The Exchange – October 28, 2025

Host: Leslie Picker (in for Kelly Evans) | Podcast: CNBC’s The Exchange
Episode Theme:
A sweeping look at the day’s major business stories: All-time highs for tech stocks amid looming earnings and a pivotal Fed meeting, the real state of the AI "boom," big tech’s AI-driven restructuring, PayPal’s strategic AI integration, Nvidia’s historic market moves, the evolving job market under AI, and a vibrant IPO landscape despite macro uncertainties.

Episode Overview

This episode delivers insights from noted investors, strategists, and industry insiders on the red-hot tech-driven market rally; examines whether the AI economy is in a “bubble” or a legitimate new boom; discusses the implications of massive job cuts at Amazon and other major corporations in the age of AI; explores PayPal’s strategic OpenAI partnership; analyzes the market’s anticipation of substantial Fed rate cuts; recaps breaking updates from Nvidia’s GTC conference; and evaluates the current IPO climate.

Major Themes & Segments

1. Tech Markets at Record Highs: Are We in an AI Bubble?

(00:45 – 07:17)

• Market Milestones:

  • Microsoft and Apple both cross $4 trillion market cap.
  • Microsoft’s 27% stake in OpenAI valued at $135 billion, lifted by latest developments.

• Bill Gates Weighs In: Is this an AI Bubble?

  • [02:02] Bill Gates [via Andrew Ross Sorkin]:

    “If you mean it’s like the Internet bubble, where in the end something very profound happened... Some companies succeeded, but a lot... fell behind. Burning capital companies. Absolutely. There are a ton of these investments that will be dead ends.”

• Analyst Perspectives:

  • Leslie Picker hosts a discussion with Michael Kantrowitz (Piper Sandler), referencing Gates’ take and comparing today’s boom to past bubbles.
  • [03:19] Michael Kantrowitz:

    “We would characterize things more as a boom today... the companies have really good fundamentals. They’re almost able to self-finance through free cash flow.”

• Earnings as a Litmus Test:

  • Market’s tolerance for risk remains, but focus is squarely on the tech giants’ results this week, given that five companies now represent a quarter of the S&P 500.

• Macro Risk & Correction Outlook:

  • [05:56] Kantrowitz:

    “Markets are going to continue to absolutely be very attuned to macro. But we got here today because the market’s current view is that risks are very low.”

2. AI and Payments: PayPal’s Big Bet with OpenAI

(07:17 – 12:25)

• PayPal Stock Jumps on ChatGPT Integration:

  • Earnings beat and news that PayPal’s wallet will be embedded in ChatGPT—a major win.
  • Other recent OpenAI tie-ups: Shopify, Etsy, Walmart, Spotify, Zillow, DoorDash.

• AI-Driven “Agentic Commerce”: Analyst Perspective

  • [08:33] Dan Dolev (Mizuho):

    “You could get a 20% bump in ecommerce consumption because of agentic AI. This is huge news for ecommerce overall... and amazing news for PayPal.”

• Exclusivity and Competitive Landscape:

  • [09:46] Dolev:

    “Choice. But you want to be there, right? Not being there was the fear. The fact is PayPal is there... it tells you a lot about PayPal’s durability.”

• Long-Term Role & Moat:

  • [11:37] Dolev:

    “PayPal is a two-sided network... the best thing ever since sliced bread because there is moat embedded in that.”

3. The Great AI Restructuring: Amazon, Meta, and the White Collar Workforce

(12:26 – 18:36)

• Amazon Cuts 14,000+ Corporate Jobs; AI at the Center

  • [15:12] Mackenzie Sagalos:

    “Across big tech... companies like Amazon and Alphabet are pouring hundreds of billions into generative AI... while cutting tens of thousands of jobs.”

  • Meta and Microsoft also slashing roles, especially middle management.

• AI Will Transform, Not (Immediately) Replace, White Collar Jobs

  • [17:09] Sagalos:

    “It’s not so much that the AI is replacing these jobs, it’s that they need to flatten the structure in order to be more competitive with AI, move faster, less bureaucratic.”

• CEO Perspective on the Future of Work

  • [18:36] Steve Odland (Conference Board):

    “AI is software. It’s the next phase of digital transformation... The highest concern [for CEOs] is that others will get there first and establish a competitive advantage.”

• Labor Market Weakness vs. “AI Blame”:

  • [20:13] Odland:

    “There’s very little evidence that AI has taken anybody’s job yet... The kinds of things that we’re seeing in terms of layoffs are where people got out over their skis.”

• Socioeconomic Impacts:

  • [21:28] Odland:

    “The slowdown in consumer spending... is now driving companies to have to pare back to adjust to a different growth rate.”

4. Fed Rate Cut Anticipation and Debate: How Fast, How Far?

(26:02 – 35:29)

• Market Expects Aggressive Rate Cuts:

  • [26:02] Steve Liesman:
    • 92% of CNBC survey respondents say the Fed will cut rates by December.
    • Total cuts expected: 100 basis points, putting the Fed funds rate at ~3.2%.

• Expert Exchange: Will the Fed Cut—and Should It?

  • [28:38] Paul McCully (Georgetown, ex-PIMCO):

    “Not only will the Fed cut 100 basis points... but it should. The macro [softening labor]... the market has already discounted a 3% policy rate. The Fed needs to validate what the market has already discounted.”

  • [30:04] Steve Liesman (with humor):

    “Paul, I’ve already discounted being a billionaire and retiring, you know, pretty soon, and that doesn’t make it so.”

