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I'm Scott Wapner, and you're listening to CNBC's Halftime Report, the podcast, the most profitable hour of the trading day. We record this live weekdays at 12 Eastern. Listen in.
Okay, Carl, thank you very much. Welcome to the Halftime Report. I'm Scott Wapner, front and center this hour, streaking stocks. The S&P going for 10 up days in a row. Obviously have a little bit of work to do today to extend that run. We'll ask our experts how to play the markets from here. And we'll also be joined in just a little bit from Altimeter's Brad Gerstner from Milken.
in Beverly Hills and we look forward to that. Joining me for the hour, Joe Terranova, Jim Labenthal, Anastasia Amoroso, Brian Belsky. We'll show you what you're doing in the markets here. Dow's green. As I said, we do have some red on the board. S&P is down by one third of one percent. NASDAQ's about a half. We might as well start with what the Treasury Secretary had to say. Obviously, we were watching the markets
closely there, Joe. When Scott Besson was talking to Sarah, we're very close to some deals, he said, related to trade, maybe some as early as this week. On China, I think we can see substantial progress in the coming weeks. We'll see. Didn't really want to talk about the market as he made
perfectly clear but trying to remain as optimistic as certainly he can about where growth prospects are doesn't sound in any way that he thinks we're going to have a recession what's your take on the rally that we've had we're going for ten in a row and then the context of what secretary best and just told sarah i think his words are always pro-market i think his words always give investors comfort
And I think his emphasis on where are yields, where is the price of oil really underscores what the clear intention has been on this three-prong approach to fiscal policy. I understand the sequencing was difficult for markets to digest. That was a very aggressive
tariff policy, but markets have clearly recovered. And when you ask the question, what do you think about as it relates to markets as we move forward? What's interesting to me is always trying to discover what the personality of the market looks like. And I think what's very clear in 2025
is that the opportunities that we are seeing are no longer just isolated to software, semiconductors, artificial intelligence, ALO names. We're actually seeing areas of the market like financials, like industrials, that are providing strong earnings growth and therefore strong price appreciation. And if there's one thing I can emphasize to the viewers, it's not figuring out exactly where the market is going, not trying to figure out are we going up and down, but rather ultimately where you want to be.
And in 2025, the one element of investing that we have restored is being able to diversify once again, because you actually get paid to own financials, industrials and health care. We moved up a little bit, just a little bit on perhaps what the Treasury secretary had to say to our Sarah Eisen there. Again, optimistic that we could get some kind of trade deals.
As early as this week, as I was saying a little bit earlier, I think we can see substantial progress in the coming weeks. Brian Belsky, Joe makes the point, you know, he said the markets, they've recovered. Yes, they have. But I still don't feel as though the great majority thinks we're out of the woods because there are a lot of issues to still be decided. As Apollo's Mark Rowan told David Faber earlier this morning,
the uncertainty has, in his words, ground things to a halt. - I don't know what's been ground to the halt. Stocks have been pretty positive for the last couple of weeks. And I think Joe's most apropos comment, quite frankly, was about stop trying to pick the market and start looking and appreciating the diversification
in the broad participation that we've seen. As you know, we've been long-term bulls, we've been long-term bulls in financials, and there's other areas of the market that Joe said in terms of where we're seeing some earnings growth, some healthcare, but mostly industrial and even some consumer. And oh yeah, by the way, big cap tech and communication services are doing quite well too.
I do believe that the longer-term trend of normalization is upon us. I do believe that means that you're going to want to own some large, some small, some value, some growth, and be much more evenly distributed with respect to your equity investments. But I do believe that the recovery is real. This is not a dead cat bounce. And I think stocks are going to be higher as we continue to go forward.
ANASTASIA, WHAT ABOUT YOU? DO YOU THINK WE'RE FAR FROM OUT OF THE WOODS? BRIAN BELSKY, I MEAN, HE'S KIND OF ALWAYS BULLISH, SO HEARING HIM SAY THAT HE'S BULLISH TODAY DOESN'T REALLY SHOCK ME. WHAT ABOUT YOU?
I do also think, Scott, that the recent positive momentum can actually continue. And, you know, first of all, on this point that so much demand has been pulled forward and this is why we have the strong economic data, while an activity is likely to grind through to the halt, that's what people think. But what the market really cares about is two things. What is happening with trade deals and what is happening with tax policy? And as we just heard from Secretary Besson, it seems like both are progressing quite nicely.
