The Feud For The Fed… And How It’s Hitting The Bond Market 7/16/25

Summary

CNBC's "Fast Money" Episode Summary: "The Feud For The Fed… And How It’s Hitting The Bond Market" (July 16, 2025)

In this compelling episode of CNBC's "Fast Money," host Melissa Lee and panelists Tim Seymour, Karen Fierman, Steve Grasso, and Guy Adami delve deep into the escalating tensions between President Donald Trump and Federal Reserve Chair Jerome Powell. The discussion highlights the significant repercussions this feud is having on the bond market, broader financial landscapes, and emerging sectors like cryptocurrency and technology.

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1. The Trump-Powell Feud and Market Reactions

Courtney Reagan opens the discussion by outlining the volatile market environment influenced by the ongoing conflict between President Trump and Fed Chair Jerome Powell. Initial headlines suggesting President Trump's intent to fire Powell caused a midday stock drop, followed by a partial rebound after the President reconsidered his stance. This back-and-forth led to firmer Treasuries, with the 2 and 10-year yields declining, and a slight weakening of the U.S. dollar.

Karen Fierman provides context on President Trump's statements, noting that while he expressed concerns about Powell, he hasn't firmly decided to remove him. She states, “[President Trump] is very concerned about him, and he confirmed that he joked about the idea with Republican lawmakers last night” (02:48).

Tim Seymour offers skepticism about the President's intentions, suggesting, “I think this is all ado about nothing” (04:14). He posits that Trump's strategy might be to create market noise without any concrete actions, potentially presenting buying opportunities if a sell-off occurs.

2. Legal and Institutional Implications

The panelists discuss the legal constraints surrounding the potential removal of Powell. Karen Fierman highlights that some Senate Republicans doubt the President has the legal authority to fire Powell, aligning with Powell's own stance on the matter. Tim Seymour further elaborates on the complexities, stating, “You cannot find any analog of any president ever making these kinds of public statements” (10:52).

Loretta Mester, former President of the Cleveland Fed, weighs in, emphasizing the importance of an independent Federal Reserve. She argues, “independent monetary policymaking does not mean a monetary policy committee that is unaccountable for its decisions” (19:01). Mester underscores that political interference could lead to higher long-term rates and undermine economic stability.

3. Impact on the Bond Market and the Dollar

Tim Seymour expresses concern over the potential devaluation of the U.S. dollar if the Fed's independence is compromised. He explains, “When you're in a $37 trillion hole, sitting on top of a $27 trillion economy, you're not going to grow your way out, you're going to devalue your currency your way out of that” (19:25).

Andy Constant of Damped Springs Advisors discusses possible Treasury interventions if Trump pushes for lower long-term rates. He speculates, “If Trump wants to suppress yields on the long end, he could instruct the Treasury to sell fewer long-term bonds and/or increase their buyback program” (32:30). Constant warns that such measures could lead to a surge in asset speculation and a crushed dollar.

4. Cryptocurrency Legislation and Market Movements

Shifting focus to cryptocurrencies, the episode covers the hurdles faced by three crypto-related bills in Washington. While stablecoin legislation gains support, anti-central bank currency measures face Republican resistance.

Counselor Tim Seymour links the Fed feud to Bitcoin’s resurgence, stating, “Bitcoin is just a reflection of fiat currencies losing their value” (43:56). He predicts significant upside potential for Bitcoin, especially as institutional distrust in traditional fiat systems grows.

5. Corporate Earnings: United Airlines and Sarepta Therapeutics

The panel reviews United Airlines' mixed Q2 earnings report. Philippeau details United’s earnings beat in EPS but notes revenue fell short, primarily due to operational issues at Newark Airport, which negatively impacted margins. The guidance for Q3 remains cautious, anticipating ongoing challenges.

In contrast, Angelica Peoples discusses Sarepta Therapeutics' 30% surge following news of workforce cuts and regulatory adjustments to their muscular dystrophy drug, Elevidis. These strategic moves aim to stabilize the company amidst uncertainties regarding FDA approvals.

6. Technology Sector Outlook and AI Growth

Dan Ives from Wedbush Securities presents a bullish forecast for big tech, driven by the explosive growth in artificial intelligence (AI) applications. He highlights Microsoft and Nvidia as key players poised for substantial market cap growth, predicting, “This is going to be a very bullish tech earnings” (36:08).

The discussion extends to software and cybersecurity firms, with Ives advocating for investments in companies like Palantir, MongoDB, and Snowflake, which are set to benefit from AI advancements. He anticipates a “golden age for tech stocks” in the second half of the year.

7. Options Trading and Market Speculation

The episode also touches on speculative trading, particularly in Netflix options. An options trader is making a significant bullish bet ahead of Netflix’s earnings report, wagering on an 8.3% move. Tim Seymour likens Netflix to a utility, emphasizing its resilient service model despite high trading multiples.

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Conclusion and Final Trades

As the episode wraps up, panelists share their final trade recommendations:

• Tim Seymour suggests buying ASML and mentions being long in his ETF.
• Karen Fierman recommends Citi and Liberty.
• Dan Ives points to MongoDB.
• Guy Adami supports Liberty.

Courtney Reagan closes by previewing upcoming segments, including further discussions on United Airlines' earnings and the potential implications of a Fed Chair firing on interest rates.

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This episode of "Fast Money" provides a comprehensive analysis of the intricate dynamics between political actions and economic policies, underscoring the profound impact of leadership conflicts on financial markets. From bond yields and currency valuation to emerging technologies and cryptocurrency legislation, the panel offers insightful perspectives crucial for investors navigating today's complex economic landscape.

