What Did the Fed Actually Say?

Summary

Podcast Summary: The Compound and Friends

Episode: "What Did the Fed Actually Say?"

Date: October 31, 2025
Main Hosts: Josh Brown, Michael Batnick
Special Guest: Stephanie Roth (Chief Economist at Wolfe Research)

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Overview

This episode goes deep on recent macroeconomic developments, tech sector trends, and—most prominently—a close read on the latest Federal Reserve policy commentary. The discussion blends reactions to tech earnings, the impact and future of AI on the economy and labor market, and the implications of Fed Chair Jerome Powell’s latest messaging for investors and consumers. With Stephanie Roth offering a wonky, data-driven perspective, the energy is lively, often irreverent, but grounded in timely market and policy analysis.

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Key Discussion Points and Insights

1. Tech Earnings, Capex, and the AI Build-Out

(07:52–23:30)

• Tech Spending Strength
  • Tech companies (Meta, Microsoft, Google) are sustaining strong revenue growth—Meta up 26% YoY, Microsoft 18%, Google 16%.
  • “The spending is strong. It's gonna continue to be strong. We get a lot of questions, is this a bubble? ... Our sense is absolutely no.”
    — Stephanie Roth (08:19)
• Capex and Economic Ripple Effects
  • Companies are ramping up capital expenditures (capex) for AI infrastructure. Meta, for example, is guiding much higher capex in 2025 and 2026.
  • Josh quotes Meta: “We are still working through our capacity plans but we expect to invest aggressively ... We anticipate this will provide further upward pressure on our capex.” (13:01)
  • Stephanie estimates about a quarter of US GDP growth is currently tied to the AI-driven capex boom.
    • “It’s roughly about a quarter of the GDP growth ... driven by all this capex spend so far.” (14:03)
• AI Productivity Gains
  • Early evidence: Productivity uptick visible in tech and professional services.
  • Roth: “...we’re seeing it so far. Productivity within the tech space has picked up a little bit... but outside of that there’s no clear correlation yet ... My expectation is over the next couple of years this is what we’re going to be watching...” (09:51)
• Is it a Bubble?
  • Historical perspective: The AI boom so far is nowhere near the unsustainable levels of past bubbles (dot-com, China supercycle, railroad).
  • “The only thing we could find is the China supercycle ... $14 trillion. In today’s dollars, the dot com was about a trillion. So nothing else compares outside of the China story.”
    — Stephanie Roth (16:58)
  • “For the next at least 12 months, this is not a bubble and it's not an issue. It could become a bubble ... but I think we're a long way away from that.”
    — Stephanie Roth (54:59)
• Labor Market Disruption
  • Recent college grads aiming for tech face high unemployment as AI shifts skills demand.
  • “...right now is within young workers ... specifically looking for jobs in the tech sector. It’s the youth unemployment specifically for white collar workers. Those people are having some trouble finding jobs.”
    — Stephanie Roth (14:59)

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2. Fed Policy and the Rate Cut Debate

(23:52–33:15)

• Powell’s Messaging
  • “A December rate cut is far from a foregone conclusion”—the main line that shifted market expectations.
  • “The market was pricing a nearly 100% chance of a December cut. Powell completely poured cold water on that.”
    — Stephanie Roth (24:32)
• Why the Market Reacted
  • Immediate repricing: housing and mortgage-related stocks swooned as the cut became doubtful.
• Cut vs. No Cut?
  • “The labor market appears to be largely fine. The economy is pretty steady. There's not a great reason to be cutting at this point, just given where they are today and where the economy is.”
    — Stephanie Roth (24:44)
• Dissent in the Fed
  • Notable rarity: two dissents in opposite directions for the rate decision—showing debate inside the Fed, but only one (Meyer) wanted a 50bps cut for political reasons (26:24).
• Consumer Health and Debt
  • “We're looking at a chart of household debt relative to disposable income. ... the consumer is healthier today than ... a year ago and two years before.”
    — Stephanie Roth (28:53)
  • Stress is most acute in the lowest-income consumers, but for the broad economy, “it doesn’t appear to be getting that much worse.” (29:12)

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3. Wealth Effect and Consumer Spending

(34:07–38:58)

• Stock Market’s Influence
  • Michael Batnick stakes out a strong view: The wealth effect from equities is the biggest driver of consumer behavior, more than wage growth or housing.
  • “People are not doing that because of the value of their house ... they're doing that because they feel rich.”
    — Michael Batnick (36:42)
• Stephanie Roth’s View
  • Initially skeptical, Roth acknowledges that, with $6 trillion in equity net worth gains this year and broader stock market participation (especially among Millennials and Gen Z), the effect is likely bigger than historical data suggests.
  • Millennials' exposure to stocks is far above what Boomers had at the same age—a shift in economic dynamics.
    • “Millennials ... own about 23% of their net worth in equities. Boomers ... had only 6% ... at the same age.” (38:27)

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4. AI, Labor Market Dynamics, and Future Disruption

(39:32–42:22)

• Adaptation and Economic Dynamism
  • “About 60% of people who are working today are employed in jobs that didn't exist in 1940 ... Even though a lot of jobs will get displaced as a result of AI... eventually the economy will be in a better place.”
    — Stephanie Roth (39:46)
• Low-Hire, Low-Fire Labor Market
  • Companies are neither firing nor hiring at historic rates—creating labor “stasis.”
• What to Watch Next
  • Monitoring a range of labor indicators (claims, WARN data, etc.) is necessary—no single signal gives a reliable heads-up under current conditions.

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5. Inflation, Housing, and Tariffs

(44:59–51:28)

• Shelter Inflation (Owner’s Equivalent Rent)
  • Despite common criticisms, Stephanie clarifies the methodology and says recent drops in this data are broadly valid.
• Tariffs: Effects and Surprises
  • Tariffs caused goods inflation to run higher than usual, but the magnitude is less than expected.
    • Companies spread out price increases (the “sneakflation” effect).
    • Only about 50% of tariff pass-through has likely occurred so far—more could come but slowly.
  • Portfolio managers and investors are now more focused on AI than tariffs.

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6. Credit Spreads, Investment Cycles, and Bubble Anxiety

(51:41–55:24)

• Credit Spreads Tight, but Not Worrisome
  • “I don’t know if I would emphasize that too much. I think it's telling you that the economy's fairly healthy and there's ... little signs of stress.”
    — Stephanie Roth (52:32)
• Investment Boom Context
  • AI-related investment is substantial but, as a share of GDP, still below levels historically associated with bubbles.
  • “When you get calls, is it a bubble? Your answer is no, maybe someday.”
    — Michael Batnick (55:20, paraphrasing)
• Investor FOMO and Bubble Talk
  • Many asking about bubbles are likely frustrated by missing out or anxious about valuations.

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7. China, Trade, and S&P Market Risk

(57:37–60:14)

• US–China Interdependence
  • Despite headlines, US/China trade exposure is fairly balanced. Key tech names (Tesla, Apple, Nvidia) have double-digit revenue exposure to China.
  • “China was the only country that showed equal, roughly equal leverage to the US. Everybody else showed the US had a ton versus [them].”
    — Stephanie Roth (58:05)
• Trade “Truce” and Market Rally
  • The recent Biden–Xi summit “paves the way for the rally” into year-end—more about easing tension than a substantive trade deal.

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Notable Quotes & Memorable Moments

| Timestamp | Quote | Speaker | |---|---|---| | 08:19 | “The spending is strong. It's gonna continue to be strong ... Is this a bubble? ... Our sense is absolutely no.” | Stephanie Roth | | 09:51 | “Productivity ... within the tech space has picked up a little bit ... My expectation is over the next couple of years this is what we’re going to be watching.” | Stephanie Roth | | 14:03 | “It’s roughly about a quarter of the GDP growth ... driven by all this capex spend so far.” | Stephanie Roth | | 16:58 | “The only thing we could find is the China supercycle ... $14 trillion. In today’s dollars, dot com was about a trillion. So nothing else compares outside of the China story.” | Stephanie Roth | | 24:08 | “A December rate cut is far from a foregone conclusion. That was by far the important thing ...” | Stephanie Roth | | 28:53 | “We're looking at a chart of household debt relative to disposable income ... the consumer is healthier today ...” | Stephanie Roth | | 36:42 | “People are not doing that because of the value of their house ... they're doing that because they feel rich.” | Michael Batnick | | 38:27 | “Millennials ... own about 23% of their net worth in equities. Boomers ... had only 6% ... at the same age.” | Stephanie Roth | | 39:46 | “About 60% of people working today are in jobs that didn't exist in 1940 ... Even though a lot of jobs will get displaced as a result of AI... eventually the economy will be in a better place.” | Stephanie Roth | | 52:32 | “I don't know if I would emphasize [tight credit spreads] too much ... the economy's fairly healthy and there's ... little signs of stress.” | Stephanie Roth | | 54:59 | “For the next at least 12 months, this is not a bubble and it's not an issue. It could become a bubble ... but I think we're a long way away from that.” | Stephanie Roth |

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Segment Timestamps (for Key Topics)

• Tech Earnings & Capex: 07:52–23:30
• Fed Policy Commentary: 23:52–33:15
• Wealth Effect & Consumer Spending: 34:07–38:58
• AI & Labor Market: 39:32–42:22
• Inflation, Housing, & Tariffs: 44:59–51:28
• Credit Spreads & Bubbles: 51:41–55:24
• China Trade Exposure: 57:37–60:14

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Original Tone and Style

The tone remains conversational, banter-heavy, and often playfully self-deprecating. The hosts weave in cultural references, inside jokes, and a bit of Halloween-flavored energy. Stephanie’s expertise as an economist shines, and her explanations are detailed but approachable. There’s a shared skepticism about both doomsday and euphoria narratives—favoring data, context, and humility about what the future holds.