So on the trade deal front first, first of all, I do think we have seen peak tariffs. And it seems like the administration is really committed to getting some of these deals done before the July 2nd or so deadline. So that means that even if we go through this quarter, the second quarter of uncertainty and the short-term pain, it's going to be mitigated by the fact that when July comes upon us, we will likely have a deal in place.
So I think that's quite favorable. The second thing that's quite favorable is that this is still sort of behind the scenes, but Congress is working on tax policy. And one thing Secretary Besson was emphasizing, that they want the United States
to continue to be a great place to invest. And that means not only personal tax rates, which will continue to be extended, but also on the business side, maybe there will be some accelerated depreciation. Maybe there will be interest deductions. Maybe there will be R&D expense.
So if you make this an attractive place to invest, the capital will continue to come here. So overall, Scott, I would say the administration's approach has been short-term pain, which seems to be focused in the second quarter for long-term gain. And I think we're starting to sense some of that optimism about the long-term gain. So I do think the market momentum here can continue. And by the way, the technicals are also much more supportive of it coming into May.
Jim, maybe Belsky's bullishness is well-founded if you look at the three-pronged approach that the secretary believes that the administration's taking. Tariffs are but one. Taxes and deregulation are the other two, the other two outweighing the one. And especially if you think we're going to get some trade deals, which we are eventually, obviously.
we can dissect them at the time, but the tariffs to this level today are not going to be at this level figuratively tomorrow, right? So what about that?
Well, I like running with Brian on this, and I think when you get to the end of the year, if all the things you just laid out, Scott, come true, we're going to be nicely higher in the markets than we are now. I do have to respect, just as a market participant, that we've been up nine days in a row on the S&P 500, first time in 20 years. Scott, if we get a 10th day today, that's the first time in 30 years. I don't know if it's ever happened.
in 11 days in a row. Somebody will probably tweet it in. The point I'm driving at with that is a lot of good news is priced in. A lot of what you just said, deregulation, and Anastasia said it as well, deregulation, lower taxes, and some trade deals. Okay, that's good. A lot of that's priced in, and as a market participant, I'm looking at the last two weeks of gains and saying, all right, I'm going to trim a few winners here and not put that money immediately back to work. I'm not making a huge market...
I'm not going to bet here, but I am taking a little bit of money out of the market so that if there's some dislocation, it's on who knows what. You know, yesterday we had President Trump talking about 100% tariffs on movies filmed overseas, and that knocked Netflix down, albeit it's recovered. My point being is that there is going to be volatility going forward. A lot of good news is priced in. It's probably going to come true, but there will be volatility and buying opportunities. I want to have the dry powder ready.
How is that priced in? How are taxes and deregulation possibly priced in? We haven't even recovered all the losses from the trade upset. Yes, we have. On the S&P 500? Yes, we have. We're still down. Let's just say we're still down year-to-date. We're still down year-to-date. All right? Let's just say that. How are taxes and deregulation priced in? Well-
Well, because first off, okay, good question. You know, first off- It's the question according to your answer. He always asks good questions. I know, I know, I know. Anybody read the Beige Book last week? I mean, those anecdotes from manufacturers- I stayed up all night. Okay, that's good reading. Those anecdotes from manufacturers were pretty dire.
They were talking about things like they're not getting orders because of the higher prices they're pushing through, the higher prices of raw materials. They're thinking about laying people off. They're not making profits. So there is some bad news out there that this market is looking past and pricing in, in my opinion. They don't write this in the lead of the Wall Street Journal. It's being looked past by virtue of deregulation and lower taxes. And I'll also point this out.
deregulation and lower taxes are not a fait accompli. There is a lot of dissension, particularly on taxes, in the Republican caucus that needs to be worked out. So when, you know, we're up 14% on the S&P 500 from the low, I would say there's quite a bit priced in that's good.
Yeah, I think to play the other side here, and I think to Scott's comment before about things grinding to a halt, I have had conversations in the last several days with several people, one of which is a very big real estate developer here in New York who has said, we are just seeing frozen commerce. Everybody knows, everybody knows that business
business activity has slowed dramatically. CEO decision-making has slowed dramatically. The uncertainty has done that. We're not talking about the stock market activity, but Mark Rowan sees and talks to a lot of business owners in a lot of areas of not only this country, but around the world and talks to leaders as such. So he's
he echoes what almost every other person has said. I don't know. We can get back to Belsky for a second, like trying to throw cold water on that notion. But you give me your answer. No, I just think that the stock market sometimes is not the economy and sometimes the economy is not the stock market. I really do believe the economy continues to cool. I think the effective damage from
the aggressive tariffs is already built into the economy. I'm not sure exactly how you give people comfort to go out and say, OK, we're going to begin to accelerate spending once again, either for consumers or for corporations. So to me, that leads to an environment where at some point the Federal Reserve has to do something. Maybe they end QT. I look at the bond market. OK, we talk about being up eight or nine consecutive days. The bond market has allowed that. Remember that if the bond
If the 10-year starts going back towards 4.50, we're not sitting here talking about the equity market going higher. The bond market is running the show, and equities will roll over if, in fact, that happens. Yeah, well, bond yields have started to move higher towards the end of the week. Now, a better-than-expected employment report would obviously do the trick on that. Belsky, I'll give you the last word on this, because your portfolio moves very much represent your perspective and your point of view.
