Yahoo Finance Live: Daily Market Coverage (3-5 p.m. ET)

Hello and welcome to Market Domination. I'm Broo Pama and we are live from our New York headquarters. It is looking like another day, strong day on Wall Street. There's just about an hour to go into the closing bell and the Nasdaq and the S&P 500 on track yet again to close at new record highs. And Freay is joining us now to break it all down. But Anes, we are seeing cyber security all-time highs. Nvidia also leading momentum. We also are seeing others posting strong gains as well. >> Yeah, that's right. So, we are seeing technology, the semis that are really uh uh today going higher. If you take a look across the board, as you mentioned, the NASDAQ hitting an all-time high, the S&P 500 on track for one. We have seen the 10-year Treasury yield uh easing a bit. And if we look under the hood as we were just talking about you are seeing uh technology that's in the green utilities is higher today. Real estate is higher. That's because of you are seeing those easing of those longdated bonds. But on the NASDAQ 100 is really where you're seeing much of the action. You've got Nvidia at uh on pace for a new all-time high after its all-time high closed yesterday. This in part is be um due because of Hanigh. This is also known as Foxcon. uh they saw a 47% jump in revenue in part tied to its role as Nvidia's server assembly partner. So you are seeing sort of the whole AI space being lifted so to speak. We're also looking at Broadcom that's higher. AMD up more than 3% also hitting all-time highs. This is after CEO Lisa Sue in Taiwan said that demand for AI compute is still blowing past supply and she expects that gap to last for years. And if you take a look also at the market caps, you are watching that uh AMD is past uh the $1 trillion market cap yet again as it had recently hit all-time highs. And of course, we're watching Nvidia as it climbs towards the $6 trillion market cap. As you mentioned, we are seeing uh cyber security stocks that have been higher. So, that's part of the AI trade as well that has gone uh higher in recent weeks as well, Brooke. >> And as all eyes on that $6 trillion market cap for Nvidia, some people saying it could happen by the end of the month, others saying by the end of this week. So, we'll have to wait and see. Anes, thanks so much as always. appreciate it. I want to stick to this topic. Joining me now is Kevin Mann Hennian and Walsh, chief investment officer. I mean, this is incredible. We're seeing yet again the NASDAQ, the S&P 500 at record highs. There's so many factors playing into this market. So, what are those factors here? >> Yeah, clearly investors continue to climb the proverbial wall of worry. Whether it's oil staying above $100 a barrel, the tenure above 5 and a4% uncertainty over what the Federal Reserve will do or perhaps not do next, and of course the upcoming midterm elections. But still, we see record earning strength. We're on track now for the third consecutive quarter of 20% plus year-over-year earnings growth. And then we continue to hear more announcements on billions of dollars being spent in our economy around AI infrastructure, around power, and around aerospace and defense. Look no further than Constellation Energy this morning, announcing their 20-year contract to provide nuclear energy to Google. And then we learned recently that uh a big company out there, you may have heard of them, Rathon or RTX Corporation, received a $20 billion plus order from the US Navy to restock their Tomahawk missiles. Money continues to be spent. Growth opportunities continue to exist and it's not just technology even though technology is leading the way right now. >> I want to get on that because we are seeing this concentration right now in tech. Does that worry you and are there other ways? You mentioned some growth opportunities that investors maybe should be looking at to diversify here. >> Yes. I I don't want to get back to 2023 when the MAG 7 accounted for 62% of the total return of the S&P 500. That was good for those seven stocks, but it wasn't good for the sustainability of this bull market rally. What we're seeing today is strengthen utilities. Once again, not your father's utilities or my father's utility. Yes, utilities hold up well in the face of volatility. Yes, they pay good dividends. But now they become a backdoor play into the AI revolution, particularly as it relates to nuclear energy. And then aerospace and defense. They pulled back over the course of the last quarter, but history shows when they pull back as much as they did in a given quarter, more than 12%, well, guess what? Over the next year, they've been higher 100% of the time with an average return of nearly 29%. So that tells me as a portfolio manager, I want to look at those as attractive entry points, not ignore technology, not ignore the AI revolution. >> I don't think technology ever went away. Right? To me, we're still in batting practice of a double hedger as it relates to the AI revolution, but don't just focus on the software names. Don't just focus on semiconductor and chips. Add the data centers, the cooling solutions, and of course the power component. Now the biggest sort of elephant in the room is that midterm elections that are coming up really close actually when you think about the sort of returns that we could see after significantly during Q4 of midterm years we do see stronger performance. So can we expect that yet again despite all these factors here? I think so because once we get past November 3rd, I believe is election day, that uncertainty will be removed and as the betting markets stand right now, looks like we're going to have a divided Congress and historically that has bowed well for the stock markets, but we could see some choppiness leading into that. Remember, we got a big Federal Reserve meeting coming up at the end of this month. I think they hold again. Perhaps they do raise again by 25 basis points. We don't know. That's uncertainty. What happens with the midterm elections? That's uncertainty. What happened between the US and Iran between now and November? That's uncertainty. But after the midterm elections, we should have some answers. And investors like some degree of certainty. So, we could have a strong close to the year. >> All right. Now, hear me out. You're talking about a potential hold. You're talking about a potential raise. Could there even be a possibility that we could see a rate cut? Is that back on the table here? >> Uh, I believe trying to play the Fed guessing game is an exercise in futility. As it stands right now though, they're forecasting one additional rate hike this year, at least as of September, and no activity next year, with the first rate cut coming in 2028. I believe, however, Brooke, that that one rate cut may be pulled forward into early 2027, but not by the end of 2026, unless things change materially. >> How worried are you between the discrepancy that we're seeing on Wall Street, these record high gains, and Main Street right now? We're heading into winter. People are really concerned about their energy bills at home. So, how worried are you about that that bifurcation, I guess you could say? >> Yeah, there's a clear dichotomy right now between the halves and the have nots. The halves are having more and the have nots are having less. And that's going to come out loud and clear during this midterm election season, but we do know that companies continue to grow their earnings. We do know that consumers are continuing to spend. So, the underlying health of the economy is generally good. What I'm paying close attention to, and what I hope the Federal Reserve is, too, is the labor market. We just had a weak