Crude Climb Continues, Spring Housing Season, and the Mag 7 Melt 3/20/26

Summary

Podcast Summary: The Exchange (CNBC) – "Crude Climb Continues, Spring Housing Season, and the Mag 7 Melt"

Date: March 20, 2026
Host: Brian Sullivan (in for Kelly Evans)

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Overview

This episode of The Exchange dives into three major storylines impacting markets and investors: the continued surge in oil prices due to escalating conflict in the Middle East, how the spring housing season is shaping up amid high rates and shifting demand, and the recent turbulence in major tech stocks – particularly a staggering scandal at Super Micro Computer. Guests offer expert analysis on investment strategy in uncertain times, the state of the housing market, and the evolving tech sector, all while threading through geopolitical risk and macro headwinds.

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Key Discussion Points & Insights

1. Market Backdrop: Geopolitical Turmoil & Economic Headwinds

• Stocks: All major indices are down, heading for a fourth straight losing week. S&P 500 down 1% this week ([01:04]).
• Bonds: Ten-year Treasury nearing 4.5% ([01:04]).
• Oil: U.S. oil just under $100/barrel, Brent crude over $110, and even higher in select Middle Eastern markets ([01:04], [08:23]).
  • Prices have soared 40–50% since the start of the war between the U.S. and Iran.
• War in the Middle East: The U.S. and its allies are now directly involved, with the risk premium baked into global energy costs.

2. Investment Strategy: Looking Past the War

• Chris Grisanti, Chief Market Strategist, Mai Capital Management ([02:55]):
  • Main point: The war, while significant, may not define 2026 for investors.
    • “Is the war going to be the story for investors for 2026? …I think the answer is going to be no. …The story is much more likely to be, you know, it's a big surprise, AI and AI spending and the disruption that I may cause for other parts of the market.” ([02:55])
  • AI as the real investment driver: Nearly $800 billion in AI spending announced, expected to continue despite war-related cost increases in energy ([03:51]).
  • Opportunity for U.S.: U.S. might benefit as a safer location for data centers compared to the Middle East ([04:26]).
    • “Money tends to go where it’s the most efficient, but also we’re geographically protected.” – Brian Sullivan ([04:26])
  • Stock pick: Bullish on UPS as a value play, citing its high yield and post-Amazon-divorce recovery potential even as war and fuel prices weigh on shares ([05:49]).
    • UPS offers a 6.5% yield “while we wait.” ([05:49])
  • Weight loss drug sector: Favors Eli Lilly over Novo Nordisk as new, superior drugs (retatrutide) come to market; calls GLP-1s “a revolutionary change in healthcare” ([07:26]).

3. Oil Market Dynamics & Risks

• Andy Lipow, President, Lipow Oil Associates ([10:03]):
  • Wide, increasing spread between U.S. (WTI) and international oil prices; scarcity pricing for Middle Eastern crudes means some buyers are paying $150+/barrel ([10:03]).
  • U.S. Gulf Coast exports will likely flow increasingly to overseas buyers due to arbitrage, limiting how long the U.S. can stay insulated from global price shocks ([11:16]).
  • Gas prices: Soaring not just because of oil, but also due to global refinery outages and higher costs for blendstocks and refined products ([12:30]).
  • U.S. government options to ease supply: May include further Strategic Petroleum Reserve releases or even (controversially) relaxing sanctions on Iranian/Russian oil ([13:53]).

4. Spring Housing Market: Cautious Opportunities

• Diana Olek, CNBC Housing Correspondent ([17:01]):

  • It’s a “buyer’s market” by inventory, but not a straightforward one. Mortgage rates have climbed sharply to 6.53%, reversing a prior downtrend after the war began ([17:01]).
  • Home price growth has flattened nationally (up just 0.7% YoY). Inventory rising as homes sit longer, but new listings are down ([17:01]).
  • Inventory/local trends vary: Big jumps in listings in Las Vegas, Seattle, and DC; lower in San Francisco, Chicago, and Miami ([18:39]).
  • Builders offering deals: 10 months’ supply, price cuts, mortgage buydowns ([17:01]).
  • Tech’s influence: San Francisco sees renewed buyer interest as AI brings workers back to offices ([19:41]).

• Comedy Lane, CEO, Coldwell Banker Realty ([20:34]):

  • Takes a rosier view: Steady/healthy demand, stabilized prices, climbing inventory are positives for affordability ([20:34]).
  • The all-cash phenomenon: In luxury markets, “90% of homes over $3 million” in Manhattan are cash purchases ([22:05]); luxury remains highly resilient.
  • Middle America: More sensitive to rates but still within “U.S. historical averages and lower than last year” ([23:18]).
  • “For over 85% of people…home ownership is still central to the American dream.” – Comedy Lane ([23:18])

5. Super Micro Computer Scandal: AI Smuggling & Market Fallout

• Christina Partsinevelos, CNBC Tech Reporter ([29:48]):
  • Super Micro co-founder among three charged in a scheme to circumvent U.S. export controls and smuggle $510 million in AI servers to China in six weeks, including dummy servers and fake labels swapped with blow dryers ([29:48]).
    • “A web of lies, dummy servers, and to your point, a blow dryer involved…” ([29:48])
  • Reputational and compliance questions for Super Micro, given its 2018 accounting scandal ([33:06]).
  • Dell stocks up as investors bet it’ll benefit from Super Micro’s lost business ([29:48]).

6. Tech Stocks: The “Mag 7” Downturn and Where to Find Value

• James "Chuck" Muck, CIO, Clockwise Capital ([34:42]):
  • Mag 7 tech stocks (“Lag 7 lately”): Down 10%, underperforming the S&P 500 ([33:43]).
  • Apple is the top pick: Offers “path and predictability” amidst uncertainty, is “much more non-discretionary,” and deserves a premium like other “defensive” stocks ([34:42], [37:15]).
    • “Apple checks off all the boxes, whereas you will have question marks on the others as you go down the list.” ([34:42])
  • Crypto and gold: Both hammered as financial system deleverages; gold’s drop surprising in context of global chaos ([38:23]).
  • For semis, prefers scarcity/value (Micron, Intel) over higher-risk chip stocks ([39:23]).

