Closing Bell 9/10/26

0:00It's NFL kickoff time exclusive NFL team valuations with sports business expert Michael O's a N F L. It's by far the most popular believe NFL team valuations now on CNBC dot com slash sport. All right guys, thanks so much. Welcome to closing bell. I'm Scott Walker live at post nine here at the New York Stock Exchange. This make a break out begins with rates, the Fed oil and stocks and whether they're all on a collision course in the weeks ahead. Well, ask our experts over this final stretch, what's really at stake for these markets. Now in the meantime, I'll show you the scorecard was 60 to go in regulation today. It's all playing out as you see in the stock market. We're read across the board. The PPI came in a little lighter, but July got revised higher and some of the internal components that play into the PCE were hot. All playing a role in the markets today. Most sectors as you see are negative. Let's talk Apple shares, though. They're a big winner today following its big iPhone event. Heyes today, better than 3%. We're also watching Oracle. It's red ahead of its earnings and overtime.

1:00That's a critical report. We'll have a report ahead of just what to expect there. It does take us to our talk of the tape that wrote ahead for stocks as potential pot holes loom large. Let's welcome in our headliner today, the Wharton School professor of finance, wisdom, tree, chief economist. Jeremy Siegel, welcome back. It's nice to see you. Good to see you, Scott. So what do you make of what's transpired here? Oils up, yields are up. The 10 year, 490. Is that what's at play today? Let me tell you, I would not want to be Kevin Worsh next week. It's damned if you do. Damned if he doesn't. If he does raise rates, which I think the market really is saying you need to, you know, President Trump can throw a fit. I mean, you know, he said, if you don't lower rates, I'm going to throw a fit. So if he raises rates and if he doesn't, you can see, well, what, listen, one of the

2:01things we always have said, the market tests new Fed chairs. And I think this is the test for Kevin Worsh. The market 10 years moving towards five. The futures are all signaling. You should raise. I think he would love to be able to hold off until after the midterms and try to keep some kind of confidence with Trump. But it's a very, very difficult situation. What's he going to do? What do you think he's going to do? Oh, boy, I'm right on the border line. I think he's going to bite the bullet and raise rates because if he doesn't raise rates, I think there might be four or five or maybe six descents, which would be, you know, unprecedented. Now, let's say we are going to get the CPI tomorrow that might give him some comfort. So a few more days of some data there, Waller is sort of put a line in the sand saying,

3:05well, if it's point two, I might, you know, say it's okay to keep the rates of its point three, maybe other than we got to raise the rates. But the, you know, we've taken a look at the commodity indexes, of course, what's going on in oil and most importantly what's going on in the bonds, they say you just have to raise rates. And so I think that's the bottom line. Okay. If you're right and they do, what's the market going to do? Well, I think the market of first shutter and you'll see a sell off. And if, as I expect that lawn bond reacts positively, saying, okay, the Fed is credible at fighting inflation, we're going to get a recovery in the stock market. So I think there will be a first kind of, you know, cold shower. Oh, wow. But we needed that. And, you know, let's get it over with, you know, 25, 50 basis points on the short end,

4:06you know, if they do one this time and one in October is, you know, not the end of the world. And would put the market on notice that the Fed still is serious about fighting inflation. I mean, maybe the, maybe it would force the bond vigilantes or convince them to sort of sit out. And I think so, otherwise they're going to be screaming at the top of their lungs. Yeah. I think there's a legit concern about that. That's why it's so highly anticipated. Next week and truly uncertain as to what's going to happen. I'm wondering, most of the notes that are coming out from strategists on Wall Street or observers who are well thought of, Citadel Scott Rubner says his highest conviction right now is that the highs are in for the month. That you've got seasonal weakness. You've got the blackout window of buybacks mid month. You have option, expiry coming at the third week and then the quarter all ending and that's all a transfer of risk and not in the right direction.