You are leaning in a little bit more to the consumer. You bought Deckers, you bought American Eagle, you bought more Target, you bought more AMD in terms of tech. So you are putting your money where your mouth is, so to speak.
Thank you. Yeah, my good friend Stephanie Link's been trying to get me to buy DEC for a long time, and the stock's down 40-plus percent this year, but operating income remains quite strong. And on American Eagle, we've got some great brands there, but this is another area that has been absolutely hammered. We like to be value investors.
when everyone else is saying the opposite. And so at the end of the day, a lot of our work is centered around estimate revision, Scott. And estimate revisions for the out year, meaning FY2 for 2026, have been hammered for the S&P 500, but even worse so for consumer discretionary. And going way back over the last 20 years or so, we've always bought
the consumer when everybody hates it. So I don't doubt that things have slowed down. I get that. But from a longer term perspective, these names have been absolutely beaten up. And given my prior comments that I think we want to own, quite frankly, some value and some growth, we need to be opportunistic in some of these areas that have been beaten up.
All right. Let's bring in our halftime headliner now. He is Brad Gerstner. He's the founder and CEO of Altimeter Capital. He's live with us for our annual conversation at the Milken Conference out in Beverly Hills. It's always great to have you, especially now. Welcome back.
Hey, it's good to be here, Scott. Thanks for having me. Yep. The last time you were on with us, which wasn't all that long ago, of course, you were critical of the way that the tariffs were implemented. You called it an own goal. You did say at that time you were buying the weakness in the market, adding to your NVIDIA position, which is your largest. I think people know that. Now we've rallied a long way back. So how do you feel about these markets today?
Well, if you recall, Scott, I set it up. I said there's a debate within the administration between what I characterized as the free and fair trade Trump versus the nuclear Navarro approach. So were we going to land the plane closer to 10% tariffs across the board, about $300 billion to $400 billion of tariff revenue, or were we trying to go back to a time of McKinley where we replaced the Internal Revenue Service? I think the market realized, and that's why we were leaning into the market,
market that Trump at his core is a free and fair trader, wants to cut deals. And so the market's up 10, 15% off of its lows over the last 10 trading days because it's beginning to discount that future. Now we have a long way to go. We haven't announced any deals. We haven't set the framework for China. I think that's what's next up. We'll see the president on a trip to the Middle East, I think in a week or so. I expect we'll hear some deals there as well.
Let me ask you this. The secretary in his conversation with Sarah, which I know you were watching from, you know, adjacent to where they were sitting, he said the U.S. I'm quoting him. The U.S. is the best place, best place to invest. And we're trying to accelerate that. There's been some questions, frankly, over the last two weeks to a month as to whether the U.S. was in fact still the best place to invest. You saw some suggestions of capital flight out
out of the U.S. I'm wondering whether you agree with his comment where others would also suggest that there's been, quote, brand damage. It was a Mark Rowan comment this morning with David. It was a Ken Griffin comment of late as well. How about that?
Well, listen, I think whether you love him or hate him, this president anchors his negotiations in a very aggressive place. And I think there are a bunch of people who are beginning to question whether in fact he was a free and fair trader, given that we went to 140% tariffs on China. But listen to the president's words over the course of the last couple of weeks. I think all of these folks, they're out here at Milken, I've talked to all of them over the last two days. I think we all share this belief
that he's going to land the plane. You know, the art of negotiation, you anchor deep and then you come back from that. But now we have to prove it. We have to prove we can get deals done, not only with China, but the rest of the world. And so, listen, the market's down 4% on the S&P for the year. It's down 7.5% for the NASDAQ on the year. That seems to me to be a pretty fair place to be, given the remaining uncertainty that we have to reconcile over the course of the next few weeks.