7. AI, Big Tech, and the Defense Sector

• Mackenzie Sigalos, CNBC Tech Reporter ([40:04]):
  • AI in defense: Google, once wary of military AI after 2018's Project Maven blowback, is now “leaning into national security work” and quietly winning Pentagon contracts after Anthropic’s talks fell apart ([40:04]).
  • Google’s own researchers are supporting Anthropic’s legal fight against the Pentagon, highlighting internal dissent ([41:10]).
  • Alphabet removed anti-weapons language from its AI Principles last year ([40:04]).

8. Muni Bonds: A Tool for Housing Affordability

• Dan Close, Head of Munis, Nuveen ([42:18]):
  • Muni bonds used by state housing agencies to lower borrowing costs, improving housing affordability ([42:18]).
  • Types of housing bonds: Single-family, multifamily, and new “workforce housing” structures that help middle-class buyers (teachers, police, nurses) live where they work ([44:14]).
  • Returns: Taxable equivalent yields up to 7.5% for top tax brackets ([45:15]).
  • High demand for affordability solutions; focus on states with worst affordability for new investments ([46:13]).

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Notable Quotes & Memorable Moments

• Chris Grisanti: "The story is much more likely to be...AI and AI spending and the disruption that I may cause for other parts of the market." ([02:55])
• Brian Sullivan: “Money tends to go where it’s the most efficient, but also we’re geographically protected.” ([04:26])
• Chris Grisanti: “GLP-1s [weight loss drugs]...they’re not an improvement. They’re a revolutionary change in healthcare.” ([07:26])
• Andy Lipow: "People simply don't know whether they're going to get that cargo in May. And then you're hearing prices of $150 a barrel or higher." ([10:03])
• Diana Olek: "Buyers are only in the driver's seat now because inventory is up and prices have flattened." ([17:01])
• Comedy Lane: “In Manhattan, homes over $3 million, 90% ... are all cash.” ([22:05])
• James Chuck Muck: "Apple checks off all the boxes..." ([34:42]); "You're paying a premium for that path and predictability." ([37:15])
• Christina Partsinevelos: "A web of lies, dummy servers, and...a blow dryer involved." ([29:48])
• Dan Close: "Municipal debt can be used to lower the cost of housing because it's a significantly lower cap structure than anything else available." ([42:18])
• Brian Sullivan: "If we're going to really attack affordability, it has to come in the housing market and getting those affordability under control." ([43:55])

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Timestamps for Important Segments

| Timestamp | Segment & Summary | |-----------|-------------------| | [01:04] | Opening market commentary, war’s financial impact | | [02:55] | Chris Grisanti: Investment focus moving past the war, AI is key | | [05:49] | UPS: Value pick, post-Amazon recovery, despite war | | [07:26] | ELI Lilly vs. Novo Nordisk in healthcare transformation | | [08:23] | Oil market update, U.S. deployment, geopolitical risk | | [10:03] | Andy Lipow: Physical oil scarcity, spread explanations | | [11:16] | U.S. oil exports abroad, rising gas prices and their causes| | [13:53] | Government levers: sanctions, SPR, market interventions | | [17:01] | Diana Olek: Housing stats, market segmentation | | [20:34] | Comedy Lane: Optimism, luxury vs. middle markets, rates | | [22:05] | All-cash craze in luxury markets, resilience context | | [29:48] | Super Micro Computer scandal: smuggling, compliance risk | | [33:43] | Tech stocks update: “Lag 7,” Apple as defensive play | | [34:42] | James Chuck Muck: Apple’s path/predictability | | [40:04] | Mackenzie Sigalos: Google’s re-engagement with Pentagon | | [42:18] | Dan Close: Muni bonds, housing affordability innovations |

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Tone and Style

The episode balances urgent, newsroom energy with market-savvy banter. The language is direct, sometimes sardonic (e.g., the blow dryer caper), but always focused on distilling actionable insights for investors and market watchers.

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Conclusion

This Exchange episode delivers a layered look at how global conflict, market dynamics, and technological transformation are upending conventional wisdom in investing, housing, and tech. Despite uncertainties, experts highlight pockets of opportunity (UPS, Eli Lilly, Apple, Muni bonds) and argue for focusing on the secular — not just the sensational — in turbulent times.

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Transcript

[Podcast Host]

This episode is brought to you by Schwab Market Update, an original podcast from Charles Schwab. Join host Keith Lansford for this information packed daily market Preview delivered in 10 minutes or less, including projected stock updates, monetary policy decisions and key results and statistics that may impact your trading. Download the latest episode and [e-mail] Market Update podcast or find Schwab Market Update wherever you get your podcasts.

[AT&T Business Wireless Advertiser]

Not every sale happens at the register before AT&T business Wireless, checking out customers on our mobile POS systems took too long. Basically a staring contest where everyone loses. It's crazy what people will say during an awkward silence. Now transactions are done before the silence takes hold. That means I can focus on the task at hand and make an extra sale or two. Sometimes I do miss the bonding time.

[Brian Sullivan]

Sometimes AT&T business Wireless connecting changes everything. You're listening to the Exchange.

[Christina Parts]

Here's today's show

[Brian Sullivan]

and welcome to the Exchange everybody. I am Brian Sullivan in for Kelly today as the war begins to take its toll on investors. Stocks down once again. All three major indexes now on track for their fourth straight losing week. Borrowing costs keep going up. We are nearing four and a half percent on the ten year oil prices here, just under 100 bucks a barrel. But overseas prices keep rising as the US and its allies now taking military action in the Persian Gulf. Oil and your gasoline prices popping lately. Brent crude that's up more than 50% since the beginning of the war. Oil here up more than 40%. It's not just about energy. Your stock of the day, super microcomputer ow. Getting hammered, losing investors nearly one third of their money. And it's a story that could have been ripped straight from a Netflix thriller. But it's real. We'll get more on the SM CI story ahead. Welcome everybody. Let's start this Friday around your money because every day now seems to involve oil bond yields and the prospect of a longer war than many originally thought. This is weighing on stocks a bit. The S&P 500 is down about 1% this week, but let's be clear, that is only a 1% drop. Remember in midterm election years, the S&P 500 historically falls about 15% at least one time during the year. So context is key. And your first guest looking past the war saying that something else may have a bigger role in how things ultimately play out. Let's bring in Chris Grisanti is chief market strategist at Mai Capital Management. Chris, welcome. What is that other thing or things that you're looking at outside of what's happening in the Middle East.

