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Halftime Report
Halftime Report live from Future Proof in Huntington Beach, California. 9/9/25
00:46:07
Scott Wapner and the Investment Committee are lives in Huntington Beach, California at Future Proof, a gathering of financial advisors and Investment professionals. We are joined by Dan Ives of Wedbush Securities to look ahead to the Apple Event at 1pm. Plus, Blackrock’s Rick Rieder joins us later to talk about everything from the market, the fed, rates and more. And later, CNBC’s Leslie Picker brings us an interview from JPM’s Jamie Dimon to talk about his new HQ in NYC.
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- [00:00]
A
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B
I'm Scott Wapner and you're listening to CNBC's Halftime Report, the podcast the most profitable hour of the trading day. We record this live weekdays at 12 Eastern. Listen in. Welcome to the Halftime Report. I'm Scott Wagner live today in Huntington Beach, California at Future Proof, a gathering of around 5,000 financial advisors and investment professionals. Josh Brown's Ritholtz wealth is the key driver of this event, which means he's with me here along with Stephanie Link and Shannon Sokosha Blackrock's Rick Reeder. He is the keynote this year. He'll be with me right here in just a little bit. Our Leslie Picker is going to speak with Jamie Dimon live shortly. There's a lot going on today. Dan Ives is going to be with us as well. We're going to kick things off with these record setting markets and how best to play them. And Josh, I'll go to you first. So we'll talk about this event in a little bit. But this is a market that's been in full on rate cut mode. Yes. And what's so interesting is I looked back to last year and we sat here a year ago in these very chairs overlooking this beautiful ocean and stocks were at record highs and the Fed was literally on the cusp of cutting rates for the first time as part of this cutting cycle. And here we are again.
- [02:17]
C
It's a little bit Groundhog Day ish. I totally agree with you. I think what's changed is that We've had incredible earnings growth, especially in the NASDAQ 100 names, S&P 100 names. I don't think sitting here last year we could have been as confident as what actually ended up happening. Just tremendous growth in the AI theme and a lot of the ancillary companies that are not necessarily tech but involved in the build out. Stephanie's been talking about the industrials all this time. We've mentioned the utilities. We had no idea that the next 12 months would include so many companies from so many industries beating earnings. We had a great earnings quarter this past quarter. So that was all still up in the air. But listen, that explains what the market has done from then till now. What's going to happen going forward? There's a really interesting trade happening in the financials and in anything home, building or mortgage related which I know we'll touch on later. That could be the next leg of this market. Not to say the AI theme will peter out, but it's really nice to have a new group of stocks that are joining the party and I think that you can make the case. That's what the month of September was all about.
- [03:22]
B
This a rate cutting rally stuff, right? I mean we've priced a lot of that in do you think at this point? Because that's what it feels like is what the whole conversation is about. We know that the Fed or at least we think we're pretty good handle on the fact that the Fed, if they don't cut next week, there's going to be a lot of surprise.
- [03:39]
A
I think in this they're going to cut, they're going to cut next week for sure. The question is how many more are they going to do? Are they going to do two? They're going to do three this year. But they are cutting. And there is that old adage, you do not fight the Fed. And I would say that the market is acting very well because the economy is actually holding up remarkably well. We're running at 2, 2 and a half, 3% GDP led by the consumer. All you need to do is listen to the Barclays conference this week from the banks. Every single bank company executive talked about the consumer being very strong and it's because they have jobs. I know it's cooling, it's not collapsing. They have wage growth at 5% and then also you have business spending, you're running at about 10% annualized spending growth from businesses. And it's not just AI and data center build out, it is capital goods, it's the industrials that Josh just mentioned. And so to me the economy is doing well. That means the earnings picture is going to continue to do well. And I think you're going to see double digit growth this year and mid single digit revenue growth with margin expansion, which is really very, very important.
- [04:48]
B
And the chart we're showing on the screen right now, Nasdaq, I mean look at from the April lows, it's really been the story certainly of late that money has just started to flow back into this space. You could maybe in terms of the last month, month suggests. Well, it was the news around Alphabet, the regulatory relief around that name that sort of, sort of started this next leg, right?
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A
Well, I think it's the news around Alphabet, Scott. And I also think that there has been a dogmatic approach to investing in tech over the last couple of years in terms of those who haven't been keyed in on the AI story have been talking about valuations and the challenge is here is that that was predicated on the fact that it was exposed expected that earnings for big tech would slow more markedly than they have over the last couple of quarters and into the second half of this year. So the rotation story was really around. We're going to see some compression in tech earnings. We're also going to see some stronger earnings in 493 stocks as well as small and mid cap stocks. Instead, what you're getting is you're actually getting stronger earnings than anticipated in tech along with the growth in earnings from those other parts of the market. And so it's no longer an either or trade. But investors feel a lot more comfortable that US stocks collectively are probably a good bet for the second half of the year. And you've got those tailwinds around rates and capex that Steph already mentioned.
- [06:07]
B
It's definitely been more bifurcated within tech lately. And the Alphabet news seems to be the line in the sand. If you look at the one month performance for example of Alphabet and some of the other names relative to a Microsoft and an Nvidia, I mean it's pretty stark. The performance. In one month, Alphabet's up 17%, Nvidia's down 8.5%.
