The Exchange – Final Trading Hours, Biotech's Boom & Buffett's Last Day (12/31/25)

Podcast: The Exchange (CNBC)
Date: December 31, 2025
Host: Contessa Brewer (in for Kelly Evans)
Primary Guests: Jamie Cox (Harris Financial Group), Steve Kobach (CNBC Tech), Jared Holtz (Mizuho Securities), Eamon Javers (CNBC), Ann Winblad (Hummer Winblad Venture Partners), Bernie Reagan, Patrick Mullie (Piper Sandler), Bob Pisani (CNBC)

Episode Overview

On the final trading day of 2025, The Exchange delivers a comprehensive wrap-up of the year’s major market themes: the persistent AI-fueled rally, a biotech M&A surge, ongoing retail sector shakeups, Nvidia chip smuggling intrigue, and, momentously, Warren Buffett's last day as CEO of Berkshire Hathaway. With expert commentary and insightful analysis, the episode explores what drove the year’s double-digit market gains, spotlights big sector winners and losers, investigates regulatory drama in AI and chips, and contemplates the post-Buffett future at Berkshire.

Key Segments and Highlights

1. Market Wrap: Another Banner Year on Wall Street

Starts at 00:15

• S&P 500: Poised to close up 17% for the year (third straight year of double-digit gains).
• NASDAQ: Up 21%—AI stocks fueling massive gains.
• Dow: Up 13%.
• Russell 2000: Up 12%, showing broad gains beyond megacaps.
• S&P Sectors: All 11 end higher; leaders are communication services (Warner Bros, Alphabet), tech, and industrials.
• Commodities: Gold, silver, platinum up, but metals falling on the day. Oil’s the exception, down 20% for the year.

Notable Quote

“We're looking at that AI frenzy that has fueled the NASDAQ...but look, don't count out those smaller guys.”
—Contessa Brewer [00:55]

2. Debate: Is There an AI Bubble? (w/ Jamie Cox, Harris Financial Group)

Starts at 02:44

AI Bubble — Or Not?

• Different from the 1990s dot-com era:
  • Current tech leaders have real earnings and cash flows.
  • True "bubble signs," like speculative IPO surges, are absent.
  • Next year may see more private AI giants (e.g., Anthropic) go public, offering markets more clarity.

“What we don't see are some of the markers that typically define bubbles...What we're going to see next year...is clarity. When these companies report, that will really fuel more growth...”
—Jamie Cox [03:13]

Small-Cap AI and Productivity Gains

• Opportunities are moving beyond the largest techs; expect broader productivity enhancements and higher company earnings across multiple sectors.
• Productivity gains showing up in macro data (“starting to see some increase in gross domestic income”).

Best Ways to Play Infrastructure

• Defense/security (Raytheon, Apple, Saab, etc.) and international companies (Japan, Korea) are better bets than U.S. metals.
• Copper preferred over silver/gold for data center infrastructure.

“If you really want to play industrial metals, copper is the better place...seems more realistic and more reasonable.”
—Jamie Cox [07:31]

3. Apple: A Tumultuous Year and What’s Next for AI

Steve Kobach, CNBC Tech
Starts at 08:15

• 2025 Recap:
  • Executive departures, tariff battles, AI “failure” (missed Siri update).
  • Stock up 9% YTD, helped by August policy wins.
• AI’s Critical Role for 2026:
  • New Siri promised for 2026, needs to be compelling enough to drive iPhone upgrades.
  • Could Apple pivot to subscription pricing for advanced AI features?
  • Internal changes: Head of AI (John Giannandrea) ousted, new leadership structure.

“Apple intelligence and this new version of Siri is going to be free with their iPhone. So Apple needs to make sure people are buying these new phones...”
—Steve Kobach [09:02]

• Affordability:
  • U.S. carrier deals (“zero down” leasing) lower the cost barrier, but subscriptions could be a sticking point.

4. Biotech: M&A Boom and Policy Uncertainty (Jared Holtz, Mizuho Securities)

Starts at 13:20

• Record Biotech Deals:
  • $65B in M&A through Q3—double 2024 levels.
  • GLP-1 (obesity) drugs buoyed the sector; Structured Therapeutics a likely acquisition target.
• Policy Risks:
  • White House drug pricing negotiations may ease—less regulatory pressure could spur more deals.
  • Expiring Affordable Care Act subsidies not likely to affect sector near term.
  • Leadership shifts at HHS and FDA considered “mostly noise” by markets; biotech ETFs up 30%+ in 2025.

“The drug pricing discussion is one of the more interesting ones in all of health care...the government's going to walk back a little bit from drug pricing as this major issue.”
—Jared Holtz [14:53]

5. Commodities & Top Dow Performers

Starts at 17:45, 18:01

• Commodities:
  • Silver up 142% (best since 1979), gold up 65%, platinum up 122%, copper up 41%.
  • Oil down 20% — diverges dramatically from metals.
• Dow Leaders (2025):
  • Caterpillar (+58%), Goldman Sachs (+54%), Johnson & Johnson (+43%).

6. EXCLUSIVE: Inside the Nvidia GPU Smuggling Case (Eamon Javers)

Starts at 20:15

• Operation Gatekeeper:
  • Large-scale smuggling of Nvidia GPUs to China, circumventing U.S. export controls.
  • Smugglers used fake company names, relabeled chips, and a New Jersey warehouse.
  • Nvidia: “We will continue to work with the government...to ensure secondhand smuggling does not occur.”

“It’s a surprisingly low-tech smuggling operation for a high-tech product... right out of like a Prohibition whiskey run, but this is Nvidia GPUs going to China.”
—Eamon Javers [22:51]

• Regulatory Curveball:
  • President Trump announced new export permissions for Nvidia’s H200 GPUs (w/ 25% fee to U.S.), undermining the government’s smuggling prosecution.