But remember, tariffs is just part of the story. We have a bunch of pro-growth administrative policies around deregulation, tax extensions, and incremental tax cuts, I think that people are looking forward to in the month of June that could really set the next leg of growth for the economy. I'll go with your analogy. Are we going to land the plane with both engines intact? Or are we going to land the plane with some damage that we then have to rebuild?
Well, I would tell you a couple of weeks ago the market was pricing it like it was going to be that Delta Airlines flight that came in upside down on fire a few days ago. But, you know, listen, I think all joking aside, the president has always been an aggressive negotiator. The country knew what it was getting when they voted for him. We'll see whether or not that's an effective strategy. It certainly has caused consternation among some of our allies in Europe and others, but
But I think the UK will be in front of the line. I think South Korea, Japan, India are lining up for these frameworks. I don't suspect that they're going to be that unusual. I think they're going to generally be a 10% tariff.
with exemptions. We're doing targeted things to rebuild important national industries like chip fabs in Arizona, steel, aluminum, et cetera. If that's where it all settles out, I think we will look back at this in six months and recognize that this was a huge buying opportunity. But listen,
It is a higher risk, higher reward strategy than the last two administrations that came before him. No, I don't think they knew they were going to get a hugely negative market event. I think that was shocking to most people, probably including you.
Oh, no. You know, if you remember, Scott, I came on and, you know, I talked about it on my podcast, PG2, on February 4th. I came on in January and February. I told you we had taken our risk way down because it was very clear to me that the president was going to embark upon a restructuring of the global economic and trading order and the market wasn't pricing it in. So I don't think it was that surprising to folks. But
But Liberation Day clearly set the message that we're going to go hard. I think that event was surprising to the market generally. But now you've seen this walk back up.
Ten trading days in a row, the S&P 500 is up. So listen, if you would have told the administration that they could restructure global economic trade, that they could restructure regulation, et cetera, and only have the market down 4% from an all-time high, I think they would have hit the bid. So we'll see. But, you know, I don't think the president wants a recession heading into the midterms. I fully expect it.
We're going to see over the next eight weeks, like here's the flight plan. First, we're going to get some of these announcements on other countries, then in the Middle East. Then we're going to probably see a walking back and a reconciliation, at least partially, with China. And then in the month of June, we're going to negotiate the reconciliation bill, which is going to include no tax on tips, no tax on overtime, no tax on Social Security, and an expensing
of business investment. If you do those things, that's a $500 billion annual stimulus into the economy. That's what the market is beginning to price in. If this president is as pro-growth as the policies that he ran on, I think there's still upside to the market in the back half of the year. But, you know, listen, we're going to have some chop along the way because there are a lot of balls in the air. Your optimism is represented in the way that you've been playing the market. You've added to your core positions.
Seems to me all of them, Nvidia, Amazon, Microsoft, Meta, Coupang, Instacart, Snowflake, Broadcom, Taiwan Semi, and Robinhood. What does your full exposure look like if it was taken down and then it started to go back up by the last time we spoke? Where is it today? Right, Scott, you remember, I think, over the last few years, we've talked a lot
to the investors at home, at certain times there are these macro events that mean you have to reduce or increase your units of risk. So think of it as a volume knob. And in '23 and '24, I had nine units of risk on. So our volume was turned way up. At the start of this year, we turned that down to one unit of risk, one out of 10. And today we're back up to about six or seven on that volume knob. And those are
are these macro overlays, tariffs, changes of regulation and taxes. The underlying stocks, our favorite stocks like Nvidia, those don't change all that often, but the amount of risk that we have on at any one moment in time has to change. And unfortunately, 2025 has demanded that you're very agile.
because there have been a lot of changes in these first four months. I expect that that will begin to settle down. We'll get more predictability. We'll get back out there and rebuild brand America
You know with some of our allies. I think that begins over the course of the next few weeks You obviously have high exposures. I just read off the names of your core positions all over the mega cap arena We're not going to get Nvidia for a while. So we really don't need to go there So specifically other than for me to ask you what do you think we learned last week? from the mega caps and the hyper scalars that you can glean from them into what we might get in
down the road from Nvidia? Well, first, Scott, 75% of S&P 500 companies have reported and that 80% of those companies have beat their earnings expectations, right? Nobody expected that coming into the quarter. Secondly, all the mega caps, Microsoft, Meta, et cetera, all reconfirmed their CapEx guides. Again, nobody expected that. They're spending and making incredible investments over the course of the next three years because they know that AI
is the single biggest super cycle we've ever seen in technology, right? Take this stat, Satya Nadella told us last week, just last month alone, they processed 50 trillion tokens. That's three and a half million years of AI conversation. There's an extraordinary amount of pent up demand, both by consumers and every enterprise on the planet
and increasingly every sovereign in this room for AI. The president and these companies want the world to run on American compute, American models, and American applications. And we're just getting started. We're in the first inning. This is 2000 to 2003 internet time here. And what we heard over the last few weeks is all of the biggest companies in America
continue to double down on their investments in AI and they're seeing the paybacks. - Did you reduce your position in Tesla or sell it entirely?