- [06:32]
C
Yeah. One of the things that's so interesting about what's happened in big tech this year is we've had this kind of rotation within the Mag 7 names. So like Apple is now in bull market mode. It hadn't been for, I don't know, four or five months straight. The Alphabet story has been revived thanks to obviously regulatory stuff. But there were A lot of bulls pent up waiting for a reason to buy the stock because it was the cheapest among the mag 7. A little bit of good news didn't take much and some of the other names like Nvidia and Microsoft take a breather. But that intra mag 7 kind of rotation is what keeps the market where it is. You don't need all of these stocks going up all the time. That's good enough. So hold up the Nasdaq, hold up the S&P 500 and it's frustrating for the Bears. They want to see all of them go up or all of them go down all at once. And that's just not the way the market acts. That story where money comes into index funds and just indiscriminately buys the 10 biggest stocks, literally no, you could see it on your screen. There is money moving between them and I think it's healthy.
- [07:38]
B
The question over as Steph these stocks have gone back up. The valuations continue to climb as well. UBS had a really interesting note today. Tech valuations, while higher, may not matter as much right now. They say this is only the fifth time since 1950 that the S&P 500 forward PE has started above 21 times. Yet history shows that an elevated PE alone rarely dictates short term market direction. I can't tell you how many times you guys have said stuff like that, right? Valuation, it's not insignificant. But if you're making all of your investment decisions based on valuation, you're making the wrong move. Now valuations do matter. If everything around mega cap tech, for example, starts to slow down, which Goldman Sachs is talking about today, to hyperscaler Capex growth is going to slow beginning in Q4. They gave us a chart as well, or at least put that out as part of their note. A reversion quote back to early 23 levels would imply 15 to 20% downside to the current valuation multiple of the S&P 500. How do you judge all of that together?
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A
Well, I think, you know, I was looking at my notes because the companies, the Mag 7 and now with Broadcom Mag 8, all of the earnings estimates have actually gone higher. Post earnings, almost all of them beat expectations and the free cash flows all rose substantially. Substantially. I do think you're going to see a slowdown in the spending for data centers because you can't grow $400 billion every single year. But that doesn't mean that the trend is over. And again, these companies are delivering in spades. So yeah, they might be Expensive. But then you have these earnings revisions. And we know that stocks follow earnings revisions on, on the way up and on the way down, and they're all going higher. And so I think you do want to be selective. And, you know, I only own Amazon and Metta and I own Broadcom. I'm happy with all of those. I don't think you need to own all of them. You pick your spots, but all the numbers are going higher. And that's a good thing.
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B
Yeah. And that leads us to Apple. It's rallied a lot over the last three months, really, after being sort of a sideways trade. This stock has definitely picked up and it's right ahead of that event they're holding today on the iPhone 1:00pm Eastern Time. Dan Ives, I told you of Wedbush is out here with us too, at Future Proof. We welcome him to the conversation. It's nice to see you.
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D
Good to be here.
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B
You know, some have said this is the most inconsequential, if not insignificant iPhone event that Apple has held in arguably many, many years. Is that how you see it, too?
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D
Yeah, look, I'd say it's really apathy from an investor perspective going into the event because there's really no major hardware changes. I mean, obviously a little thinner. Probably going to be about $50 to $100 more given maybe some of the tariff issues. But the reality is that the elephant in the room continues to be AI when they doubled down the Gemini partnership, now that the DOJ stuff's cleared, Cook's played great in the sandbox in D.C. now, you know, with Trump, and that's removed a part of the overhang. And look, Scott, my view is like expectations. We thought back a year ago super cycle, which really obviously was a little disappointing. Now you have 315 million that haven't upgraded their iPhone four years. Expectations are very low. And I think the sentiment combined with what ultimately is going to be probably be an AI catalyst. I think Apple, we sit here a year from now and Apple's probably, you know, a stock that I believe is probably 30, 40% higher.
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B
I mean, the reason why 315 million people haven't upgraded their phones in over four years is because the company hasn't given them a reason to do so.
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D
Yeah.
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C
Okay.
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D
Goes back to every Apple event. Mean you've been many of them. I feel like Michael J. Fox, Back to the Future. Right. I mean, it's been sort of, you know, they've missed so many of the sort of a trades that you're seeing. But I do believe Clock struck midnight. Cook and Cupertino recognize it. They waited for that DOJ situation. That's cleared. Now it comes down to they walk down the aisle with Google and Gemini in terms of that huge partnership. And that really also takes out the.
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C
Chance of an estimate on how many people will Upgrade on the 17. Do you think it's a big number.
- [11:41]
D
So we think right now if you look ultimately expectations are you about 7, 7 to 8% iPhone growth with the unit, you're probably going to have 225, 230 million units that they sell. Look, and I like that setup the expectations relative to the stock and iPhone 17. The big key is going to be China because you have 100 million in China that have an upgrade. Starting to see some senate improvement there. And I think right now, look, overall, even though you've had a move here, I mean the cab driver here in Huntington beach is negative, bearish on Apple.
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B
You know what the deal is? Those people you say who are bearish, they're just not talking about the company nor the stock in ways that they used to. That may be the biggest problem that Apple has right now.
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D
Yeah, I think it is a problem, but it's a sleeping giant. You have the biggest install base in the world, 1.5 billion iPhones, 2.4 billion iOS devices. And that's why I continue to think cook every time you count them out, and there have been some called for, maybe he's not going to be the CEO to lead into this next era. I believe he is. And I think they've been late. But guess what? You could be late when you have the best installed base in the world. And that's why I believe ultimately this is probably stock risk reward on large cap. It was Alphabet. Now this is probably more the table pounder relative to the next 612 months, given some of the catalysts that could.
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B
Happen as a shareholder. Do you believe that?