7. NYSE Year-End Traditions & Bitcoin ETFs (Bob Pisani)

Starts at 25:59

• Ringing in the New Year: [26:32]
  • Annual singing of "Wait Till the Sun Shines, Nelly" by traders, a NYSE tradition since the 1860s (led by families of the late Art Cashin, Jimmy McGuire).
  • Emotional tribute to Art Cashin, emphasizing resilience and community on Wall Street.

“2025 was a year that everything could have been thrown—everything that could have been thrown at a market was. And we still closed out 52 record highs on this year.”
—Peter Tuckman [29:52]

• Bitcoin ETF Analysis:
  • Bitcoin ETFs down sharply (BITO –47%, Grayscale –8%, others worse).
  • Pisani: Market clearly prefers ETF structure for crypto exposure; major players (BlackRock, others) have “cornered” the market.

8. Warren Buffett Steps Down: Legacy & the Next Era for Berkshire

Ann Winblad, Hummer Winblad Venture Partners
Starts at 31:43

• Buffett’s Last Day as CEO:

  • Berkshire down 6% since his retirement announcement; underperformed S&P in 2025.
  • Greg Abel to take over as CEO; Buffett remains as Chairman.

• Strategic Outlook:

  • Huge cash reserve ($300B+) gives new CEO options.
  • Winblad: “The culture of Berkshire Hathaway, which is what I've invested in…will probably still remain.”
  • Buffett’s value investing questions: Does the business have a moat? Leadership? Predictable model? Applied to new investments like Google.

“Warren as chairman will be an advisor to Greg, a cultural anchor and a real long-term thinker, which is one of Warren's many strengths.”
—Ann Winblad [33:12]

9. Retail Recap: A Rough but Resilient Year (Bernie Reagan)

Starts at 37:20

• Sector Moves:

  • XRT up 7.5% (half the S&P’s return), outperforming expectations despite April’s tariff shock.
  • Value-led winners: Five Below (+80%), Dollar General (+75%), Dollar Tree (+64%), American Eagle (+59%), Victoria’s Secret (+32%).
  • Struggles for Lululemon (–45%), Target (internal missteps), and other specialty stores.

• Key Consumer Trend:

  • “Value” is about both price and item attributes (quality, brand appeal), not just low cost.

“Just because a baseball bat is priced right doesn't mean a consumer will buy it. But if it helps that kid score more home runs...they will sell it no matter what it costs.”
—Bernie Reagan (quoting Dick’s Executive Chairman Ed Stack) [39:57]

10. Prediction Markets and the Next Frontier for Retail Trading (Patrick Mullie, Piper Sandler)

Starts at 41:13

• Huge Volume Growth:
  • Weekly volumes on Kalshi & Polymarket near $3B, up 16% month-over-month.
  • Sports contracts drive most growth, especially where regular sports betting is restricted.
  • Non-sports markets (weather, economic, political events) up 250%+ annualized.

“Overall awareness of the space is growing quite rapidly. We think that’ll continue in the coming year.”
—Patrick Mullie [42:14]

• Will growth persist if sports betting is restricted?
  • Legal uncertainty looms (states, tribes, federal government), but non-sports use cases and info demand remain strong.

Memorable Quotes / Moments

Jamie Cox on AI bubble fears:

“People are trying to relate it to the 1990s...What you have now is a completely different situation.” [02:44]

Steve Kobach on Apple’s AI struggle:

“They failed to deliver that Siri update that was supposed to happen in March...It’s been a long time coming.” [09:01]

Eamon Javers on Nvidia smuggling:

“A surprisingly low-tech smuggling operation for a high-tech product...this is right out of like a Prohibition whiskey run.” [22:51]

Bob Pisani on Wall Street traditions:

“If you find something you love to do, you'll never work a day in your life...2025 was a year that everything could have been thrown at a market, and we still closed out 52 record highs.” [29:53]

Ann Winblad on Buffett:

“Warren as chairman will be an advisor to Greg, a cultural anchor...the culture of Berkshire Hathaway will probably still remain.” [33:12], [34:22]

Bernie Reagan on retail winners & losers:

“Resilience of the consumer and retailers’ ability to mitigate most of the tariff costs to mute the impact for consumers.” [37:24]

Timestamps for Key Topics

• Market wrap & AI/Tech sector: 00:15–08:09
• Apple AI outlook: 08:15–11:49
• Biotech M&A & policy: 13:20–16:56
• Commodities & Dow review: 17:45–18:01
• Nvidia chip smuggling investigation: 20:15–24:33
• NYSE year-end traditions (Pisani): 25:59–31:43
• Buffett’s retirement/Berkshire outlook: 31:43–36:39
• Retail sector review: 37:20–40:24
• Prediction markets analysis: 41:13–44:59

Takeaway Themes

• 2025 marked by resilience in both markets and the broader economy—AI and productivity narratives driving tech, while consumers and retailers adapted to shocks like tariffs.
• AI is widespread—but not a bubble...yet. Fundamental earnings and capital investment differ from the 90s dot-com boom. Smarter, broader plays (e.g., copper, international defense/security) suggested.
• Mega deals and policy shifts dominate biotech, but sector optimism persists.
• Old and new Wall Street traditions coexist (from NYSE caroling to bitcoin ETFs and prediction market mania).
• Buffett’s departure symbolizes the end of an era but not a revolution at Berkshire—steady value investing and patient capital remain pillars.
• Prediction markets and event-driven trading are an emerging growth area, blending finance, information, and entertainment in new ways.

Happy New Year, and here’s to navigating 2026’s opportunities and surprises!