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Final Thoughts

Stephanie Roth’s presence catalyzes a thoughtful, multidimensional conversation that demystifies Fed policy, contextualizes the AI investment surge, and spotlights how much the current economic expansion relies on tech-driven capital allocation and society-wide equity market participation. The episode is especially valuable for listeners wanting both macro and micro investment insights, with practical guidance for understanding where the US economy, markets, and policy may head next.

Transcript

[Josh Brown]

Stephanie, our partner Chris is in. Who we love dearly. I should preface this with that.

[Stephanie Roth]

Okay.

[Michael Batnick]

Nicole, come here.

[Josh Brown]

He's in Mexico this week.

[Stephanie Roth]

Oh, that sounds amazing.

[Josh Brown]

It does, right?

[Stephanie Roth]

Yes.

[Josh Brown]

He's texting me and Josh pictures every day.

[Stephanie Roth]

Come on.

[Josh Brown]

It's like the most. It's like the most absurd thing. Do you do that? Who does it?

[Stephanie Roth]

No, I just send people pictures with my kids, but who don't ask at.

[Josh Brown]

The time, but on vacation every day. Can you imagine?

[Michael Batnick]

I'll have the email.

[Josh Brown]

So I took a picture of my desk, and I'm like, dude, great. Thank you. Thank you.

[Stephanie Roth]

That's amazing.

[Michael Batnick]

So, so, so sprinkles makes me do this whole thing. And then she's like, oh, you missed it. The 30 is over. I'm like, well, I'm hitting. I'm smashing the. So I'm smashing the buy button regardless. I don't really care.

[Josh Brown]

You can proximity to the mic. So if you go too far away, you're like, oh, I got it back.

[Michael Batnick]

She said there's another. There's another sale right before Thanksgiving. Of course there is. Oh, here we go.

[John]

Probably the black Reddit.

[Michael Batnick]

All right. What do you think? Is that like two? Is it smurfy?

[John]

No, I like the color.

[Josh Brown]

Okay, that's cute.

[Michael Batnick]

All right, so the chill sweatshirts and sweatpants are the lightest weight, which is what I need when I'm on the airplane. Right. The Scholar is like, almost pajama y. Yeah, it looks.

[Stephanie Roth]

It looks.

[Michael Batnick]

And then the accolade, sweatpant, and crew neck.

[Josh Brown]

So. Do you know that he thinks this is cute for the audience who can't even see or listen?

[Michael Batnick]

No, I'm working on something.

[John]

Sidebarring.

[Josh Brown]

Sorry.

[Stephanie Roth]

Ordering clothes.

[Josh Brown]

Yeah, yeah.

[Michael Batnick]

30% off sale at Alo. That I missed by a day, and I just bought it. Shit. All this shit. Anyway, it's called alo.

[Josh Brown]

That was called aloe.

[Michael Batnick]

Yeah, I don't think I'm going to look like that guy, though. I don't know.

[Stephanie Roth]

I don't know. It's a good question.

[Josh Brown]

I don't. It's alo.

[Michael Batnick]

It's alo. It means hello and will not own any alo or not alo.

[Stephanie Roth]

I don't own any of them.

[Josh Brown]

You just said alo.

[Michael Batnick]

I know, but that's not. It doesn't make it right. Two wrongs don't make a right.

[Josh Brown]

If I need my. What are those clothes called? Casual clothes. What are they called? Athleisure. That's the word I was looking for. I'm a traditionalist.

[Michael Batnick]

It's Alo. It means hello.

[Josh Brown]

In what language?

[Michael Batnick]

And it's way better. It's way better than. Way better than Lulu. It's not even close.

[Josh Brown]

Is it better than vuori?

[Michael Batnick]

Vuori? I don't like the.

[Josh Brown]

I said it that bad.

[Michael Batnick]

Vuori. Yeah, you know, view. You said view Vuori.

[Stephanie Roth]

Okay, I don't even know what that is.

[Michael Batnick]

It's Italian.

[Josh Brown]

You don't want Athleisure.

[Stephanie Roth]

Surely you do the idea.

[Michael Batnick]

Yeah, she likes the idea of it. All right, John, how are we looking, sir?

[Stephanie Roth]

Getting close.

[Michael Batnick]

All right, two more minutes. So we have a bunch of charts in here.

[Stephanie Roth]

Okay. Yep.

[Michael Batnick]

We're in earnings season. I don't know how deep you want to go on, like individual companies, but like, we definitely have to. We have to get to it.

[Stephanie Roth]

Okay.

[Michael Batnick]

All right.

[Stephanie Roth]

I can't comment on individual companies.

[Michael Batnick]

You don't have to.

[Josh Brown]

You can listen. Are you a call listener or what? Are you a transcript reader? How do you ingest the data?

[Michael Batnick]

How do you ingest, like, what you need to know from the earnings reports?

[Stephanie Roth]

I listen to the other smart people at Wolf because they follow the companies. Right, Good idea. Yeah. Every chance of reader otherwise.

[Michael Batnick]

Right. What do, do you ever. Do you ever, like, have something in your research where you actually want to double check it with the equities people?

[Stephanie Roth]

Oh, all the time.

[Michael Batnick]

Yeah, all the time. I would imagine. Right.

[Stephanie Roth]

Because they're like, they're really good and.

[Michael Batnick]

They'Re in the weeds.

[Stephanie Roth]

And they're in the weeds. They know everything. They're talking to the companies. As soon as there's something out on the companies, they're talking to them.

[Michael Batnick]

That's the benefit of being at a shop that's covering the gamut of things is that you have other people to talk to.

[Josh Brown]

Oh, for example, so this morning or last night actually, Chipotle said, oh, young people have no money. They're not buying our stuff anymore. You could go to your analysts and.

[Stephanie Roth]

Say, hey, is that really the case?

[Josh Brown]

Are the other. Are their competitors saying the same thing? Or does their food just suck and nobody wants it anymore?

[Stephanie Roth]

Exactly.

[Josh Brown]

Right, yes.

[Michael Batnick]

That must come in handy.

[Stephanie Roth]

Super helpful, super helpful.

[Michael Batnick]

Right.

[Stephanie Roth]

And they cover every single sector and space.

[Michael Batnick]

Right. If you're just doing, if you're just doing economics or macro or whatever and you're by yourself, you kind of like are going by other things that you read to try to figure out what's going on.

[Stephanie Roth]

Yeah. You're kind of on an island.

[Michael Batnick]

Right.

[Stephanie Roth]

We've got a great policy analyst too. So all the stuff coming outta Washington, I can talk to him about.

[Michael Batnick]

Which is, like, more important at different times than anything else.

[Stephanie Roth]

100%.

[Michael Batnick]

Because it could change everything.

[Stephanie Roth]

Exactly.

[Michael Batnick]

Okay.

[Stephanie Roth]

And like, the big banks don't really do the policy thing quite as often.

[Michael Batnick]

Why do you think they wanna stay out of that? They don't wanna have commentary on that.

[Stephanie Roth]

Yeah. So we're independent. It doesn't really matter.

[Michael Batnick]

Okay. Is your policy guy in D.C. no.

[Stephanie Roth]

He sits here in New York.

[Michael Batnick]

He's in New York.

[Stephanie Roth]

He used to be in D.C. but now he's here.

[Josh Brown]

Oh, my God.

[Stephanie Roth]

So good.

[Josh Brown]

This weather is so bad. I'm going out later.

[Michael Batnick]

What are you doing?

[Josh Brown]

I have a small umbrella. I'm going to be down bad.

[Michael Batnick]

Where are you going?

[Josh Brown]

Dinner?

[Michael Batnick]

No, but far. Not close.

[Stephanie Roth]

You can buy, like, an umbrella for $40 somewhere.

[Michael Batnick]

Yeah, that's always a good option for you.

[Josh Brown]

I'll sell mine, you vulture.

[Michael Batnick]

All right.

[Josh Brown]

I always knew you were a pirate, Duncan. Hey, Jeffrey. The giraffe. We good?

[Michael Batnick]

She doesn't even know what that reference means.

[Stephanie Roth]

Yeah, I do. Toys R Us.

[Michael Batnick]

You're old enough to know what Toys R Us is. I don't know. I thought 215.

[Josh Brown]

Whoa, whoa, whoa. Stop the clock. Here's a word from our sponsor. Today's show is brought to you by our sponsors at Betterment Advisor Solutions. If you happen to be thinking, there's gotta be a better way to grow my Ria, you're not alone. With Betterment Advisor Solutions, we do the heavy lifting so you can focus on what matters most. Your clients. From improved service that makes asset transition smoother to fast paper free onboarding that delights clients. On day one, we've built a digital first platform designed to streamline your operations and make life easier. Now, if you're thinking, wow, they take the paper out of paperwork, then you'd be right. Grow your RIA your way with Betterment Advisor solutions. Learn [e-mail] advisors. Investing evolves. Risk performance not guaranteed.

[John]

Welcome to the compound and friends. All opinions expressed by Josh Brown, Michael Batnick and their castmates are solely their own opinions and do not reflect the opinion of Ritholtz Wealth Management. This podcast is for informational purposes only and should not be relied upon for any investment decisions. Clients of Ritholtz Wealth Management may maintain positions in the securities discussed in this podcast.

[Michael Batnick]

Play my theme music. I'm gonna drop a few bars. I'm gonna show off my flow to Stephanie. Is that cool? All right.

[Stephanie Roth]

Do it.