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Notable Quotes:

• Tim Seymour (04:14): “I think this is all ado about nothing, much ado about nothing.”
• Loretta Mester (19:01): “Independent monetary policymaking does not mean a monetary policy committee that is unaccountable for its decisions.”
• Andy Constant (32:30): “If Trump wants to suppress yields on the long end, he could instruct the Treasury to sell fewer long-term bonds and/or increase their buyback program.”
• Dan Ives (36:08): “This is going to be a very bullish tech earnings.”

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This summary is intended for informational purposes and does not constitute financial advice. Investors should conduct their own research or consult with a financial advisor.

Transcript

[Tim Seymour]

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[Courtney Reagan]

Live from the NASDAQ Markets site in the heart of New York City's Times Square. This is fast money. Here's what's on tap tonight. Stocks whipsawing, short term rates dropping and the dollar down. We dig in on the market reaction as tensions between the President and the Fed chair hit new highs and back on track. A trio of crypto related bills seem to regain momentum last night. But facing another setback today, what it'll mean for the industry as bitcoin trades near record highs. Plus we're watch watching shares of United Airlines after its latest earnings report. Johnson and Johnson gets a jolt as Q2 results beat expectations. And we're counting down to Netflix's report tomorrow afternoon how the options market is setting up ahead of those results. I'm Courtney Reagan and this evening for Melissa Lee. Coming to you live from Studio B at the nasdaq. On the desk tonight we have Tim Seymour, Karen Fierman, Steve Grasso and Guy Adami. And we start with a growing feud over the Fed that sent ripples through markets today. Stocks dropping midday on reports that President Trump could try to fire Fed Chair Jerome Powell, quote, very soon, but then staging a turnaround after the President walked back. Plans to pull the trigger. For now, Treasuries firmer on the back of that news with the 2 and 10 year yields both moving lower and the dollar also weakening slightly. For more on where things stand between the White House and the central bank, let's bring in Megan Casella. What a day, huh, Megan? Quite a big day, Courtney. The latest escalation here. As you said in this long running feud. But what the president said today is that he's not currently planning to fire the Fed chair. But he did say he's very concerned about him, and he confirmed that he joked about the idea with Republican lawmakers last night. And he's not closing the door entirely. Here's how he put it.

[Tim Seymour]

Completely ruling out the idea of firing Jerome Powell. I don't rule out anything, but I think it's highly unlikely, unless he has to leave for fraud. I mean, it's possible there's fraud involved with the 2.5, $2.7 billion renovation.

[Courtney Reagan]

Leaving some wiggle room there, while raising the idea that fraud in the ongoing renovation of the Fed building could be enough. This was first approved eight years ago and that it could be enough to be probable cause for firing him. So those comments came after a senior White House official told me that the president had indicated he he was likely to fire Powell sometime soon, although the official cautioned that no final decisions had been made at this point. So the biggest questions as of now, whether Trump, of course, will actually do this and if he legally can now, that would become a question for the judicial system and for the Senate. And I'll note that some key Senate Republicans today have made clear they do not believe the president would have the legal authority to do this. And I'll remind our viewers that's a stance long shared by Powell himself. Courtney Meghann, thank you so much. You followed all the twists and turns for us today and got us up to speed with where we are. I mean, what a day. Grasso, I'm just going to, going to start right there. Do you think that this, I know we're not all policy experts here, but was this at all sort of strategic, an attempt to like, lob out the idea.

[Tim Seymour]

Sure.

[Courtney Reagan]

How markets reacted.

[Tim Seymour]

Yeah.

[Courtney Reagan]

And then take it from.

[Tim Seymour]

He's done that before, I think. I think he is good at doing that. That's part of his strategy. I don't think that he the term is up in May 2026, so I don't think he would waste that. And then Philip Jefferson would take over. And Philip Jefferson was appointed as the co chair, as the vice chair by Biden. So he's not going to get the wanted result. If you can't get the wanted result, why do it? So I think he is just floating it out there. The Supreme Court said he can't do it. So why. I don't think, I think this is all ado about nothing, much ado about nothing. And I think if we did get a sell off. That would be the greatest buying opportunity of the last couple of weeks. I don't even think we'd get a sell off. I think the market has moved past this debate between Powell and Trump and the Fed policy is tight. The Fed says they're tight. So if you look at the two year yield, it's 3.9. You look at the fed funds rate, it's 4.3. They're tight. They should cut at least once. The rest of the central banks around the world, the four top central banks were the highest, right? ECB is at 2, China's at 3. Japan raised rates for the first time in 17 years from a quarter point to a half a point. We are at 4.3. We are what, what is the rest of the world's interest rates? This is a global world and it's a competitive world and money flows to the most accommodative spot. That's why we don't have the same economy. We want the same inflation rates. We don't have the same. I mean, look, I hear what you're saying. I think the more important point is that what is 25 basis points going to do? And I think the more important point is what is the next Fed chair going to be? Whether. Whether. Because I actually do think that if he was fired and it's a big deal and I do think it would be more than just a why bother? Equities could shrug. I think markets could shrug. But I think the longer term impact is whoever is the new Fed chair and whether he's fired or not is going to cut rates aggressively and they're going to try yield curve control and they're going to try to control the long end until they can't. And I think that's really the biggest risk. The biggest risk is not the short end of the curve. The biggest risk is what happens at the long end of the curve. And that probably is not determined for six to 12 months or more. So I think there's been a lot of noise. I think Trump's probably happy that there's a lot of noise. And my guess is there's, there's just not a whole lot that really can be done in the near term if you're a Fed president that Trump puts in or not. Yeah, they're going to cut. It's not going to make a big difference.