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C
I hope Dan's right. The problem with Apple historically has been, okay, we understand it's a sleeping giant. At some point there will be this upgrade cycle. But how much of that is in the stock at what your. What's your P. E on next year's numbers is 31, 32 right now.
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D
Yeah, but. But I also believe the one thing, if you look at straight PE, I think what you're missing is what the AI opportunity $100 per share could be to Apple. And I'd factor right now like no one is factoring that in with that.
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B
Ultimate and an additional hundred dollars per per share from AI I believe how do you.
- [13:36]
C
Or from multiple expansion.
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D
The monetization is going to be about 70% of that's going to come from they're essentially going to build an AI app store that I believe is ultimately going to be the highway for AI when it comes to the consumer. And I think that will ultimately be the super cycle that plays out. You could be wrong in a year. And I think, Scott, what that does is if you look at numbers street, you look at next two or three years, you're probably underestimating where numbers could go by 30%.
- [14:00]
B
Steph, do you have skepticism around that as a. I mean, you had the stock.
- [14:05]
A
I don't own it and I wouldn't buy it here after the rally it's had. I just don't think they're anywhere to be found in terms of AI. I can pick a whole bunch of names in technology that have AI and are benefiting from it and are monetizing it and go back to Broadcom. That's one of the reasons why the stock has totally rerated because they did get AI Right. So I'm not saying that they're not going to get AI, Dan, but I just don't think it's, I don't think you're going to see a super cycle on 17 because they don't have it. So I think it might be 18 and that's fine. They'll get it eventually. But it's not 17.
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D
Yeah, good point.
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B
All right, well, we'll see Top of the hour and we'll talk to you again. Dan Ives here at Future Proof. Thank you so much for that. Let's spend a moment talking about the banks, too. We did mention it a moment ago. They have been trading, as you know, at record highs. Goldman Sachs today reiterated overweight at Wells. Bank of America overweight also at Wells. Stephanie Link has that name. There's been a lot more optimism around the deal market and M and A private equity hasn't traded well, though one of the spots that you would say, well, if there's more optimism around deals, why wouldn't private equity be right in the mix? Blue owl over one month, down 9%. Apollo down five and a half. KKR down two and a half. Stephanie Link, you sold the stock?
- [15:18]
A
Yeah, KKR. I'm up 10% in the name, so I bought it when it was down almost 20%. It's great company. It's not cheap. I think the banks are so much more compelling because you do have them benefiting from the steep yield curve deregulation. You also Have M and A, M and A right now, year to date, $2.7 trillion. Scott. Completed M&A transactions are up 40% worldwide and in North America up 102%.
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B
Yeah. No. Why aren't you buying more of KKR rather than selling it?
- [15:46]
A
No, because I think the banks actually are going to benefit and they're cheaper and that's how I'm playing. KKR is a fine company and yes, capital markets recovery will help them too. But the private market stocks, they've done so well over the last several years. I think there's a catch up trade with the banks and I do think the valuations, I know that they're at the high end of the price to book, but I think you're going to see a massive rerating in these stocks and that's where I want to be putting more money.
- [16:12]
B
Shannon, I'll give you the last word on this. And just to remind everybody again, Leslie Picker is going to be live with JP Morgan's Jamie Dimon coming up on this very program in just a little bit. So you don't want to miss that. But what about your take here?
- [16:23]
A
I think that there definitely was some pull forward in some of the private equity names in terms of the anticipation of a deregulatory environment, lower cost of capital and, you know, everything that was coming into this year. I do think that there's probably an opportunity for both to win from an I banking perspective on the traditional banks as well as the private equity providers announced. M and A is increasing, but you need to start seeing deals being closed en masse to really be able to monetize the public portfolios and be able to get that second run for the private equity names.
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B
Okay, so after we hear from Jamie coming up, we'll talk to you. Josh, because you're a JPM shareholder, we'll continue the conversation there. But coming up, as we just get started here at Future Proof, our next guest, an exclusive sit down with BlackRock's Rick Reeder. We get his outlook for this market, what the Fed's going to do next week and his potential role there. We'll discuss that next.
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A
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- [18:11]
C
Celebrating 30 years of SquawkBox tomorrow Charles Scharf, Michael Rubin, Mohamed El Erian Squawkbox 30 tomorrow, 6am Eastern and streaming on CNBC.
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B
Welcome back live here to Future Proof in Huntington Beach, California. Our next guest recently called the current investing environment one of the best he's ever seen. Rick Reeder is BlackRock's CIO of global fixed Income, also its head of its global allocation team. He joins us now. It's good to see you out here by the beach.
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E
Wow, pretty nice.
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B
So you made that statement with me on closing bell and since then the market continues to go up. We got a bad jobs report and this feels like it is very much a rate cut rally. Don't, don't fight the Fed. Is that what it is?
- [18:58]
E
So you know, by the way, by the way, I think that quote went crazy in terms of people repeating it. It taken a little bit out of context. Do I think the equity market's going to go up? Yes, I think it's still going to go up. I think the technicals are extraordinary. Why? I think it's the best investment environment. You have a couple of things taking place all at once. Technology's changing. We've got incredible earnings growth in a number of tech companies. That's exciting. You got bifurcation across different, different companies. In the fixed income market, you've got income everywhere. You can still create 6% income until the Fed cuts rates. That's super exciting. In different areas. You've got publics, you've got privates, you got gold, you got bitcoin. There's so much to do that it's the best I've ever seen in terms of figuring out where it is and that, that to, to be an investor is as Exciting as ever.