jobs report. We also saw unemployment rise to 4.2%. Still historically low, right? But if that continues to creep higher, that's going to spill right over into the economy because consumers will spend less. And in an economy where 70% of our economic growth comes from consumer spending, that's important to watch. >> Yeah, we're below 5% for unemployment for the past like 60 months. A record there. I I do want to hit on something that was interesting. I heard from Apollo's chief economist, Torsten Slock. He said in a note that the harder question is whether AI is raising total factor productivity, meaning whether it's making the economy fundamentally more efficient. He says that data shows him that it is not. What's your take on AI when it comes to productivity within this economy right now? >> I would suggest not yet. Again, if I go back to my baseball analogy, we're just in batting practice of a double header. batting practice is all the billions of dollars that are being spent to build out the AI infrastructure that will ultimately allow these AI algorithms to transform society as they claim and to improve productivity. But that's not going to take place until they start playing the games and that could be years away. So if you want to invest in the spenders, you got to be patient. If you want to invest in the receivers, well that's where you find the growth opportunities today. >> And what are those growth opportunities? >> I think they're relating like a company. Let's just look at one, a heating and cooling provider, an HVAC company called Comfort System, ticker symbol FIX. According to Creative Planning, over the last 5 years, that was the number one performing stock in the S&P 500 on a total return basis. Comfort Systems, an HVAC provider. Who knew? But now they've become part of the AI revolution. That's an example of a company that's benefiting from the AI revolution that most investors wouldn't even think of. >> All right. All about getting in on the back door here. That's right. >> Okay. All right. We'll wait and see. Thank you so much, Kevin. I appreciate your time. And coming up, the AI rally is on in full force today thanks to shares of Marll. We've got the details on the company's outlook next. Heat. Heat. Heat. Heat. Down. Down. Take a deep Marll shares are surging after the chipmaker laid out a massive long-term growth target at its investor day driven by booming AI demand for custom chips and data center networking. For more on this, I want to bring in Yahoo Finance tech editor Dan Howie. Dan, break this all down for us. >> Yeah, Brooke, this is, as you said, part of their investor day, and the the big kind of to-d do here comes down to their custom chip offerings. They build custom chips uh for the likes of Google and Amazon. They have a huge deal with Google uh that is a multi-yearlong agreement north of hundred billion uh if they complete all of uh the different steps uh involved in it, hit certain milestones. Now, the reason why the the stock is up today is likely because of the revised estimates that they have for forward-looking guidance. Now, for 2028, uh they say that they are expecting upwards of $20 billion in revenue. That's higher than what the street was originally expecting. And it's worth pointing out this is not two years away. This is less than a year away. They're currently in their fiscal 2027 uh Q3. So, not too far off for them for their fiscal 2028. Uh, and then they're also looking at the 2030 revenue guidance. They put that between 70 to90 billion. Uh, that's far more than the uh original Wall Street estimates. So obviously they see a lot of advancements here from their custom chip business and what that means for the company going forward as we continue to see more companies like Google, like Amazon look for ways to wean themselves off of Nvidia's uh the dependence on Nvidia as well as begin to rent out those chips to third parties. Don't forget Amazon it says that its chip business could be a $50 billion uh a year business if it didn't have to gobble up most of its chips for its own processing. Uh and Google also is looking to rent out its own chips as well. So this could be huge for Marll if they're able to continue to provide the necessary components and Google and Amazon can get additional customers. >> Dan, you can't help but notice Marll stock up 240% year to date. I'm taking a look at Alpha Space right now and that is such momentum and up today just about 7%. So definitely one to watch. Dan Hi, thanks so much for bringing that all down. Appreciate it. >> Thank you. >> Homeowners are bracing for a winter sticker shock as global oil disruptions push home heating prices to near all-time highs, adding nearly $900 to the average home's heating bill. That's according to the National Energy Assistance Directors Association. Joining us now for a closer look is Yahoo Finances Claire Boston. Claire, I am scared when I'm reading those numbers. >> Yeah, Brooke. I mean, you really should be. About 4.8 million households in the US heat their homes with oil in the winter. Mostly it happens in the Northeast. So places like Long Island, Vermont, Maine, they tend to use heating oil. And heating oil is a pretty expensive way to heat your home even when oil prices are not so high. But these homeowners are just getting hit this year because heating oil is almost identical to diesel. And we have a national or a global diesel shortage that's pushed prices up to record highs. And it now costs about $6 a gallon to buy heating oil. And typically a household can run through a 100 gallons of heating oil in the winter in a matter of weeks. So this has a huge impact on those energy bills for people who will be affected this winter. And a lot of people are quite concerned. you know, I mean, this could be a real issue and cause people to, you know, freeze in their homes. >> Also worrying about pipes, what that could mean as well. So, what would be your advice to Americans who are trying to figure out if they should order now or if they should hold off? I mean, are we seeing an increase in plet stove orders here? >> Definitely. So, unfortunately, there is a big seasonal component to this as well. And very often, oil prices rise even more as we head to those colder months. So, I did talk to people who said that, hey, we're at $6 now. You know, $7 to $8 is not out of the question. And so, it may be a good time to order now. Uh, we're also seeing people look into alternative sorts of heat heating. You mentioned pellet stoves, which can be relatively cheap because the pellets that go into them don't cost very much. Um, you know, if you have an older system, potentially looking into switching to a non-heating oil system if you're going to upgrade anyway is an option. And there's also a lot of sort of smaller winterization steps that people can take. There are various types of filters under windows that can help block drafty air. You know, if your home has circulation issues, getting a fan can help that heat spread through a home better. So, there are options, but this is a real concern, you know, as we head into these colder months here. >> All right, Claire, once again, I heard Long Island, Vermont, and Maine. So, users there, make sure that you're looking out, contacting your local companies to see how you can get insulated for the winter. Claire Boston, thanks so much for for laying it all out. I appreciate it. >> Yeah. >> Coming up, AI agents are getting smarter and more autonomous, but are they also becoming harder to control? We'll dig in to it after this break. Heat. Heat. Down. Down. Take a heat. Heat. Heat. Heat. Heat. AI is quickly moving from chat bots that answer questions to autonomous agents that can take action