5:09I might add, those are my words, of course, not his. Is that how you see it too? Is now the time to be cautious? Yeah. I mean, you know, we know about the month of September. I mean, look at oil continuing to rise, diesel rising even more as we know to records, gasoline futures, signaling another 20 to 30 cents, potential rise and gasoline. This is not good for consumer sentiment. Going forward, range bound is probably the best that we can expect over the next several weeks. Of course, at the end of the quarter, then we get another earnings cycle that does begin and we'll see how that plays out. But until then, with rising oil prices hard to see any really true upward movement in stock market. I mean, you make the interesting point that there's an air pocket between now and then. There's just, when you don't have earnings, which have been the story beginning, middle

6:13and end of it, you don't have anything to hang your hat on other than the fact that you're fixated on the bond market, you watch yields go up, you're fixated on the oil market, you watch prices go up and then you watch positioning move around and get more cautious, sort of feeds on itself, doesn't it? Yeah, I mean, all those things do and we do know stock prices, as any asset are discounted at these interest rates. So you don't have bonds are competitive. I mean, in my opinion, in the long run, of course, I think that stocks still have a huge edge on bonds, even with the 10 year at 5.3. But nonetheless, it's certainly more competitive than we've seen it in quite a long time and you really need that earnings push to continue to justify the type of gains we've seen in stock. So even sideways for the year, which would give you what, a 10% gain, 12% gain S&P is

7:14now looking at what I thought in January is not something that's that bad. It's, you know, when you say it's more competitive than we've seen it, you're talking about the competition between bonds and stocks. You've got yields to a point where they're now super tempting with a lot of cash on the sidelines or in money markets or what have you. It's been difficult to get that cash to move kind of anywhere. Are we at that moment? If we go 5% 10 year, is that the moment that sends buyers into the market? Well, I think, you know, I actually think, you know, going over 5%, which will get a lot of headlines, is a lot of signals. And it's a lot of signals to our government about, you know, there is worried about long-term deficits and debt. I mean, that is ultimately, you know, what is, I think, driving those long-term rates

8:15up, the Fed has to stand against it. You know, it did not stand against it, you know, during the period with Jay Powell during the big deficits that we had during COVID and we saw what the result is. Now we're getting deficits not as big, but almost as big, the Fed has got to make a stand. This time to really convince the bond market that we're not going to let that 2020-2022, you know, 8% to 10% rate of inflation materialized again. Well, Professor, we'll talk to you soon. I appreciate the time as always, Professor Jeremy Siegel at the Wharton School. We'll bring in our panel now, CIVC's Chris Harvey, CIVC contributor requisites, Brent talking and good to have you both, Chris, start with you. Fed's got to take a stand. You heard the professor says he thinks they should go, he thinks they will go. You think that? I'm not sure. So, I'll tell you after CPI tomorrow. CPI runs hot, I'll go.

9:17CPI runs cooler in line. I have a hard time believing that they can go. But if they don't go, they're going to have to signal why and what's going on. Otherwise they're going to have a bond tantrum at some point in time. Markets telling you, hey, they need to go, wash, build expectations that they will go, but I just don't see enough on the ground unless you get a really hot CPI. What about the professors take, they're sort of darned if they do, darned if they don't? Yeah, that's a problem. So, lots of things about the power administration I didn't like, but one of the things they did, a really good job at, is they kept optionality, right? They kept everything open. Here, what Warsh did, he painted himself into the corner. He didn't feel like he got enough credibility. He didn't feel like the market believed that he was hawkish enough. So he came out very, very hot in Jackson Hole. Now he's got to kind of follow through and Bissent didn't do many favors by not really managing the buy back very well. That said, if you don't get CPI hot, I don't see the kind of why now, right?

10:20Why other than the market's forcing you to do it, the underlying fundamentals, the underlying, the recent reports don't tell you I got to go now. During this market, it's going to be on edge for the next, better part of the next week, don't you think, until we actually hear from the Fed? 100%. I think the market's going to be on edge until midterms. And we've discussed this before, but since 1962, in every midterm between the end of August and November 4th, we've had about a 12 to 13% drawdown as a median. So I think investors should expect that drawdown. And I think that to what everyone said, the Kevin Worsh said that he wants the market, the bond market to signal him. And with the two year at what, 453, rates are already risen on the short end. And so to me, it is a precarious position because you don't want to have, and they don't want to come out and do 125 basis point.