Our position is reduced in Tesla as we pull back our position in all the names in our book because of some of this macro risk that we've been seeing. And like I said, Dara Khashoggi, he's done an unbelievable job at Uber. They have earnings coming up, I believe, this week. Tesla has done an unbelievable job navigating a very tricky global backdrop, right? Imagine.
They're in the center of the bullseye of these tariffs. They're in the center of the bullseye of the negotiation with China. They're in the center of the bullseye on, you know, U.S. auto tariffs that the president announced early on. So it's tricky.
But we believe in full self-driving. We think they probably have the best full self-driving technology in the world. And it's clear, you look around Los Angeles on any street corner, you're now likely to see two or three cars with no driver in the front seat. One of the biggest transitions of the next five to 10 years will be the multi-trillion dollar transition to autonomous driving. You didn't mention brand damage caused by Musk.
which some have suggested is going to take a long time to fix if it can even be fixed. Sales, if you look around the globe, are obviously down significantly, I think even to a degree that have surprised a lot of people. Did that factor into any reason why you reduced the position?
No, you know, listen, Elon has always been controversial. I think the work he's done in D.C. in reducing, with Doge, reducing government bureaucracy by $50 to $100 billion a year, we'll look back on that as a great gift, a great kickstart.
to some of the changes that needed to get made. But frankly, he said he's going back to his companies full-time at Tesla, full-time at SpaceX. Listen, the Chinese wanna own global autonomous driving and they're running the table around the world. So it's very important if the US wants to compete in global autonomous driving, we need them at the helm of Tesla.
And he's told us that's where he's going. So I think they're gonna do just fine. But we are at this moment of, you know, I've described it as the fog of war. And when it comes to Tesla, to self-driving, to, you know, the Chinese auto industry, I think there's still a lot of uncertainty in the world. - You think though that the sales issues that we've seen, especially overseas, can rebound when you say you think he's gonna be fine? - I think it has a lot more, Scott, to do with the competition with China and places like Europe.
You know, do not underestimate Huawei. Do not underestimate, you know, when it comes to chips, do not underestimate Huawei when it comes to self-driving and autonomy or any of the other major Chinese companies. They are very competitive and they're determined no longer to be just Chinese players, but global players. South America, Europe, Middle East, Africa. If we want the U.S.,
you know, compute and U.S. technologies to be predominant around the world, the way we did in technology or the way we did in the Internet, then we got to go full speed ahead. We got to stop worrying about however
how everybody else is running the race and how we keep our technology from them. And we need to defuse American technology as aggressive as possible around the world. All right, let's take a quick break. You stay with us. Sit tight. We'll do that and we'll come back. I want to get your reflections on Warren Buffett. Obviously, you spend a lot of time out in Omaha. We'll talk Invest America, too, which could be getting closer to the goal line and other stocks that we want to run by Brad Gerstner as well. We're back in two.
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Back with our headliner today, Altimeter's Brad Gerstner, live from Beverly Hills at Milken. Joe has a question for you, Brad. Brad, good to see you. I know in the past you've...
owned other sectors in the market besides communication services, besides technology. We're talking a lot about those types of names today. Just give us some insight if you think there's opportunity, whether it's healthcare, industrials, financials. We've got stocks like Spotify, Netflix, Palantir all racing towards all-time highs. How are you thinking about all that?
Yeah, good to see you, Joe. You know, for sure, listen, the internet sector, you mentioned a few, Spotify, Netflix, etc. Some of the names we've owned there have had great runs this year of 20, 30, 40 percent. I think they've been safe havens, a little bit tariff trade, you know, stocks that people wanted to get into. I think some of these other names in the U.S. economy also safe havens. So I think you have to be a little bit careful because as money begins to trade out of those safe havens, as
As we get some trade deals announced, the companies that have underperformed due to the tariffs, I think will start to outperform. But generally, the S&P is only down 4% this year. People still expect double-digit S&P growth. I would say there's still a lot of disruption coming to the economy. There's going to be a lot of alpha.