[Michael Batnick]

All right, ladies and gentlemen, welcome to the best investing podcast in the world. We're so excited to have all of you here with us this week. I gotta tell you guys, the numbers that we're doing on YouTube, on Spotify, on itunes, we know we owe it all to you, and we love you for it and we appreciate it. We have a giraffe in the room. You'll have to watch us on Spotify or YouTube to see what I'm talking about. We're having a very Gen Z Halloween day here at the compound, and we have a special guest on the show. Ladies and gentlemen, Stephanie Roth is the chief economist at Wolff Research, an equity and macro research firm covering roughly 800 stocks. Prior to joining, Stephanie was a senior economist for Global Wealth Management at JP Morgan Private bank, and she specializes in macro strategy. Stephanie, so great to have you here.

[Stephanie Roth]

Great to have you here.

[Michael Batnick]

You ready to rock?

[Stephanie Roth]

Yeah.

[Josh Brown]

All right.

[Michael Batnick]

Where's your costume? Did you not get the email? You didn't see it?

[Stephanie Roth]

I'm saving it for tomorrow.

[Michael Batnick]

You would never. I know. They would kill you. Okay. All right. It's tech earnings week, and I know you don't cover these companies specifically, but I do feel that you would probably agree from a macroeconomic standpoint, a lot is riding on current trends in tech spending. To continue. What's your take on what we're getting from these companies? Cause from my perspective, it seems like we're getting confirmation of exactly what we needed to hear.

[Stephanie Roth]

Yeah, the spending is strong. It's gonna continue to be strong. We get a lot of questions, is this a bubble? Is this gonna end anytime soon? And our sense is absolutely no.

[Michael Batnick]

No. Okay.

[Stephanie Roth]

It's a fairly small share of GDP at this point, even though it's been growing quickly. So our sense is that it's just gonna keep going for quite some time. And we don't even know the full effect of AI on this economy. So companies are gonna keep spending until we see who the winners and losers are.

[Michael Batnick]

Okay. I think that's where I land. Like, I know that it will at some point, maybe not blow up, but it'll slow. Just not yet.

[Josh Brown]

But I think everybody agrees that's like consensus. And I think consensus is right, that these companies are telling you that they are going to continue to spend. Now, maybe there's a quarter or two out there where shareholders say, nope, we're not going to let you do that anymore. And we'll find out when it happens. But. And also, so we're in the whatever inning relatively early in this spend out. That doesn't really tell you anything about where the stocks are or how they're going to perform because Obviously Nvidia at 5 trillion, it's looking forward many, many, many quarters out in the future.

[Stephanie Roth]

Yeah, I think that's right. And the trend is that this is gonna be a game changer for the economy. Productivity is likely to pick up pretty significantly.

[Josh Brown]

Do you buy that?

[Stephanie Roth]

I do. I don't think it's impacting productivity today. The usage in terms of product productive AI is not really playing out yet, but I think it will.

[Josh Brown]

So you're an econ person, you're a data person. Where do you think the data is going to? Where do you think those numbers are going to reveal themselves on the productivity side?

[Stephanie Roth]

So we're seeing it so far. Productivity and within the tech space has picked up a little bit within professional services, but outside of that there's no clear correlation between ChatGPT usage, for example, and productivity by industry. You are seeing it in those other two sectors. So my expectation is over the next couple of years, this is what we're going to be watching because it's likely to pick up pretty substantially as you see usage picks up. But right now the levels in terms of say chatgpt usage by industry is fairly low for the bulk of the economy.

[Michael Batnick]

You would expect it to show up in tech first. These are the people selling it. So of course they're using it the most aggressively and finding use cases for it internally that they. Then it's the same. That was the same pattern with the cloud. Like you have these companies providing cloud services to themselves before they turned them into for profit businesses, you know, aws. They turned it inside out and said, okay, we're using this. Who else wants to use it? So it makes perfect sense to me. Let's start with this chart, Mike, unless you have somewhere else, Meta, Microsoft and Google revenue.

[Josh Brown]

So it's still very healthy top line across the board. Meta's up 26% year over year. Microsoft up 18%. Google up 16% to its first hundred billion dollar quarter, which is kind of. It almost said it felt wrong coming out of my mouth. I was like, wait, is that right? It is, right. Microsoft cloud, the run rate, the revenue run rate. So it's 49 billion for the quarter is up to a $196 billion run rate. Alex Morris tweeted this and this part is hard to believe. They've grown 20% in every quarter for the past decade.

[Michael Batnick]

It looks fake.

[Josh Brown]

It looks fake. How is this happening? Yeah, now the question on the call, on every call, and I think meta is the one that is bearing the brunt of this because their expenses are as great as their top line growth is, it is slowing, their free cash flow is slowing and their expenses are ramping. And today anyway, it's one day but investors are like yeah, we'll take 10% back of your market cap because it's a bit.

[Michael Batnick]

Did you listen, did you listen to the metal?

[Josh Brown]

I did, I listened to all of them today.

[Michael Batnick]

So the big takeaway that I had was capex is going to accel expenses are going to accelerate significantly next year. Like not just the number but the rate of growth.

[Josh Brown]

So here, here's the quote. Yeah, so they said so every analyst and every call is asking the exact same question. Right? Like the spend, the revenue, where it's going to show up, where's this land? And they said it has become clear that our compute needs have continued to expand meaningfully, including versus our expectations last quarter. We are still working through our capacity plans but we expect to invest aggressively to meet these needs both by building our own infrastructure and contracting with third party cloud providers. We anticipate this will provide further upward pressure on our capex. Capex dollar growth will be notably larger in 26 and 25 and they all said basically the same thing that it's going to be a lot higher. So meta this year they gave their numbers, it was a hundred and where is this? 70 to 72 billion is their capex for 2025. Yeah, right. Is that right? That was expected. Let me see. Anyway, the number's big.

[Michael Batnick]

Lots of money here, Alphabet. 91 to 93 billion.

[Josh Brown]

My bad. 116 billion, that's where it was. The number I just said was they're expected coming into the year, it's 116 billion. So whatever, what I just say 86, it's 116. That's what they're going to do for the year.

[Michael Batnick]

Right. And you got that across the board basically. And that's so to my earlier question, Stephanie, that's what I kind of felt like the market needed to hear is yes, we're still spending at the same rate and actually we're going to spend more next year and they got that. And I know we're not seeing the productivity gains yet widespread, but we're definitely seeing like industrial activity, utility use. That's the real economy feeling the effect of the AI build even in advance of whatever productivity boom we may or may not get. It's got to be a really big factor in. It's like a ripple effect from all this CapEx spending.

[Stephanie Roth]

Yeah. So our sense Is it's, it's roughly about a quarter of the GDP growth is. Is driven by all of this capex spend so far. Of course that may slow down eventually once it transitions from companies doing the big capex to companies integrating the AI and then it's a different type of story. So we're transitioning from the hard investment construction portion of this to then being a sort of productivity boom. Because it's like a handoff. Exactly. It's a handoff to companies using the AI and then becoming a lot more productive. Of course the challenge for the economy will be a rebalancing in the labor market because there will be a lot of people whose jobs will change as a result.

[Michael Batnick]

Right. So can people upskill fast enough to remain useful? The answer is usually not. And then what do all these people do now that they are considered to be idle capacity?

[Stephanie Roth]

Right. And right now you're seeing.

[Michael Batnick]

But is that like a one year thing or like a ten year thing? Because I think it's a ten year thing.

[Stephanie Roth]

Yeah, I think it's a ten year thing.

[Michael Batnick]

Okay.

[Stephanie Roth]

The start of it right now is within young workers who have graduated college recently specifically looking for jobs in the tech sector. It's the youth unemployment specifically for white collar workers. Those people are having some trouble finding jobs.

[Michael Batnick]

Developers, programmers, people that learn.

[Josh Brown]

Exactly how does that get better?

[Michael Batnick]

People that learn to code are. Now it's the irony if you could do H Vac or landscaping, you're probably very busy. If you learn to code, maybe you're very busy, but maybe you can't find a job.

[Stephanie Roth]

Yeah, I think that's exactly it. And how does that get better? It's a couple of things. One, they'll find more use cases for these types of skills eventually and or people will go to school for different things. When you were entering school four years ago, the dynamic was a lot different and it made a lot more sense to study a lot of these things. Now students looking to sort of pick their major might look for something slightly different.

[Josh Brown]

What do your analysts say in terms of the capex spend? These things depreciate very quickly is my understanding. Like a lot of the spend, it is not a one time thing. It's a constant upkeep. And there's estimates that there's going to be $2 trillion in annual spend at some point. That can power GDP for a long time. If that's the case.

[Stephanie Roth]

Yeah. So Jensen put out those forecasts a couple weeks ago saying that it would be 3 to 4 trillion dollars by the end of the decade of that, let's call it 60% in the US that is a lot of spending. I don't know if we'll necessarily get quite that high, but if you're anywhere close, that's nearly 5% of GDP, which is massive.

[Michael Batnick]

So you said right now you think a quarter of economic growth is directly capex or capex plus the ancillary that.

[Stephanie Roth]

Comes along with it directly, the capex tied to AI.

[Michael Batnick]

So if economic growth is 2% a year, let's say you think like, you think like 50. A half of 1% of that is coming from this story.

[Stephanie Roth]

Yeah, probably a little bit less, but very close.

[Michael Batnick]

Okay, Is there another example of anything like this that you could think of in like economic history?

[Stephanie Roth]

Yeah, so we look back to see one. So we look for Jensen's forecasts. If you end up with something like that, your cumulative $7.2 trillion of U.S. spend, the only thing we could find is the China super cycle. Historically that was $14 trillion. In today's dollars, the dot com was about a trillion. So nothing else compares outside of the China story.