11:21That doesn't, that's not really the way the Fed historically run. They go into a rate tightening cycle or a rate easing cycle. So to me, I think it is a threading the needle here of what type of cycle will we be in over the next 12 to 18 months? And ultimately, that's going to decide what the market does. One rate hike, or one rate hike is not going to do anything. It's really the signaling of what the longer term trajectory is, which I think is very unknown right now because we have so many cross-currents. Traditionally, no, it wouldn't do anything just one move. Other than if you think they're embarking on a very short credibility cycle, where one does do the job, enough to settle down the bond market from getting to away from the Fed. But let me ask you this. So two months to the midterms, you think we could be unsettled between now and then long-term story intact. We start to get earnings that remind us why we're here in the first place. Two percent or whatever it is now away from that all-time high on the S&P.

12:21That means you'd be buyer. Should we be buyers on any weakness that comes over the next few weeks? Oh, 100 percent. And that's what the history tells you that. If you buy during this midterm drawdown, like over 95 percent of the time with the exception of 2002, that was a wonderful entry point. And so I think cell calls, dollar cost averaging, earnings are good, AI buildouts going to continue. And so I think take advantage of this volatility because this will pass because we do all understand. Iran is a really big issue around energy, around oil. And I don't think we're going to have a forever war. And when that dissipates, that's going to be very deflationary. And so I'm in the camp of take advantage of the volatility. All right. You know, I love selling calls. If you don't do that, dollar cost average. I will say this one thing. We have not been buyers of long duration bonds forever. You got 10 years. You can get on a taxable equivalent basis, well over 7 percent on munibonds.

13:22And so I'll be interested to see if cash buyers come out and actually from a tax equivalent yield come out and start looking at munibonds, which on a long term basis off really good return. This is one of those moments, don't you think, whereas an investor if you're thinking longer term, you've got to see the forest through the trees. You do. I'm going to talk out of both sides of my mouth, so watch this. Right. So tomorrow, I think there's a potential for a pretty good pop. Everyone's getting really defensive. Everyone's running for the hills. The probability of the feds are going to hike is there. If you get a cooler CPI, suddenly things change like that. You get a pretty big pop. We would sell into that, or we'd reposition the portfolio to take off some risk for the short term. I don't think you're right. There's 2 percent off the high. Is there enough there to put new money to work? No, not yet. What we want to do is we want to tread water. We want to be a little bit more defensive. We want to wait for the opportunity to come up. In weakness, you know, I like the good. We tell folks to start putting new money to work, but not right here.

14:22Where would opportunity knock the most? Do you think if your scenario plays out? Yeah. What we're looking at is we're looking at a lot of the communications names, which are some of the bigger hyperscalers. We're also looking at some of the alt managers, because we think they've been oversold. They've traded down recently. We just want to get a little beta where we think the risk award looks pretty good. And those are the two areas that come to focus. What do you make of the, if you want to call it, the resurgence in the mega caps over the last, you call it month. Yeah, make some ton of sense. Since earnings, really. That trades come back. Tough right. It makes a ton of sense. You've had rates going up since the end of June, right? So small caps have underperformed. What you're seeing is a move back to large cap. You're seeing breath beginning to narrow. You're seeing industrials underperformed. And that's what you would expect. You're seeing utilities underperformed. That's what you expect in a rising environment. You should expect larger cap, less cyclical, and more tech is selectively.

15:23All right, we'll leave it there. It's good to have you back. Thanks for being here. Brent, thanks you as well. We'll see both of you soon. We're just getting started here coming up next. The NFL goes down under and it's biggest international push yet. We're live in Australia, straight ahead. Plus, what the new season means for the betting boom. We have an exclusive with Draft King, CEO Jason Robbins coming up as well. We're live with the New York Stock Exchange. You're watching Closing Bell on CNBC. The NFL is by far the most profitable league NFL team valuations now on CNBC dot com slash sport. All right, welcome back hours away from kickoff now down under in the NFL's most ambitious international trip to date. Our Alex Sherman joins us now from Australia with all that is riding on this game for all

16:24of the parties involved. Hi, Alex. Hey, Scott. Hey, Scott. Yeah, you know, when I came down here, I was a little skeptical about the whole process of coming down to Australia. Are people here really fans of the NFL, Australian rules football is very big in Melbourne. But is the NFL like does that carry over? It's so far away. So I actually asked a handful of people on the streets of Melbourne and just asked them, are people really excited for this? Watch this. Oh, for sure. We definitely have guys at work. I mean, we're a school that's sporty people and they're always talking about American sports, everything that NFL and basketball really get more popular at our school. 100% the American is a real buzz around the city at the moment. I've got friends that live in Perth in Western Australia and they're like flying in for 100% 100% yeah. What do you attribute that to? Probably just the internet, to be honest.