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B
Let's just say that those opportunities exist in fixed income until the Fed cuts rates.
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E
So.
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B
Because that's going to happen next week. Yeah. So do you wait, they're going to cut next week?
- [19:51]
E
Yeah, they're going to cut, I think they should cut 50. They're going to cut 25. Probably depends. You know, the CPI report that's out tomorrow will be interesting or Thursday will be interesting. Listen, I think they should go 50, but I think they're going to go 25 and then we're going to start moving rate down. That being said, you can still build a portfolio to get this sort of yield. And by the way, you can still stay in the front to the belly of the yield curve. Get that yield. We've been extending a little bit out because now your real rates are pretty exciting. Get the things that are interesting, real rates. Now, if inflation's running 3ish, these real rates are actually okay out the curve now.
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B
Okay. So this is the best opportunity before they cut rates to take, to take advantage of a trade that will still work after they make that move. But you're not going to get as good of a value on it as you will literally like now.
- [20:38]
E
Yeah. Ironically, you know, people, you know, people are cynical, say, you know, I want rates to come down. Feels good for it actually for an investor. By the way, if you're in this country and you're a wealthy saver, these interest rates are phenomenal because you can just keep clipping income. Like I would rather rates that from a commercial point of view, I'd rather rate stay here from a, what I think is best for the economy and particularly lower income in this country. I think we got to get that, get that rate down.
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B
Are you worried at all about stagflation and if so, where on the concern meter does it fall for you?
- [21:06]
E
I don't know what the extreme low end of the meter would be characterized at, but I think so we're going to run, by the way, our projections this year. We're going to run 4.6% nominal GDP. We've run almost 5% or 5% plus nominal GDP the last couple of years. It seems like every time, you know, particularly the first quarter, second quarter this year, people say, okay, the recession is coming and at the end of the day the numbers come out. So no, I don't think, I think growth, I think we can get real GDP of about 2%, maybe just under 2. You put some inflation on it, you get nominal GDP, that's close to 5, which by the way, with the debt burden we've got in this country, having a 5 nominal GDP is pretty good.
- [21:43]
B
Okay, so we mentioned the call you made with me on closing bell and when you said it, I quite literally said to you in that, in that moment, wow, if they're watching at the White House, they're probably standing up and saying, yes, that's what we're talking about. The Fed needs to cut and this is a great environment to be an investor. And lo and behold, less than 24 hours later, your name appears on the short list to be the potential next Fed chair. What do you want to say about that?
- [22:13]
E
So what? I don't say anything about that, but all I want, all I want to say, you know, from, by the way, when I heard that, listen, I, you know, I've had a long career. It's a, it's an unbelievable honor to get to be even mentioned in that list. A great group of people to even be up there. There is a pretty neat thing for me. What do I think about it? Listen, a couple of things that run through your head. We are now talking about a Fed that can move 25 basis points and maybe they do it three times till the end of the year. Moving 25 basis points of the overnight funding rate is not that exciting. There are so many innovative things. We finance resi, commercial real estate, asset backs. You think about capstack, you think about what the Fed could do so whoever, whoever ends up being the Fed chair. There's so many innovative things. How to use a balance sheet, how do you use liquidity? Where on the yield curve is it by the way, the Fed's reducing mortgages, same time we have mortgage rates too high, that's hurting a huge number of people in the country. We are seeing something in the country today that we haven't seen with this intensity in an extended period of time. Low incomes having a really hard time. And you know, I don't agree with the thesis that while tariffs are inflationary, we've got to fight in tariffs. You think about, and by the way, it's half the country that's having a hard time. If you think about today, if you're being burdened by tariffs and largely it's goods. So the goods are where lower income, middle income suffer from. When you have goods inflation to say, gosh, we're going to charge you a higher rate to borrow too. It doesn't feel like that is equilibrium. I think we can get that rate down.
- [23:38]
B
Have you had your interview yet?
- [23:41]
E
I cannot, I can't I can't talk about that.
- [23:43]
F
We're.
- [23:44]
E
I'm enjoying what I do, I'm enjoying being here with you, I'm enjoying investing thing.
- [23:48]
B
That's okay, Fair enough. We obviously are having a pretty deep conversation these days about Fed independence and what the future of that holds. Ken Griffin wrote in the Wall Street Journal just a couple of days ago, quote, pressuring the central bank to adopt a more permissive stance towards inflation carries steep costs. These actions raise inflation expectations, increase market risk premiums and weaken investor confidence in US Institutions. How do you feel about the issue of Fed independence and what do you make of what Mr. Griffin had to say about it?
- [24:21]
E
So a couple of things. So for the smart guy, I would say, listen, I think Fed independence is critical. You think about how today one of the big critical items for this country is we got to fund debt. Globally people have to have confidence in we're managing the currency, we're managing our debt stack effectively. So I think Fed independence and our debt costs effectively, I think Fed independence is, is superior in terms of importance. That being said, I still think there are creative things that you can do. And if you said to me today inflation is running a little bit hotter, we've got some tariff transmission. I think for. If you go back two decades prior to Covid, we couldn't get inflation to 2, we couldn't get it to 2. On the high side, if you think about where the next five to 10 years are going to be, we are going down what I think is the most extraordinary period of technology productivity. And quite frankly, after you get the fiscal tailwind next year, I actually think the bigger issue is going to be putting enough people to work. You're seeing it today and you saw the revision in payroll. Today you're seeing weak labor. If you strip health care out, you have negative job growth. I think people underestimate. We're going to displace a lot of people from jobs to me for the next five to 10 years. Yes, you've always got to manage inflation. You always got to be thoughtful about it. By the way, five year inflation break evens today are two and a half percent. If you got the funds rate to three and a quarter, you're still above the rate of inflation today. If you ask young people about getting a job, if you ask people in urban settings about getting a job, it's really hard. That to me is going to be the secular discussion over the next few years.
