't as affected by inflation, interest or Specifically interest rates changing where they have fixed mortgages or no mortgages.

[Discover Card Narrator]

Right.

[Courtney Garcia]

So they've been holding up better. I think that's pretty interesting.

[Guy Adami]

I do remember during the pandemic it was a golf trade from Dick's as well. All right, up next, your final trades. It is time for the final trade. Let's go around the horn. Mike Schumacher.

[Mike Schumacher]

Yep. 10 year treasury yield 5% by 730.

[Guy Adami]

All right, so sell the tens, guys. CLF Resource Trade.

[Michael Santoli]

Michael.

[Guy Adami]

All right, Courtney, Berkshire Hathaway.

[Courtney Garcia]

We talk about broadening a play this year.

[Guy Adami]

All right, and Tim, Mike, thanks for joining us.

[Tim Seymour]

Mike Schumacher, thanks for joining us. Long haul notes of the 70s, very short haul notes about 80s and SLB. I mean, totally, very confident about that

[Guy Adami]

SLB rich girl, she's gone. All right, thanks for watching.

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[Tim Seymour]

Yeah, hi.

[Gene Munster]

Quick question.

[Courtney Garcia]

Why are you not spending your Venmo balance?

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Yeah, we're concerned you can like buy stuff with it.

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You love buying stuff.

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Cash back on eligible purchases.

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M. You love purchasing eligible things.

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So the money your friend sent you yesterday, that's today's ramen or ride share or eye patches.

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