17:25Lots of people more looking at clips and streaming. So obviously small sample size there, but that message even beyond those people that we spoke to of social media kind of resonating and making the NFL more popular was a common answer. I sat down with NFL Commissioner Roger Gidell and I asked him, look, are you looking for short term results here where you suddenly see a pop in Australian popularity regarding the NFL? Or is this the long game? And he answered, no, no, no, it is a commissioner's responsibility to play the long game. Listen to what he told me. You have to be thinking about all of these things going out five years and if you're not you're being irresponsible. So whether it's media or whether it's labor, whether it's our international plans or other strategy, what we're doing with stadiums, all of that is taking a five, 10, 15 year look and it's critical to do that. And Roger Gidell is going to be the commissioner of the NFL a little bit longer.

18:26He just signed a four year contract extension taking him through the year 2030 and into March of 2031. He's already been the commissioner of the NFL for 20 years. Scott, where are you live from? Alex, just checking. I am I am live from Melbourne, Australia. Melbin, not Mel Bourne. That is one of the things I learned here. And by the way, I'm right next to the Melbin cricket ground, which is where tonight's game between the Rams and the 49ers will take place in just a few hours. All right, awesome. Thanks for joining. Appreciate that. That's Alex Sherman. Meantime the start of the NFL season, always a big deal for betting platforms like DraftKings. Our contest abroar with that company CEO Jason Robbins joins us now. Hi there. Scott and really this is the season for DraftKings and its competitors. Jason Robbins joins me now from Boston. Okay, so Jason, tell me how was it the lead up to last night and kickoff on a Wednesday

19:28night? Well, it's the first Wednesday game. So we didn't have a lot of comparisons, but overall I thought it was really great, great matchup game. Obviously, didn't have a ton of scoring, but it's usually good for the books. So overall, great start to the season and really look forward to tonight and the weekend. There's a serious trend emerging where sports books are stagnating and the prediction markets are soaring alongside the onslaught of NFL. H2Gambling Capital told me that they estimate that the sports event contracts could actually pull $2 billion away from the legal sports books in the United States. You have both. You have sports books across the nation. You're one of the big giants and you have a nascent prediction market business. What are you saying? Well, I think the notion that it's pulling volume from sports books is a completeness. I've seen so much data on this, both internal and external and absolutely zero that I've seen points to anything like that.

20:30I think prediction markets are exciting growth because they're opening up so many new states like California, Texas, Florida, Georgia that we haven't been able to offer sports products at least beyond fantasy and maybe horse racing in before. So now we can offer sports predictions in all of these states. It's almost half of the US population that we weren't previously offering sports book too. So, to me, that's a pretty clear reason why it's growing so quickly. Obviously, sports book has been launched in many states, but many of those states have been, you know, seven, eight years now since they launched. And I think, you know, obviously, very different when you have states that are experiencing their first full NFL season where there's a truly competitive sports prediction market. Okay, well, part of the reason is because in Florida, for instance, you don't have a gambling license. Sports betting is legal there, but only through hard rock, which is owned by the Seminole tribe. H2Gamble and Capital said that they think the NFL handle in Florida alone will fall 12%.

21:30Do you think you're pulling away hard rock's customers onto your prediction platform? It's very hard to say. I mean, I don't have access to hard rock state. I could tell you from what we see in our own data in the markets that we operate in. We have seen zero discernible cannibalization. So, you know, I would stand a reason. It's probably not super material in Florida. Either that said, you know, we obviously feel we have the best product in the market. And that's probably a big reason behind why we've been able to retain our customers so well. Okay, give me a sense of what you really think about prediction markets because you have the business. But then, for instance, when Nevada gets a win in the ninth circuit saying that it can enforce its state gambling laws against CalShi, with whom CNBC has a commercial relationship, draft king stock pops. So there's clearly an investor optimism around prediction markets going away.