- [25:55]
B
Speaking of the discussion, what do you make of the way that both the bond market and the Stock market are telling sort of different narratives about what the current environment really looks like. Tony Pascarello at Goldman Sachs I think somebody you know quite well, as do I and I know he has great respect for your views on the market. I think it's vice versa. He says bonds are principally focused on the current slowdown in the labor market. While stocks are looking forward to a cyclical acceleration. If equities were to get genuinely concerned about the growth outlook, the downside tail could really open up given the interest rate strip has already pricing in a lot of easing. Is that fair? Do you agree with that?
- [26:36]
E
He's very good. I would say a couple of things. One, you know, it's always. I always find it hard interpolating what the market is telling you. Oftentimes the market tells you what the technical condition is. So the thing about the equity market, earnings growth is pretty darn good. Like when you wrap up second quarter earnings. It's pretty impressive. What we're still able to by the way a lot of it through cost cutting. You didn't see a tremendous amount of revenue growth. Market is telling you earnings growth is pretty good and anticipated to continue to be pretty good. And there is. We talk about it all the time. There's a massive amount of cash. The buybacks relative to the IPO calendar dwarf it. It's what, a trillion 3 versus 50, 60 billion we'll get this year. Technicals and equities are amazing. What the bond market is telling you is the rate, the funds rate is too high. We got to get that funds rate. What is neutral? I would argue is it three. I actually personally given what we talked about around technology and productivity, I think it's a lower than that. But the bond market's telling you we got to get to at least neutral. And it's going to happen, I think should happen faster, but it'll happen over the next year and a half or so.
- [27:39]
B
What do you think the ideal portfolio is supposed to look like today? We're surrounded by investors. We're surrounded quite literally by financial advisors who are thinking about that, retail investors who are watching. I mean, what does it look like today?
- [27:56]
E
Very different than the past. So maybe I'll start with start with the equity market. I mean the first thing I would say we're going through the most extraordinary technology dynamic I've ever seen before. I would stay long equities, by the way. You can buy volume, you can buy volatility very cheaply to manage your exposure and stay long equities oriented to where growth in technology is in fixed income. Income is amazing. You're still clipping 6%. Would I stay five years in in on the curve? I'd still clip that coupon. We're extending a little bit out. And then quite frankly, I mean, there's some interesting things to do in privates, bespoke markets. And I think hard assets have to enter the equation today. Gold, bitcoin, things that give you a little bit of ballast in the portfolio against potential for currency depreciation.
- [28:40]
B
When you talk about bitcoin should be part of the portfolio, what type kind of percentage are you thinking about? Is it a 5%, which generally seems to be what people are talking about, more or less.
- [28:50]
E
It seems high to me. The so I run our global allocation Fund. You know, we're running long equities. You know, we're heavy income. You know, we're running, you know, in the 3 to 5% region on gold. Gold strikes me today as a better currency hedge. Bitcoin tends to trade with volume, tends to trade with the nasdaq. So we're running considerably lower than that in, in crypto. I just think it's going to go up and I think it's a good expression. But five seems high to me. But it depends where you are in your life and how much risk you want to take.
- [29:21]
B
Well, we'll see on the stage. The big stage, I said, is our as the headline speaker, the keynote today, Rick Reeder. Thank you.
- [29:27]
E
Thanks for having me.
- [29:28]
B
All right. Joining us here at Future Proof the Headlines with Contessa Brewer. Hi, Contessa.
- [29:32]
A
Hi there, Scott. The Justice Department is considering handing over voter roll data to the Department of Homeland Security for use in criminal and immigration investigations. Reuters is reporting that government documents show DHS intends to compare voter data gathered by the Civil Rights Division against other law enforcement databases. Both the DOJ and Department of Homeland Security said this move is intended to ensure only eligible people are voting. Ukrainian President Volodymyr Zelensky is urging the country's allies quickly to step up deliveries of air defense supplies. In a nightly address, Zelensky said Moscow considered a lack of stronger international sanction a sign that he can continue the war in Ukraine. The address follows a Russian airstrike in eastern Ukraine that killed 24 people. And the Justice Department said today it will move to dismiss a lawsuit against Norfolk Southern after it agreed to give priority to all all Amtrak passenger trains over freight trains. The DOJ said Norfolk Southern's agreement settles a 2024 lawsuit in which the company was accused of delaying trains on Amtrak's route between New York and New Orleans. So passengers getting a sigh of relief there, Scott.
- [30:49]
B
All right, Contessa, thank you, Contestant Brewer. Coming up next. We're back live here with the committee at Future Proof. We do have an update today to Josh Brown's best stocks in the market. We'll tell you about about that. We are just moments away from a live interview with JP Morgan's Jamie Dimon. Don't go anywhere. We're back here in California right after this.
- [31:08]
E
Sometimes an identity threat is a ring of professional hackers. And sometimes it's an overworked accountant who forgot to encrypt their connection while sending bank details.
- [31:17]
A
I need a coffee.
- [31:18]
E
And you need Lifelock because your info is in endless places. It only takes one mistake to expose you to identity theft. LifeLock monitors hundreds of millions of data points a second. If your identity is stolen, we'll fix it, guaranteed, or your money back. Save up to 40% your first year@lifelock.com special offer terms apply.