[Courtney Reagan]

Karen, in the beginning we did see markets move, maybe not markedly, but we saw a move down when we got those initial headlines. And then we sort of even Back out. So. Right. The markets did seem to care to a degree on even the rumor. Yes, they cared to a degree. But I don't think you could look at this as a true trial balloon. When we had the trial balloon of the tariffs. Ok, right. And we saw the market's violent reaction to that and then the walk back and so everyone will look at this and think, all right, well, he's just testing and you know, so we didn't really get a true look. I don't think of how the markets react. I agree with Tim that if he indeed were to try to do this, the markets would react much more dramatically than what we saw today. I do agree with you. The Fed probably should cut, but I don't think it's great politics at all. If you look, go back to Reagan who had a Fed, you know, chair who was as aggressive as we have ever seen in the history of the United States. He wasn't happy with it. But you know, I don't love the out there calling him a moron and, you know, idiot and all that. I don't think that's, that's helpful. But one thing about, you know, we talk about this administration as crypto friendly. If you want to see a crypto friendly administration, fire the Fed, fire the chair of the Fed and you will get crypto moving for sure. I think part of that has been in the crypto move. Oh yeah, you think that's part of the. I do, I do. I've thought that for a little while.

[Tim Seymour]

Yeah.

[Courtney Reagan]

That's interesting stuff. Yeah.

[Tim Seymour]

Are you familiar with. You've been to Paris? I have.

[Courtney Reagan]

It's a great place. Yeah.

[Tim Seymour]

No, it's Notre Dame. You've never heard of it?

[Courtney Reagan]

Yeah.

[Tim Seymour]

Nice rebuild on Notre Dame as previously discussed. I love nice rebuild.

[Courtney Reagan]

Yes.

[Tim Seymour]

That's a pretty job. Kind of like what the Yanks have done. How much that rebuild of fell down, got burned, I understand. Less than $1 billion. Why do I bring it up? Apparently the president is saying that this Fed chair spent over 2 billion. I just heard Megan say, oh, right.

[Courtney Reagan]

Right, right, right, right.

[Tim Seymour]

Which is virtually impossible, number one. But he's floating it out there because I do believe he's trying to come up with some reason. The only way they can be fired is for cause. And in his mind, in this administration mind, that would be the cause. I do actually think he's going to give it a shot and I think it's going to happen.

[Courtney Reagan]

Give it a shot, try to fire.

[Tim Seymour]

Him over the weekend and, you know, he's going to wait until Friday or Saturday, because that's typically when people wait for these things, Danny Moses calls them, the Friday night 30s. And I think there's a real possibility of that happening. I don't think it's particularly bullish. And I will say this, the dollar today didn't think it was particularly bullish either because although the bond market recovered, there is still considerable pressure on the US Dollar, which by the way, may be the goal in the first place. Because when you're in a 37 trillion dollar hole, sitting on top of a $27 trillion economy, you're not going to grow your way out, you're going to sort of devalue your currency, your way out.

[Courtney Reagan]

Nobody knows more about this, of course, than Steve Liesman. So for more on the Fed and Powell's path forward, let's bring him in. I mean, Steve, what a day. Thank you for being here with us. I think you had other plans today that didn't include working, but we do appreciate you being here. What can you tell us?

[Tim Seymour]

Well, I'm really worried that Karen Feiderman is right because I was first of all concerned that Grasso actually thought there was a strategy here. And I was trying to think, well, what is the strategy of waving a letter and then having it go away? Maybe it's just to show to see what the market reaction will be. But if the strategy here is to pump up crypto, that's the most dangerous strategy I could possibly think of because I think Tim Seymour has it right. The dollar is really in danger here. If we're going to go from an independent Federal Reserve bank to one that is a third world Federal Reserve bank, one controlled by the president and the political sphere here, as well as the US treasury market, where I think would be in really bad shape if that were ending up to be the case.

[Courtney Reagan]

Steve, why does this feel so different? Is it because of sort of the low blows with the name calling? We've had other presidents that have not agreed with the Federal Reserve or with the chairman or chairwoman at the time. This feels markedly different.

[Tim Seymour]

Well, you know, his surrogates keep trying to compare it to those things, but there is absolutely nothing like this is all I can tell you. And I've done this for, I don't know, a couple decades now. A president can take a Fed chair behind the scenes and ask him to do X, Y and Z, and, and that's happened before and it's led, by the way, the behind the scenes stuff to, to terrible policy, but you cannot find any analog of any president ever making these kinds of public statements that the President has made. And this business about the renovation, I don't know all of the ins and outs of it. I do know A, that the Fed has the authority over all of its real estate. I know, B, that all of this stuff was approved by various committees and C, it would be very difficult, I think, legally from the legal experts I'm talking to, to pin this on Powell as the four cause he would need to fire him as a governor. So those are three really high hurdles, I think, to get by. But the general, the gist of this, Courtney, that I'm hearing is that this is all just pretext for a president who wants to lower interest rates to make it so that the, I don't know, somebody said to me it's to distract from Epstein. Another person said it's a, distract from the deficit out there, but it's all pretext out there. There's this stuff about the, the building renovation and it's just hard to find any kind of analog for this among any president. So it doesn't, it feels different, Courtney, I think, because it is very, very different.