[Chris Grisanti]

Well, thanks, Brian. It's always good to be with you. You know, I do think it's important for investors to ask themselves, is the war going to be the story for investors for 2026? And I think the answer is going to be no. Just like tariffs was not, at the end of the day, the story from 2025. So I think the story is much more likely to be, you know, it's a big surprise, AI and AI spending and the disruption that I may cause for other parts of the market. So that's what we're staying. And I actually think this is giving us opportunities. The conflict is giving us some opportunities.

[Brian Sullivan]

Okay, I want to get to that opportunity Friday, but I want to go back to your, your AI point. Is there any connection at all between what's happening in the Middle east and AI? And I say that because AI, as we all know, is largely an energy story and what's happening overseas is largely an energy story.

[Chris Grisanti]

Yeah, no, you're absolutely right, Brian. To underscore that there are a lot of factors involved and it's complicated, but I think at the end of the day, the important question investors will should ask is will the spending that's been announced and it's, as you know, almost $1 trillion, just shy of 800 billion, is that going to be spent this year? Because that has huge ramifications. And I think the answer is almost certainly yes for a bunch of reasons. But, but, you know, it might be more expensive to operate the data centers there might be, it might take longer because of what you're pointing out. But I think the main thrust is still there and I think that's still investing.

[Brian Sullivan]

Yeah. And you, you do wonder, and I don't want to sound gross because I know what's happening is serious, it's real, and people are being killed overseas. What that means for us here in the US could it actually mean that even more capital flows to the United States? Not only are we the most efficient with capital in the world, and money tends to go where it's the most efficient, but also we're geographically protected. I mean, you look what happened there was a, an Amazon or a data center blown up, hit whatever in the uae. The risk of that build out there is now elevated. Our risk, I think, is brought down. And I wonder, is there a positive outcome for us here because of that, Chris?

[Chris Grisanti]

Yes. I mean, Brian, I don't think it's positive long term, but as you can see, the dollar is Certainly stronger. And obviously if you're considering building data centers in Middle Eastern countries, you know, you care greatly about how this war ends and what the risk situation will be after that. So this may help to bring stuff

[Brian Sullivan]

back to our shores, like the Code Opportunity Friday. It's not my show, but we'll just, we'll have it here and on Power Line.

[Chris Grisanti]

Kelly, right?

[Brian Sullivan]

Yeah, Kelly. Kelly would agree on that. Kelly, hi. If you're watching UPS and that stock's been crushed, it's not down 17% in the last year. A lot of, listen, they're, they're exposed to fuel prices as much as anybody out there. But you are bullish on ups.

[Chris Grisanti]

I am. And this is, this is a great value idea, Brian, because the long term story is that they're divorcing Amazon and that's, you know, that was a huge part. Their largest single customer. So that's almost finished. You know, they've signed the divorce agreement and that's happened. So we've suffered through two years of that. The stock was starting to come back, the earnings were starting to improve and then the war hit. And the war is bad for these guys, bad for FedEx. It's bad for UPS. Obviously fuel, a huge input for them is going up, but in the meantime, the stock is down almost 20% since the start of the war. And so we've got a safe six and a half percent yield that we get paid while we wait. I think the momentum will come back and again, investors should look past the war. And what's that investment story going to be for UPS going forward? I think it's in.

[Brian Sullivan]

Did you find any. Encourage FedEx basically raised guidance today. You find any encouragement in that or the company's different enough that it doesn't really matter?

[Chris Grisanti]

No, no, I definitely find encouragement and they are different important ways. But the thing I like about UPS is that they, you know, they did worse than FedEx because of the Amazon divorce. And so they will have more ground to make up and I think the stock price will reflect.

[Brian Sullivan]

Okay. We look at the GLP ones, the weight loss drugs, if you will, and it appears there was kind of a, a two horse race. You had Nvidia or Nvidia. Oh my God. Novo Nordisk. We could bring up Nvidia. I'm sure they're connected. They're probably connected. They both start with an M. Novo Nordisk. Okay. With Wegovy and others and Eli Lilly and their drugs. And they're kind of duking it out, right? Kind of. They're kind of Duked out like Cassius Place, Sonny Liston kind of thing. It looks like Lily has won the

[Chris Grisanti]

fight easily win here. And the reason is that the Zeppelin is already better than the Ozempic test. But crucially they're coming out with retatrutide, which is even better than Zepbound. And this isn't the pill which other people are excited about. This is what will be their best injectable to date. And the reason I like the GLB1s is just like AI. They're not a transition, they're not an improvement. They're a revolutionary change in healthcare. And something that can't be disrupted by AI is, you know, is something you're going to inject into your body. So I'm excited about that.

[Brian Sullivan]

Yeah, maybe it's like the Ali picture where he's standing over, I think was that Joe Lewis and he's standing over kind of doing this. It's that iconic photograph. Maybe that's Lilly. We'll see what happens. Things turn but ups Eli Lilly and a good macro worldview as always. Chris Crisanti, Mai Capital manager. Chris, thank you.

[Chris Grisanti]

Thank you, Brian.

[Brian Sullivan]

Good to be all right. You're very welcome. Have a good weekend. So let's stay kind of on the energy story. As we noted at the top, oil here just below 100 bucks a barrel. But overseas a different story. The officially traded Brent crude's at 110 and it's not on the board there. But oil prices in certain markets in the Middle east are higher. In some cases over 130 or $150 a barrel. Not exchange traded crude. But if you actually want to buy a physical barrel of oil, natural gas, a little bit lower today, at least here in the United States. European natural gas is slightly up, but nowhere near the highs of recent days or the highs of the Russia invasion of Ukraine. All this coming as the US and some of its allies work to secure the Strait of Hormuz. Iran's new supreme leader issuing a defiant statement, a scary one, threatening to now further expand the war and attack tourist sites, civilians around the world. Think about that. In the meantime, America deploying three more warships and roughly 2,500 additional Marines to the Middle East. All that according to the Associated Press. Press. And your next guest says the conflict drags on. Maybe if we go another couple of weeks it could see oil here up to 120A barrel. Joining us now is Andy Lipow. He is president at Lipow Oil Associates. Andy and I was trying to, I don't want to get too in the weeds, the oil weeds. But you know, you got WTI and we've got Brent and the spread is getting wider and wider. But there's some really scary stuff happening in some of these less liquid oil markets that I tried to reference. What's your take on what's happening globally?