[Michael Batnick]

Okay, so this like this is one of the big ones.

[Stephanie Roth]

This is one of the big ones.

[Josh Brown]

And the market is getting the memo. Daniel Chart 11 so over the last five sessions, semi stocks, semiconductors and semi equipment added a trillion dollars in market cap, which is how long?

[Michael Batnick]

Five days.

[Josh Brown]

Five days.

[Michael Batnick]

It sounds incorrect, but that should not have happened.

[Josh Brown]

It's bigger than the entire material sector by I don't know, a hundred billion dol dollars, I mean in five days. Now nobody disputes or doubts. I mean obviously the market is, is telling you that this is everything we think it's going to be and more. But some of the numbers are getting really difficult to wrap your arms around. A trillion dollars in five days and.

[Michael Batnick]

And most of that's like in five stocks. And so it's not even like it's in 100 stocks.

[Josh Brown]

Micron and AMD and I'm guessing Broadcom. Yep, yep, yep. Nvidia of course. Yeah. Wild, wild times.

[Stephanie Roth]

It's wild, but I don't think it will be. I don't think we'll be in bubble territory for a while until it becomes 1. Clear who are the winners and losers are 2. Until companies start to spend in terms of debt, a lot of it's coming from cash flow right now. Once it becomes debt finance, that's where it becomes a lot more risky. We started early innings.

[Michael Batnick]

We're in the early innings of actually cash flows. Won't be specific, won't be Enough, because if we don't spend now, we're going to get locked out of the game. We need to, we need to make the bet.

[Josh Brown]

Yeah, but that narrative is being blown up, blown to smithereens. Because it is true that debt is now entered the conversation right, what Oracle's doing. But Microsoft Chart 4 like their free cash flow meta also their free cash flow all time high. Google killing it now Meta's free cash flow is rolling over chart eight. Chart eight please. So Meta's trailing 12 months. This is from Alex Morris. Yes, it is, it is rolling. And we know like their, their, they're spending a lot more, expenses are growing faster than revenue and the markets, the stock's getting hit as a result. But this idea, so, but this idea that they're going free cash flow negative for anything even like remotely close, like that's just not true. Not even close.

[Michael Batnick]

But we do have massive debt deals now to cover the infrastructure build and everyone's in the game, like every major firm on Wall street, all the private credit and private equity firms, all the market makers, all the asset managers. Michael and I were talking about a deal earlier this week where they're building two different facilities, one in Texas, one in Wisconsin for Oracle. And just like the whole list of names of firms that are getting in on financing this thing. So let's say it's early innings and it's not quite a full blown debt bubble yet. But if that's directionally like where it seems obvious we're headed, why is that the danger to the economy? Like aside from the obvious that eventually the debt becomes unsustainable, does it have to go go there eventually or it could stop short of that?

[Stephanie Roth]

It doesn't have to, but that's where it becomes more vulnerable. Because if you get disappointed and then you have all of this debt, then it becomes a bit more of an issue. If it's funded by cash flow, then it's an issue for those companies, but it doesn't have broader implications. Does it have to get there? No. Generally speaking, when you have these types of investments, usually does companies, like you said before, companies spend to keep up and their investments are maybe not ones that they necessarily should be doing for their businesses and they might be spending sort of in the wrong direction. It might be some sort of mal investment because that generally happens.

[Josh Brown]

They're saying that they're going to over. Zuckerberg keeps saying if we overspend by a few hundred billion, so be it.

[Michael Batnick]

Like Zuckerberg said last night on the call, we are spending for the quote, optimistic, most optimistic case for AI. And then he said if we overshoot it, meaning between now and whenever superintelligence actually arrives, which is their stated goal. I don't know what it means, but fine. He said if we overspend, we could just use that compute elsewhere in our core business. Like it's not going to go to waste. And I think like if you're a sell side analyst on the call listening to that, you're probably like, oh yeah, that makes sense. Because it's not like this is a startup company. They have a massive core business that probably does need more compute one way or the other.

[Josh Brown]

Reels is at a $50 billion revenue run rate.

[Michael Batnick]

Right.

[Josh Brown]

Like one piece of one product of a broader ecosystem of products. Google said last night that they have 13 different businesses that are doing a billion dollars in revenue. Microsoft LinkedIn keeps growing 10% a quarter by the way. Do you see that every quarter?

[Michael Batnick]

Yeah, I think I'm helping to drive the LinkedIn growth numbers. Alphabet CapEx is now at $100 billion run rate. So like they're all probably going to have to get to 100 billion just as like that'll be the industry standard or more. And to your point, there's still plenty of cash flow to support that. I don't know, is that infinite though? Does that just mean keep going?

[Josh Brown]

It would be really something if there is no reckoning at some point whether it's five years from now if we don't get the complete crazy overspend, would that be, would that be surprising or not necessarily?

[Stephanie Roth]

Yeah, I'd be surprised if we didn't get there. But you never know. But these things, companies tend to pile in and I think the issue is more on the side. Smaller companies that get involved in the investments here, it's going to become a bigger problem for them because they're spending in areas that they maybe didn't need to be.

[Michael Batnick]

Okay.

[Stephanie Roth]

We haven't really gotten to that point.

[Michael Batnick]

Like privately held companies that haven't come public yet.

[Stephanie Roth]

Yeah, or like just smaller public companies that are putting money that they don't really have. That's why it becomes more of an interesting story when it becomes debt finance. Because then it's companies maybe can't really back it up with cash flows.

[Michael Batnick]

Right. If the ROI doesn't arrive and we all know, we all understand like it might not tomorrow, then what do you do?

[Josh Brown]

Okay, but also Microsoft's free cash flow up 34.

[Michael Batnick]

No, we're fine with Microsoft.

[Josh Brown]

No, it's up 34%.

[Michael Batnick]

Yeah. Yeah. All right, let's. So let's talk about. Let's talk. Oh, I wanted to shout out Dan Ives. Michael, did you know he hit a billion dollars in assets in his AI etf?

[Josh Brown]

Unbelievable.

[Michael Batnick]

In five months. Would you have predicted that?

[Josh Brown]

Nope. All due respect, I really.

[Michael Batnick]

I was rooting for it. I don't think I would have predicted it. That's pretty. That's pretty crazy. Shout to. Shout to Dan. It's the air.

[Josh Brown]

It's the air.

[Michael Batnick]

What did the Fed actually say this week? Stephanie, I sort of get it, but I don't get it. Why did yield. I'll ask you follow ups. What do you think. What do you think was the point of. Of Powell's statement and the answers to the reporter's questions?

[Stephanie Roth]

I mean, the one statement. If you listen to one statement, all you needed to hear was a December rate cut is far from a foregone conclusion. That was by far. The important thing is that the one.

[Michael Batnick]

The market disliked, the stock market disliked the most.

[Stephanie Roth]

Yes.

[Michael Batnick]

Probably lost 30, 40 basis points on the S and P immediately.

[Stephanie Roth]

Exactly. That's exactly what he said.

[Michael Batnick]

Okay, why. Why are we still begging for rate cuts with stocks at all time highs? Are we crazy?

[Stephanie Roth]

I mean, the market always loves lower rates. This is disappointing. Versus what was in the price. The market was pricing a nearly 100% chance of a December cut. Powell completely poured cold water on that. We had been calling for the market to be. Or the Fed to at least be less convinced that they're going to do a cut in December. The labor market appears to be largely fine. The economy is pretty steady. There's not a great reason to be cutting at this point, just given where they are today and where the economy is.

[Michael Batnick]

Well, I'll give you one reason. Well, make America great again.

[Josh Brown]

Oh, real estate.

[Michael Batnick]

Why don't you love America? Oh, wait, hold on. So why was that statement so consequential? Only because it forced everybody to change their expectations for December.

[Stephanie Roth]

That's exactly right. It was just a complete repricing of the December cut, which now is less likely to. Significantly less likely to be the case. Now it's all else equal. If the economy is exactly today as it is for the December meeting, the Fed's not gonna cut is effectively what they told you. And then you have to question, well, are they gonna even cut beyond that? Are they gonna be in some sort of extended pause at 4%? Are they only gonna cut maybe two more times? As opposed to the market thinking it would be several more times beyond that?

[Michael Batnick]

Okay, the Mortgage related stocks that we follow all got crushed. All housing, like, fast. Anything housing related, fast. So that's. You see that it really was in the price that you were getting this December. Okay. And now it's in doubt, but you might still get it anyway. He didn't say we're not cutting. He just said we're data dependent. So maybe we will, maybe we won't F around and find out.

[Stephanie Roth]

Well, we're data dependent, but if there's no data, the assumption was given the shutdown. If there's no data, the assumption was the Fed would cut anyway. But now he told you maybe not. Now if there's no data, or if we're kind of still in this data fog, which, by the way, the data's gonna be really quick, questionable between now and then that you should assume that the Fed will probably not be cutting. And there's significant divide among Fed members about what they should do from here.

[Michael Batnick]

Oh, this is. So Callie pointed this out. Our chief strategist, Callie Cox, pointed out she can't think of another time where there were two dissents, which itself is rare, but two dissents in opposite directions. Yet one person say it should have been a 50 basis point cut, yet another person saying it should have been no cut. Can you think of another example of that? Or does that strike you as, like, really emblematic of the confusion right now about what the right course forward for the Fed is?

[Stephanie Roth]

Yes and no. I mean, Meyer's the only one who you would have. We would have known. We knew he was gonna dissent for a 50 cut. And that's political.

[Michael Batnick]

That's his master wants that. And that's exactly.

[Stephanie Roth]

So no one else who is more independent and credible is looking for a 50 basis cut at this point.