on their own. And that's raising new questions about safety, security, and control. For more, we're bringing in Satya Nita, co-founder and executive chairman of Emergence AI. Let's just start big picture here because there's so much fear right now around AI agents going rogue. So to you, what exactly does that mean in this in this period of time when we're hearing about hugging face where you're even hearing about AI agents going into Wikipedia as well? >> Right. Yeah. I mean, I think that is a real danger. That's the danger with AI we should be talking about as opposed to AI going to that's an AI that's going to wipe out humanity and make us all extinct, which I don't think is the real danger. I don't think anyone really believes that. Uh but can AI agents compromise uh all kinds of systems uh that run the world? I think there's a real danger there. Uh we saw that with the open AI hack uh recently and then earlier in the summer uh we publicized a series of experiments called emergence world where we let a group of AI agents live in uh live in a city a simulated city and govern themselves and we saw a variety of concerning behaviors that were exactly similar to the open AAI agents that that escape containment and and went rogue. So I do think that's a real danger. >> Okay. So, it's a real danger, but at the end of the day, who is responsible for this? Because it seems like some of these acts that these AI agents are doing would be deemed illegal. Should I or you do the same thing? >> That's a great question, Brooke. Uh so, first of all, uh the the I want to I want to actually highlight the the nature of the danger. uh what's happening today is all the frontier AI companies the foundation model companies uh they are releasing these models >> like anthropic >> like anthropic open AI uh right and then you have gro and you have gemini and then you have the Chinese openweight models um all these models are released they do their best effort to align the models to put guardrails in the models and so on um and then people build agentic AI on top of it agentic systems on top Right. The problem that happens is in long horizon autonomy which is if you have a a task that that an AI agent is running by itself for any length of time and a length of time is not like you know 20 minutes or a couple of hours but days and weeks and you're trusting the AI agent to make its own decisions. That's when a whole bunch of problems start popping up. Uh and that's the fundamental nature of the technology. It's a bunch of uh probabilistic uh AI and and the longer the horizon of the autonomy, the more the things will drift and the more they will uh create sub goals and the more they'll drift from the original training and alignment that happens. So who's responsible? Well, agents are systems and safety is a is a is a property of the system. It's not just a property of the model. So it's not enough to put out a model and to show that on a static bunch of benchmarks, which is what they do today. they'll they'll they'll release a new model. They'll show a bunch of benchmarks. They'll say it's safe. Uh but that's not predictive at all about what will happen when these things when agents will then run for days and weeks and months sitting on top of those models. So ultimately uh it's the the responsibility of both the foundation model companies and the people who build the agentic systems to ensure that these things are safe. >> Yeah. And we've heard from tech leaders that they certainly are looking for perhaps regulation that they're looking to be sort of reigned in here. But we also heard, interestingly enough, from JP Morgan Chase CEO Jamie Diamond today. He warned that the release of Anthropic's powerful Mythos AI system could increase cyber risk by 10fold. So ultimately, he went on to say that technology has handed bad actors unprecedented leverage here. How much does that worry you? Because we're talking about all these different ways that AI agents can just continue on for weeks, for months. So, how does a Jamie Diamond, how do you get ahead of that AI agent just keep going? >> Yeah. No, I I I agree with Jamie Diamond here. Um, I think uh one one of the things we showed with our emergence world study uh which I urge your viewers to uh to to Google and to read the paper. Uh we did two experiments. The second one was with more more capable models. And what we saw was less overtly bad behavior with more capable models, but but a lot more insidious uh behaviors that are deeply concerning. So the more capable the underlying model is, the more the AI agents are capable of manipulating the the situation, creating sub goals, colluding, creating their own vocabulary, hiding their intent. So all this is absolutely possible. So I don't know whether 10x is is a is a scientific scientifically quantified statement but but the premise that more capable models create greater risks is absolutely correct. How do we stop it? That's your next question, right? Um I think there is a way. I think uh uh you know uh one of the things that at emergence AI we've been advocating for is a form of AI called neuroformal AI. It's uniform, >> neuroiformal, neuroiformal. Neural being the LLM part and formal being a branch of AI called symbolic AI that used to be all of AI. In fact, the the LLM uh branch of AI is about 15 years old. It's the deep learning uh part of AI. But before deep learning, there was a different branch of AI called symbolic AI where you were proving and you were actually in in a sense getting an AI system to reason through a series of facts and it was being right and if an AI system reached a decision, you can actually audit how it got there and you could provably correctly say this is how it got to the got to the particular decision. So what we're doing is combining these two branches of AI and and we are advocating that a way one should build agentic AI and we'll come to bad actors next but a way that at least agentic system companies should build agentic AI is with these kinds of guardrails with formal guardrails mathematical guardrails. >> Okay. So if we put in these guardrails though how do we actually know that all these guardrails that these companies put in are actually working? What are the solutions that maybe everyday consumers or everyday viewers who fear of these AI agents going rose? How do we know that what they're doing is actually fixing this problem? >> No, that's a great question, Brooks. See, the there are guardrails in their guardrails. If you just build guardrails and ask another uh LLM to enforce guardrails, uh the odds are you can you can't have one probabilistic system, judge a second probabilistic system. I don't have to tell your viewers that.9 *.9 isn't one, it's 81. So you can't actually get uh certainty through two probabilistic systems. Right. Right. >> So there is a way to build guardrails however and there's a way to prove get the AI to prove that it's acting correctly using the symbolic AI bit that I briefly mentioned. Right. Symbolic AI built where uh a series of what are called formal methods which is a branch of mathematics enables the AI to basically show that it has to it has to actually mathematically prove it's about to act correctly uh with respect to what you expect it to do before it can it's allowed to act >> and that will probably end up translating to statements that these companies putting out saying that their AI models they were able to fundamentally stop the company or stop the agent from moving forward. >> That's correct. And the the great thing about math is a mathematical proof is either you know it's binary. You either prove it or you can't prove it. You can't fake a proof. So the so what you're expecting the AI agent