[Andy Lipow]

Well, thanks for having me, Brian. What you're seeing is the Middle Eastern crudes coming out of Oman or the United Arab Emirates. They're pricing on a scarcity basis because people simply don't know whether they're going to get that cargo in May. And then you're hearing prices of $150 a barrel or higher. And what this actually means, in spite of the futures market structure, is that the arbitrage from the Gulf coast into the Middle east and Asia is going to be wide open starting in April. And we're seeing that in the physical market as there's been a significant number of fixtures of oil going to Japan, Korea, India and elsewhere. And that's how the market is going to try to readjust where the scarcity is really happening in the Middle east compared to where we have a significant amount of exports off the Gulf Coast.

[Brian Sullivan]

Does that impact ultimately our prices here? We are still dependent on some imports, mostly from our friends up north in Canada. But is there a scenario where prices overseas keep going up, up, up, Andy, and we kind of stay where we are, or do we. We have to rise with them.

[Andy Lipow]

Well, we really have to rise with them, setting aside any freight implications and we're seeing freight costs go up. But the fact is, the wider the spread gets, you're still going to be having Gulf coast barrels, whether it's in Houston or Corpus or on the Mississippi River. That will be looking to those overseas markets because the ARB will be wide open. So we can stay at extremely large differentials between Brent and Ti and the rest of the world for very long because the the ARB and the traders are just simply going to take advantage

[Brian Sullivan]

of that and go into the story. You probably get this question a lot. I know I do, Andy, from all the beloved viewers and listeners that we have out there, which is why are gasoline prices going up so fast when the price of oil, while up, is maybe not up as much as some gas prices? My answer, I hope is correct is that gasoline is not just oil. There's a lot of other stuff that goes into making it. A lot of ingredients in the stew, if you will. What do we know about those other ingredients, all those other less known chemicals that go into making refined Gasoline, a lot of those are also coming from the same place.

[Andy Lipow]

Well, certainly all the gasoline blend stocks are coming from crude oil with the exception of maybe butane coming out of the natural gas liquids side of the business. But the fact of the matter is is that we're seeing gasoline, diesel and jet fuel prices rally simply because we have damage to refining capacity around the world, whether it's in Israel, Kuwait or Iran. As capacity comes offline, then that creates an additional supply disruption on the refined product side and especially on jet and diesel where the Middle east was a significant exporter of of jet and diesel volumes rather than gasoline. So as a result, you're seeing diesel prices absolutely soar.

[Brian Sullivan]

It's about six things, according to Andy Lipow, that the government can do to maybe help mitigate price hikes or hopefully bring down the price of oil or gasoline. Removal of sanctions, we saw that on Russia. Temporarily release of the spr. Saw that globally as well with US And IEA stocks. There are some talk about the removal or suspension of sanctions on Iranian oil, which I know sounds weird because we're at war with Iran. But do you think that could happen?

[Andy Lipow]

Well, it's a possibility. I mean as crude oil prices go higher and higher, you seeing the administration look for ways to bring more oil on a prompt basis into the market. And of course that means whatever is in floating storage is available to the market and you just redirect the tankers. So it's certainly not out of the question to be easing sanctions on Iran and followed and that follows suit with easing sanctions on Russia because that's the oil that's on the water and that's the type of oil that has been restricted coming out of the Middle East.

[Brian Sullivan]

Andy Lippow, really appreciate your insight. Critical time, Andy, thank you. Have a good weekend.

[Andy Lipow]

Thank you.

[Brian Sullivan]

All right on deck. Today, the official start of spring. And with that we kick off housing's most important time of the year. But spoiler alert, it's not looking great. Coming up, we'll get a gut check on home prices, supply and where rates may be headed. Also as we head into break here on the exchange, check out gold. Gold is down about 12% this month on pace for the largest monthly decline in nearly 13 years. And if that holds, it would be the 8th largest one month drop in gold going back to 1975 when even I was alive. The exchange is back after this.

[Podcast Host]

This is the exchange on CNBC Foreign. This episode is brought to you by Schwab Market Update, an original podcast from Charles Schwab. Join host Keith Lansford for this information packed daily Market Preview delivered in 10 minutes or less, including projected stock updates, monetary policy decisions and key results and statistics that may impact your trading. Download the latest episode and [e-mail] MarketUpdatePodcast or find Schwab Market Update wherever you get your podcast.

[Chris Grisanti]

To realize the future America needs, we understand what's needed from us to face

[Andy Lipow]

each threat head on.

[Brian Sullivan]

We've earned our place in the fight

[Chris Grisanti]

for our nation's future.

[James Chuck Muck]

We are Marines.

[Chris Grisanti]

We were made for this not every

[AT&T Business Wireless Advertiser]

sale happens at the register before AT&T business Wireless, checking out customers on our mobile POS systems took too long. Basically a staring contest where everyone loses. It's crazy what people will say during an awkward silence. Now transactions are done before the silence takes hold. That means I can focus on the task at hand and make an extra sale or two. Sometimes I do miss the bonding time.

[Brian Sullivan]

Sometimes AT&T business Wireless Connecting Changes Everything as of a few hours ago, it is officially spring, the most important period of the year for housing, as people look to move over the summer and many times in time for their kids to start school. But with mortgage rates on the move, where does housing stand right now? Diana Olek has all the stats and the state of the market for us now.

[Diana Olek]

Diana well, Brian, this spring is clearly a buyer's market, but that doesn't mean it's going to be easy for all buyers. And that's because mortgage rates are rising when we thought they'd be falling now, and concern over the economy is very real. The average rate on the 30 year fix jumped 10 more basis points this morning to 6.53%, according to mortgage News Daily. Barely a month ago, it was dipping into the 5% range, but the war with Iran turned that around. Buyers are only in the driver's seat now because inventory is up and prices have flattened. Prices nationally were up just 0.7% year over year in January, according to Totality. Compare that with last year, when prices were still gaining by 3 1/2 percent. Now, for the week ending March 14th, active inventory was up 5.6% year over year. And that's according to Realtor. But new listings were actually down 1.4%. So inventory is climbing, mostly because the homes on the market are sitting longer. Given the local disparities in inventory across the nation, this spring is likely to be a tale of many markets. For example, in February, active listings in Las Vegas, Seattle, Cincinnati and Washington, D.C. were all up over 20% from a year ago, according to realtor.com, but listings in San Francisco, Chicago, Buffalo and Miami were much lower than a year ago. Now the best bets for buyers are probably with the builders. They have a nearly 10 month supply of homes for sale and are actively cutting prices and buying down mortgage rates. So, you know, it depends on what you're into, new, existing, but it's going to be a very interesting spring ahead.