[Courtney Reagan]

Steve, it's Karen, thanks for being on. You're probably wearing shorts and flip flops below the desk, so thanks for taking time for your vacation. But I'm wondering if there is a new Fed chair, what would be the mechanism to get rid of the other members of the Fed? Because they could all still vote and potentially still keep the policy consistent with what, what we have currently.

[Tim Seymour]

So that's a really good question. I do not believe the President has any authority to get rid of any of the bank presidents. And the rotation of the bank presidents, I think is according to Federal Reserve policy, its own internal policies for how those bank presidents end up having a vote. The governors are serving according to their terms. Adriana Kugler, I believe her term is up in January, so the President will get a slot there. I think that Powell's term as a Governor runs through 2028, so they could actually, I'm not sure how they would do this. I've been back and forth a lot of legal experts. It'd be very difficult for them to fire Mr. Chair, but they could demote him, make him just a governor, but he could still serve, which would mean that it'd have to come from the Coogler position, the new chair, as I understand it, so he would. You're right. The fomc, the committee does not have to go along. And by the way, while Powell, sorry, while the President points the finger at Powell. His committee has been virtually unanimous in terms of where policy is right now, and they've been pretty clear about where it ought to go. And I will point out maybe something that's not been part of the conversation, which is you do see tariffs showing up in the inflation numbers, but the inflation numbers have generally been relatively tame. And I think there's a terrific irony here. If that was because of what Fed Chair Powell and the committee are doing in terms of policy, which is keeping a lid on inflation, I want to point out everybody should go read a January 2025 op ed by Kevin Warsh, who was one of the people who is elevated as a possible replacement for Powell. Wash said at that time that it is the responsibility of the Fed to make sure that tariff inflation does not become widespread inflation. And almost word for word, Powell has repeated that at several of his press conferences and in several speeches that we are looking out to make sure it does not become a worse problem. So here is Powell, essentially, ironically, I would say, following the very same advice from one of the people that Trump wants to pick to take the job.

[Courtney Reagan]

Oh, this is very confusing in a lot of ways. Thank you so much. Right. I mean, for boiling it down. What are you trying to accomplish? I'm not sure getting rid of him does that, but here we are. Steve Liesman, thank you so much. Our next guest says President Trump firing Jerome Powell is, quote, a terrible idea that would only have negative long term consequences. Loretta Mester is the former president of the Cleveland Fed and a CNBC contributor, someone that knows an awful lot about the inner workings of all of this. We're lucky to have you here. Thank you so much. Ms. Mester, I guess just to get started, what was your general take on how today's events played out and what you think should or should not happen? Well, it's just another comment from the president about Jay Powell, unfortunately. And I think the vitriol has gotten ratcheted up under this president. I agree with Steve Liesman that you can point to past episodes where presidents have expressed their views about monetary policy and in most cases wanting lower interest rates. And in particular, it seems to happen before elections, which you'd expect. But we haven't seen this kind of vitriol and we haven't, as far as I know, really gotten to public remarks about firing the chair of the Fed. I do believe that would be a terrible idea. And you know, even putting myself in the administration's shoes, I don't see how it helps them at all. It certainly would not be a pro growth strategy. It certainly would not. Necessarily, even if you get a chair in there who will lower short term rates, it wouldn't necessarily lower long term rates, which I know that President Trump and his Treasury Secretary have been focusing on, because those do influence the economy. I think long term rates could go up in response as those longer bond yields incorporate higher inflation expectations and concern about lack of independence in monetary policy going forward, which means a higher risk premium for inflation in those bond yields. So I don't see how this can help in any way with the President's own agenda. And I think it would be terrible for the institution of the Federal Reserve. You know, we know from other countries and from a lot of research, whether you're a advanced economy or an emerging market economy, when the central bank is not able to set independent monetary policy, you end up with worse economic outcomes. And when the central bank can set an independent monetary policy, meaning one that is not influenced by short run political concerns, you end up with lower, more stable inflation. And you don't have a cost because it turns out you don't get more volatile growth because of that lower inflation. So in all, in all cases, you end up with better outcomes when you have an independent central bank. And I should say that independent monetary policymaking does not mean a monetary policy committee that is unaccountable for its decisions. And I think Jay Powell has done his best to make sure that he is communicating the rationale for policy. He is talking to Congress, he is putting out reports on the economy. And so I think that is the accountability. And you know, anybody can disagree with the policy perspectives of the Fed and that's legitimate. And different people, even people on the Fed, have different views about policy in any particular meeting. But I don't think it's helpful to have a president go after the Fed chair in a way that undermines the stability of the committee and therefore the stability of the U.S. economy.

[Tim Seymour]

You know, we dig having you on here. I speak for everybody. But I'll ask you the following question, because when you're in a $37 trillion hole sitting on top of a $27 trillion economy, you're not going to grow your way out of that. You're going to devalue your currency your way out of that. And my sense is, I mean, that's sort of the plan all along, whether they acknowledge it or not. How closely are you watching this weakness in the dollar which has been significant over the last six months or so?

[Courtney Reagan]

Well, I think you're pointing out one of the reasons that you want to have an independent central bank, meaning one that sets policy to fulfill the goals that Congress gave it, rather than one that will inappropriately and lower interest rates either to lower the cost of financing, which President Trump did say out loud. He has said that one of the reasons he wants lower interest rates is, is the lower the cost of financing the economy. And that is a very dangerous place to be. Devaluing the government debt is not going to help this economy. It's going to basically push things down the road and we're going to lose the great position we have relative to other countries. We're going to undermine the value of the US and you're going to see the dollar depreciate, as you point out, and you're going to see less demand for longer term US Government debt because of this. Loretta Master, thank you so much for making some time for us today. I'm sure your phone has been ringing off the hook. We appreciate getting your perspective. As always, Mr. Grasso, I go back.