[Michael Batnick]

1 out of 100.

[Stephanie Roth]

Just go for it. Right.

[Josh Brown]

When is this term over?

[Stephanie Roth]

Myron?

[Josh Brown]

No, I'm sorry. Powell.

[Stephanie Roth]

Powell's term's over in May.

[Michael Batnick]

May.

[Josh Brown]

Okay. All right.

[Michael Batnick]

Or whenever I decide. All right, wait. So. All right, so it's not that strange because you know where that's coming from.

[Stephanie Roth]

Right.

[Michael Batnick]

So the real debate.

[Stephanie Roth]

Right, so the real debate was do we not cut or do we go ahead a couple more times? It's really the debate in the room. Myron is kind of out on his own on that.

[Michael Batnick]

What's the case for not cutting? Just as simple as CPI is 3% and not 2%. Yeah.

[Stephanie Roth]

And inflation is potentially heading a little bit higher. On top of that, you have an economy that's doing okay.

[Michael Batnick]

Okay. So unnecessary cut.

[Stephanie Roth]

Yeah. And valuations are High. Why not just wait and see? There's not as much harm in waiting now as it was months ago.

[Michael Batnick]

Well, here's the Doves would tell you. Recent college graduate unemployment at 6 and a half percent is really significantly higher than 4% and possibly a harbinger for a worsening labor market. You'll tell us if you agree with that or not. If the data says that, that's true, but that's a thing. The other thing is people with debt balances. Obviously a rate cut helps them and those are the people right now that need the help. And maybe that doesn't justify lowering rates across the whole economy just to help borrowers. But like the politicians who are getting elected right now, including in New York City, are the people who are making promises that they'll ease people's debt burden. So there's obviously a real issue out there. So that would be like the Dove's case as to why. Yes, one more cut at the end of the year. Does that move you or not really?

[Stephanie Roth]

Maybe. Let's go to chart 13. So not necessarily. I mean, the debt picture actually looks pretty good.

[Michael Batnick]

Tell us what we're looking at. For the listener that's not watching, what are we looking at?

[Stephanie Roth]

We're looking at a chart of household debt relative to disposable income. So it's an income rate, a debt ratio chart. And you're seeing it steadily move lower, which tells you that in fact the consumer is healthier today than it was a year ago and two years before.

[Michael Batnick]

That on this measure. But what people say we look pretty good.

[Josh Brown]

But which consumer?

[Michael Batnick]

Yeah, which consumer?

[Stephanie Roth]

The broad consumer. So there is a story about the lowest end consumer that is showing cracks and getting the K shaped, the K shaped economy. And that's true.

[Josh Brown]

Can I say one thing? Not to be insensitive to the lower end consumer, but are they not by definition always under a level of distress? I mean, if you're talking about the bottom 10%, when are they, when are they not?

[Michael Batnick]

Six months in 2021 where they did better than everyone because money was put into their bank accounts. And that's pretty much it.

[Stephanie Roth]

Yeah, I mean it's fair. And we can't conduct policy aimed at just this lower, lower end consumer. You know, you have to think about the broad picture here. And you're seeing this low end consumer which is under stress, but it doesn't appear to be getting that much worse than it's been.

[Michael Batnick]

I actually don't even think that that should be the purview of monetary policy like the Woke Fed era should be way over. I understand why we have to do something. I think that's Congress and maybe the states. I don't feel like we can accomplish that with overnight interest rates.

[Stephanie Roth]

Yeah, I think that's right. And we don't really wanna incentivize too much borrowing at the lower end. And by the way, there's gonna be a decent amount of stimulus headed for the low end consumer come tax season. They're going to get some pretty large refund checks for no tax on overtime and no tax on tips.

[Josh Brown]

Okay, so that comes in refunds.

[Stephanie Roth]

This is going to come in refunds for this cohort.

[Michael Batnick]

So according to, according to what you showed us then, like yes, there is a vocal group of consumers who are under duress right now because of high prices in the economy. But the overall picture does not support just continuous rate cuts from these levels. Is no evidence that that's what's needed.

[Josh Brown]

Well, if you listen to the banks on their earnings and not just American Express, but the banks that serve Main street ally Capital One, bank of America, they're all saying the same thing, that things are pretty good and they're not blowing smoke. They have like reserves and charge offs and like actual data and you're not seeing any stress there. You're just not. I mean there's pockets obviously everywhere in auto subprime. For sure there was a lot of sloppy behavior in 2021 and 2022 that is now coming home to roost. But by and large based on that, I think to both your points, maybe supportive of no rate cuts.

[Stephanie Roth]

Yeah, that's exactly right. The picture looks pretty decent outside of subprime auto. And a couple of things that you're right are generally poor and aren't looking that much worse than where they've been. And the backdrop is one where the economy is actually likely to head up from here. We have a lot of tailwinds when you think to 2026.

[Michael Batnick]

So if you were Powell, you would not be in any rush to do the next one.

[Josh Brown]

But what about the housing market? Because clearly that is in desperate need of lower rates because we have seen lower rates and you're not seeing much of a pickup in activity like at all.

[Stephanie Roth]

Yeah, I think that's fair. Housing market has been struggling. We might see a bit of a pickup from here. Mortgage rates have come down quite a bit. They have done a couple more cuts, you know, recently so that could help spur activity a bit.

[Josh Brown]

But I'm surprised. Mortgage rates have come down quite a bit and you're not really seeing much activity.

[Stephanie Roth]

Yeah, I think it happens with the lag. It tends to be about three months where the lag comes from rates to the broad economy. So I actually expect to see that.

[Michael Batnick]

It'S taking refi applications though that did happen this summer.

[Stephanie Roth]

Exactly. So I think we'll see it play out. That happens fast.

[Josh Brown]

But you make a good point. It doesn't happen overnight. People don't just, oh, lower mortgage rates. I bought a house, right.

[Stephanie Roth]

And I think one underappreciated part about the housing market earlier this year was not just about mortgage rates and affordability being bad, but also economic uncertainty. If you were sitting here earlier in the year and you were planning on buying a house, yet you thought there was going to be a recession at some point in H2.

[Michael Batnick]

Trade war driven recession. Trade war driven would have told you exactly.

[Stephanie Roth]

Most people thought there was going to be a recession caused by the administration because of trade war. So at that point, if you expect a recession, you would expect lower prices and lower rates in say six months time. So it made sense to just wait.

[Josh Brown]

Our friend Warren Paes looks at, I think some sort of housing construction, if it's new units or something like that.

[Michael Batnick]

Employment.

[Josh Brown]

Okay. Is that what it is? And so that has been very sensitive and very closely aligned with the business cycle. When that rolls, we usually get a recession. I don't think you're seeing that right now. Is that because this is just such a bizarre environment of everybody buying houses and then rates and is it just. Can we not rely on that anymore?

[Stephanie Roth]

Yeah, I think the economy's a bit different. It's a little bit less cyclical than it used to be. There's so many other secular drivers, things like AI. And then on top of that there are some construction related jobs that are tied to this AI story. So there's a bit of a sort of makeshift from that perspective. And then on top of that, the consumer is not really that interest rate sensitive anymore. If you're not in the housing market looking for a new house, then you're not really that sensitive to the rate of interest rates. So that's been one reason why the consumer has been spending so well despite rates being elevated. Equity net worth has been perhaps one additional reason.

[Michael Batnick]

I want to double click on that because like this is the hill that I like to die on every week. I'm a wealth effect truther. I think it's the number one most important factor in the economy, bar none. It decides employment. It decides whether or not people get wage increases. I think it Decides Capex spending projects. Nothing will halt AI CapEx in its tracks faster than a stock price that falls 30% after an earnings disappointment. Nothing. And so as a result, I really think we underprice the ability of the stock market to influence things that happen in the real economy. More Americans than ever are in 401s. I understand housing is a bigger asset for the middle class, blah blah blah. I get all that. The people that work for people though, those people, they care about their stock options in the companies they work for. I think it's a huge driver to that point. Sean and I on my research team, we write this column for CNBC Pro every week. Best stocks in the market. And we're always looking for charts that invalidate things that we believed or things other people believed. We love that more than anything. We did a spotlight on Ford and GM today. Ford and GM made 52 week highs this week.

[Josh Brown]

Yeah, what's the story there?

[Michael Batnick]

The story there is the wealth effect is what sends people to the dealership to buy a new F150. Not trade war. Bullshit. These companies have handled this tariff war, handled this, this tariff situation so well. Not because they're in control of the prices of, of the supplies they buy, but because the demand never let up. The demand never let up because everyone's stock portfolio is at a record high. So GM is selling, they, GM's in a better situation than Ford. They're selling more higher margin SUVs. Ford has a lot more execution risk and it's not as good of a stock. They don't do buybacks, they do dividends, blah blah blah. But the big picture is both of them are at 52 week highs. If I told you in March next month Trump is going to restart the trade war and auto parts and finished automobile is going to be like the epicenter of the trade battle with all these countries. You would not have said, oh, I get it. Therefore buy Ford and gm. They're up, they're up more than Tesla this year. People don't even understand that. And so my point is that's the power of the stock market wealth effect. People are not doing that because of the value of their house and they're not doing that because they're getting wage increases, because we know they're not. They're doing that because they feel rich. What do you think about that idea?

[Stephanie Roth]

I think that's entirely right. So a fun stat.

[Michael Batnick]

See? Can we cut that clip for TikTok? Okay. Say no.

[Josh Brown]

What did I. I haven't said anything.

[Michael Batnick]

It doesn't matter. I just want that to land on you. That she said. That's exactly right, Nicole. Exactly right.