[Brian Sullivan]

Brian, I'm trying to find some commonality between those cities, the cities with the big jumps in listings, Vegas, Seattle and others. And then on the downside, you said Chicago, Buffalo. Is there anything that any of these markets has in common?

[Diana Olek]

Well, you know, what we're looking at is inventory has been weaker in the Northeast and the Midwest simply because that's not where the homebuilders are the most active. You look at a market like Las Vegas, that was one of those that really went crazy in the post pandemic surge of buyers. But now you're seeing inventory come up again because there are just fewer buyers than there were before. Seattle, that's more of a tech story. It's hard to say. San Francisco, San Francisco, it's also a tech story. So it's hard to get one big story in all the different localities. But again, it's the south and the west tend to have more supply and the Northeast and the Midwest have less in general because that's where to your

[Brian Sullivan]

point, Diana, they boomed right during COVID I mean a lot of people just moved to wherever they could. The desert seemed nice.

[Diana Olek]

Yes, it did. And markets like San Francisco crashed badly during that time because the work from home, everybody was moving out. Now AI is completely refueling the San Francisco market because likes people in the office. And so people are moving back into the San Francisco area. Again, Seattle is a tough one because they were, you know, very, very tight and now they're starting to see, you know, that easing up.

[Brian Sullivan]

I love that. We'll leave it there. The irony of what you said, the AI Loves people in the office. Diana Olek, great stuff. Thank you. So your next guest now has kind of a bird's eye view on all of this. Joining us, Comedy Lane, CEO of Coldwell Banker Realty. Comedy. Well to have glad to have you on the Exchange and cnbc. You heard Diana's report. Anything that you would add to that about macro trends you and your team all over the country are seeing right now.

[Comedy Lane]

You know, I think that what my team and I are seeing all over the country is a little bit rosier than the picture that Diana painted. Now, I don't disagree with any of the statistics that she cited. However, when we look at demand, it actually is pretty healthy. So, you know, pending home sales are up year over year, prices have steadied. But I think actually a really good thing for affordability, which has been a factor in demand. And, you know, inventory climbing is a really, really healthy thing for the housing market, particularly as we look over the last couple of years where, you know, suppressed inventory has actually been a major problem and part of the reason that volume hasn't risen to the levels that we would have liked to see. And, you know, so when I think about the entirety of the, of the housing picture right now, we're actually pretty optimistic going into that spring selling market, really based on the fact that affordability is climbing, demand is really steady.

[Brian Sullivan]

I don't know where you are physically. We're here in New Jersey. I've got a lot of friends in the D.C. area, kind of near where Diana was. And I could tell you just anecdotally where we are here. And some of my friends in the D.C. and even Chicago suburbs, they all say the same thing. If a house goes on the market, it will often be under contract in about a day, maybe two, and often for all cash, which is insane because I don't know who's got all that cash, but they do. In other words, mortgage rates don't matter. If you're paying all cash, you don't really care where mortgage rates are. I know this is not true in every market, but what are you seeing with those two things? Quick turns. All cash?

[Comedy Lane]

Yeah, all cash is a big trend, particularly in the luxury market. So you look at Manhattan, for example, homes over $3 million, 90% of homes are going for all cash. So when you think about the luxury market, which 90%, 90% of homes over

[Brian Sullivan]

3 million in Manhattan are all people just sitting around with a couple million bucks in the bank, you know, under

[Comedy Lane]

their mattress, maybe not even in the, in the bank. And so they're just, they're pulling out those suitcases of cash and they're going and buying those luxury homes and luxury. You know, the luxury real estate market has always been the most resilient piece of the real estate market. And we're seeing a lot of strength in that sector of the market right now. Cities like Manhattan, San Francis, the Silicon, the entire Silicon Valley, you know, and that is for both rents and purchases. So it's a, it's a very strong part of the market.

[Brian Sullivan]

All right, so that's obviously the super duper top end by the way I literally would just want to meet somebody has a suitcase of money. How about in most of the markets nationwide, the more middle class markets, very sensitive to interest rate movements, bond yields are up, interest rates, your borrowing costs have gone up a little bit. How much does that change the calculus?

[Comedy Lane]

It does, you know, I mean, middle America definitely is very sensitive to interest rates, but I think the thing to keep in mind is that interest rates are still very well within U.S. historical averages and lower than last year. So when you combine that with rising inventory, it actually paints a pretty good picture for the average home purchaser in the US And Coldwell Banker did an American Dream study and surveyed, you know, hundreds of thousands of adult Americans and showed that for over 85% of people in the US home ownership is still central to the American dream. And so we know people want to be able to purchase a home. And I think that there is a confluence of factors making that very possible for many, many people, including the fact that interest rates are lower than last year despite the volatility.

[Brian Sullivan]

That's a fair point and I love the optimistic view heading into the weekend. On the first day of spring, we need some good weather comedy. Lane, Coldwell Banker Realty, thank you very much. Have a great weekend.

[Comedy Lane]

Thank you.

[Brian Sullivan]

All right. Still ahead, a story you gotta hear to believe. And even after hearing it, you may still not believe it. And it's costing investors in one stock a lot of money.

[Podcast Host]

This episode is brought to you by Schwab Market Update, an original podcast from Charles Schwab. Join host Keith Lansford for this information packed daily market Preview delivered in 10 minutes or less, including projected stock updates, monetary policy decisions and key results and statistics that may impact your trading. Download the latest episode and [e-mail] MarketUpdatePodcast or find Schwab Market Update wherever you get your podcasts.

[Chris Grisanti]

To realize the future America needs, we understand what's needed from us to face

[Andy Lipow]

each threat head on.

[Brian Sullivan]

We've earned.

