Attention has always been valuable but difficult to price. A blue check on Instagram promises credibility; a large follower count or a viral moment can open a world of opportunity. Attract as many eyeballs as you like, but there was never any way to cash in on the gaze itself. “So it’s just the next phase,” says Bark, a crypto influencer who, according to a woman who knows him, is running what amounts to “a full-blown cult” on X. (“Anything he tells his audience to do, they’ll do,” she says. “You make people money, they’ll worship you.”)
“Having clout and followers and blue check marks had value, but there was no way you could put a dollar on it,” Bark continues. “Now we’re putting a dollar on it.”
This may be why people who spend most of their time making products that live on the internet are drawn to the world of crypto, where even micro-influencers can create tokens tied to their online popularity.
One such influencer is a guy called Fluffy, who, when I met him at Meme House LA, gave the impression of an ebullient, larger-than-life Nintendo Mario, dressed in red-and-white-striped overalls and a red cap. Fluffy has his own meme coin, which, he says, “is so stressful because my face is on it. If this coin goes bad, it ruins my whole persona in Web3.” When Fluffy starred in a commercial for a crypto company called Bullpen earlier this year, his token’s total value increased from $28,000 to $40,000 because, as he puts it, “people saw me as the commercial, they saw that I was actually putting in work trying to entertain the world, which correlated to the token getting bought, and that makes me feel good.”
There is an annoying problem with the nature of attention, however. It tends to alight on the collective imagination with seemingly capricious randomness. But what if you could control where attention was headed next? This, in the view of Amy Street, a former kindergarten teacher who became a crypto influencer after flipping two NFTs for a combined $18,000, is the current trajectory. “I’m not in control of whether or not Elon Musk uses the phrase DOGE over and over again or if Labubus are cool in two months,” she says. “But I do control if I’m gonna get a tattoo of an eggplant on my stomach. And if there is money on the line, people are gonna do some crazy stuff. Bull runs create hunger for money, and people do crazy things and put up a lot of money.”
That comment about the eggplant tattoo is something Street picked up from a crypto company she’s working with called Dare Market, which has yet to launch. The idea is in the name: a market of dares where people pay bounties that others cash in on by recording themselves performing crowdsourced challenges. These dares, according to the company’s founder, Isla Rose Perfito, a bubbly blond 29-year-old living in New York, could include things like breaking into a Scientology center, moving into a McDonald’s for 24 hours, and getting people to streak at the Super Bowl. “The goal,” says Perfito, “is to break the internet. It’s like Black Mirror/Jackass coded but still super relatable. It’ll give you the feeling that you can change the world and the adrenaline rush of driving a fast car.”
After nearly a decade spent studying the most famous stock market crash in history, financial journalist Andrew Ross Sorkin warns that the Wall Street of today echoes the market of 1929, when highs preceded a massive slump, leading to the Great Depression.
Artificial intelligence and technology have contributed to a remarkable boom in recent years. But, Sorkin said, today’s economy is being propped up by the AI boom, and it’s too soon to tell if this is a sugar rush, a short-term and unsustainable boost to the markets. But, Sorkin is positive there’s a crash coming.
“I just can’t tell you when, and I can’t tell you how deep,” he said. “But I can assure you, unfortunately, I wish I wasn’t saying this, we will have a crash.”
The Roaring ’20s
Despite a tumble this Friday, stocks on Wall Street have shot up in recent months. Still, some investors are getting weak in the knees, fearing stocks are overheated. Sorkin, author of “1929: Inside the Greatest Crash in Wall Street History – and How It Shattered a Nation,” out Oct. 14, says the U.S. is in a new roaring 20s, the 2020s, with stocks pushing to record highs, just as they were in the 1920s.
Market highs today have him feeling anxious.
“I’m anxious that we are at prices that may not feel sustainable. And what I don’t know is we are either living through some kind of remarkable boom and part of that’s artificial intelligence and technology, and all of that, or everything’s overpriced,” he said.
Andrew Ross Sorkin and Lesley Stahl at the NYSE
60 Minutes
The market of 1929 was fueled by rampant speculation, including by ordinary investors unaware of the mounting risks, and of heavy borrowing. People of modest means were lured by Wall Street bankers and other stock market touts to invest using what was then a newfangled concept: credit. It was called buying on a margin. You only had to put down 10% of the stock price, borrowing the rest from your banker.