22:31You know, that's been one of the things that we've marveled at here is that we feel that prediction markets are overall a very good thing for us. Sure, there's some new competition. But we feel very good about, as I said earlier, the fact that it's having very little to know discernible impact on our existing business. And so really what it does is it opens up this huge new incremental tan. And even within the states that you are seeing, you know, that have online sports book, a lot of the volume there is coming from sharps and professional bettors who are doing market making and things like that. It's a different audience than what we're really focused on from the retail entertainment perspective. So, you know, those are basically the people that are making the markets instead of draft kings, right? Yeah. So there is a market for that for sure in a lot of these states. But I would say within the retail, you know, core customer base, we feel very good that we are not seeing any cannibalization. So we think it's a huge new incremental opportunity. The fact that the market doesn't believe that I can't control, obviously always interesting though to see something when you feel like it's good news and you get a negative reaction

23:35the stock and you feel like it's bad news and you get a positive reaction to the stock. It always gives us a chuckle here. But we think over time the facts will play out and people will figure it out. I just want to remind the audience that you have refrained from offering sports event contracts in states where you already have a gambling license and offer sports betting. Last night after the kickoff for the NFL game, your competitor, underdog, has surrendered its fantasy sports licenses in seven states. The regulators there said you cannot have a fantasy license if you're offering prediction markets. Are you experiencing the same sort of regulatory pressure for your fantasy business as well? And in what other, because I heard even from a payments processor, they're getting regulatory pressure about customers, clients of theirs that offer both sports betting and predictions. Well, we've been really respectful and had very transparent open dialogues with all our regulators and I think we have great relationships with them and so I feel very good that we

24:40have approached this in a way that they will view as being a good actor and we've received feedback as such. To date, we haven't been involved in any of that litigation. We haven't had any issues like the ones that you're describing that underdog had and I think it's because of the approach that we've taken. We've always said that the most important thing is that we treat our licenses like gold. It's obviously where we generate almost all of our business revenue from. Predictions is certainly an exciting new opportunity but we're going to focus on it in the places that we don't operate licensed products. Yeah, Jason Robbins, good to see you. I know that football season is exciting for you and for your team. Thank you for giving me some time. Thanks for having me. Scott, it's exciting but what you're seeing is with all of these sports book operators, they are really trying to differentiate themselves and push forward their product and make sure that they have something that helps them stand apart from the competitors. All right, appreciate that interview. Fantastic. Thanks so much. Fantastic Brewer coming up. AI's biggest threat may not be a bubble but the technology itself.

25:42Billionaire, Paltruder Jones, sounding the alarm. Plus what why combinators CEO just told CNBC about this issue. You don't want to miss that next. It's NFL kickoff time. Exclusive NFL team valuations with sports business expert, Michael O'Zania. NFL is by far the most profitable league. NFL team valuations now on CNBC.com slash sport. We're back on the bell, ad billionaire investor, Paltruder Jones, to the growing list of those warning about the potential perils of AI. Mr. Jones writing in op ed in the Wall Street Journal today saying, AI may become the third superpower. Quote, the threat is real, he wrote, while referencing the potential of self-improving AI. Meantime, the president and CEO of Y Combinator weighing in on this topic this afternoon during an interview with our very own Kate Rooney. She joins us now to tell us more about what Gary Tan said.

26:43Hi. So, Scott, good to see you. We are at Y Combinator's demo day. So for those who don't know, this is a startup incubator that's famous for backing names like Stripes Bay back to Open AI, Airbnb. A lot of big names in Silicon Valley. And this is the next generation of founders here and startups that we've been talking to this afternoon, as well as Gary Tan himself. He really does have a bird's eye view on what is going on in AI. And of course, did have thoughts on this entire debate around some of the doomsday scenarios. He pushed back on some of that rhetoric. Here's what he said. I think that we need to be focused on science fact, not science fiction. Why aren't we grounding this conversation in what is actually happening right now? I mean, the cybersecurity risk is real. And the policy and the way both, you know, Democrat and Republican lawmakers should be looking at this is actually the lens directly coming out of what is happening right now. We don't need to be responding to a science fiction sort of fantasy about what's going