to do is to show you the mathematical derivation of how it's staying within the constraints before it's allowed to act, >> right? And as a consequence, you have uh a bulletproof way to actually get these AI agents to work. And this is by the way Nvidia released something called Open Shell about a week ago. Uh that's a first step in this direction. Uh there's a much more we need to do but it's a step in the direction. >> All right. So a step in the right direction. I want to just end this on a big global take right now that many are talking about and that is the race when it comes to AI between the US and China. What's your take where are we at now within that competition? >> I think it's uh it's neck and neck. Uh I think this uh idea that uh we are the west is somehow way ahead of China I think is misleading. Uh their openweight models are highly capable. Um and uh at in some ways it's not terrible for the world at large because competition is good for the market and uh enterprises in particular would would in fact they're increasingly looking to embrace openweight models from China and from the US itself. uh which are not closed weight models that either Anthropic or OpenAI or Google puts out but models that other companies including Nvidia and a group of Chinese companies are putting out because that gives them choice that gives them control that gives them the way to train and and and fine-tune the models to do the things that they're trying to do. So I'm all for competition. Uh we just have to worry about bad actors building uh agentic systems on top of these to do all kinds of dangerous things. >> Right. Okay. So don't fear, but fear a a little bit. There's some worry there. >> There is some worry here. Yes. >> All right. Well, thank you so much for coming by. I really appreciate it. >> Thanks so much, To. Thank you. >> And according to the conference board, the median S&P 500 CEO made, get this, $17.5 million in 2026. That's a 6% year-over-year increase. And the average hourly workers wages rose 3% in the September jobs report. Steve Oddland, Conference Board CEO, spoke with Yahoo Finance executive editor Brian Sazy about how this contrast is driving economic pes. How is consumer confidence tanking and consumer spending is staying intact? >> Yeah, it it is really remarkable. You know, consumer confidence um the consumer confidence index is from the conference board. We monitor it monthly and it has been declining. It's been in a long-term decline for for many years here, but uh it's gone down recently as well. The worries are about inflation. Okay. So, they're telling us that they're really concerned about prices. It's driven by oil and food primarily. Uh they're continuing to spend, however, because they have to eat and they have to get to work or school by driving their car. So a lot of the spending is driven by need and you know that concerns them and that's why confidence has gone down. >> So the K-shaped economy alive and well >> well you know the economy has been K-shaped forever. Um but it is uh it it is uh it is driving uh spending still. You know we're at consumer levels of debt that have we've never seen before. $1.3 trillion worth of consumer debt. credit cards are being maxed out even with interest rates rising where they are. You know, at some point it's not going to solve because you know that you you can't do that forever. >> At what point, Steve, that the high-end consumer which is driving this economy, driving this spending, at what point do they buckle under high higher mortgage rates, higher costs of credit, like when is that point coming soon? I don't think so because the high-end consumer, you know, has their wealth driven by the markets and the markets are sitting here at a relative high. As long as that's the case, we ought to see that spending continue. If the markets correct significantly, then you see that dry up and that's a big deal. >> Now, uh your latest survey on CEO pay, uh COP pay is up now. A lot is coming from higher stock options. Why is this happening? Well, first of all, all pay is up. Uh, companies tell us that they're raising wages between 3 and a half and 4%. CEO pay, however, is not driven by the base salary. It's driven by uh the the uh b, you know, the compensation from equity. Now, that is all performance pay. So, 90% of a CEO's package is driven by performance. Look at the stock market sitting here at all-time highs and therefore it's driving imputed um imputed uh remuneration from the stock market. Now look at it the other way. If CEO pay was falling that would mean the market was falling and they weren't the company wasn't performing and everybody would be unhappy pension funds and you know everybody else. So it's actually a good thing because it means that their companies are doing well. But is it a good thing, Steve, in the sense that look, boards, as you know, having been a CEO and you're still a CEO at the conference board, boards set the compensation for the CEO, as this pay rises, it just seems very out of touch with the average worker. Well, it's not because it's not rising out of touch with what the average worker's pay is rising. Number one. Number two, it's variable. I mean if you look back to the financial crisis or any other kind of crisis where the market's correct the CEO pay has gone down and uh it's taken wealth out of the market you know everything gets hit then so look I think these packages are um are important um you know you have to be careful boards have to be careful but they're looking at consultants they're looking at you know all the various indices and now shareholders vote on them and you're seeing overwhelming support from shareholders for uh executive comp packages. So the there seems to be an equilibrium here on the market. >> Steve, I want to stay on the lower wage worker for just a second. Take a listen to what uh Anthony Scaramucci told me on this front recently. >> Corruption takes away hope. But when you have that level of corruption going on inside of Washington, people look up and say, "Oh my god, there's a two-tiered system. Uh some people are getting treated more favorably than others." And guess what? I'm not in there. Uh, and this doesn't become a glass ceiling, Brian. It becomes a concrete ceiling for people. >> Steve, people, you know, Anthony frames it as people losing hope in the economy. At what point do we start showering the average worker with some more stock options or just give them stock options to begin with? At what point does the Walmart worker, you know, start to cash in? >> Well, if you look at the average pay of a Walmart store manager, it's around $200,000 a year. their department managers are 80 to $100,000 a year. So they're doing okay. I think you know the issue is the you know the the very low end the the minimum wage kind of worker and it's not out of whack until inflation takes off. And what we've seen here postco with all the stimulus packages with all of the um the issues in the Middle East, oil in particular, you're seeing unusual levels of inflation. You know, when the straight of Hormuz opens up, you get oil flowing again. That's 20% of the world's oil. You start will start to see oil prices come down, gas prices come down. But it's not just gas. I mean, you look at that, but it's packaging. It's distribution of everything including food. It's 6,000 consumer products in our economy that are derivative of oil, rubber, packaging, um, plastic. So, it it's driving a lot of inflation here. And that's what consumers are telling us is the issue. Got to get inflation under control, which means you've got to get the trade open and get trade normalized. So the best that the average, let's say the store worker at some of