Before 1919, most people did not take on credit or debt, influenced by religious views and moral norms against borrowing money, Sorkin said. That changed when General Motors, in 1919, started lending people money so they could afford to buy the company’s cars. It changed out Americans shopped.
“And then the bankers realize what’s happening, and they realize that they can lend out money so that more folks can buy stocks. It was all sort of wrapped in the flag of democratizing access,” Sorkin said. “And in good times, when the stock is going up, it’s like free money. In bad times, you’re on the hook, and you’re on the hook in a very bad way.”
Today, it’s hundreds of billions being invested in AI, with some investment pros warning of a possible bubble as stocks soar to stratospheric heights even amid significant economic uncertainty, such as Friday’s slide after President Trump threatened more China tariffs.
“I think it’s hard to say we’re not in a bubble of some sort,” Sorkin said. “The question is always when is the bubble going to pop?”
Protecting consumers in the market
When things got out of control in 1929, frightened traders dumped stocks as investors lost their businesses and homes. In the years since, laws, regulations and agencies have been put in place to protect investors.
Some of those barriers to prevent exploitation are now coming down, Sorkin said. U.S. Securities and Exchange Commission rules have become less stringent and “the Consumer Protection Bureau practically doesn’t exist anymore.”
“That’s what concerns me,” Sorkin said. “It’s not that we’re going off a cliff tomorrow. It’s that there’s speculation in the market today, there’s an increasing amount of debt in the market today, and all of that’s happening against the backdrop of the guardrails coming off.”
Those guardrails include ones that allow only the wealthy to invest directly in private companies that have fewer regulations, like AI startups before they go public.
In recent decades, people who could invest in private equity and venture capital outperformed investors who did not. Those kinds of assets, generally restricted to wealthy investors, are potentially more rewarding, but also riskier.
“Public companies, after the SEC was created, were required to have all sorts of disclosure rules so that the public could understand what’s going on inside them. Private companies don’t have that,” Sorkin said. “But historically, the average ordinary American wasn’t really allowed to invest in the private companies. But in this flag of democratizing finance, there’s a lot of people who want access to that.”
Some people feel elite investors have better access, while others are unable to get in early on opportunities, Sorkin said. There’s been a push by both the Trump administration and the financial sector to open up the market to more people.
But that would also require moving the guardrails designed to protect people.
“They have protected a lot of people, but some people would say they protected people from getting rich,” Sorkin said.
Push today for democratizing investing
In his latest annual letter to investors, BlackRock CEO Larry Fink suggested opening retirement 401(k)s to riskier private investments in the name of democratizing investing. He said there were opportunities for investing in AI or data centers.
Right now money managers are precluded from investing in those types of assets in many retirement products, but the Trump administration is in the process of changing that, Fink explained.
The new investment opportunity comes with risk.
“But everything is risky other than keeping your money in a bank account overnight,” Fink said.
Larry Fink, CEO of Blackrock
60 Minutes
Fink, who once called bitcoin the domain of money launderers and thieves, also wants to add crypto to investment portfolios.
“The markets teach you, you have to always relook at your assumptions,” he said. “There is a role for crypto in the same way there is a role for gold — that is, it’s an alternative.”
He sees it, as he does AI, as an opportunity to add diversity to a portfolio.
But Sorkin says some crypto products, like meme coins, can be abused in ways similar to 1929, with speculators sending the value of cryptocurrencies soaring before they come crashing down. Sorkin has his own personal example involving a television appearance with Fink.
“He makes a joke, I think, about how there should be a Sorkin coin. Well, two hours later, somebody makes a Sorkin coin. And all of a sudden, this Sorkin coin is now worth millions of dollars. And I’m watching it,” Sorkin said.
The Sorkin coin peaked at $170 million worth of trading in a day.
“And I think today it does something like $20 or $21 a day,” Sorkin said.
Stocks took a nosedive on Friday after President Trump threatened a big tariff hike on China. Until then, Wall Street had been at record highs for months, which is why we decided to check in with Andrew Ross Sorkin, one of the country’s most influential financial reporters.
He’s just written a book called “1929” about the market crash a century ago. We wondered if he’d run out of news to cover, oris he alerting us that what’s been happening in the markets lately – is a replay of what led to the most devastating financial collapse in our history?
Imagine the New York Stock Exchange back then: the crush of frightened traders dumping stocks, investors losing their shirts, businesses, their homes, sweeping away the Roaring ’20s, walking that same but transformed floor today.
Andrew Ross Sorkin: Everything’s digital.