- [31:39]
C
Celebrating 30 years of Squawkbox tomorrow. Charles Scharf, Michael Rubin, Mohamed El Erian.
- [31:46]
E
Squawkbox 30 tomorrow, 6am Eastern and streaming on CNBC.
- [31:54]
B
We are back live from Future Proof here in Huntington Beach, California, said Josh Brown, this is your big event. You want to give people an idea of what actually is happening behind us in these tents off the beach.
- [32:05]
C
Absolutely. So basically, what you're looking at behind me is a representation of the future of wealth management. There are 5,000 people here attending the event. The vast majority of them are people working in wealth management, wealth tech, software. All of the custodians, the brokerage firms, the asset managers, everyone's here to try to figure out and how they can learn from each other what's happening, how are you having success serving clients? And what am I not doing within my firm or within my practice that could give me that competitive edge? We are probably the fastest growing segment within wealth management, the RIA segment. But we're joined by people in private equity, people at wirehouse firms. Everyone's here to try to get better at what they do with the goal of serving their clients to the best of their ability.
- [32:55]
B
You've really turned the conference model on its head, so to speak, especially trying to reach a younger cohort of investors and financial advisors, for that matter. Thus the setting here off the beach.
- [33:10]
C
Well, in year one, they looked at us like we were crazy. We said we're going to do an event, but it's not a conference, it's a festival. It's all outdoors. They asked is this Fyre Fest and are you the new JA Rule? It didn't go that way. It worked. So the growth has been incredible and lots of potential and it has nothing. It's not really about me. It's not about Red Holtz Wealth Management. We were, you know, the founding team that created the idea. The event is about the advisors. And every advisor here has a story. What are they trying to get better at? Whether it's portfolio management or practice management or segmenting their time or how do I hire people, how do I train the next generation of advisors. Everyone here has what they're looking to get out of the event and we're just happy to be here and to support that effort.
- [34:00]
B
What is about you is your best stocks in the market list, which is.
- [34:03]
C
That'S all what's become a thing.
- [34:05]
B
And it's on CNBC Pro. And it's an important and growing part of that. You want to highlight a stock or two. And why did you, did you pick the names that you have here?
- [34:14]
C
Yeah. So this week my, my writing partner Sean and I took a look at some of the bigger winners from the list. And of course they're not all winners. We get stopped out of names all the time. But these are some of the names that have just continued to run and we wanted to give people updates. Who took these trades on the lamb has just been outrageous. Up, I don't know, 50% or so since we wrote it up. I wanted to tell people I like this pullback. There's a little bit of consolidation around the 450 level. You go to the company's investor relations page, you just see a wave of potential catalysts coming up. And so if you want to keep riding this name, I think you can do so. The pullback has been orderly and it's found support exactly where it should. Ebay, which I pitched to Al Michaels on this show. Ebay has been a winner. I'm looking at $86, which is the rising 50 day for risk management here. If you get a violation below that level and you're a shorter term trader, that might be the time to get off this horse. More patient. Investors could wait till about 82. If it gets below there, it gets a little bit sloppy. I'd walk away. The last one is Carvana, another huge home run. Carvana is about 6% above its 50 day right now with a 50 day. So it's cooled off. We've seen the company consolidate over the last couple of months, but it looks to me More likely that we'll see another leg higher. From a risk management standpoint, I would basically say, look, this is an extremely wild stock. I probably wouldn't worry as much about stops. The way I would risk manage Carvana is by position size. You don't need to own a lot of a name that's got a beta coefficient of 3.5. That means it is triple as volatile as the S&P 500. So position size risk is an underappreciated way to ride a name like that.
- [36:01]
B
All right. And all of this is really becoming a bigger part of CNBC Pro because speaking of that, you can join Josh as he reveals his pro stock playbook for next year, 2026. We're going to do a CNBC Pro live event. It's January 15th. It's at the New York Stock Exchange. Tickets are on sale now and they are limited, so scan the QR code on your screen. You can also visit CNBC events.comprolive for tickets and more information. You can see Josh do this in person. Coming up, we'll have a live interview with JP Morgan CEO Jamie Dimon. Don't go anywhere. We are back here in Huntington beach after this. Welcome Back to halftime. J.P. morgan CEO Jamie Dimon is in New York City today celebrating the company's brand new Manhattan headquarters. Let's get to Leslie Picker who is live today with Mr. Diamond. Leslie?
- [36:54]
A
Hi Scott. Thank you so much. And thank you, Jamie, for taking the time out. I know it's limited time, but we're here of course, at your new headquarters in New York. $3 billion to build 1300ft high, almost as high as the Empire State Building.
- [37:07]
F
A lot of higher. The Empire State.
- [37:09]
A
There you go.
- [37:10]
F
Higher they have that antenna.
- [37:11]
A
But yeah, a lot of companies are paring back their footprint, have questions about New York. What strategically is so important about this building for J.P. morgan.
- [37:20]
F
Yeah. So first of all, you love, first of all, thank you for coming. I think this is a wonderful event. You said 8,000 people worked on it took six years. We try to have great place for people to work and for a lot of us, buildings of labor love for the folks who build it. You can see the craftsmanship and work from the ship that actually goes into it. But we make long term views about where we build and where we invest, how we build and how we invest. And we need, we're going to continue to grow and expand. And New York City's been a home. If you look at New York City, it is a huge amount of talent here Technology talent, banking talent, financial talent, marketing talent, that's not easy to replicate. And so this is our home. We've been here for 225 years, and we're going to keep on building.