27:47to happen. And Scott, that does align with what Jensen Wong and Vidya CEO said at the Goldman Sachs conference today. We're seeing headlines that he poured some cold water on what he described as the hysterical rhetoric around AI fears. And again, the worst case scenario, human extinction level events that people are now saying is possible with AI. Speaking of that, we did also get news this afternoon. Anthropic put out about 100 page report on this. Part of that was this risk of bio weapons. They said they have locked possible efforts to build biological weapons with clog, using clog. And it is a real threat. I mean, we talk about this, but anthropic outlining really how this is happening and the steps that they've taken behind the scenes to shut this down. But I will say this is about as optimistic as a group as you can get. I mean, these are the founders that are using AI every day. They're saying that they're able to build startups in a much leaner, cheaper way. We're seeing a lot of former SpaceX folks. And I would say the theme out of this and what folks should pay attention to in terms

28:49of what the next thing is in AI, it's physical AI. So it's robotics. We're seeing a lot of drone and defense startups out here. One person told me it's because they want to do what they feel like is defensible against anthropic in the AI labs. What they can't basically, what can't be copied by an anthropic. That is physical hardware. And that's what we're seeing out here. Finally, Scott, one more comment from Gary Tannen, I think is interesting. He said none of this in terms of AI and the impact on society is going to happen overnight. He said it's going to take decades to permeate through society, which is interesting. And I think a much longer timeline than maybe we would have thought a couple of years ago. We sort of say, and there's time to figure this out. Kate, I appreciate that very much. Thank you. That's Kate Rooney. Now let's bring in big technologies, Alex Cantrowitz, he's also a CNBC contributor. Welcome back. Have we drifted too far into science fiction and away from science fact? I think we have. I mean, this idea, so the idea that some of the X and even current anthropic employees are advancing that there's a 10% chance of AI wiping us out over some time.

29:52They're advancing these probabilities like it's rooted in science and it's rooted in math. It's not. It's numbers that are made up and just speculation based off of what's going to happen. And remember, today's technology can barely order you a pizza. So I think we need to hold our horses a little bit in terms of what has spun out of it, which is that AI poses a risk that a lot of people are taking this as it's likely to harm humans and it's likely to wipe us out. And so certainly, this story has sort of left containment. And it's now spread into places like Washington and governors mansions across the United States and could be a turning point where we end up seeing, you know, pauses or kill switches debated in a much more serious fashion than they have been today. So the idea that even some on the quote-unquote inside are raising these alarms at a time when they're also the industry tech itself is being criticized for the amount of distrust that's out there in the public domain now.

30:56How does tech reconcile with all of that? I think it's trying at least some within that industry are trying to be out there. A little more like Jensen Wong as Kate was talking about at the Communicopia conference. Fred Gerson was in the room, had to have been because he posted on X with a photo about Jensen's comments, calling that a anthropic researcher's comments outlandish and quote-deeply untrue, said the comments were wrong, arrogant and ignorant of all the work being done. That's how Brad Gerson or Perif raised part of what Jensen had to say. So those on the inside are raising some alarms. Those on the inside are also trying to come to the rescue to sort of tamp down the hysteria. What do you make of that? Well, on the risk side, you're looking at a perfect storm here, right? Because AI was on popular coming into this week. People didn't like data centers. They don't like this idea that AI is going to take your jobs. The idea that AI might kill you or your children wasn't even part of the discussion.

31:56And now it firmly is. So all of the worries about the government getting involved in stopping the progress that were manifesting up until now, now they're even worse, right? Now they're even more concrete. Meanwhile, you have so much money that's been plowed into this. You know, whether it's Nvidia's market cap, whether it is the open AI and anthropic IPOs that are imminent and looking like they might be at $2 trillion. For all this to work, in many ways, a lot of this needs to go perfect. And when you start to have these worries injected, it starts to take that perfect pathway and disrupt it. And so that's why you're seeing Jensen and Brad Gerson are amplifying this. The industry is going to push back on this extremely hard. But there are legitimate concerns, right? I mean, Paul Tudor-Jones is not a hysterical human being. He's a measured, thoughtful person who's seen a lot and over the years, obviously. And specifically, it seems talking about self-improving AI and suggesting that the threat is real.