Lesley Stahl: Well, yeah, OK.
Andrew Ross Sorkin says we’re in our own roaring ’20s: the 2020s. with stocks climbing for months, just like then.
Andrew Ross Sorkin: The crazy part about this is, from 1928 to September of 1929, the stock market was up 90%!
Lesley Stahl: When you say the stock market was way up, immediately I think of now. Are you scared?
Andrew Ross Sorkin: I’m anxious. I’m anxious that we are at prices that may not feel sustainable. And what I don’t know is we are either living through some kind of remarkable boom and part of that’s artificial intelligence and technology and all of that, or everything’s overpriced.
Lesley Stahl: Or we’re reliving–
Andrew Ross Sorkin: 1929.
Andrew Ross Sorkin: There was so much anxiety.
Andrew Ross Sorkin and Lesley Stahl at the NYSE
60 Minutes
Sorkin has covered the markets for two decades. He joined the New York Times after college, soon founding the DealBook newsletter covering finance. He also co-hosts “Squawk Box” on CNBC, runs the DealBook Summit, where he interviews the high and mighty, he co-created “Billions” the TV show, wrote a bestseller about the 2008 crash, and now, a book about 1929.
Lesley Stahl: We’re always being undone by bubbles. There was the internet bubble in 2000, the housing in 2008. Are we in another bubble? An AI bubble or something like that?
Andrew Ross Sorkin: I think it’s hard to say we’re not in a bubble of some sort. The question is always when is the bubble going to pop?
Lesley Stahl: One symptom of a bubble is when the market goes up and up, but the underlying economy – the real economy – goes soft. And that appears to be happening right now.
Andrew Ross Sorkin: I would argue to you that the economy is being propped up, almost artificially, by the artificial intelligence boom. There are hundreds of billions of dollars that are being invested today in artificial intelligence. This is either a gold rush or a sugar rush and we probably won’t know for a couple of years which one it is.
1929 was a sugar rush caused by speculation and debt. People who didn’t really have much money were lured by Wall Street bankers to invest using a newfangled concept to take on debt, called credit. You only had to put down 10% of the stock price, borrowing the rest from your broker.
Andrew Ross Sorkin: Prior to 1919, most people did not take on credit or debt at all. It was a sin. It was a moral sin to use credit–
Lesley Stahl: Oh, really?
Andrew Ross Sorkin: –to buy anything. And it was really General Motors that basically came up with the idea that we’re gonna lend you money so you can afford to buy our cars.
Lesley Stahl: Brilliant.
Andrew Ross Sorkin: And then the bankers realize what’s happening, and they realize that they can lend out money so that more folks can buy stocks. It was all sort of wrapped in the flag of democratizing access. And in good times, when the stock is going up, it’s like free money. In bad times, you’re on the hook, and you’re on the hook in a very bad way.
Since then, laws, regulations, and agencies have been put in place to protect investors – especially the less affluent – from being exploited.
Lesley Stahl: We put up barriers after 1929.
Andrew Ross Sorkin: Yes.
Lesley Stahl: Protections.
Andrew Ross Sorkin: Yes.
Andrew Ross Sorkin
60 Minutes
Lesley Stahl: So those are coming down. They’re tumbling down one — the SEC rules aren’t as stringent anymore.
Andrew Ross Sorkin: Yes. The Consumer Protection Bureau practically doesn’t exist anymore.
Lesley Stahl: Correct.
Andrew Ross Sorkin: That’s what concerns me. It’s not that we’re going off a cliff tomorrow. It’s that there’s speculation in the market today, there’s an increasing amount of debt in the market today, and all of that’s happening against the backdrop of the guardrails coming off.
Including guardrails that allow only the wealthy to invest directly in private companies that have fewer regulations, like AI startups before they go public.
Andrew Ross Sorkin: So over the last 20 or 30 years, folks who had access to, who could invest in private equity, in venture capital, clearly outperformed folks who didn’t. And so–
Lesley Stahl: That’s how you really made money. But you have to remember that these kind of assets are gambles.
Andrew Ross Sorkin: Public companies, after the SEC was created, were required to have all sorts of disclosure rules so that the public could understand what’s going on inside them. Private companies don’t have that. But historically, the average ordinary American wasn’t really allowed to invest in the private companies. But in this flag of democratizing finance, there’s a lot of people who want access to that.
Lesley Stahl: Wow.
Andrew Ross Sorkin: Isn’t this something?
Lesley Stahl: This is spectacular.