- [38:02]
A
And this is a celebration of workers of the labor force. We learned today that the number of workers on payrolls will likely be Revised down by 911,000 for the 12 months through March. Does this amplify any worries you might have about potential weakness in the labor market?
- [38:20]
F
First, talk about the celebration. So people know 8,000 people. And we promise them, we thank them and their families, their kids here, we have barbecue for them and we really mean it. We've been working with the union labor here led by Gary LaBarbera, and it's been an outstanding thing. They worked through Covid, as did most of us. Kept on going. This flag flew at the top. They just gave to me as a gift. It's going to sit proudly in my office. And so we're big supporters of labor and we like, we bank small businesses, large businesses. People forget that we bank unions, we bank cities and schools, and we try to be a great part of the citizen. I didn't know about the number. You know, I think the economy is weakening. You know, whether that is on the way to recession or just weakening, I don't know. And that just confirms what we already thought kind of. I know that's a big revision.
- [39:06]
E
So those are big revisions.
- [39:08]
A
I believe it's the biggest going back to 2000. And the day after you and I sat down in North Carolina about a month ago was the day that President Trump fired the commissioner of the Bureau of Labor Statistics. And since then, there have been been some questions around politicization of the data. And since you operate such a sprawling bank and you have unique insights, do you see any gaps between the numbers that the government's putting out and what you see within your own firm? And are you increasingly relying more on the numbers that you see within your own firm?
- [39:37]
F
No, we, we get, we get data like you wouldn't believe. The government data is important. Our own data is important. We get data from non government sources. And, you know, you can look at delinquency data, worldwide data, trade data, we get all of that. But trying to figure out what the economy is going to do is still hard to do with all that data. And maybe one day I'll fix that problem. But, you know, hopefully things will be okay.
- [40:00]
A
And.
- [40:01]
F
But you do see that kind of weakening? Unfortunately.
- [40:03]
B
Yeah.
- [40:03]
A
And I know this is a lively event and we're here to celebrate the workforce. But given this renewed attention on Jeffrey Epstein and his links with JP Morgan in the New York Times investigation, we've talked about this in the past and kind of the safeguards that JP Morgan has put in place, do you feel like those are sufficient at this point in time?
- [40:23]
F
Well, so first of all, as I've said before, we totally regret ever having done visit that man. So and then what we always get better what we do. So when you talk about cyber safeguards or anti money laundering or bad guys in the system, we're always trying to improve that and it'll never be perfect. The bad guys are quite smart too about how they go about it. But, but we get we're among the best in the world, doesn't mean we don't make mistakes.
- [40:47]
A
And speaking of kind of what we're going back to with the state of the economy, the difficulty predicting, one of the questions people have is what's going on with the consumer right now? What do you see from your vantage point?
- [40:59]
F
Well, the most, they're still spending money. It's a little bit different depending what income set they're coming from. They still have jobs. Now you just gave a big number. So consumers tend to react to that. So the consumers weaken, commons weaken, you know, corporate profit still up. And there's a lot of different factors in the economy right now. It's hard to figure out what it all means, you know, and you know, and I've always been quite skeptical of most forecasts for that reason. So we just have to wait and see. There's a lot of stimulus out there too. We don't know what the Fed is going to do. They'll probably reduce rates, but I don't think that's going to be consequent of the economy. So we'll see while we are. But the important thing is we build regardless of what you think. We cover clients through thick and thin, through good times and bad times, with our balance sheet, with our advice, etc. And we're going to continue to do that regardless the environment and this, this one, you know, working with these unions. I wish the spirit that we all had after Covid, you know, clapping for, you know, all the workers was, I wish I had continued after Covid. Unfortunately it didn't. But, but JPMorgan has got lots of plans that we're going to be announcing, but we're going to be doing for the U.S. economy, for the U.S. defense, for U.S. resiliency. So we're coming, we got ideas and we're still optimistic about the role we can play in trying to help this wonderful country of ours.
- [42:11]
A
Well, I look forward to learning more about those. Jamie Dimon, thank you so much for being here.
- [42:15]
F
Thank you.
- [42:16]
A
Part of your brand new building here in midtown Manhattan, Scott, I'll send it back over to you on the other coast.
- [42:23]
B
Yeah.
- [42:23]
E
All right.
- [42:24]
B
Leslie, thanks so much. Our thanks to Jamie as well for that great conversation. You're a shareholder.
- [42:29]
C
Yeah.
- [42:29]
B
What do you think?
- [42:30]
C
I just love what he said about building through thick and thin because it jibes so well with what we were saying before about wealth management from a banking perspective. Now you've got all these new entrants that are making loans, they're doing all sorts of nontraditional credit products and et cetera. Regardless of how that all shapes out, when the chips are down, JP Morgan is going to stand and be ready. And I think that's why I've been such a long term shareholder in the stock. My theory on the building, by the way, it's like 200 yards away from Avra, which I'm pretty sure is one of Jamie's favorite restaurants. Of course they're going to build in New York. And of course they're going to build on 47th Street.
- [43:07]
B
OK. You're always thinking about the restaurants that you like. Including, including almost including one that we are going to discuss next because here from Future Proof, we do have some delicious new news on one of Josh Brown's favorite stocks. We'll tell you about it next. All right, we're back here in Huntington Beach. Arguably the biggest news of the day beyond the NASDAQ hitting a record high, which beyond, beyond Rick Reeder saying the Fed is going to cut and should do 50 is the wall that we've made. It is the Shake Shack new French onion menu. I wanted a breaking news banner on this. They wouldn't do is launching on the app today and in stores on September 12th. This is one of your most loved stocks. It has been one of the most delicious names in your orbit. What do you make of this news?