[Josh Brown]

You see the insecurity just oozing.

[Michael Batnick]

All right, but I want to hear you say more about how right I am about this.

[Stephanie Roth]

So I'm generally a skeptic of the wealth effect. I generally feel.

[Michael Batnick]

Get out.

[Josh Brown]

Say that one more time.

[Michael Batnick]

Stefan, the show's over.

[Stephanie Roth]

But. But send her back. Okay.

[Michael Batnick]

Generally say why you are. Say why you were skeptic.

[Stephanie Roth]

So generally there's academic studies that will tell you it's a couple cents for every dollar of equity net worth that will support the economy. This time it's been a really big increase. So net worth, equity net worth has gone up by about $6 trillion this year.

[Josh Brown]

That's it that matters.

[Stephanie Roth]

Which boosts growth of, call it 40 basis points if you apply historical estimates. And historical estimates are understating it because this time the equity exposure is a lot broader than it typically is.

[Michael Batnick]

So, for example, because of retirement accounts and because of retirement, adoption, compensation and.

[Stephanie Roth]

And the whole, like, Robin Hood thing. So younger people are involved in equities, which they didn't used to be.

[Michael Batnick]

So, for example, 35 million new accounts in the last three years.

[Stephanie Roth]

Yeah.

[Josh Brown]

You know what's so interesting? Amex. If you look at their earnest call, all of the growth, not all the growth. The biggest growth is coming from Gen Z and Millennials. The biggest growth, the biggest spending growth, they're spending more than boomers are. Which is kind of wild when you think about, like, you think Amex is like an old premium stock. No, it's not. It's growth on the young end.

[Michael Batnick]

And they own crypto and they own tech stocks in much higher proportion than the rest of the population. And they have made more money from this boom in stocks in some cases than their parents.

[Stephanie Roth]

Yeah. So millennials, so currently roughly age 35, own about 23% of their equity of their net worth is in equities. Boomers, when they were at the same age, had only 6% of their net worth in equities. That just tells you the broadening and why it's impacting younger people, which it typically isn't the case.

[Michael Batnick]

So in conclusion, sounds like you would agree with me, we're underpricing the wealth effect. Cause we're thinking about a historical paradigm that's no longer in force. Now it's different world. It's a stock market world.

[Stephanie Roth]

Yeah, I think that's right.

[Josh Brown]

Well, you also made the, you started making the point that a lot of the people that are not exposed to interest rates, people that already have a paid off mortgage, well guess what, those people are also retired. So they're also not exposed to the labor market. And so you could see some really weird activity with a softening labor market and consumer spending not really slowing that much because they're responsible for such a large portion of the spending. It's just a very interesting time that we live in.

[Stephanie Roth]

Yeah, it's an odd environment and I think it matters realistically. As long as layoffs don't pick up, people will continue spending.

[Josh Brown]

So that's it. That's it. That's all that matters.

[Michael Batnick]

I agree with you. I agree with you. So to that end let's do your next chart. Chart 12. This is concern about the AI labor market disruption. So this gets right to the heart of that question. So what are we looking at in this chart and why is this important?

[Stephanie Roth]

Yeah, this is one of my favorite charts of all time. So here we show that about 60% of people who are working today are employed in jobs that didn't exist in 1940. It just tells you how dynamic the economy is. And even though a lot of jobs will get displaced as a result of AI and there might be disruption in the near term, people will have to go to school for different things. Eventually the economy will be in a better place.

[Josh Brown]

I think we all agree on that. The thing that is the troublesome side of it, and I'm not a tech doomer by any stretch of the imagination, I think we all agree that the future is very bright, it always is. But in between now and then, when you do have this displaced group of people and growing and voting, you get some really funky election results. And it can impact, it impacts policy and it impacts society maybe more than it impacts like the overall aggregate economy. And it definitely these people having trouble finding jobs, not only will it not impact the stock market, you can have an environment. In fact, I would say this is probably better odds than not of record margins with rising unemployment.

[Stephanie Roth]

Yeah, it would be an interesting backdrop if it plays out that way. And it might to some extent it would be great for margins. But what tends to happen is as margins get better, companies want to grow and they expand and they do capex and that will spur other types of job opportunities. So yeah, I think that's a risk. And we might see various industries displaced at various times. There was this sort of the tech related recession somewhat after the COVID pandemic where tech companies did a lot of layoffs.

[Josh Brown]

Absolutely. There was 22.

[Stephanie Roth]

Exactly. So you might see different industries have problems at different times, but this is unlikely to be a recessionary type of layoff cycle. It'll be probably a little bit different than that.

[Michael Batnick]

The media has coined this term low hire, low fire. Do you think they largely have it right? Companies are not shooting, shedding millions of jobs by any means, but they're just not hiring as fast as they used to. And it's almost like on the surface, if you net those two things out, it looks like a stasis. And the stasis won't last forever. But could it go on for five years? Yeah, totally could, right?

[Stephanie Roth]

Yeah. And I think the low fire, low hire environment is right, and it's been that way for quite some time so far. And by the way, the labor supply issue kind of supports that because both supply and demand has come down roughly in line.

[Michael Batnick]

Supply has come down because less immigration, and demand has come down because companies are waiting to see how much efficiency they might get out of all this AI stuff they're buying.

[Stephanie Roth]

Yeah, that's exactly right. And as long as the bulk of the people remain employed because layoffs don't pick up, their wages are growing at nearly 4% a year and they'll just continue to spend.

[Michael Batnick]

What would you be watching if you wanted to use the labor market as your way of understanding when we're about to go through a change? Because we've had people come on here. Michael mentioned construction workers being like a really great early signal. We've also had people come on and say initial claims, if it hits 240,000 in any given week, that's the trigger. We've heard lots of different theories about how the labor market might be useful as forward looking. I understand it's backward looking, but what are the things that. Is it the SAHM rule? Is it like, what would you use if you were trying to get a little bit of an edge on the economic trend?

[Stephanie Roth]

I think what we've learned is having any one particular rule could get you into trouble. So SAHM rule was kind of triggered before and it ended up being sort of fine.

[Michael Batnick]

Oh, well, the inverse credit thing didn't work out this time either.

[Stephanie Roth]

Yeah, exactly. And there was a problem with Texas fraud in terms of claims, so those spiked for no reason. So I think you do genuinely need to look at a broad array.

[Michael Batnick]

What do you look at indicators, like, when clients ask you, like, how will I know something's changing? What do you tell them?

[Stephanie Roth]

So I would say I'm looking at claims. I'm looking at the Warren Data to get a sense of. And the Warren data comes from the Warren Act. And basically, if, if larger companies are doing big layoffs, they have to announce it in advance.

[Michael Batnick]

That's all right. That's a rule.

[Stephanie Roth]

Yes.

[Michael Batnick]

So you can't have it, even though the press would pick up on it anyway. That's not enough. The company has to disclose a certain level of layoff.

[Stephanie Roth]

Correct. They have to disclose the layoff in advance. And that gets.

[Michael Batnick]

That gets disclosing it because the stock price goes up as soon as they announce it.

[Josh Brown]

Are you surprised that claims didn't break out over the summer? Because we were talking about it then and I'm pretty sure people said, like, once this starts to move, it generally doesn't slow down or stop moving. Well, it did. We were like, there was a week or two where we're like, oh, it's claims. Let's claims. It's claims.

[Michael Batnick]

What was the Texas fraud? What was that?

[Stephanie Roth]

So that happened a couple weeks ago. Texas claims jumped. I quickly looked at the Warren data for Texas to see did any big companies do a big layoff? That wasn't the case. So our immediate conclusion, which we had published, was, no, there's something funky going on. I don't know what. And then we later learned that there was actually some fraud happening within the Texas claims. And Texas came out and said that this was an issue.

[Michael Batnick]

Why would somebody do that? Isn't that weird?

[Stephanie Roth]

I guess trying to, trying to get.

[Michael Batnick]

Oh, it's unemployment fraud.

[Stephanie Roth]

Yeah, exactly. Unemployment fraud.

[Michael Batnick]

So somebody did that on a large enough scale that it showed up in the data.

[Stephanie Roth]

Yes.

[Michael Batnick]

My, my word.

[Stephanie Roth]

20,000, I believe.

[Michael Batnick]

What's Elisa Abramowicz chart?

[Josh Brown]

So thank you for that great setup. Josh, are you surprised that so this the way that, that the Fed measures inflation, Shelter inflation. It's this weird thing, owners equivalent rent, where basically they asked people, well, how much do you think you can rent your house for? And it was a big talking point at the time. Like, it's such a bizarre way of doing things. Like, how would. I don't know how much I could rent my house for. And yet I bring this up to say it looks like it was kind of right. I mean, it's, it's the lowest.

[Michael Batnick]

What do you mean by that? Why does it look like it was right?

[Josh Brown]

It's at the lowest level since 2021. And this is probably a decent representation of where shelter inflation really actually is. What do you think?

[Stephanie Roth]

So one correction on the. The way they measure it. So there's two ways that they go about collecting the data. First they actually measure how does this particular sample of houses compare to rents about six months ago.

[Michael Batnick]

And then this is in cpi.

[Stephanie Roth]

This is in CPI as well as pce, which is the Fed's preferred measure.

[Michael Batnick]

Okay.

[Stephanie Roth]

They are not using that question. What do you think you could rent your house for in the actual calculation of rents? They only use that in terms of the weights. How do they weight it up?

[Michael Batnick]

What do you mean weigh it up? Do they weigh your house? How much could you sell your house, weigh your house for by the pound?

[Stephanie Roth]

More like how important is New York houses relative to Chicago? How they like aggregate everything up.

[Michael Batnick]

Okay.