these retailers, for example, could hope for is that inflation comes down and and that's their raise. >> Inflation has to come down and that will be a raise. But at the same time, remember that companies are telling us they're raising wages 3 and 1 half 4% on top of that. So inflation right now is is right around 3 3 1/2%. Wages are keeping up with that on average. It's not everybody. It's not every worker yada yada but u but on average in the aggregate it's it's maintaining pace. So you will get a real wage increase when inflation comes down. Steve I was reading your survey and I love the data. I mean I love reading this. So I I appreciate you guys send it to me but I put that on one of my screens at my desk and on the other side I was reading the story on uh David Zazlov his last day today as Paramount getting a $550 million golden parachute. How do we justify a package like this in this world? >> Yeah, you know, these parachutes have to be tested against the un unintended consequences, right? I mean, this is this is where consultants, comp consultants and boards need to really uh focus >> like these shouldn't exist, right, Steve? Like that that this should not exist. >> Well, you know, it it it it happens because people this is an unintended consequence of that. these these go colon golden parachutes or you know exit packages are put in place in case somebody's fired they can't work again. You know you've got all of that that you're dealing with. But you're not dealing with you know a you know once in a-lifetime kind of uh kind of merger with an outsized uh impact on that. But they have to you have to test for that. You have to you know look at the potential unintended consequences and then govern these packages accordingly. >> Lastly, Stephen, I used some of your data this morning for a post on my Instagram account. you know, big increases in personal and home security for CEOs. Now, when you talk to CEOs, do they fear for their life? And how are they paying for the security? Yeah, it it is a real issue. You know, a few years ago, you would have security, you know, under the title of a perk. They are no longer perks when CEOs are getting shot in the back. Okay? It is a requirement uh in order to do the job. they're getting their families um threatened. You know, when you have your children threatened, you you need you need security. You need to be taken care of. Uh you can't walk through airports. I mean, it it's a you know, it's a real deal. And these aren't perks. This is part of protecting your assets of the firm and and you know, more boards are stepping up to say, "Okay, we realize that uh we've got to do this." And so it gets imputed in pay. And so therefore, that's part of the package increase, but it's it's really it really should be at a business expense. >> Steve, appreciate it. Always good to see you. I'll talk to you soon. >> Coming up, Paramount and Warner Brothers Discovery are officially Sky Dance. We'll talk about what's next for the media giant. That's after this break. Heat. Heat. Heat. Heat. Paramount and Warner Brothers Discovery are officially together under the new Sky Dance banner, creating one of the biggest media company in the world. The opportunity is massive, but so are the questions around debt, streaming, and whether all that blockbuster IP translate into gross. You saw him already. Here's Ian Bear, founder and CEO of Sooth. Ian, we have so much to talk about. >> Oh my gosh, how much time you got, >> right? Because this has been such a long time coming and to finally seal this to see this deal go into play. One analyst Laura Laura Martin over at Needam, she was saying that this actually puts up a competitor against Netflix and Disney. So would you agree there? >> Well, for sure. I mean, look, Disney Disney with uh the the merging together of the Disney Plus and Hulu platforms, which is happening in the weeks to come. Uh they're going to be neck andneck in terms of subscriber count with Netflix. and and uh look the the big winner in all this and ever since the fuse was lit towards the changing of the economic picture by all of those Hollywood strikes that happened in 2023, >> right? >> The winds have been favorable for YouTube. >> So Google and especially with their ability to not only uh get the viewership but to monetize the content, Google's been the big winner throughout. Google wins again in in this case because YouTube's not going to slow down. But YouTube at at 14% of viewership and now you have the rolled up Hulu and Disney. You have what's going to be the rolledup Paramount Plus and HBO Max, right? Uh along with Netflix, they're all sort of neck andneck right below YouTube. >> Now, this was a $110 billion deal. And this company is carrying over about $80 billion in debt. >> How much should that worry investors here? It's a pretty sizable amount. So what does the company need to do to sort of make that worry? >> Well, there's two parallel paths, right? So if you look at the way the co-CEOs are dividing up responsibilities, at least the way it's been communicated, Scott Ellison's going to be focused on operations, on efficiencies, on standardizing, but now he's brought in a co-CEO, the former CEO of Mattel. >> Interesting move there. >> And I'm a huge fan. I I mean Iron Cry is probably or it's Inan Cry I believe is probably the best person on earth at monetizing intellectual property. And you look at the tremendous wealth of IP that this deal brings together. You're talking about, you know, Lord of the Rings and Game of Thrones and Star Trek and Top Gun and DC Comics and and and uh Looney Tunes and on and on and on monetized through all the distribution channels they have, including by the way theme parks. Lot of reason to believe that they will become a major uh threat to Disney in the theme park space just because of all that IP. >> Okay, interesting. is another asset to look out for as well. >> Yeah. So, if you're monetizing all of those fan bases, at the same time you're finding efficiencies, that is a recipe for growth and profitability. The challenge is going to be people have so many subscriptions, so many platforms, they're looking to cut things. And our data shows that Paramount Plus subscribers are the most price sensitive. Netflix are the least price sensitive. So I think everyone now is on a ticking clock either to get more content, monetize the content they have or find new distribution for their content. >> What does this mean for the consumer at the at the end of the day? Are our subscription prices going to increase? Could we see a combined HBO Max and Paramount here? >> Okay. Well, few different questions. You're going to see a lot of rollups. >> So combined HBO Max and Paramount Plus. Absolutely. Okay. uh same way Hulu has rolled or rather Disney has rolled Hulu and ESPN into the Disney bundle. So you'll see a lot of these rolled up bundles, but we're also going to see people making some tough choices because the more these bundles start to represent one another and the more expensive they get, well, people are either going to pay with their dollars, they're going to pay with a willingness to see more ads, they're going to pay with their personal data. There are lots of different forms of currency that can be used in exchange for content and we're going to see every player blow out everything they've got. >> Wow. So, all stakes on hand. I do want to get to some of the legal challenges that were presented prior to this deal closing. They had that settlement with a dozen states, including California, and they sought to block the company's acquisition because of antirust. Now, with that in mind, they did sort of agree to this need to release at least 30 films in theaters. one every