- [43:56]
C
Well, look, it's funny, but it's also a true driver of foot traffic. People come to the stores on these drops. We know this from a lot of the things that they've done over the last couple of years. It's something that started before CEO Rob lynch and he's now like doing weapons grade product rollouts. And people are super excited. I want to talk a little bit about the burger itself. Stephanie, try to contain yourself. Gruyere cheese, caramelized and crispy. Sweet onions, a garlic parmesan aioli.
- [44:23]
A
Are you gonna join me on the treadmill?
- [44:25]
C
No. Yeah, while I eat it.
- [44:28]
B
Look, look.
- [44:28]
C
I think this is like an underappreciated part of the story is the innovation. They're doing things that are far and away more exciting than any of their competitors. And I think the share price over the last five to ten years reflects that. They've got pretty much all of the ingredients, pun intended, that you need to be a multi year growth story. And I remain long the stocks.
- [44:49]
B
Steph prefers Chipotle, quite literally in her portfolio over, over Shake Sack. Right. That's the stock you have. The Target today goes down by five bucks to 60 from 65. Stifel still likes it and says you should buy it. They did cut their estimates though, on the comps tracking below estimates. What do you make of that?
- [45:07]
A
Yeah, I mean, I think this is really more of a second half of the year story. They do have a whole new products slate coming. They have really done well in terms of digital. They still have store openings and they have industry high restaurant margins. It's been a tough stock to own, no question about it. This year, the stock, the valuation is getting even more compelling. It's really not done anything. And you have easy comparisons also ahead. So I think you have a recovery into the end of the year.
- [45:33]
B
You hired your own promoter, so you don't, you don't need Live Nation for future proof. However, you love the stock.
- [45:39]
C
Yes.
- [45:39]
B
You have liked the stock.
- [45:40]
C
Yes.
- [45:41]
B
It's up 31% this year. And the target goes to 195 from 165 buy reiterated at Citi.
- [45:47]
C
Yes, I started buying it at 70 and at a certain point on the way up, I trimmed, took a little bit of profits. But I've kept my position here because it's really a crown jewel. What Michael Rapinoe has been able to accomplish here, even in the face of lawsuits and issues with the government, is just extraordinary. And I think it's a testament to the business that they're in. It's more about the musicians and the fans than it is about any one company. But this happens to be the best way to see a live show is to go to a Live Nation event and use their ticketing service. And look, everyone wants to pay a cheaper price for tickets, but at the end of the day, when your favorite artist is in town and Live Nation is facilitating it, it just works. You get there. Look at all the people that went to see Oasis two nights ago here in California. It was an unbelievable event and we see that repeated all over the country and Live Nation supports that.
- [46:41]
B
Lastly, sorry, Steph Zoetis reiterated a buy today, 190@argus.
- [46:46]
A
I like animal health. I would say that I prefer Elanco to Zoetis at this point because it's much cheaper and it's a turnaround story. But animal health, we're going to spend 150 billion a year on animal health and wellness and I think we want.
- [46:58]
B
To have exposure this year. Why is the WET is down seven and a half percent this year?
- [47:02]
A
It's been on uneven in terms of their earnings. They very high expectations, very expensive stock. But I still like the theme and I don't think, you know, one bad year in terms of performance. I just don't think that. I think if anything, it's probably getting closer to being a buy. But I like Elanco better because they have a better product rollout coming and that stock has done really well this year.
- [47:22]
B
All right, we'll take a quick break. We'll come back with finals next. Looks to us like stocks are basically at the highs of the session. It's been kind of a volatile session, Chan, but you just heard Jamie Dimon talk about the economy slowing, the consumer slowing, but the flip side of that, Fed's going to cut and that seems to be where the optimism is. Where is your final trade heading today?
- [47:44]
A
China. Dan Ives actually touched on it. Expectations are for an improving consumer in China and there's a number of different ways to play that.
- [47:51]
B
Wow. Okay. What's your best way?
- [47:54]
A
I think, you know, in terms of a China ETF or, or Apple's a great example of a way to play. Thank you, Stephanie Link Lennar, I still like housing very much. I don't own it yet, but the valuation is very compelling.
- [48:05]
C
And Josh Brown, I like housing, too. Rocket Company's new 52 week high right now just added to the best stocks to the market list as well. I am long and I'm loving it.
- [48:13]
B
All right. Good stuff. Thanks, everybody. You've been listening to CNBC's Halftime Report, the podcast. You can always catch us live weekdays at 12 Eastern only on CNBC.
- [48:29]
A
All opinions expressed by the Halftime Report participants are solely their opinions and do not reflect the opinions of CNBC, NBCUniversal, their parent company or affiliates and may have been previously disseminated by them on television, radio, Internet or another medium. You should not treat any opinion expressed on this podcast as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of an opinion. Such opinions are based upon information the Halftime report participants consider reliable. But neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. To view the full Halftime Report disclaimer, please visit cnbc.com halftime reportdisclaimer Celebrating 30.
- [49:10]
E
Years of SquawkBox Tomorrow Charles Scharf, Michael Rubin, Mohamed El erian Squawk Box 30.
- [49:18]
C
Tomorrow 6aM Eastern and streaming on CNBC Plus.