Sorkin took us to the Fifth Avenue mansion of one of the big bankers back then, who pushed democratization.
Andrew Ross Sorkin took 60 Minutes to the Fifth Avenue mansion of one of the big bankers back then, who pushed democratization.
60 Minutes
Lesley Stahl: If this idea of bringing a regular guy into buying stock, if that was a big problem back in 1929 why are we going there again? Doesn’t it defy some kind of logic?
Andrew Ross Sorkin: There is a view that it’s been only the elites that have had access to these investments, Facebook before it ever went public, Uber before it went public. So there is this idea that it’s unfair, actually, to the ordinary investor because we haven’t allowed them to get access to some of these investment opportunities early. And there is a real push, partially by the Trump administration, partially by the industry itself, which wants to–
Lesley Stahl: Get more money.
Andrew Ross Sorkin: Get more money in– to open up the market to more and more people.
Lesley Stahl: So we have these guardrails for a reason. I mean, they’re there to protect, and they have protected.
Andrew Ross Sorkin: They have protected a lot of people, but some people would say they protected people from getting rich.
Larry Fink: Many people don’t believe in capitalism anymore. And I think a lot of it is because they were not a part of the growth of the economy.
We went to Larry Fink, CEO of Blackrock, the world’s biggest money manager, handling $12.5trillion in assets, like pension funds. His annual letter to investors is a kind of industry roadmap. This latest one he suggested opening our retirement 401(k)s – bastions of caution – to riskier private investments in the name of, wait for it: democratizing investing.
Larry Fink: As I wrote, there are many great opportunities to be investing in the s- in startup companies, to invest in AI or data centers. Right now, we’re precluded to put those type of assets in many retirement products. And the Trump administration has now said we’re going to allow in our 401(k) products the opportunity to invest in these private markets.
Lesley Stahl: But, they are risky. Aren’t they?
Larry Fink: Yes. But everything is risky other than keeping your money in a bank account overnight.
Lesley Stahl: But we’re talking about 401(k)s.
Larry Fink: Yes.
Lesley Stahl: Investing out of retirement accounts.
Larry Fink: Yes.
Lesley Stahl: You’re risking the nest egg or part of the– a little part of the nest egg.
Larry Fink: But what the markets will teach you over the last 100 years, even at the worst moments, if you have the ability to persevere and you have a long-term horizon, you’re going to do fine. And a diversified portfolio is essential. We’re not suggesting, you know, one shoe fits all. We are suggesting the opportunity to have that ability to invest in these private market investments.
Larry Fink, CEO of Blackrock
60 Minutes
He also believes we should be investing in crypto.
Lesley Stahl: It wasn’t that long ago that the big bankers, Jamie Dimon and Larry Fink, were saying that crypto was stupid and a fraud.
Larry Fink: I did say Bitcoin, because we were talking about Bitcoin then, was the domain of money launderers and thieves. But you know, the markets teach you, you have to always relook at your assumptions. There is a role for crypto in the same way there is a role for gold, that is it’s an alternative. For those looking to diversify this is not a bad asset, but I don’t believe that it should be a large component of your portfolio.
But Sorkin says some crypto can be abused in ways similar to 1929. Take meme coins: cryptocurrencies that can be manipulated by speculators who pumped them up, then let them crash.
Andrew Ross Sorkin: There are a number of examples where it felt like there was an inside group of people who were colluding to pump up some of these cryptocurrencies, and other things. I’ll give you a bizarre story of my own. I was on television with Larry Fink, and he makes a joke, I think, about how there should be a Sorkin coin. Well, two hours later, somebody makes a Sorkin coin. And all of a sudden, this Sorkin coin is now worth millions of dollars. And I’m watching it.
Lesley Stahl: Are you serious?
Andrew Ross Sorkin: Go up, and up, and up, and up, and up.
The sorkin coin peaked at $170 million worth of trading in a day.
Andrew Ross Sorkin: And I think today it does something like $20 or $21 a day, so…
Lesley Stahl: [makes spiral noise]
Sorkin is trusted by the world’s top business leaders, who talk to him often exclusively.
Lesley Stahl: What role do you think these business leaders should be playing now?
Andrew Ross Sorkin: My own view is that most CEOs in America today are very scared to speak out publicly about anything. They are so worried that they are going to be potentially attacked by the administration, or regulated. They’re gonna have a merger in front of some agency that’s not gonna be allowed to go through. They are so nervous about criticizing anything that’s going on with this administration.