single year. And if they don't, then they're going to face a pretty hefty penalty there. So, what's the likelihood that this company can release that many films? I mean, they're going to get charged $30 million for each movie if they don't. >> Well, let's go back to Mr. Cry. >> Uh, and let's look at the film pipeline he left behind at Mattel. I think he had close to 50 uh Mattel character or Mattel propertybased films in production when he left. Well, if you look at the the amount of IP that Mattel had compared to the IP in the new Sky Dance, >> it's going to be very easy for him to get that stuff into production. The question is how do you monetize it? Cuz you're not going to make all your money selling movie tickets, selling streams, and that's where the expertise coming out of Mattel. book. This is the person who built Endm All and their global syndication model for things like Big Brother. >> He built Maker Studios and sold it to YouTube, the the biggest multicreator platform deal when it happened. Then he went over and turned around a bankrupt Mattel. So, they're in the right hands when you want to both monetize and globally syndicate these massive entertainment properties. So is he sort of the secret sauce here to make this company successful? >> He he's kind of the king of fandom as it goes right now. If if again you define that that royalty as being about monetizing all that IP because all this IP even if you're talking about sports rights, it all has to come back through the sale of merch. It's it's not just subscriptions, but it's licensing. It's merchandise. It's, you know, doing a a billion and a half dollars of revenue on a Barbie movie. It's that magic that >> they'll be looking for him to bring over to Sky Dance. >> I do want to get to some other assets of the business and that's linear TV businesses like CNN. You have CBS, you have CNN, TNT. What happens to those? Well, what has already started to happen if you look for example at what took place with Comcast about a year ago where they spun off all the cable nets. They relaunched as Versent. That's where now MS Now and a bunch of those properties live. We're going to continue to see a casting off of some of these more traditional assets. However, there's still a lot of money to be made in linear TV, especially on the free adup supported platforms that to an extent have replaced the old linear TV model. Uh whether people find what they want to watch there, well, that's a question everywhere. I mean, that's why Netflix is having a really hard time holding on to subscribers because there's only so much content people are able to find that that they love, >> right? Ian Bear, thanks for breaking it all down. David Ellison said in his in his post on X, I guess this is just the beginning, so we have to wait and see. >> Yes. >> But coming up, we have you covered through the closing battle on Wall Street. Do not go anywhere. Heat. Heat. Heat. Heat. N. Down. Down. Take a Take a look. Heat. Heat. stocks ending the day higher across the board. We have the S&P 500 and the Nasdaq both hitting record highs to end the day. But at the same time, we're seeing this concentration within tech, within this AI trade really lead to narrow breath within this market. For more on that, I do want to bring in anes break down where we're seeing some of the biggest gains during today's market session. >> Yeah, Brooke. And if we take a look under the hood where we saw the sector action, we saw that utilities and consumer discretionary were really in the leads, but you saw, of course, technology that also edged higher. And part of this had to do with that concentration that you're talking about among the mega cap names. So you can see on the left hand side of the screen on our Wi-Fi interactive, the NASDAQ 100. You're looking at Nvidia. That's a new all-time high for Nvidia. Back-to-back record high for Nvidia. Then you're also seeing Amazon that's higher, Apple that is higher, Microsoft that is higher. There's been a concentration, a narrowing of market breath when it comes to this uh market. In fact, you've got 21% of the S&P 500 is now comprised of Apple, Nvidia, and Microsoft. So, you have been seeing this narrow breath within the market and why some strategists are saying you should really broaden out uh your portfolios uh even though they're still bullish on the AI trade. If we take a look also at where we saw today action in the semiconductor space as I mentioned in the mega caps but look at uh Broadcom up more than 3% AMD also hitting a new record for the day uh for as AMD is up more than 2 and a.5%. But look at the semiconductor space in general as you see this chart. You're looking at Intel that's lower, ASML that's lower, applied materials also lower, but yet you've got these other mega caps that are in green territory. So again, this narrow breath that we have been seeing with this rally as we see the NASDAQ and the S&P 500 at record highs, Brooke, and many investors watching out for these earnings expectations. Analysts now pricing in a roughly 25% increase in third quarter S&P 500 profits from a year ago. So that's certainly leading to momentum as well. What we will see within these quarterly results. Anes, thanks so much. Appreciate it. President Trump is allowing die diesel on highways in an attempt to alleviate rising fuel costs, but under the hood, there are some complications to take into account. Gas Buddy head of petroleum analysis Patrick Dhan joins us here now to discuss. Patrick, I mean, could we see relief here? What sort of impact could this have at the pump? Yeah, Brooke, I'd love to say it's going to suddenly lower diesel prices by over $2 a gallon, but in reality, what sounds good to a politician may not always stand up. And that's the case here. Now, the important distinction is that dyed diesel is simply a less taxed version of of diesel. It's generally off-road use only. So, farm equipment, construction equipment, anything not going on a public roadway or highway because those vehicles are subject to diesel tax to pay for that infrastructure. So allowing die diesel is a way to circumvent the tax impact from the federal government. The 24.4 cent federal excise tax. It also helps to circumvent many states that may tax diesel fuel. This die diesel is reduced tax in many states. But again, there's a lot of uh of problems here. Only I believe six states are waving the enforcement. Meaning that only in six states can you use off-road diesel on the road. And if you travel outside those six states, say for example, you're a long-distance trucker, if you cross a state boundary into an an area where they're still enforcing the law, you may get stuck with thousands of dollars in penalties. So, this is a little bit of a band-aid. The funnel is very, very small here. And only a certain amount of people that stay within the state and can find this die can really take advantage. And that's the problem. You can't find this die diesel at your average truck stop. It's interesting point there you bring up and and a lot of concern is coming to this impact that this all these higher prices for diesel will have on farmers and the prices that then we could see in turn at their grocery store. So how are they interpreting this move? >> You know it's hard to know. I mean farmers like I said farmers are already using diedf free tax reduced diesel in their operations. They always have. That's why it exists for those agriculture purposes and the process of doing business. Um, you know, really what I think the Trump administration is looking to help here is the truckers that are hauling the fruits and vegetables across the coast, the grocery stores being impacted here, but unfortunately that's where