[Stephanie Roth]

But they don't actually ask you how much do you think you could rent your house? And that's used to calculate the inflation.

[Josh Brown]

So what does this represent? What is owner's equivalent rent?

[Michael Batnick]

Then?

[Stephanie Roth]

It represents a measure of actual rent inflation, but it's the aggregate houses out there as opposed to new rents.

[Michael Batnick]

Why don't they just go to like the 10 largest multifamily apartment building landlords and get the actual data? What are we.

[Stephanie Roth]

That is what they do. That is what they do.

[Michael Batnick]

They do that.

[Stephanie Roth]

It's just not only the big ones that they're going to capture as much as they can to be representative, capture everything. But they are measuring actual, the prices of rents compared to where they were six months ago.

[Michael Batnick]

I had a guy sitting in your seat on Monday. He owns. He's the biggest multifamily landlord in the Pacific Northwest and. Or Mountain west they call it. So he's in Salt Lake, he's in Denver, he's in Seattle. And I asked him like off camera, but about that question, like, what's the Ren situation? He's like, it's fine. It's always the same. There's no, he's like, there's no trend. It's just like apartments open up, people come in and rent them. He's like, I wish there was some signal in there that I could use for my business. But like on a week to week basis there's nothing on a year to year basis. You know, property developers use that like as a signal of where to invest and where to build more. But like week, month after month cpi, who knows? Like, who knows what that really means?

[Stephanie Roth]

Yeah, and the data are pretty volatile. And most recently there was a big deceleration in this one. I think what we're seeing though is that rent inflation is coming down, which we all knew what was happening because the CPR CPI data is very lagged. It's very Slow moving. Unlike sort of a potentially better measure is some of the private measures of rents that are advertised in the market because CPI measures average rents for everybody.

[Josh Brown]

In the U.S. i know it's over a 12. Is it a 12 month leg?

[Stephanie Roth]

It's been longer. The expectation was it would be a 12 month lag. But that's why people have been talking about OER is coming down and they've been having the same conversation for 18 months and it hasn't happened yet in a material way.

[Michael Batnick]

Stockpile data is what you're talking about.

[Stephanie Roth]

Yeah, exactly. Zillow has good measure.

[Michael Batnick]

Zillow, okay.

[Stephanie Roth]

These are helpful to gauge what's happening more real time because these are apartments that are being listed as opposed to the average of all apartments out there.

[Josh Brown]

So this has been a big source of the cooling of inflation to the extent that it is cooling. But then there's obviously the cost pressures or maybe even lack thereof that we've seen from tariffs. Are you surprised that we haven't seen more in the way of tariff related price increases?

[Stephanie Roth]

So you've seen. It's definitely showed up to some extent. It's been goods price inflation is running about 2% year over year. Typically it runs zero to minus one. So you've seen it. It just hasn't been as large as many expected. And I think there's a couple reasons as to why it's been smaller than anticipated. One has been companies have just been slow to pass it through. They're taking a little bit on margin. Exporters have taken some of the hit too.

[Michael Batnick]

Yeah.

[Stephanie Roth]

And then I think the way people think about the sort of the percentage they were expecting for an item, they're not necessarily calculating it exactly the right way. So when you think about say example, a sneaker import, so you might import it. It's a. The company pays $50 at import and $100 in the store. Well, your tariff rate is tied to the $50 that you imported. So it gets watered down. When you're talking about the end, by.

[Michael Batnick]

The time it gets sold to the end consumer.

[Stephanie Roth]

Exactly.

[Michael Batnick]

You wouldn't know the difference as a.

[Stephanie Roth]

Percentage of the final price. It's a lot smaller than the tariff rate.

[Michael Batnick]

One of the things we heard was that sneakflation would be the way companies would pull this off. Live with the tariffs where there might be like a very high price attached to one particular item. But if you're target, you could spread that high price out across 5,000 items and it almost becomes like unrecog. Like you can't see it anymore because it's a penny on 5,000 items rather than $500 on a lawnmower.

[Stephanie Roth]

Yeah, I think so.

[Michael Batnick]

They've gotten away with. They've gotten away with some of that too.

[Stephanie Roth]

Yeah. And companies have been passing it through in items that they know the consumers are a lot less sensitive, so they're higher price items. For example, they know the wealthier people might not really care if their sneakers are $10 more expensive, but that's a much bigger deal for their, their lower price.

[Michael Batnick]

Portfolio managers at what you're sitting at, Wolf, do portfolio managers want to talk to you about tariffs anymore or. Not really.

[Stephanie Roth]

Not really. They want to talk about AI a.

[Michael Batnick]

Year ago, though, that's probably what they wanted to talk about.

[Stephanie Roth]

That's always six months ago.

[Josh Brown]

And companies aren't talking about.

[Michael Batnick]

Isn't that so funny how that happens?

[Stephanie Roth]

Totally. These things go on waves. I mean, tariffs have still been important. We're seeing inflation running about 3%. Inflation should otherwise be in the low twos. So this is having an impact. It's just not. It's more of an issue for the Fed than it is for the end consumer broadly.

[Michael Batnick]

It's like on a low boil. Also, the consumer doesn't really know who to blame anymore. The consumers don't really want to hold Trump accountable for it. But Biden's been gone for so long that there's no point in yelling about Biden anymore. Like, people don't even know like, who to hold accountable for this. They're just getting used to it.

[Stephanie Roth]

Yeah. And I mean, there still might be some more pass through involved, so that's something to keep an eye on. We'll still see goods prices continue to rise. Our sense is when we aggregate it all up, we're about 50% of the way through of the tariff pass through. So there's still more to come, but it's happening slowly.

[Michael Batnick]

Okay. That's a good segue to you wrote AI Bubble. Nope. The real danger is in tight credit spreads. Let me quote you. Okay. Do people do this often to your face? I'm gonna quote you to you.

[Josh Brown]

This is not her.

[Stephanie Roth]

This is not me.

[Michael Batnick]

Oh, who wrote this?

[Josh Brown]

Alison Schrager.

[Michael Batnick]

Oh, this is Alison's article in Bloomberg. Okay. Can you respond to this idea of credit spreads being a potential threat maybe to the market or to the economy or both?

[Stephanie Roth]

I mean, I think they're tight for a reason. The economy's doing pretty well. I don't expect this to.

[Michael Batnick]

It's not always the greatest time to invest when credit spreads are this tight because people have become complacent in an environment where they're just not putting much emphasis into pricing risk. That's the general idea with this, right?

[Josh Brown]

Yes. Yeah.

[Stephanie Roth]

I mean, I don't know if I would emphasize that too much. I think it's telling you that the economy's fairly healthy and there's sort of little signs of stress. So from that perspective, I would say it's actually an okay environment to invest and it tells you that the economy is fairly healthy.

[Michael Batnick]

And.

[Stephanie Roth]

And there were a couple of negative credit events that popped up somewhat recently and I view those as idiosyncratic and the backdrop is actually pretty good. So. No, that's not something that I would.

[Michael Batnick]

When do idiosyncratic one offs become a bigger story to you? So I think we're. Every three days we're hearing about a new one. That's the rate and they're small.

[Stephanie Roth]

Yeah.

[Michael Batnick]

Relative to the size of the credit market. But like, how many do we need to hear them out before we decide, okay, this is a problem?

[Stephanie Roth]

They've been concentrated in two main areas. One is companies that had poor business models and were tied to fraud that I would discount most days of the week. And then tied to the auto sector and sort of frothy activity that happened a couple years ago is now becoming an issue. Okay, so far, sort of the broader announcements have been part of those two categories. As it starts to. As. Or if it starts to branch out into something else, then it becomes more noticeable.

[Josh Brown]

I would agree with you. The auto stuff specifically, that was activity that, that, that took place years ago that we knew was crazy town and now it's coming home to roost. If this starts showing up in sectors completely unrelated that are more concurrent in nature, it's like stuff that's reflecting stress today, then it's time to, okay, reassess and say what the hell is going on?

[Stephanie Roth]

Totally agree.

[Michael Batnick]

Let's. John, can we do 15? This is your past investment boom that you referenced before as past investment booms as a percentage of nominal GDP versus the current AI. And for the listener, the AI. I don't know how you're categorizing the AI spend, but like it's 1.3%. In 2025, the railroad boom went to five and a half percent of GDP. The.com went to four and a quarter. The housing boom in oh, five hit three and a half. So is the message here like it's not a bubble or is the message here like it will be? We just haven't gotten quite to where it would have to be to become a bubble.

[Stephanie Roth]

Maybe for investors, it doesn't matter either way because it tells you that for the Next at least 12 months, this is not a bubble and it's not an issue. It could become a bubble. Could become an issue, but I think we're a long way away from that.

[Michael Batnick]

We haven't gotten there yet.

[Stephanie Roth]

We haven't gotten there yet.

[Michael Batnick]

Okay.

[Stephanie Roth]

AI spend, and we're calculating as above trend spending in areas like data center, computer equipment. We kind of aggregate it all up. That's where we get to about 1.3% of GDP, kind of roughly 450 to $500 billion, which is a substantial part of GDP, but nothing like historical bubbles of the past.

[Michael Batnick]

All right, so when you get calls, is it a bubble? Your answer is no, Maybe someday.

[Stephanie Roth]

Yeah, totally.

[Michael Batnick]

Okay. Do people feel better after you tell them that?

[Stephanie Roth]

Sometimes.

[Michael Batnick]

Sometimes. Okay. People seem to want it to be a bubble. Have you noticed that?

[Stephanie Roth]

Yes.

[Michael Batnick]

Okay. In the investment world, what do you think that's about? They missed out.