This is a stock picker's market. This is not a market just to own the index and go to sleep. There are going to be some companies that are helped by the tariffs, some companies that are hurt, some companies that are accelerated by AI, some companies that are hurt. So active managers get paid right now to do their job, find those companies that are going to benefit, and avoid the companies that are going to get hurt. Since you talked about a stock picker's market, I wanted to ask you about the greatest stock picker who's ever lived.
His name is Warren Buffett. And of course, this weekend, everybody is reflecting now on his announcement that he will no longer be CEO at the end of this year. I know you've been to Omaha and I know you know some of the people out there. I'd love to just hear from you on what you think his legacy that he leaves behind for people like you and others who are trying to invest in this market. Yeah, it's a...
You know, when I saw those words from Buffett on Saturday, I was both happy for him to go out on top
20% compounded returns for 60 years. We'll never see a goat like Warren Buffett. He was one of a kind, but most importantly, what you can't put on a spreadsheet is that Warren unlocked the potential in folks like me. I grew up in rural small town, Indiana, and I saw somebody in Omaha who sounded like people around me, who looked like people around me. He inspired me to start tracking stocks when I was in high school.
uh... you know really inspired a generation inspired many generations a nation
to invest, to understand the power of long-term compounding, to understand the power of investing in the upside of the American economy. He was a personal hero of mine. I was lucky to get to know the organization later in life. I came on, I think, your show just after Charlie died. And I said, the two of them, you know, they've always spoken truth. They've always spoken wisdom. Just this weekend, he said,
Free and fair trade, right, has been the most powerful engine for prosperity on a global basis and this country for the last 50 years. It's still the greatest country on the planet. He believes that deeply in his core. So I wish him the best. He's not going anywhere. He'll continue to weigh in on the important issues of the day at Berkshire Hathaway. But salute to Warren. It really is an incredible career.
But it wasn't just about investing. He moved the country forward. He gave the country reason to believe. And in our most trying times, in the times where the country was beginning to lose faith, I remember the fall of 2008. He settled the market at critical moments in time. And so this nation owes an incredible debt of gratitude to Warren Buffett. And I was happy to see him go out on top like he did on Saturday.
He leaves an oversized legacy. It's really hard to quantify it, obviously. But in a way, you're thinking about your legacy, too, and the future investors and
people in this country through your Invest America program that you've talked to us on numerous occasions. And I know you're dealing with that out there to some degree. The idea, of course, for those who may not remember, is giving every child born in this country an investment account, $1,000 funded by the government. That's the key, funded by the government, because that means you need help to get this done.
Where are you in terms of getting that help you need as we are talking about a reconciliation bill and the Republicans trying to get their budget and their spending bill through Congress? Are you close? What can you tell us?
Well, I'll tell you, we're making incredible progress and I think we are going to get it in the reconciliation bill. But, you know, tying this back to Warren Buffett, nobody understands the power of compounding better than Warren Buffett. And now is the time. We have 70 percent of Americans who feel that they're left behind.
They don't have accounts that compound. We need to get them into the game. So it's $1,000 at birth, seeded by the federal government, but private accounts, 3.7 million kids born a year, they each get a private account. Think of it as a 401k from birth. And we have companies like Uber and Dell
and many, many others, Oracle, Nvidia, et cetera, who all say they'll contribute to the accounts of the kids of their employees. We have philanthropists, major philanthropists, who are donating billions of dollars to this if we set it up. We have states like the state of Connecticut or Ohio who will add to these accounts. And of course, parents will add to these accounts. So by the time you're 18 years old,
You will have an account in the S&P 500 that's worth upwards of $50,000 to $60,000. It changes the game by getting everybody. This is the president's Main Street agenda. The White House is very much aligned with this. The Senate is very much aligned. You know, it's led in the Senate by Senator Ted Cruz
and Hagerty and Booker Warner and others, a big bipartisan group. But Ted Cruz is helping to get this scored, helping to get it in the reconciliation bill. We got a lot of support in the House, again, bipartisan support led by the Speaker of the House. So I fully expect that we're going to get this into reconciliation. Imagine this. If the president signs this into law as part of reconciliation on July 4th of this year, that means
That means on our 250th anniversary, July 4th, 2026, we can have 40 million children, 40 million families. They can open up their phone and see their child owns a little slice of Apple, of Berkshire Hathaway, of Microsoft, et cetera.