[Chris Grisanti]

We earned our place in the fight for our nation's future.

[James Chuck Muck]

We are Marines.

[Chris Grisanti]

We were made for this.

[Brian Sullivan]

Before we had AT&T business Wireless coverage, our delivery GPS wasn't the most reliable. Once our driver had to do a 14 point turn to get back on route. A 14 point turn. An influencer even livestreamed the whole thing. Not good for business. Now with AT&T business wireless routes are updating on the fly and deliveries are on time. And the influencer did get us 53 new followers though. AT&T business Wireless connecting changes everything. All Right. Welcome back. As the graphic says, time for a market alert. Kelly, by the way, is off today. She'll be back on Monday. I am Brian. I'll see you this hour and next hour as well. Markets are down across the board, but they're not down a lot. I mean, the Dow industrials down about 0.41%. S&P down a little bit more. Again, the pain is in the Nasdaq. It's in the big tech stocks. The Nasdaq down about 1.4% as well. Here are some of the individual movers. At the salary of Planet Labs, that Stock is nearly up 30%. They beat fourth quarter earnings, sales estimates as well. It's an earth imaging company. Remember we interviewed their president a few months ago in San Francisco. They had a lot of optimistic talk. And that stock rocketing 23% this year, I guess rocketing is a good pun for a company called Planet Labs. They're going to launch 40 satellites. They're going to team up with Google to explore putting data centers in space. And pl Planet Labs on pace for its best day since November. By the way, they're welcome back on this network anytime. Next up, another company we've talked a lot about lately for very different reasons. That is Mosaic. Mosaic MOS, it's a fertilizer company. Now that stock is down 7%. Got a downgrade from bank of America. They cited delayed margin expansion in phosphate fertilized thanks to rising materials costs, you guessed it, from the war in Iran. Shares of Mosaic on pace for their worst day since October. But a lot of the fertilizer companies have come up the last couple of weeks. And finally, ARM holdings up 4%. It got a double upgrade from HSBC. They call ARM's AI CPU narrative quote game changing, writing that ARM is now firmly in the middle of a transition from being a smartphone dependent semi IP player to a major AI server CPU beneficiary to catch all that, basically they're going to move from phones to AI and that is not reflected in the price of the stock. All right, now to Julia Boorstin for a CNBC news update.

[Julia Boorstin]

Brian. A senior Cuban official said that neither Cuba's political system nor the term of his president are under negotiation talks with the US the comments came during a press conference, according to Reuters. It follows a New York Times report earlier this week that the Trump administration is seeking to push Cuba's president from power. Cuba acknowledged a week ago that it had entered talks with the US Government. A federal commission consisting of President Trump appointed members has approved a 24 carat commemorative gold coin of the President in honor of America's 250th anniversary. The design is an image of Trump in the oval office with 1776 on one side and 2026 on the other. The vote clears the way for the US Mint to begin production on the coin. It, its size and denomination are still under discussion. And Jeff Bezos says Blue Origin filed a FCC application to deploy nearly 52,000 solar panel powered AI satellites into orbit. The project, named Project Sunrise, is Blue Origin's new effort to operate space based data centers. It follows similar applications from Elon Musk, Space X and Startup Star Cloud. Back over to you.

[Brian Sullivan]

All right, Julia Boorstin, appreciate that. We got the obligatory Bezos in a cowboy hat shot, Julia. Thank you. All right, so shares of super microcomputer losing about one third of their value. It's because of an international smuggling scandal that apparently includes hot air dryers, secret cameras, and maybe the worst alleged criminal activity. I mean, Christina Parts and Evolos with the story today's tech check. This was not maybe the highest grade potential criminal activity we've ever seen. Just throwing that out there.

[Christina Parts]

Oh yeah, but they got away with it with millions of dollars. And that's because there was a web of lies, dummy servers, and to your point, a blow dryer involved or maybe many blow dryers. That's the alleged scheme federal prosecutors laid out just last night, charging three people tied to server maker Supermicro, including the co founder you're seeing on your screen and board member Wally Liaof with conspiring to illegally divert billions in AI servers to China. In of course, violation of US Export controls. Supermicro, for those who don't know, builds high performance servers which include Nvidia's most advanced chips. Prosecutors say the scheme routed servers through a Southeast Asian middleman, repackaged in unmarked boxes and then shipped them to China. That's what you're seeing on your screen right now. Defendants staged thousands of fake non working servers just in case there was inspection. So those are the fake ones you're seeing on your screen. Also caught on surveillance camera using a blow dryer to swap labels and serial numbers. That's the red thing that you're seeing in that woman's hand. On the right hand side, $510 million worth of servers were diverted in a single six week window just last spring. Nvidia is not accused of any wrongdoing. Supermicro says it's not named as a defendant. But analysts of course are pointing to the company's 2018 delisting over accounting issues where that same co founder stepped down, but then he was rehired Eyes surprise auditor resignation just in 2024 as reasons to question just how deep the compliance failures go and whether the current CEO, Charles Liang, also seen on your screen with Jensen Huang, the CEO of Nvidia just a few days ago, knew more than the company is letting on. Raymond James said the stock will suffer from a reputational discount over its reporting credibility and that's why you're seeing shares down so dramatically right now. Dell, on the other hand, is up almost 5% because it's flagged as the most immediate beneficiary of Supermicro's customer relationships. Brian, take a hit.

[Brian Sullivan]

All right, so I want to be clear, we just showed some of those still photographs. We had the blow dryer, we had the hidden camera. I stand corrected. You said they got away with it. So I guess these are the greatest criminals in the history of crime. Allegedly, by the way, potential crime. I don't want to make nothing. Nobody's been convicted yet. Want to make sure that clear. So how did they get away with this? Like what happened?

[Christina Parts]

Well, they did get away with it because the US Department has been working, the state attorney's office has been working on this for quite some time, but this is a continuous problem. Just last summer we reported that there was three Singaporeans that were just arrested as well for a very similar case of smuggling chips. There are two other California men on a very similar case. And some of these cases, most of them, involve Nvidia chips, which just shows how desperately certain countries like Russia, including China as well, want these chips. And it just.

[Brian Sullivan]

But somebody's still on the lam. I heard you say that earlier on CNBC. I think it was like the 10 o' clock show, sorry, say to somebody, somebody's still like on the run, on the lam.