[Tim Seymour]

To where I started this whole thing. First of all, I think every Fed chair is a political person. They're appointed by the president and they're.

[Courtney Reagan]

Approved by the Senate inherently, because you.

[Tim Seymour]

Have to be, you're appointed by the president, so you're not. So Trump appointed him in 2016, Biden kept him on while he was president. So now Trump wants his own Fed chair. I totally get it. But for all of us to make believe it's not a political position. It is a political position. Right. They have to meet with the Senate constantly throughout the year so they hear everyone's opinion. And by the way, Elizabeth Warren wants lower rates and every president in the history of our country wanted lower rates. So this is all, I don't agree with calling names, but at the end of the day, I think rates should be lower. And that's where I stand. So it doesn't matter all the bluster. It matters what the end game is. Rates will eventually, sooner rather than later be coming down. Well, I mean, the Fed's, the Fed's mandate, again, it gets back to it's about full employment and an inflation bogey. And these are things that really have to be seen as independent from politics because we know the job market's entirely political and we know that the politics related to where people have jobs, what parts of the country they have jobs and what sectors they have jobs in. And we know inflation on some level ultimately is political as well. So, I mean, I just, it's really nice to hear Loretta Mester point out the, the, the sanctity of the institution, because the sanctity of the institution is someone that's worked in emerging markets. What do you think was going on back in April when our bond market, our dollar and our equities were all going down in the straight line? It wasn't because suddenly we were that worried about the US Going into a recession, we were worried about structural dynamics and a change in the United States. So look, I hope it's all just a big test. I mean, the reality is, again, we have a deficit issue under every president we've had for the last five. But this is, this is bipartisan, a lot of blame to go around. I'm saying that clearly. I want that to be heard. But I, I think this is a case where the Fed has to be the arbiter of independence.

[Courtney Reagan]

We're going to have to drop it here, but we will pick it back up because coming up, we have shares of United Airlines losing altitude. We have to talk about that after its earnings report, the details from that quarter. Plus, don't go anywhere. Fast money is back into we got a lot more to talk about.

[Tim Seymour]

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[Courtney Reagan]

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[Tim Seymour]

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[Courtney Reagan]

Fiance and that video call for your gran's 80th stays in the family. Even your streaming password stays between you and your college roommates, who still ask.

[Tim Seymour]

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[Courtney Reagan]

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[Tim Seymour]

Them, not even us.

[Courtney Reagan]

WhatsApp message privately.

[Tim Seymour]

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[Courtney Reagan]

There'S like you guys. Welcome back to Fast Money, an earnings alert on United Airlines. The stock dipping after reporting mixed results. CNBC's Philippeau has the details on this quarter. Hi, Phil.

[Tim Seymour]

Hi, Courtney. United beat the Street. That's about the only good news that you're going to get out of the second quarter. They came in earning what, $3.87 a share. The street was at 381 revenue, a little shy of expectations. That's not the reason the stock's under pressure. It's under pressure because when you look at the performance in the second quarter, premium revenue despite being up 5.6% could not offset the fact that domestic revenue was down 0.7% pre tax margin of 11%. That compared to 11.6% Q2 of last year. And when you look at what's putting pressure on the margin, it's all about Newark. In fact, the pre tax margin was 1.2% lower in Q2 than it would have been were it not for all the problems at Newark. Essentially, Newark was a 1.2% margin hit in the second quarter as they had to cut all those flights. They had the delays. Everybody knows about the mess that was at Newark and has limited operations since then. And that carries over into Q3 where the margin hit will be about 0.9%. At least that's the estimate from United at this point. The other reason the stock's under pressure, take a look at the guidance from the company. In the third quarter, it expects to earn between 225 and 275 a share. The Street's at 260, but it's the full year guidance and this is important to keep in mind. The guidance is for $9 to $11. The street's at 1004. Regardless of what the Street's expecting, United back in April said we're going to give you two to issue two guidances, if you will, seven to nine dollars in a recessionary environment. Those are the words that United use, 1150 to 1350. In a stable environment, we're getting 9 to 11. Clearly United is feeling the impact of the issues at Newark in the second quarter. That's where the biggest impact was. But that's carrying on, guys. The flight caps are still in place there and this is their third busiest hub in the United States. So we're going to be talking with Scott Kirby tomorrow morning on Squawk Box first on cnbc. You do not want to miss what he has to say. Yes, we'll talk about the state of the consumer. But clearly plenty of questions about the impact of Newark on the bottom line.

[Courtney Reagan]

Certainly, Phil, we look forward to that. That's going to be a great interview. Thank you for that information going through the quarter. Tim, I know we talked recently, I think after Delta you said airlines are great trades.

[Tim Seymour]

I like, I like airlines here. I like Delta more than, than United. I'm sure I've said that. And I think the story with United, I'm less concerned about what's going on in Newark and in fact, the beat that they reported, when you add back in, if Newark hadn't happened, I thought it was a pretty solid quarter. But what the guide is, as Phil says, there's no hiding from a guide which isn't a great guide. And again, the reduction in trasm guide, you know what that stands for. Well, you're going to fill me in. Yeah. It's because we have to. On the show, we don't like to put too much financial jargon, but that's total revenue per available seat miles. So it's some combination of capacity outstanding against how efficient they are and really where they're pricing. And it was down about four and a half percent, which was much worse than the street expected. So I think airlines are still as a, as a, as a group within the industrial space, a place that if this economy continues to be resilient, you want to own airlines. Delta is the one I want to own.