• On Caution & Pace:

  • [30:48] McCully:

    “A steady march at each of the next three or four FOMC meetings of 25 basis points... without a lot of herky-jerky behavior.”

  • [34:27] Liesman (counterpoint):

    “I would take a more cautious approach... I’m afraid the signal being sent is one that we’re cool with 3% inflation and we’re not really hot and heavy and concerned about our target.”

5. Nvidia GPU Summit: Game-Changing Deals and Investments

(36:21 – 39:25)

• Live Update from Nvidia’s Washington D.C. GTC Event

  • [36:21] Christina Parsinevolis:
    • Nvidia partners with Oracle and DOE for the U.S.’s largest AI supercomputer.
    • New “NV Q Link” connects quantum processors to major U.S. labs.
    • Collaborations announced with CrowdStrike (security AI agents), Palantir (enterprise AI operations), and Lowe’s (infrastructure).
    • $1B Equity Investment in Nokia for U.S. wireless and cell towers, giving Nvidia a near 3% stake. Nokia stock soars ~24%.

• CEO Jensen Huang’s Strategic Signals:

  • Ongoing big-ticket investments: Committed $5B to Intel, up to $100B to OpenAI over the next decade.

• Geopolitical Undercurrents:

  • GTC conference in D.C. coincides with critical China trade meetings—sentiment among CEOs is “very bullish” despite uncertainty.

6. IPO Market Resurgence Amid Policy and Macro Turbulence

(40:19 – 44:41)

• IPO Market Heats Up Despite Disruptions:

  • Third quarter deal volume up 19%, proceeds up 89% year-on-year (EY).
  • Retail participation is climbing, especially with digital assets and high-profile consumer IPOs.

• Perspective from the Top:

  • [41:21] Liz Myers (JP Morgan):

    “Financial sponsors are starting to feel that valuations are fair... M&A market come alive... multiple avenues to realize gains for LPs and to return capital.”

• Government Shutdown’s Impact:

  • [42:17] Liz Myers:

    “Some companies have used the ‘20-day avenue’ to price their IPOs while the SEC is shut down... rest will try to complete something by end of year or move into next year.”

• CEO Confidence Still High:

  • Activity especially robust in Asia (India, Japan); U.S. consumer still spending robustly in many sectors despite macro nervousness.

Notable Quotes & Timestamps

• [02:02] Bill Gates (via Sorkin):

  “A ton of these [AI] investments will be dead ends.”

• [03:19] Michael Kantrowitz:

  “We would characterize things more as a boom today... companies have really good fundamentals.”

• [08:33] Dan Dolev on Agentic AI and Commerce:

  “You could get a 20% bump in ecommerce consumption because of agentic AI. This is huge news for E Commerce overall.”

• [17:09] Mackenzie Sagalos:

  “It’s not so much that the AI is replacing these jobs, it’s that they need to flatten the structure in order to be more competitive with AI, move faster, less bureaucratic.”

• [20:13] Steve Odland:

  “There’s very little evidence that AI has taken anybody’s job yet... the kinds of things we’re seeing in terms of layoffs are where people got out over their skis.”

• [28:38/30:48] McCully vs. Liesman - The Rate Cut Debate:

  McCully: “Will [the Fed] and should [the Fed cut]? ... the answer is yes.”
  Liesman: “I would take a more cautious approach... I’m afraid we’re cool with 3% inflation.”

• [36:21 – 39:25] Christina Parsinevolis (on Nvidia):

  “Nvidia... partnering with Oracle and the Department of Energy to build the DOE’s largest AI supercomputer... $1 billion [investment] in Nokia...”

• [41:21] Liz Myers (JP Morgan):

  “There absolutely is [buy side interest in sponsor-backed IPOs]... multiple avenues to realize gains for LPs.”

Takeaways for Listeners

• Big Tech Momentum: Microsoft and Apple break new market cap records on strong AI and infrastructure bets.
• AI: Boom or Bubble? Most analysts see this phase as a justified economic boom, not a speculative bubble like dot-com, grounded in strong fundamentals but with pockets of excess.
• Workforce Transformation: Mass layoffs at Amazon, Meta, Microsoft reflect a drive for leaner, faster organizations in the AI age—organizational flattening, not pure automation, driving much of the change.
• AI in Payments: PayPal’s early partnership with OpenAI positions it as a payments leader in AI-augmented commerce, leveraging its unique “two-sided network” moat.
• Fed Outlook: Market expects significant rate cuts; experts differ on the urgency and wisdom. A steady, measured approach is advocated by some, while others counsel caution due to persistent inflation.
• Nvidia and the AI Gold Rush: Massive capital investments and partnerships are rapidly expanding the AI infrastructure ecosystem—Nvidia at the center, driving global tech and telecom transformation.
• IPO Market Resilience: Despite policy and macro headwinds, the IPO market is vibrant and diversified, with new channels for retail participation and growing sponsor interest.

Key Timestamps

• Tech & AI Bubble? – 00:45–07:17
• PayPal/OpenAI/AI Commerce – 07:17–12:25
• Amazon/AI Workforce Restructuring – 12:26–18:36
• Fed Rate Cuts Debate – 26:02–35:29
• Nvidia GTC Announcements – 36:21–39:25
• IPO Market Update – 40:19–44:41

Tone:
Fast-paced, analytical, and candid—high energy, with well-informed guests and hosts, technical yet accessible, with a clear focus on actionable insights for investors and executives.

End of Summary