[Christina Parts]

Well, there's one fugitive, so two. The co founder was arrested along with another employee, the contractor. But the third guy that was involved with this scheme, he is, quote, a fugitive right now. Maybe that's changed within the last 24 hours. But we haven't received any updates from,

[Brian Sullivan]

well, either way, the government. Yeah. And by the way, this is a company that didn't they have accounting issues in 2018, like severe accounting issues 2018.

[Christina Parts]

And that's why that same co founder who's being charged, he stepped down. Then they rehired him as a consultant a few years later in 2021. Then they added him onto the board in 2023. So how did they not know this? And this is the second time this guy has screwed up big time.

[Brian Sullivan]

It's a listen, it's a really good lesson for investors. Just know what you own, know some of the history and just be careful out there and also be mindful of any company that buys a lot of blow dryers. Apparently. I don't know if they did, but it's just something to, you know, to note. Christina Parts Nobles, big story there. Thank you very much.

[Comedy Lane]

Thanks.

[Brian Sullivan]

All right, coming up in bigger tech news, the Mag 7 slipping about 2% this week. You're coming up tech investor bullish on one of these names more than any other. That name will be named. No Hot air next. All right. Welcome back. Certainly been a tough few months for all of you who love big tech, the so called Mag 7 more like the Lag 7 lately they're down 10%. They're doing worse than the S&P 500 this year. But as prices go down, maybe there's opportunity for you. Buy low, sell higher. Your next guest adds rising oil price to a list of any headwind that's out there. But he does see a lot of upside in one mega cap. Name, James. Chuck Muck is chief investment officer at Clockwise Capital and joins us now. That single one top tier, as you call it name is what?

[James Chuck Muck]

They're not breaking that much news here, but the stock is Apple. And just to give you context on it, you know, I think you got to zoom out here. What are we dealing with? We're dealing with a regime in Iran that's not driven by cronyism but rather by ideology. That's a dangerous game with more incentives to escalate than de escalate. At the same time, you look at the bond market, what it's doing, you know, they're trying to shift the yield curve, trying to get a GDP to eclipse the pressures in the fiscal system. But the fact of the matter is we can't grow that fast. And you have structural headwinds as well. And at the same time, obviously, you guys have talked about ad nauseam, the stresses in the private credit market and whatnot. And with the rising oil prices and a big question mark, and I think you can get that from Powell's testimony or his press conference two days ago that it's a big question mark on where all this goes. So putting all that together, I think the priority in the portfolio is path and predictability. Where do you have the highest conviction in terms of what the earnings will be, what that growth profile will be and the relative valuation to the, to the sector as well as the broader market. Putting all that together, I think you can safely say across the Mag 7, Apple checks off all those boxes, whereas you will have question marks on the others as you go down the list.

[Brian Sullivan]

Does it check off the boxes, James, or is it like. But Apple is immune to a lot of the headwinds, rising energy, certainly in the Middle east that you just mentioned.

[James Chuck Muck]

I would venture to say it's much more non discretionary in nature than the other ones. Obviously data center spending and the shift to digital assets will continue to benefit the other Mag seven companies on a secular basis. But you know, Apple's business, I mean you still need your devices, you still need your computers, you still need Apple services. You know, I would venture to say it's just simply more predictable in nature now as far as, you know, exposure to more riskier parts of the story, you know, with oil and whatnot. Yes, it doesn't have that. But if Apple, if the market goes down, Apple in all odds is going to follow down with it. So the question is what will offer the most relative downside protection as you go on the way down? Because we don't know with confidence which direction things are going to go. I would say that that's Apple versus the other ones where the earnings are more, more difficult to ascertain.

[Brian Sullivan]

Are you comfortable with Apple's valuation? It's not low, historically, no, it's, it's not low.

[James Chuck Muck]

I mean you're, you're paying a premium for that path and predictability. I mean that's why you pay up for Costco, that's why you pay up for other staples. I would put Apple in that same category as defensive. And yes, it's a technology name, yes, it has secular attributes and yes, they're innovating. But at the end of the day I just think it's a more defensive name. As you look at the rest of the Mag 7 and there's a lot of leverage in the system. You know, leverage is a big risk that the reallocation of capital, you know, across the bucket, across crypto, across other areas of the market, you know, precious metals, you're seeing it.

[Brian Sullivan]

Yeah, gold's having worse month in a long time. Cryptos seemingly the last. I mean, I don't want to say since October can't get out of its own way, it's lost half its value since October. Or you could honestly say maybe it didn't deserve to have the valuation it did in October. Either way, there's a lot of really interesting things, James, happening right now on certain corners of the market.

[James Chuck Muck]

Yeah, I mean you would expect an all else equal gold should be soaring right now. But the fact of the matter is,

[Brian Sullivan]

I mean it was, it was fair.

[James Chuck Muck]

It was. And a lot of it was driven on leverage and derivatives markets. But you know, right now with oil doing what's doing the whole stagflation argument back, the whole question marks around inflation and interest rates and all resurfacing to the top of mind right now, you would suspect all else equal, that gold should benefit from that. But, but it's not, you know, when we're looking at leverage in the system, you know, kind of prioritizing, you know, what has already kind of started to deleverage and what's the last tail of it. You know, you could argue crypto has faced the brunt of that burden. First, you know, metals have followed and then you have the, the, the aspect of things. There's a lot of leverage there as well. So I think you got to be really picky and choosy when it comes to the semiconductor stocks that you own. You know, we're leaning into scarcity. That's like Micron and Intel versus the traditional chips.

[Brian Sullivan]

Guys, predictability, maybe the Apple story. And one of your favorites, James, Chuck Buck clockwise Capital. James, thank you very much.

[James Chuck Muck]

Thank you.

[Brian Sullivan]

All right, coming up is Anthropic's pain, Google's game how that mag7 name came to the top of the military short list of AI providers despite some employee opposition. Stick around. Google looking to take advantage of the battle between Anthropic and the Pentagon, despite Google's own employees siding with Anthropic in its battle against the Department of War. Mackenzie Segalus has more on this story.

[Christina Parts]

Mack hey, Brian.