[Courtney Reagan]

Interesting. And interesting what United had to say about that new guidance. Sort of in between the two recessionary environment and stable environment. Well, thank you very much. And coming up, we have a Fed chair firing and what it could mean for rates. We don't have it yet, but we got the threat of it at least on the bond market. Reaction to the Trump Powell problems, palace intrigue. You are watching Fast MONEY live from the NASDAQ marketsite in Times Square. We're back right after this.

[Tim Seymour]

At Capella University, learning the right skills could make a difference. That's why our business programs teach you relevant skills you can take from the courseroom to the workplace. A different future is closer than you think with Capella University. Learn [e-mail]. which are America's top states for business. Get all the data and complete state by state analysis. See how your state measures up. America's top states for business now on topstates.cnbc.com.

[Courtney Reagan]

Welcome back to Fast. We've gotten a news alert on Sarepta Therapeutics shares surging on news around its muscular dystrophy drug Angelica Peoples has the details. This is a really big move, Angelica. Can you explain it to us? Yeah, Courtney. So what's going on here is a couple of things. First, Sarepta is cutting about one third of its workforce. And, and they're also adding a black box warning to the label of elevidis. That's a gene therapy for Duchenne muscular dystrophy. Now, Sarepta says that agreement with the FDA resolves any material issues with the indication for patients who can still walk. So remember last month Sarepta announced that a second patient who could no longer walk died from liver failure after receiving the gene therapy. And that raised concerns that the FDA would remove the drug entirely from the market. Now, Sareptol will also submit a new protocol to the FDA with, for safer administration of that gene therapy to patients who can no longer walk. So it's a little bit tricky here, but there's two different groups that we're talking about Now. Sarepta stopped shipments to those patients after the second death from acute liver injury last month. And Sarepta will also discuss a pathway to resuming those shipments when they talk to the fda. In the meantime, Sarepta's pruning its pipeline along with those layoffs, cutting about 400 million in annual cost as it tries to retrench, as it faces a lot of this uncertainty. Courtney, really interesting stuff, Angelica. This is a difficult one, of course, to talk about because we don't want to be crass, but the move is significant. Up 30%.

[Tim Seymour]

Guy, you don't want to be crass, but this is one of those situations. I mean, pull up a long term charge, surrept. I mean, Karen can speak to this. I mean, look at how dramatic the move to the downside has been. And we've talked about this, but this is one of those situations where this is sort of rock bottom in terms of news. Now it's like the news is out. You know what, you're getting the stuff. CEO's probably in trouble. It's a kitchen sink type of thing. The markets will look past this and I actually think despite this rally, there's more room to the upside in Surrepta.

[Courtney Reagan]

Well, coming up, the latest drama between Powell and the president. What a Fed chair firing could mean for rates and how the bond market is reacting. Don't go anywhere. Fast Money is back into. Welcome back to Fast Money. Stocks closing in the green after a volatile session triggered by reports President Trump was getting ready to fire Fed chair Jerome Powell. The Dow jumping more than 200 points. The S&P up 3.10 of A percent. The NASDAQ up a quarter of a percent, notching another record close. More banks reporting earnings this morning. Bank of America putting in mixed results. Goldman Sachs jumping about 1% after seeing profit surge on higher trading revenue. Morgan Stanley lower despite an earnings beat. And PNC and M and T Bank both topping EPS expectations but heading in opposite directions. Empty materials falling after hours after the company announced its selling $500 million in stock shares, though still up more than 150% over the past two months. Of course, the government deal there too. And shares of ASML dropping more than 8% despite beating top and bottom line estimates. The chip giant warning it may not see any growth in 2026. Shares down there 8%. Let's get more on the rising tensions between President Trump and Fed Chairman Jerome Powell and the impact on the bond markets. Andy Constant of Damped Springs Advisors joins us now. Andy, why do you think the president wants to fire Jay Powell if as Lauren Mesher was saying, perhaps ironically, he is sort of doing everything he can to keep inflation in check with the tariffs that the president has incentive instituted. So what's he trying to do?

[Tim Seymour]

That's a great question. The high level reality is Trump wants rates much lower and wants the Fed to do something that they don't think is good policy for just the reasons you said. He could fire Powell in some way. He can keep jawboning. He can replace Powell in May with a dovish nominee. It's mostly the same. He wants the Fed to bend to his will. If they do, his will is to cut short rates a lot. Cutting 150 basis points, for instance, would save the government $100 billion and reduce the deficit. I get the math. But a Fed who sets policy based on the president's will is no longer independent. That sort of Fed would hurt the dollar badly as investors here and abroad would not expect the Fed to conduct policy as evenhandedly expecting more debasement of the currency. Inflation expectations would rise as a weak dollar and easy monetary policy would stimulate asset speculation and perhaps turbocharge real economic growth. That would cause the long end treasury yields and mortgages to rise, perhaps a lot. That wouldn't be what Trump wants. So his next step might be to ask the treasury to intervene. On July 30, the Besson treasury is scheduled to report issuance plans and updates to the treasury buyback plan for the second half of the year. If Trump wants to suppress yields on the long end, he could instruct the treasury to sell fewer long term bonds and or increase their buyback program to retire existing bonds and fund the government with many more bills. A 25% decrease in bond issuance would be the equivalent impact of QE from the Fed running at its largest monthly rate ever. So that would control bonds. Bonds would be controlled stocks, gold and bitcoin would likely rally consistent with what happens in in an emerging market economy and the dollar would get crushed. Will this happen? We'll see. But July 30th we will know.