Lesley Stahl: There are some economists who suggest that because Mr. Trump ties his success to the success of the market, that he’s not gonna let anything like what happened in 1929 happen. And that we should feel secure because of that.
Andrew Ross Sorkin: I think it’s hard to know how things get out of control. When confidence disappears, it happens like this. [SNAP]
Lesley Stahl: So, you spent nearly 10 years on this book. The inevitable question is: do you think that we will have a crash or not?
Andrew Ross Sorkin: The answer is we will have a crash; I just can’t tell you when, and I can’t tell you how deep. But I can assure you, unfortunately, I wish I wasn’t saying this, we will have a crash.
Produced by Shachar Bar-On. Associate producer, Jinsol Jung. Broadcast associate, Aria Een. Edited by Sean Kelly.
(CNN) — President Donald Trump announced he will impose an additional 100% tariff on goods from China, on top of the 30% tariffs already in effect, starting November 1 or sooner. The threat is a massive escalation after months of a trade truce between the two nations.
“The United States of America will impose a Tariff of 100% on China, over and above any Tariff that they are currently paying,” Trump said in a post on Truth Social Friday afternoon. “Also on November 1st, we will impose Export Controls on any and all critical software.”
Trump’s announcement is tied to Beijing ramping up export controls on its critical rare earths, which are needed to produce many electronics. As a result, Trump appeared to call off a meeting with Chinese President Xi Jinping that was scheduled for later this month in South Korea.
Trump’s initial message Friday, delivered via a Truth Social post, in which he threatened “massive” new tariffs, was ill received by investors on Friday as fears of a spring déjà vu, when tariffs on Chinese goods soared to a stunning 145%, set in. Markets closed sharply lower on Friday after Trump’s initial comments, with the Dow falling by 878 points, or 1.9%. The S&P 500 was down 2.7%, and the tech-heavy Nasdaq tumbled 3.5%.
While Trump doesn’t always act on his threats, investors, consumers and businesses still have reason to worry.
President Donald Trump is threatening to raise tariffs on Chinese goods shipped to the United States. Credit: Jessica Koscielniak / Reuters via CNN Newsource
The two largest economies depend on each other
The United States and China are the world’s two largest economies. Although Mexico has recently replaced China as the top source of foreign goods shipped to the United States, America depends on China for hundreds of billions of dollars’ worth of goods. Meanwhile, China is one of the top export markets for America.
In particular, electronics, apparel and furniture are among the top goods the United States receives from China. Trump has pushed CEOs, especially in tech, to move production to the United States, but he’s softened his approach in recent months as business leaders have satisfied the president with announcements of hundreds of billions of dollars in investments in US manufacturing — even if they continue to make the bulk of their products overseas.
Shortly after imposing minimum 145% tariffs on Chinese goods — an effective embargo on trade, Trump issued an exemption for electronics, making them subject to 20% tariffs instead. The move was, in many ways, an acknowledgment that the Trump administration understood the pain he was inflicting on the US economy through his sky-high tariffs.
Then, in May, US and Chinese officials further established the interdependence of trade by agreeing to lower tariffs on one another. China brought levies on American exports down to 10% from 125%, and the United Statesbrought rates down to 30% from 145%.
Both countries’ stock markets rallied as a result.
It was only a matter of time
Trump on Friday claimed trade hostility from China “came out of nowhere.” But in reality, it’s been bubbling up for months.
For the United States, a critical part of trade agreements has been to ensure China will increase its supply of rare earth magnets. Yet despite several apparent breakthroughs, Trump has in recent months repeatedly accused China of violating the terms.
Trump first responded by putting restrictions on sales of American technologies to China, including a key Nvidia AI chip. Many of these restrictions were later lifted.
Then came the Trump administration’s announcement that it would soon impose fees on goods transported on Chinese-owned or -operated ships. China countered with a similar plan on American ships that took effect Friday.
In short: Trump has already demonstrated there’s no limit to how high he’ll go with tariffs on China, and Xi has shown no mercy in how he chooses to retaliate.
But Trump’s ability to continue to impose tariffs on a whim could soon end, pending the verdict in a landmark case kicking off in the Supreme Court next month. Xi, however, faces no such constraints.
The government shutdown may have entered its second week. But for investors, it’s been business as usual.