I think that's how we really make this a Main Street economy. We know this is the most powerful economy in the world. It's high time that we get everybody into the game, but not on the back of a bigger government agency or a big government account.
on the back of individual accounts. Make everybody an owner in the upside of America. Warren Buffett would give that his stamp of approval. All right, you keep us up to date on how that progresses. Your CEO council just littered with the biggest names in business. Barton and Benioff and Safra Katz and Michael Dell and Jensen Wong and Bill McDermott and Dara and Lorene Powell Jobs. And I left many off because there are just too many to name. But that speaks to the kind of corporate support that you have gotten. Let us know and we'll see you again soon. Brad, thanks.
Thanks for having me. Thanks for having me. Brad Gerstner out at Milken for our annual out there. Contessa Brewer has the headlines now. Hi, Contessa. Hey there, Scott. Israeli Prime Minister Benjamin Netanyahu said a new offensive in Gaza will be an intensive military operation to defeat Hamas. In a video posted on social media, Netanyahu did not share details of how much territory would be seized in the enclave.
but said the population would be moved for its own protection. Officials earlier said Israel could seize all of Gaza in an expanded operation.
President Trump said Sunday he will direct the Bureau of Prisons to reopen Alcatraz Prison to house the nation's most ruthless and violent offenders. He said he wants it to be rebuilt and expanded. In his post, the president referred to, quote, radicalized judges, his words, who have, he said, they want to have trials for every person in the country illegally. The notorious facility was closed more than 60 years ago because it was too expensive to operate. Now, of course, it's a national park.
A record-breaking 21.8 million viewers tuned in to see Sovereignty take home the $3.1 million prize at the Kentucky Derby Saturday. The race aired, of course, by our sister network NBC. Streaming platform Peacock also brought in the highest traffic of all partnered streamers. This year, Scott, there was a lot of mud. Attendance was lower than last year, but the betting 11% higher. That's pretty significant growth.
Yeah, no doubt. It was sloppy for certain, but it was exciting. It sure was. Nonetheless, contested thanks, contested Brewer. Coming up, we have fresh trades in the energy space. Oil hitting its lows for the year today. Tell you what they are next. If your small business has a problem, you could say, Ugh, just my luck. But you should say, Like a good neighbor, State Farm is there. And we'll help get you back in business. Like a good neighbor, State Farm is there.
Are you still quoting 30-year-old movies? Have you said cool beans in the past 90 days? Do you think Discover isn't widely accepted? If this sounds like you, you're stuck in the past. Discover is accepted at 99% of places that take credit cards nationwide. And every time you make a purchase with your card, you automatically earn cash back. Welcome to the now. It pays to discover. Learn more at discover.com slash credit card based on the February 2024 Nelson Report.
Let's talk about some other moves that we didn't get to yet because Joe has done the rebalance, as you know, and we talked about the mega cap moves that he's made, but there are others that are interesting. I know you'll find them as such. Chipotle, you sold it. Have to. Momentum. Focusing on momentum. You've had a slowdown on revenue growth. That's what the rules-based strategy does. It looks at momentum. It looks at quality. If it deteriorates, moves to the sidelines. I feel like you own this name in one form or fashion forever. Even before you ran the ETF where you had to be rules-based. Yes.
This wasn't any rule other than I like Chipotle and I'm going to own it. Absolutely. Ten years ago, we used to talk about it on the show. It was one of my favorite quick serve restaurants. I've owned it personally. And you have to separate the human emotion. That's why I just think rules based strategies are important in this environment. You separate the emotional element that says, you know what, this company is going to make a quick recovery. But the reality is that's not what's happening. You sold Delta.
Tell me about that one. We sold out a Delta, Jimmy. I think we both saw that one coming. The airlines have always been just a trade. And when you are rebalancing on a quarterly time frame, you're basically going to go into a name like Delta and hope that you capture something that's a much larger trend. But in fact, that has not been the case with the airline names Airbus.
any of the airline names that we've owned. You're extraordinary in your ETF. You really are. The problem with Delta for you is the quarterly timing. It just is. Because, I mean, if you look at this over the last five years, this will surprise you. The total annualized return, 15.5%, right in line with the market. But it has these ridiculous ups and downs that are kind of on a quarterly basis. So, you know, if it
If it comes up on your screen again, let's talk if you're up for it. But actually, the operations are doing just fine because traffic's still holding up good. Pricing is good. And now you've got fuel coming down. All right. We're going to take a break. We come back. The explosion of new crypto ETF offerings. Papazani's got that. He'll tell us what's driving the boom in ETF Edge. And that is next.