[Mackenzie Segalus]

So you've got the anthropic Pentagon fight heading to court Tuesday. OpenAI still battling optics after rushing in to sign a defense deal. But it's actually Google that's been quietly making the biggest moves of all behind the scenes by reporting that in a January DeepMind town hall leadership told staff the company was leaning more into national security work. CEO Demis Hassabis, once deeply wary of how their tech could be used in warfare, told employees that he's now very comfortable saying it's incumbent on Google to work with democratically elected governments. This after Alphabet stripped out a previous pledge against weapons and surveillance from its AI principles at the beginning of last year. Now, the Times then reported that Google Cloud CEO Thomas Kurian sat down with the Pentagon's AI czar Emil Michael back on February 26, the day that Anthropic's talks fell apart to pitch an expanded partnership. Now, Google's not responding to requests for comment on either meeting, but we've seen Google since land a deal to put AI agents on the Pentagon's unclassified networks, a remarkable turnaround for a company that walked away from military AI in 2018 after the project Maven revolt. But there is internal pushback. Google's own chief AI scientist, Jeff Dean, and dozens of researchers have filed briefs backing Anthropic's last lawsuit, siding with the blacklisted company over the department that Google is now trying to court. Brian?

[Brian Sullivan]

Yeah, I'd love to talk with you more about it, but I screwed up the timing of the show, so we got to go. Mackenzie, we'll get you back on soon to talk about it. Thank you. All right, on deck, how bonds can impact housing affordability, but in a good way. It's Muni money. And it's next. All right. Welcome back to the Exchange. Mortgage rates climbing for the third week as the war in Iran sends ripple effects through the economy. And the bond market rate on the 30 year fixed mortgage now is about 6.6% depending on where you are, credit, etc. Those elevated rates, just one piece though of the housing affordability problem. And your next guest says there's one way to lower costs and expand buyers options. Let's find out what that is with Dan Close. He is head of munis at Nuveen. Dan, welcome. What is that? What is that one thing maybe that

[Dan Close]

we can do to help Muni bonds? Muni bonds in their own way right now are helping drive affordability. And if you look at, you know, just how much affordability has crept into everything in the United States, the mayor won here in New York on just a simple premise that things are too darn expensive. And so municipal debt can be used to lower the cost of housing because it's a significantly lower cap structure than anything else available.

[Brian Sullivan]

What does that mean, a lower cap structure?

[Dan Close]

Well, you get to issue muni bonds and the coupons are exempt. So when a state housing agency issues municipal debt, they get to issue at a meaningfully lower rate than anything you can have in corporates, ABs, MBs, and they're able to pass along that lower cost to end users of housing.

[Brian Sullivan]

Your stats are really shocking and a little scary. So in California, Nevada, New York, Florida, more than a quarter of renters, so 25 percent of renters spend over half their income on housing Right, that's, that's insane.

[James Chuck Muck]

Yeah.

[Dan Close]

And if you look at just the cost of everything over the last six years, up 25%, you look at CPI and all the other basket, you know, the things that go into that basket, up 25%. The biggest driver by far of that has been housing. So if you look at the average spend for an American, fully a third of what they're spending is on housing. So if we're going to really attack affordability, it has to come in the, in the housing market and getting those affordability under control.

[Brian Sullivan]

So talk to us about housing bonds because there's going to be a large part of our audience, and you reminded me very nicely sat down that I was on the floor of Nuveen like 20 years ago.

[Dan Close]

That's right.

[Brian Sullivan]

And there's a lot going on 20 years ago with housing. So what have we learned? What if, how have we gotten a lot smarter with housing bonds than we were maybe 20 years ago?

[Dan Close]

Yeah, I think, you know, you look at the housing bonds, they come in three flavors. You have single family housing issued by state agencies, you can use those lower proceeds from to go in and to buy down mortgages to help with housing payments. You have multifamily housing. You know, those are the standard too. But what's really evolved is what's called workforce housing. So when you have police and firefighters and teachers and nurses in areas that are out of their affordability range, there's now workforce housing bonds that have been introduced that help these folks that are not in your traditional affordable housing bucket, help afford and getting to communities that

[Brian Sullivan]

they serve as they should. I mean, if you have those people, first responders, cops, firefighters, nurses, they need to live where they work, not two hours outside of town, because you need them there. What kind of returns are we talking about then? Are there, Are there? I know there's probably not. Are there tax benefits on the housing side or is it just more on other sides of Muniz?

[Dan Close]

Yeah. For most investors it's just getting that tax exempt income. So if you're buying state housing paper right now, a little bit further out on the curve, it's 4.25% taxable equivalent. If you're in the highest tax bracket, that's in that 7.25%. 7.5%, that's not bad.

[Andy Lipow]

Not bad at all.

[Brian Sullivan]

By the way, that's about the historical return of the S&P 500 every year.

[Dan Close]

That's right. And if you're buying these, you're actually helping affordability. There's A good social component that comes comes with it too.

[Brian Sullivan]

Yeah. And then what about the risk level? Obviously we call it fixed income which is true to a point but listen bonds can go down in price too. I mean they can. They don't often but they can. Yeah.

[Dan Close]

I mean your state housing agency paper that's good double a paper multifamily housing usually backed by Fannie Freddie. It's more your workforce housing that has more yield opportunities and that we see the most opportunity in and do do vary by state.

[Brian Sullivan]

Are there better places to look now Dan that than than others or is it the states that we mentioned even with the rent issues?

[Dan Close]

Yeah, we're looking at states where affordability is the largest issue because there's pent up demand and we think there's much better debt service coverage in those types of areas.

[Brian Sullivan]

Dan. Close. Nuveen really interesting. Seven and a half percent pretty good.

[Dan Close]

That's right.

[Brian Sullivan]

I mean tax benefits, upper income helping out seems pretty positive. Dan, thank you you thank you so much. Brian. Let's not make it 20 years. 20 come hang out on your trading for again. I was only 7 years old back then. Close. Really appreciate that. All right before we go to power lunch because I'll see you there as well. Kelly's off today. Just a quick check on your markets. It's also a huge Options Expiration Date 6,000,000,000 Notional 6,000,000,000 Expiring Today some this morning but a lot into the close. Will that change? SMB's down exactly exactly 1%. I'll see you on the other side of this short break. Stick around.

[Christina Parts]

You've been listening to the exchange. Make sure you're subscribed to get each episode every day, same time, same place.

[Brian Sullivan]

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