32:57Now if you read his op-ed and then you see what anthropic itself posted a couple hours ago, we published this, I'm reading directly from them. We published our most detailed threat intelligence report to date. It covers how people tried to misuse Claude for cyber attacks, influence operations, surveillance, biology, and building weapons and how we found and stopped them. We disrupted every operation in the report. That's great. Thank God. We don't want it to get to a point where they can't, but that just shows you the risks and the kinds of things that people like Paul Tudor-Jones, not hysterically, are talking about. Yeah, and I'm not saying there's no risk. There's definitely risk. I mean, even with the hugging face incident that we've seen come out over the past month, some of this stuff is extremely concerning. And we've seen the power of these AI is to work together in swarms, like the open AI effort that solved the Millennium problem. I only request to the AI industry and for the dialogue is that there's got to be a way to separate some of the things that you're seeing with the extrapolations that are going

34:00on. Because we saw the hugging face incident happen, does it mean that AI has a better chance of wiping out humanity? I wouldn't say so. Let's try to be, and I'm just talking about when people are talking about this in public and it goes to the researchers and goes to everybody, including Paul Tudor-Jones. Let's make sure that when we're going to say statements about what's going to happen, like recursive self improvement has improvement that it's going to be the case, AI proving other AI's, we don't have any evidence that that is going to come. So as opposed to saying it will certainly come and it's going to be a third superpower, and check some doubt in there. It's possible. And if it does happen here's what we might want to do, but I would much prefer that type of tone as opposed to it will definitely come and therefore this is what it must. Briefly, what does it mean from a regulatory standpoint? The idea of somebody having to regulate all of this or the self-regulation that others say can easily be done from the industry itself. How do we reconcile that? Well, it's very different from the tech class that we saw where we had federal agencies

35:02that sort of the FTC and the DOJ that were looking at the power of big tech and trying to rein it in and ultimately ended up doing nothing. Because from a regulation standpoint, self-regulation in many areas is sort of out of the way. Because you now have local municipalities, free market conservatives in Texas saying we don't want to go ahead and support the building of data centers in our neighborhood. So this could happen slowly but surely on a local level and then eventually spiral into something bigger. And again, when you think about how perfect the path to IPO needs to be for OpenAI and Anthropic that could certainly block that perfection and put obstacles that will make it harder for this momentum to continue. We knew we needed your insights today. Thanks for coming by. Appreciate that. Alex Cantrowauch is joining us. The former Anthropic and OpenAI researcher Jacob Coxen by the way who sounded the alarm on AI this week will be live on CMBC tomorrow. That is 11.30 AM Eastern time.

36:04Certainly one not to miss. Next, we track the biggest movers as we head into the closed Pippa Stevens is standing by with that high pips. Hey, it's got two chip stocks are in the green. On an other words, down day for the sector, the names to watch coming up next. All right, what's under the bell back at Pippa Stevens now for the stocks that are moving into the closed? What do you see? Well, American Eagle Outfitters is tumbling some 15 percent despite posting a Q2 beat, comparable sales for the quarter fell more than expected and the company expects operating income for the corn quarter to come in below street account estimates. Those shares are down 46 percent so far on the year. Meantime Skyworks and Corvo in the green while the broader chip sector falls, the two semiconductor names supply components for Apple's iPhones and are likely getting a boost following Wednesday's iPhone 18 and foldable iPhone unveiling. Skyworks and Corvo announced a merger last year and Skyworks, the CEO said in July, he is optimistic that it will close within the calendar year. So share is at nearly 11 percent. Skyworks. Thank you very much for Pippa Stevens coming up next.

37:04Watch a watch for when Oracle and Adobe, they report an overtime. We'll take in the zone next. We're now in the closing bell markets on Mike Santoli and Marilyn Bank of America's Marcy McGregor. Here to break down these crucial moments of the trading day plus all of a reneg always standing by live from the Cevo global markets and Chicago options action coming up. The Mimoti has set up for Oracle and Adobe, those critical results are an overtime. Michael, you first. You know, the stock market's got keeps processing these very dramatic moves in other asset classes into relatively muted activity. Now, it's definitely struggled to get out of its own way recently. Today's low in the S&P goes all the way back to late May. So you're talking about a three or four month trading range at this point. Arguably, maybe equities are under reacting or at least just that beneficial rotation is keeping a real flush from happening. I do think also it's kind of suspended to a degree ahead of CPI tomorrow.