uh state sovereignty comes into play. States can still collect diesel taxes and some states aren't going to enforce that because it would blow a hole in their budgets. If you suddenly allowed everyone to use off-road diesel, states would have huge uh budgets uh budget problems and we're already seeing that. Ohio wave their taxes. They're going to have to pay $750 million though uh to offer taxfree diesel fuel. Georgia also uh waving G diesel taxes as well. So, you know, again, on paper, this sounds great, and I'd love to see relief, but keep in mind, this deiesel is hardly available many places, and a lot of farmers already get to use it. In the end, it's not going to be something that really moves the needle in my mind. Diesel price is still above $6 a gallon. Most importantly, it doesn't add any supply to a system that is, you know, basically telling us that it needs a lot more supply. I want to hit on that because US petroleum strategic petroleum reserve dropped almost 80 sorry 800,000 barrels last week. So what are the longl lasting impacts of that of this smaller petroleum reserve here in the US? >> Yeah, you know uh the US strategic reserves only at about 280 million barrels and the Trump administration wants to sell the last 40 million of of the 172 million that were authorized. That would bring the SPR down to about 240 million barrels. What we really haven't talked about aside from all the releases, the US strategic release, the G7 release, the taxes, all the other levers, the Jones Act, the summer gasoline waiver, the E15 waiver. What we haven't talked about is meaningfully improving and deescalating the situations geopolitically that have led to the environment where we're seeing these runaway fuel prices. And that's worrisome because if this problem lingers, if these geopolitical tensions linger for more months, well then we have no strategic reserve to fall back on. >> So even though crude is now back below $90, it doesn't look like we'll see relief at the pump anytime soon. >> Well, yeah. And you're you're hitting on the disconnect here between the price of oil. Uh oil is flowing through the straight, but right now the kink in the hose is refining. And part of that is because who the attacks on refineries in the Middle East. Part of that is because China has ramped down crude oil purchases, but that means it's refining less oil as well. And of course, Ukraine's drone hits on Russian oil refineries, another which uh happened in the last 3 days. So, unfortunately, refining capacity is the key. You could throw a lot of oil at the problem, but that's the disconnect. Oil prices are going down because there's fewer refineries buying that oil and turning it into diesel and gasoline. Really quickly, I want to get your take on what we heard from Chevron Corporation CEO. He said specifically that a US ban on diesel exports could end up resulting in higher prices. So, walk us through that and could we hear from other executives? >> Yeah, I mean, you know, analysts like myself are are are basically saying this is a bad idea. Look, it gives refineries incentive to reduce output. I just mentioned to you a moment ago, this is a lot of this is about refining capacity. There's just not enough of it. And so banning diesel exports to flood the market with diesel. Well, you know, refiners aren't going to flood endlessly the amount of diesel. They're going to start to pull back because just like a steer, there's only so much brisket out of a steer you can get. You can't really reduce the amount of diesel coming out of a barrel of oil. You have to reduce the entire barrel of oil going into the refinery. So banning diesel exports would give refineries reason to throttle back output which exacerbates the very problem the market is in right now. Just not enough refining capacity and not enough product coming out of those refineries. >> $4.30 gas. It is hitting the wallet hard. Patrick, thanks for bringing it all down. I appreciate it. >> Thanks, Brooke. >> And if you're in the market, maybe especially now with higher gas prices for a hybrid car, expect high competition and low inventory. A new report from cars.com shows surging demand for hybrids. It's actually outpacing the amount of vehicles available on dealer lots. Joining me now for more is Yahoo Finance's Pros Romanian. Pros, I mean, what does this all mean for consumers who are in this market? >> Yeah, I mean looks, it sounds like you're not going to maybe find the the hybrid that you want, right? So, basically what they found, they did a survey and they found that 25% of surveyed shoppers named hybrid as a powertrain that they want to buy. They're interested in that in that hybrid, but it only makes up one of eight listings on a on a on a at a dealer or on an online site is a hybrid, believe it or not. Uh, which is kind of surprising. You think it would be more. So, there's that balance mismatch there for buyers looking for hybrids. So, you know, if you look at days on lot, which is a measure of supply, right? It went down to 46 days on lot for hybrids, meaning that's sort of the the amount of time that the car needs to on the lot to sell. Um, that's down 10% from a year ago. Uh meanwhile, new hybrid supply is just up 1%. Right? >> Overall cars, it's 73 days on lot. So you can see there's lot of supply, not a much demand. So that's the problem there. We're seeing in the sales data, >> Hyundai hybrids up 35% in Q3. Uh Kia hybrids up 152% in September. Wow. >> And even Toyota up nearly 30% in Q3. And why you mentioned it, gas prices are really the big driver here. People looking at that and saying, "Hey, you know what? hybrid, whether it's a mild mild hybrid or a plug-in hybrid. It gets you better mileage, extends that dollar. So, that's sort of why we're seeing that happen. >> What are the most popular models right now? What are people turning to? >> Um, so the the RAV 4, Toyota RAV 4 is the most popular vehicle in America in terms of not truck, right? Um, and now >> size SUV. >> Yeah, exactly. And for now, crossover. So, now in 2026, it's only hybrid, >> right? It's in terms of the the base mild hybrid and you can plug in two, right? You have cars like the Kia Tellide, which is a huge seller for Kia. Now, that's going all all hybrid. And then you have other cars um from Hyundai and other people like that, new Tucson, things like that that people are really looking to uh to get hybrids and they just want better gas mileage. >> It truly feels like when you're driving on the highway, you're actually seeing these type of cars more and more, at least from my take. Maybe I'm just learning about all these new models, but it seems like there's more of a presence. >> Yeah. I mean, look, it it all started 20 something years ago with the with the Toyota Prius, and people thought that thing looked weird and do I really want a hybrid? And then it became more and more mainstream to the point that you have luxury automobiles that are hybrids. You have performance. We're talking Lamborghini now uses hybrid technology because it's it create it creates a lot more power that they can that can add on to the gas engine and the car is even faster. So, uh that's just sort of where the technologies evolved from, you know, just being gas miserly sipping gas to now it's just going to be launching your car, you know. Oh boy. >> Forward. So yeah, >> I mean not at the same price point for sure though. >> Those rafars are definitely significantly less. >> Ross, thank you so much for joining us. Appreciate it. And coming up, we'll discuss how a new AI powered app is bringing financial advice to millions of Americans. Heat. Heat. Heat. Heat. Downow down. Down. Heat. Down. A new AI powered financial advice app is promising