[Stephanie Roth]

I think it's either missing out, feeling concerned about the valuations, or perhaps wanting to invest but are worried that they're going to be wrong and it's going to prove to be a bubble in two months time.

[Michael Batnick]

That's the worst. That's the worst of all worlds is you ignore it for five years, and then at the very end, because your clients are leaving, you're like, all right, whatever. And you just start throwing money at it and then it's over.

[Stephanie Roth]

Yes.

[Michael Batnick]

And then you lost twice, and you're just. You're. That's. That's the gotta be. That's gotta be the worst thing you could possibly do. I almost feel like you might even be better off just sticking to your guns and letting it blow up. I think a lot of the people that are still asking that question are probably in that camp.

[Josh Brown]

I would.

[Michael Batnick]

That's what I would do.

[Josh Brown]

100%.

[Michael Batnick]

Yeah. I think I would triple down.

[Josh Brown]

Oh, at 5 trillion. I think I'm getting interested in Nvidia.

[Michael Batnick]

No. If you were talking shit about Nvidia. Nvidia. Now it has my attention at like $300 pre split. And. And it's run all the way up. Split, Run all the way back.

[Josh Brown]

Stay quiet.

[Michael Batnick]

Just maybe don't talk about it at all.

[Josh Brown]

Yeah.

[Michael Batnick]

Do you want to do this China thing?

[Josh Brown]

It's up to you. Take it or leave it.

[Michael Batnick]

Take, take. Take us through it.

[Josh Brown]

All right. So our friend Michael Semblis wrote a post recently where he showed.

[Michael Batnick]

Did you work With Semblist, when you were at J.P. morgan, we worked like.

[Stephanie Roth]

Side by side together. So we talked to him once in a while.

[Michael Batnick]

Okay. He's probably listening. Fan of. Fan of the show.

[Stephanie Roth]

Hey, Mike.

[Josh Brown]

So here's a chart showing few Chinese industries depend on exports to us. And he's looking at consumer electronics and electrical equipment and basic chemicals and on and down the line. And they, they, a lot of it, they produce and they consume domestically, like. So he looks at US export revenues to China and it doesn't show up anywhere really, to maybe a little bit of consumer electronics, I guess that's the, that's the iPhone. So chart can. Matt looked at the average tech stock and the exposure, I'm sorry, the average sector exposure to China and in tech. So the S and P is 4.2% revenue exposure.

[Michael Batnick]

2% of S& P sales go to China.

[Josh Brown]

That's what, that's what Matt's saying.

[Michael Batnick]

Okay.

[Josh Brown]

But 10.6% of tech stocks. And then he broke it down by individual company. Tesla, we know how important China is to them. 21% of the revenue. Apple, it's 16% of their revenue. Nvidia, 13%. They buy a lot of the shit, our shit of the most important companies in the world. Our most important companies. So all of this negotiating rhetoric, whatever, like, they have leverage on us.

[Stephanie Roth]

So there was a chart that we used to run that looked at the exports that we send to various countries across the world and then how important their exports are to the US And China was the only country that showed equal, roughly equal leverage to the US Everybody else showed us had a ton versus us.

[Michael Batnick]

Like our balance of trade versus their balance of trade.

[Stephanie Roth]

Yeah, so exactly. That's exactly right. And that tells us that perhaps maybe Trump underestimated the ability for China to sort of weather this as well. And the fact that we would be caused a lot of pain just as much as they would be. And they have, they play the long game, so they have the ability to sort of wait a lot longer than we do.

[Michael Batnick]

They don't have the political reality of people not getting elected as a result of trade imbalances, whereas politicians here in the US do.

[Stephanie Roth]

Exactly.

[Michael Batnick]

Not yet, but allegedly at some point it might matter.

[Josh Brown]

We'll hear from Apple this afternoon. But the amount of revenue that they got from China has been a big overhang on the stock. It peaked a couple of quarters, quarters, quarters ago. Now I think everyone's expecting the iPhone 17 to have gangbuster numbers, and they better. Otherwise the stock's going to give a lot back. So I hope it. I hope that comes true. But yeah, China's a. China's a huge, huge buyer. A lot of our stuff.

[Michael Batnick]

Do you see that, as. Do you see this, like this meeting with Xi this week as being like, terribly consequential for the year end S and P. Like whether or not we have like a rally into year end or not, or do you think that's not really the bigger story?

[Stephanie Roth]

It paves the way for the rally and we thought the rally was probably going to happen anyway. It seems like a lot of investors are trying to catch up to a year where maybe they were underperforming.

[Michael Batnick]

At least that's what I think.

[Stephanie Roth]

A lot of clients that I speak with kind of communicate that. So I think this just paves the way for. We're kicking the can down the road. And also sort of a recognition that we can't really heat up the tensions again. That perhaps the appreciation that the. They have just as much leverage as we do.

[Michael Batnick]

So we have a truce. We don't have a trade deal. We have a trade truce. That's the last thing I read. Good enough, right?

[Stephanie Roth]

Good enough. And fentanyl tariffs came down. So there is a sort of win from that perspective.

[Michael Batnick]

You wouldn't believe what I'm paying for fentanyl these days.

[Josh Brown]

It's crazy.

[Michael Batnick]

So thank God for that. Stephanie, did you have fun on the show today?

[Stephanie Roth]

This was great. Thanks for having me.

[Michael Batnick]

Yes. All right. We loved having you here. And you're nearby. You're right in the neighborhood.

[Stephanie Roth]

Yeah.

[Josh Brown]

All right.

[Michael Batnick]

Will you come back?

[Stephanie Roth]

I would love to.

[Michael Batnick]

What are you doing tomorrow? We always.

[Josh Brown]

We always Amazon blow out numbers.

[Michael Batnick]

Finally.

[Josh Brown]

It's about time.

[Michael Batnick]

Finally, the stocks make stocks. Stocks making me look bad.

[Josh Brown]

Stocks up 8%. But it might be flat in 10 minutes. Give it a minute.

[Michael Batnick]

Hush your mouth. That stock's making me look dumber than any other stock I own.

[Josh Brown]

Let's go.

[Michael Batnick]

We always end the show by asking people what they are looking forward to. I already jumped the shark. I already told. That's not the right term. I already did a spoiler to you, but to the audience. Tonight's A4 Charles. Tonight's A4 Charles Prime Rib Night. You feeling me on that? Yes. You know, you're not. You're not a big prime rib eater, are you? You don't strike me as.

[Stephanie Roth]

Not really.

[Michael Batnick]

I'm gonna do unspeakable things at this place tonight. Oh, shit. Duncan's gonna. Duncan would faint if I. If you saw the table. The French dip, the cheeseburger Then they first bring out the prime rib.

[Josh Brown]

I've seen your social media.

[Michael Batnick]

The cheeseburger is the salad. Okay. Wait till you see what I do on Instagram to you tonight. You should unfollow me for tonight and then refollow me tomorrow. All right. Anyway, what are you looking forward to? What do you got on the horizon?

[Stephanie Roth]

Like, in life?

[Michael Batnick]

I don't care. Yeah, professionally, personally, anything you want to reveal, anyone you want to get back at, like, whatever.

[Stephanie Roth]

I mean, tomorrow. Tomorrow's Halloween. My two kids are going to be a big witch and a little witch, and we'll go trick or treating, and I can't wait for that.

[Michael Batnick]

Big witch and little witch. Okay, how old are they?

[Stephanie Roth]

Three and a half. And one and a half.

[Michael Batnick]

So cute. So cute. So you're carrying one or both?

[Stephanie Roth]

Yeah, both for a lot of. Definitely both.

[Michael Batnick]

I remember those days. You know what the move is? You got to get the wagon.

[Stephanie Roth]

Oh, yeah. The wagon is they pull each other's hair in the wagon, so you still have to pull one, hold one, and pull the wagon.

[Michael Batnick]

Are you letting them eat any of the candy or it's just.

[Stephanie Roth]

Oh, they can eat whatever they want. I don't care. Yeah, it's Halloween.

[Michael Batnick]

All right. All right, very cool. What about you? You have. You have Halloween coming up?

[Josh Brown]

I do, but I'm looking forward to Chris coming home so he would stop sending us to speak pictures.

[Michael Batnick]

Oh, Chris's vacation pictures. Yeah, they're actually pretty good pictures, though.

[Josh Brown]

Not bad.

[Michael Batnick]

Chris is in. Chris is in Cabo. The pics look pretty good.

[Josh Brown]

Normally.

[Michael Batnick]

He's the worst vacation photographer you've ever seen. You know, he want. He wants. He went to Paris and his son was, like, 12 years old. He's taking pictures of the Mona Lisa, but he puts his son in front of it. So it's like a picture of his kid close up, like, right into his eyeballs. And then behind him, you could vaguely tell that the Mona Lisa's behind. And he'll text and be like, look, the Mona Lisa. Shout out to Chris. Chris. We only tease the ones we love. All right, that's it for the show this week, guys. Thank you so much for listening. We really appreciate it. Huge shout out to John, Duncan, Daniel, Nicole, Rob, Chart, Kid, Matt, Sean, everybody on the crew. Keith, Daniel. Who'd I leave out? Rob. I'm terrible at this.

[Josh Brown]

Do my best.

[Michael Batnick]

All right, guys, thanks for listening so much. We appreciate it, and we'll talk to you soon. We're out. All right. Is that good? You wanna do it one more time.

[Stephanie Roth]

Yeah, let's do one more time.

[Michael Batnick]

We got it. Yeah.

[Stephanie Roth]

That was great.

[Michael Batnick]

You're a good support.

[Stephanie Roth]

Thank you. Thank you for having me.

[Michael Batnick]

Sam.