We're back on Halftime. I'm Bob Pisani with your ETF Edge. The crypto ETF world is exploding. Forget spot Bitcoin ETFs. There's now ETF buffer funds that limit losses while allowing most of the gain. There's yield funds that offer 10 to 50 percent income. There's option funds. There's leverage and inverse funds and more. Here to make sense of it all, Rick Edelman. He's the founder of the Digital Asset Council of Financial Professionals and the former head of Edelman Financial Engines. We have, you know, it didn't take long to go from
spot Bitcoin to buffered Bitcoins. They offer downside protection and it gets more complicated from there. Makes sense of all this exploding ETF crypto universe. Well, it all started, Bob, as you said, with the introduction of the spot Bitcoin ETFs 14 months ago, raising $100 billion in a year. That created massive liquidity in the marketplace. So option strategies naturally followed. Exactly the same as the stock market.
So today you can engage in virtually any kind of a strategy you want, including limiting your downside. That's a huge thing because everybody hates the volatility of Bitcoin. But now you can guarantee you won't lose more than 10%, yet still get 50% of the upside. So this is a huge opportunity to capture the potential profits
while protecting yourself against losses. Another thing I'm just seeing, long and short Bitcoin ETF. They're exploding, but the fees are high, 1.8%. You have a daily reset. All of this erodes the returns over time, but yet they're hugely popular. People want to bet long and short Bitcoin.
And this is exactly the same thing we see in the stock market. And just as in the stock market, it doesn't make any sense. Making a bet on what Bitcoin will do in the next trading session, that's insane. That's not investing. That's a lottery ticket. And now we have more. We have leveraged and inverse Ether.
ETFs coming and more down the road. The ETF industry is really good at manufacturing ETFs. And if they can create a product that they can get you to buy, they win, even though you may not. So this is an opportunity for terrific opportunities in the expansion of your crypto holdings. You just have to have your head about you. All right. We're going to have a lot more coming up with Rick Edelman.
on ETF Edge, 1.10 p.m. Eastern Time. Now, in addition to these new developments, we're going to talk about a lot more of these crypto ETFs that are out there. We're going to talk about new ETFs that offer elegant solutions to one of the big issues for investors, and that's how to capture a steady stream of income. Some great new ETFs out on this. That's ETFedge.cnbc.com. Scott, back to you. Okay, thank you, Bob. Bob Pisani. We have more committee moves just after this break.
All right, we're back. Want to talk crude oil. It's a very big story today. It's down more than 2%, $57 on OPEC Plus production increases. Just as Bank of America's Civita Suburbanian upgrades the sector to overweight. You sold ExxonMobil in your rebalance. Jim, you own it. Belsky, you own it. You own Chevron. Brian, let me get your take on this space here and what you think of getting rid of Exxon here.
- Scott Bauer: I think it's a really tough call to be overweight energy, Scott, especially given the fact that mathematically and historically when the WTI is negative on a year-over-year basis, the sector dramatically underperforms the overall market. So I don't think it's different this time. And I think to be bullish energy right here is a really tough call. - Jeff Kilburg: Anastasia, what do you think?
I think, broadly, that's right. It's hard to be bullish on energy because it seems like more supply is definitely coming, and it's coming from OPEC because they're tired of everybody else not conforming to their quota. And it's also coming from the United States as well. So, supply seemingly is surging. At the same time, if you look at demand, it's running almost 2 million barrels a day below where that supply is. So, all things equal, the inventories are building.
So unless we get to that 3% GDP growth that Scott Besson wants, I think the overall oil market will be challenged. But I do like the volume growth story in energy, so the MLP space. But I'll talk about that later.
Joe, you sold the OG and you sold Diamondback as well. Yes, down to one name. That's Baker Hughes. If you look at energy, you haven't had a strong uptrend really since late 21. I'd focus on EQT. That's natural gas on that personally. And by the way, we added Constellation Energy, CEG. Okay. We'll do finals next. We'll do finals. Brian Belsky, what do you got? Rockwell Automation, ROK. Thank you, Anastasia.
Midstream pipelines that can benefit from volumes of oil and gas. Farmer Jim. Lockheed Martin. Joey. Striker Corp. All right, I'll see you on the bell. Look forward to that. The exchange starts right now. You've been listening to CNBC's Halftime Report, the podcast. You can always catch us live weekdays at 12 Eastern, only on CNBC.
Thank you.
If your small business has a problem...
You could say, Ugh, just my luck. But you should say, Like a good neighbor, State Farm is there. And we'll help get you back in business. Like a good neighbor, State Farm is there.