38:07So I think that their hope is it gives certainty in one direction or the other on the Fed. If there's anything like a cooler number, obviously, you know, bonds could get some relief there. But, you know, nobody has a high conviction to bet on that today. Yeah, you got less than five minutes. I mean, until you're show you guys that's I'm assuming where you're going to be tackling pretty heavy. Plus the earnings coming up in OT. All of that plus the earnings. We also have the CEO of Freeport MacMurand coming on. I was a pretty big day for copper as well today. Yeah, Freeport was getting hit pretty good the last I saw. Yeah, good stuff Mike. Thanks. That's Mike Santoli. Oliver, Cebow, what do you see? Options traders are pounding what they've seen as a vulnerable area of the bond market. I thought it's been weeks, the high yield corporate ETF, HYG, sees a lot of bearish flow. And today at least one trader doubled down on deeper selling for the ETF. They used four legs each with 37 and a half thousand put contracts, three of which look like clear bearish positions. They bought 1.5 million dollars of the 77 strike puts expiring November 20th, about 800,000

39:14dollars of the same strike in October 16th and 375,000 of the 72 strike puts expiring in November. HYG is only down 2.5% this year roughly, but this is a 2.5 million dollar bearish bet that things are going to get worse for corporates over the next one to two months as treasuries yields blow out. Oliver, appreciate that. Oliver Renek, I'll go to Seaman now. I'm just looking at Oracle, seeing me down 5% going into this number. Yeah, and Scott, investors want to know how rising political backlash against data centers is impacting the company's pipeline specifically a site in New Mexico where open AI is a tenant. The state has raised concerns around water and air pollution. The question really for Oracle does management characterize this project as on schedule? And is this issue isolated or illustrative of a broader challenge facing the AI infrastructure buildout? Comments could have implications for other AI players like the Nebius and Core Weave, the hyperscalers, Amazon, and Microsoft that are pouring billions into data center development.

40:14Scott, this report does mark roughly one year since Oracle surprised the market with that $300 billion open AI deal, which sent shares up by 36% in one day. Investors will want an update on its relationship with the AI lab as well as its latest financing plans, right? The following that $20 billion equity issuance plan. Well, watch for that. Seaman, thanks so much. That an Adobe, of course. Don't forget about that. We'll see Seema again and over time. Marcia Pivot to you. I'm looking squarely at WTI right now above 102 Brent pushing 109. Got yields moving higher today, time to be cautious about that or not. I think we're going to have some weeks that Temporcy's inality here in equity markets, but the reaction has been fairly muted as well as fundamentals are intact. And I mean earnings and we're seeing earnings momentum continuing not just in the second half of this year, but into 27. The local division ratios are now above one globally, all time highs in Japan, five of your highs in the US. That tells me a story that the fundamentals are intact.

41:15So I would say some of the noise we keep saying followed the trend lines, not the headlines because that's what really matters here. Dip buyer, you would be, would you urge people to be because the trend still intact in terms of earnings? Absolutely. I just think this is a little bit of a loss of momentum in a rotational market more than anything. So September weakness, we know it's notoriously a week month. I would be a dip buyer here. Once you get through midterms, you tend to get markets strengthened to the end of the year and frankly for the next six and 12 months historically. What areas of the market looked the most attractive to you if they were to lose a little bit more momentum? I like US equities large and small. I know small cuts have held up pretty well, not in the last couple of days, but have held up pretty well despite the loss of momentum here. And I would look outside of the US emerging markets specifically if we are overly concentrated in US markets, think EM in the US. If you're overly concentrated in tech, I would think dividend paying stocks. I like financials for deregulation, loan growth and II growth.

42:20And I like healthcare. This has been the one sector that has been lagging on the earnings side. I we see a recovery coming and then industrials. A story about capex and backlogs, but also aerospace and defense. Talk to you soon. Thanks for being with us. That's Marcy McGregor joining us. So Bell's about to ring. You can see on the right hand side of your screen, we'll be read across the board. We're led lower by the Russell that back up in yields and certainly have a good impact. There are a story dominated today by oil and yields and stock paying a bit of the price with our entire moves on the inflation data more coming tomorrow than key. I'll see you then. Let's check it in there. It's a tie.