[Courtney Reagan]

Andy, it's Karen. Thanks so much for being on. It's an interesting take on what would happen with the long bond. So that sounds like actually would, would you not want that to let's, let's say that you did all of those and the long bond actually is tame. How long can that hold together as.

[Tim Seymour]

Long as they continue to starve the market for duration. The lack of supply versus real demand. There's still demand for treasury bonds will keep yields low. It's not necessarily good for the economy as it'll heat up inflation and turbocharged growth. But you know that could be done.

[Courtney Reagan]

Andy, thanks so much for being here with us. We have a packed show so we unfortunately have to leave it there but we'd love to have you back. Andy Constant of damped spring visors. Well, coming up we've got some big tech on deck. What to expect from mega caps as the earnings season gets underway. But Wedbush's Dan Ives joins us next to lay out what he sees coming for that group. You're not going to want to miss that fast Money back into. Welcome back to Fast Money. Wedbush securities releasing a bullish forecast today for big tech earnings doubling down on AI as a growth driver for the space. Dan Ives, the firm's global head of technology research is behind the call. His research is behind the Dan Ives Wedbush Revolution ETF which was launched last month. Dan, it's so great to have you here especially ahead of earnings season. What do you expect from these big names? And I know there's one name you think everybody should be in. You can get in now. You're not too late.

[Tim Seymour]

Yeah, I mean I think this is going to be a very bullish tech earnings. I think the main thing is is that we're seeing the use cases when it comes to AI exploding and that's bullish for software and the hyperscalers led by of course Redmond and Nadella. In terms of everything that Microsoft I think that's 1, not just 4 trillion. We think that could be a $5 trillion market cap along with Nvidia in next 18 months. But it's this is going to be I think really a prove it time for tech. I think they're not going to disappoint and I think second half tech stocks are up another 12 to 15%. Hey Dan, the main names that you always cover that you've been bullish and you've been right on are really interesting. What's more interesting to me is the software coverage that you have. Tell me a little bit about the catch up if you think we're going to see some of these names catch up to the leaders that we've seen in the software space. Yeah, Grasso, great question. To me that really is going to be a huge narrative in terms on the software trade and earnings season because software has underperformed if you think about it. But now it's not just Palantir which obviously is our top one in terms of AI revolution. MongoDB, Snowflake. I think IBM seeing a massive renaissance of growth when it comes to what we're seeing on AI monetization. The use cases are exploding and that's where I think software and even cybersecurity is going to be what I believe could be a significant outperformer across all of tech second half of the year. So Dan, I think Microsoft made an all time high today. 3.8 trillion ish. So another 1.2 to go. They're going to do about 333, $40 billion in revenue next year. What does that revenue number need to be to justify a $5 trillion company? Yeah, it's a great question guy. To me it's really about azure revenue that's accelerating. I think we can now see acceleration 2, 3, 400bps over the next, call it 6 to 12 months. But I think the main thing is when you think about AI and the stack as a percent of overall revenue, it's small today but I think as we go into next year that could be 15, 20%. You think about the math on that. I think streets underestimate numbers here by potentially 10, 15%. That's why in my opinion, you know, 4 trillion is just a stop. I believe this is one. You know six hundreds are base case price target bull case could be $700 to get out the popcorn moment. I think as we go into earnings season for Nadella and Redmond. Dennis, 10 people were throwing popcorn on the floor today at ASML. How do you explain the guide there? And again they would be more emblematic of the infrastructure around tech and obviously the picks and shovels and you know it was an awful guide. Yeah, it was. And look and obviously I think this is going to be a little uneven as this all plays out but I like when I look at asml that's when I'd actually be a buyer on this type of, you know, sort of reaction. I think overall semis in terms of everything that we see over the next call it three, six months is going to have a massive move higher because right now Demand is still 10 to 1 when it comes to AI and it comes to chips from Nvidia. That's all from our checks in Taiwan and that's why we believe any of these sell offs they should be bought.

[Courtney Reagan]

Dan, it's Karen. Thanks for being on. So you've said we're in the second inning of this AI revolution. We know that stocks peak before the end of the revolution. What inning do you think stocks peak in?

[Tim Seymour]

Yeah, look, I think stocks could peak, you know, maybe in six, seventh inning but that means that we're going to basically have this run through I think not just the end of this year but through the most part of next year because you're still seeing so many enterprise. Only 4% enterprises have span AI in the US so I think this is a capex explosion. It's a fourth industrial revolution. We've talked about it. The AI party it was 9pm, it's now 10pm and it goes to 4am and that's why I believe you buy these stocks. I think 2Q is going to be I think the start of what is ultimately a golden age for tech stocks.

[Courtney Reagan]

Good stuff. The ever bullish at least right now. Dan Ives, thank you so much. I got to throw it in. Oh, even though you cheer for those, we are Lions.

[Tim Seymour]

Yankees, Yankees have a starting staff that have trouble getting out of the second inning. Well, that's actually not true, Tim. The Yankees starting staff, despite some of the injuries, they've acquitted themselves rather well as you guys got a little break by the way. Courtney was talking about it in the break.

[Courtney Reagan]

I mean what are they doing? Right.

[Tim Seymour]

Okay. Yeah. What are they doing?

[Courtney Reagan]

Yeah.

[Tim Seymour]

What are Tim and Guy doing? Let's get back.

[Courtney Reagan]

What are they doing? Give her a guy. Okay, so Dan, Dan Ives think is we're going to see 12 to 15% gains from here until year end for big.