to bring high-quality wealth management strategies to everyday Americans. Launched by former PayPal and Intuitit CEO Bill Harris, Evergreen AI combines interactive tax tools, retirement planning, and personalized investment strategies for no cost until 2028. Joining me now is Evergreen AI founder and CEO Bill Harris. Bill, thanks for joining us. You are no stranger to building out companies. Former PayPal CEO, I believe you built about eight fintech companies. So, what was the whites space opportunity that you saw with this one? Well, first broke, thanks for having me here. That's great. Um, I've been building financial technology for 35 years through personal cap, sorry, for personal computers and the internet and mobile and now AI. And I have to say there has never been an opportunity to do so much for so many uh than there is right now. >> I think that one thing that people are worried about is data collection right now with this AI momentum. So what's your word to a user who is a little bit concerned about about handing over this amount of very personal data? >> Well, I think it is a real concern and so uh it's one of the reasons why we've built a purpose-built uh AI for one purpose only, which is personal financial advice. And as is um as opposed to a generic AI, we're doing everything internal within our walls. Nothing gets trained. Nothing is sent over the open internet. And so we're dedicated to securing your financial information. We are a registered investment adviser. And we have to do that. It's um it's part of our pledge to the government, our legal obligation to the government to act in your interest and not in our own. >> I think it's really interesting too that you're still in this beta period and until January 1st, 2028, this will come at no cost. Now the battle or the challenge when that time comes might be maintaining these users who have used the platform for free. So what could the cost look like here and who is your key audience? >> Well, the first thing I'd say is that it's beta users who will have access until the beginning of 2028. Um and so when we are out of our beta period, it will be a paid service. Um, and we will add things like um, investment management and um, uh, lifetime planning. >> What are some of the questions that you're seeing these beta users ask the most on the platform so far? >> Well, it's interesting. I mean, it's all over the place. Um, for the tech community, it's often uh, equity compensation. For many people, it's uh, can I retire early? And what you're showing on the screen right now is one of the tools we have that can help you determine what's the difference if I were to retire at 65 or at 60. What do I have to do now in terms of savings and what is the sacrifice I'm making later in terms of the amount of money that I'll have to live securely? For some of these big major life moments like maybe buying a house or planning that retirement, it seems like a lot to trust entrust yourself in a a robot to help make this decision. So what would you say to that? These big life moments and you're turning to a chatbot. >> Well, first I wouldn't call it a robot. Um robots today's robots are not very smart. Uh secondly, it's not a chatbot. A chatbot is a generic um mechanism that answers any question you've got on any topic. We're building we're building a specialized system for uh financial questions and what you end up with is something that knows more than any human adviser. It's calculates faster than any human adviser and follows you around 24 hours a day. >> Bill, there is this growing fear of AI replacing jobs. So, does this replace that human adviser? Is it a supplement for it? >> Well, I don't think that's the major. It is to some extent a threat to existing financial institutions, but far more. It is a godsend to people who need good financial advice and currently don't get it. >> What would you say is an example of how someone can go in and use this system to maybe get them to the next step in life? Well, you just mentioned um to buy or rent a house, and that's something that faces a large number of families um as they grow and as their finances get more complex. Um add that to uh potential relocation. And so now you're talking about differentials in housing prices and rental prices. You're talking about differences in tax rates. And so it's a very complex decision. We can simplify that, calculate all of those pieces and synthesize it for you in seconds. >> Bill, I know I asked this before, but I'm so curious. Who is your target audience here? Because are you trying to build something maybe say with a young 20-year-old and and go through their life with them? Or is this someone who's maybe much older and you're trying to help them figure out their next step? >> Well, we built it so that anyone can use it and we think it's valuable for many people. However, um where it really becomes u special is when you have complex finances and you are making consequential decisions. So there are many ways to think about that. Uh income ranges, uh complexity of your lifestyle, are you married? Do you have kids? Do you own a home? Um and assets. Um, if I was to try and pin it down demographically, I think the people who can get the most value out of what we do might have um, incomes between, let's say, $125,000 and $250,000, maybe higher depending if you're in New York or California. Obviously, it's higher. Um, and with assets of, let's say, something between $200,000 and $2 million. Bill, I'd like to sort of end this the way we started it because you have built a ton of other companies and you have to have some sort of feeling about the beginning of this one. What does this moment building this brand, building this company out remind you of? >> Well, it reminds me of the very first time that I was ever starting a company and that was PayPal. And you know that was in the Elon days and the Peter Teal days and all that, but it was a small group of people trying to do something big and important. And the most important thing is that the TAM the um the market the possible market is huge and quite frankly financial advice and investment management is even larger than electronic payments. >> Bill Harris, thank you so much for joining us. I really appreciate it. Best of luck and I'm excited to follow along on the journey. Thank you. >> Time now for what to watch on Wednesday, October 7th. Starting off with earnings because Levis's will announce its third quarter results on Wednesday after the closing bell. The stock taking a hit over the last 3 months, down more than 15%. Analysts expecting a solid quarter on healthy denim demand with fullear profit guidance moving modestly higher. And the Federal Reserve will release minutes from its September FOMC meeting at 2 PM Eastern as investors await more details on where interest rates may be headed. But the minutes will provide insight into the Fed's thinking when it raised rates last month in unanimous decision and suggested another hike could be on the table this year. In this in the weeks since the September meeting, Fed officials have been more mixed on the future path of rate hikes, especially as some data has come in a little soft, including the recent jobs report. And we'll also get the check on the housing market when we get the weekly release of mortgage applications. The rate on a 30-year fix has been climbing pretty high alongside bond yields. And with the moves higher, well, demand it's been tumbling. Applications have been down for four weeks in a row. And that is a wrap on today's show. Thank you so much for watching everyone. Have a great afternoon. Heat. Heat. Heat. Heat. Heat. Heat. Heat. Heat. Heat. Heat. Heat. Heat. Heat. Hey, Heat. Heat. Heat.