[Tim Seymour]

Well, I mean he's been right. It's hard to argue with him. I mean the market, where the market close today despite everything we spent the last 45 minutes talking about it. But Tim is right to bring up names like asml, which by the way, this isn't off the highs. That stock made the move. This stock has already been sort of trimmed in a major way over the last six or nine months. So there are cracks in the armor, without question. But as we've said a number of times, Microsoft might be one of the three most important companies in the world. But with that said, at 33 times next year's numbers, you better hope they grow into that valuation.

[Courtney Reagan]

That's pretty rich there. Well, meanwhile, one options trader making a huge bet on Netflix ahead of tomorrow's results are Mike Co has the actions. Mike, how are you playing with this one?

[Tim Seymour]

Yeah, so right now the options markets implying a move of about 83 bucks higher or lower after they report by the close of business on Friday, which is actually the last trading day we're going to get in this thing. That 6.5% is actually slightly lower than the 8.5% that the company has averaged over the last eight quarters. Now, I've often described this business as essentially an unregulated utility. I think there's Netflix in the streaming world and then everybody else, we see some bullish bets going into it. Somebody was buying the July 1260 calls. They were paying 42 bucks for 300 of those 300 contracts. Doesn't sound like a lot, but that's more than one and a quarter million dollars in premium on a bullish bet that expires just one trading day after earnings.

[Courtney Reagan]

Interesting stuff there. And Netflix, of course, a name we all watch so very closely. Many people, you know who, who says it trades like the utility, is that you?

[Tim Seymour]

Well, what to me trades. It trades like in video. In other words, you trade. It trades. Actually it's not even fair. It trades, it trades something with a multiple over 50 because it has it. That's the issue with Netflix. But it, it does behave like a utility in terms of how the service they provide and how it seems to be something that's impervious to price hikes.

[Courtney Reagan]

Pretty crazy stuff. Mike Co, thank you very much. Well, coming up, the latest on the not one, not two, but three crypto bills making their way through Washington, where we stand now and what it means for bitcoin prices. Next, more fast and to welcome back to FAST money. The crypto bills trying to make their way through the House hitting another hurdle today. While the stablecoin bill looks to have support. Republicans are concerned that the market structure in anti central bank currency bills might not have the votes to pass the Senate Cryptocurrencies are. I never say this. Right.

[Tim Seymour]

It's ok. We're not on air yet. Yeah.

[Courtney Reagan]

Okay. So we've got bitcoin. Everybody knows that. Ethereum.

[Tim Seymour]

Yes.

[Courtney Reagan]

That's great, Solana. Yeah, Bitcoin shaking off the news and they're surging today. So, Steve, what's going on with cryptocurrency? As we heard Karen's theory earlier in the show about potentially having to do with the turmoil at the Fed and the president, Are we actually moving on fundamentals now in the state of crypto?

[Tim Seymour]

I don't know if the only thing is the limited supply. Right. So you'll have 21 million coins ever created. We're at 19 and a half million now.

[Courtney Reagan]

That's always the case. So then why are things, what?

[Tim Seymour]

Well, I think it was the crypto week. I think that's what sparked it because it started last week. I think everything that Karen said is exciting, contributory factor to it. So if you have a digital currency that cannot be manipulated by or lose its value, so. So bitcoin doesn't really gain value, it's just everything else is losing value. So if you look at what the dollar is worth now, if you go back to 19, whatever, 72, pick your, pick your point in time when we're on the gold standard and then you run it up, the dollar is worthless right now. So bitcoin is just a reflection of fiat currencies losing their value. And that's going to continuously happen going forward. So that's why the top is not in and that's why this thing can go dramatically higher. And if you talk to Michael Saylor, guy did that recently, it could go to what, 13 million? He, you know, he thinks there's a chance the market cap of the gold is $20 trillion, I think. And he doesn't say any reason why bitcoin shouldn't be equal to or surpass it. He talks about it for a while and it is, it's a play against the fiat currency. Since 1930, the dollar lost 95% of its value. I think bitcoin's caught up to that.

[Courtney Reagan]

Very interesting stuff and I'm going to say it one more time. Etherium, I think, well done. Going to get it. I don't know why that trips me up all the time. Coming up next, your final trades. It's time for the final trade. Let's go around the horn. Tammy, get to start.

[Tim Seymour]

Courtney, it's great to have you as always. Asml wasn't great to own it today, but I think it's time to buy it. I am long in my etf.

[Courtney Reagan]

Karen yes so Citi I liked it into earnings and I like it after earnings and go Liberty Steve Go Liberty.

[Tim Seymour]

MongoDB Dan Ives flagged it. I would say that's my final trade. And Guy Tommy Best of your folks again. If you're at the Liberty game tonight, please say hello to Karen Feynman. She will be there rooting on the squad. Go Liberty.

[Courtney Reagan]

Go Liberty.

[Tim Seymour]

Yes. Pan American Silver paas okay, well thank.

[Courtney Reagan]

You for watching Fast Money Mad Money starts right now.

[Tim Seymour]

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[Courtney Reagan]

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[Tim Seymour]

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[Courtney Reagan]

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[Tim Seymour]

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[Tim Seymour]

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[Tim Seymour]

To view the full Fast Money disclaimer, please visit cnbc.com fastmoneydisclaimer@ Capella University, learning the right skills could make a difference. That's why our business programs teach you relevant skills you can take from the courseroom to the workplace. A different future is closer than you think with Capella University. Learn more at Capella. Eduardo.