Little of the uncertainty that’s loomed over federal workers, food program beneficiaries, and small businesses has so far seemed to reach the markets, which have continued to enjoy record highs. And investors seem largely unfazed by the standoff in Washington, confident that this latest shutdown will—like previous ones—reach a resolution without a long-term effect on the overall economy.
“Shutdowns tend to not be paid much attention to by the market,” says John Stoltzfus, chief investment strategist at Oppenheimer & Co. “Ultimately, what [investors] are looking at…is what is the effect from the problem of the day on revenue growth, or sales growth and earning growth.”
And right now, Stoltzfus says, the damage of the shutdown is being felt, “sadly enough, by the employees who get furloughed, the employees who might be laid off permanently”—not corporations.
“The market isn’t reacting because not a whole lot has really changed for businesses yet,” adds Stephen Kates, a financial analyst at Bankrate. “And there is the expectation that this is still going to get settled.”
In the past, shutdowns have caused relatively small economic blips; economists with Morgan Stanley estimate that quarterly GDP growth declines by .05 percentage points per each week of a shutdown. Even the record shutdown of Donald Trump’s first term, which lasted 35 days, only knocked $3 billion off the GDP. They’ve even been seen as an opportunity; the defense and health care sectors, in particular, lean heavily on government contracts, as Morgan Stanley notes. For investors, the bet is that the past will be prologue.
But there’s a possibility that this situation could be different. For one thing, the shutdown is playing out against the backdrop of broader economic uncertainty, as reflected in the ongoing surge in gold prices, which rose past $4,000 per ounce for the first time ever Tuesday, with investors also turning to Bitcoin. (A BNY Investments outlook notes that “precious metals tend to rally” as a shutdown continues and markets are impacted.) For another, the shutdown is delaying the release of economic data—some of which has undermined Trump’s claims of a turbocharged economy—potentially leaving investors in the dark. And, of course, there is the nature of this shutdown: “I feel like they’re gridlocked today more than they were even in the first Trump administration,” Kates says.
Investors bought the dip on the government shutdown.
On Wednesday, the S&P 500 closed above 6,700 for the first time ever, securing its 29th record-high of the year after US lawmakers failed to avert the closure of the federal government.
Stocks traded lower to start the trading session but reversed course to close the day in the green.
An Inc.com Featured Presentation
But that resilience matches history. Equities have finished higher across the five government shutdowns seen since 1995. In January 2019, the longest funding gap on record at 22 trading days, the S&P 500 advanced more than 10 percent.
Wednesday’s record high signals that either investors are betting on a brief and so inconsequential shutdown, or they simply can’t be bothered to care.
After all, earnings remain robust, the AI trade is only accelerating and recession odds continue to dwindle.
Still, the shutdown does prevent key data releases, including the September jobs report due Friday. But given the collapse in response rates to government surveys and diminishing credibility of official data, this is a less consequential detail than years past.
As much as the Federal Reserve, politicians and media pay attention to Labor Department reports, investors increasingly rely on private-sector gauges like ADP’s payroll report or more modern measures from firms like Indeed and LinkedIn.
To be clear, alternative indicators point to a slowing labor market with minimal hiring. ADP just reported a decline of 32,000 jobs in September, marking the weakest print since March 2023 and well below expectations for an increase of 45,000.
The irony, though, is that the shutdown seems to be juicing the market’s bullish impulse, regardless of a potential blackout on economic data.
Without the establishment jobs report, there are fewer catalysts available to challenge the prevailing narrative of strong earnings and imminent rate cuts.
CME data shows 99 percent and 87 percent odds for a quarter-point cut in October and December, respectively.
The market’s reaction to the shutdown reflects the opportunism of Wall Street. With Washington in gridlock, investors actually face even less friction to push against the bullish story that’s been driving asset prices higher.
It seems that in the potential absence of government data, traders are choosing to default to the trend that’s playing out right in front of them — more record highs, AI-fueled earnings, and a growth story that’s put bears on the wrong side of the tape all year.
(Reuters) -Wall Street indexes closed up on Monday with the Nasdaq leading gains as investors bought heavyweight technology stocks and shrugged off the uncertainty of a potential U.S. government shutdown and hawkish remarks from Federal Reserve officials.
Technology provided the benchmark S&P’s biggest boost as investors bet on growth from artificial intelligence and expectations that the Fed will keep cutting interest rates as it grapples with persistent inflation concerns and labor market uncertainties.
A major focus for Wall Street this week is a standoff between Republicans and Democrats over funding that has raised the prospect of a government shutdown beginning Wednesday, the first day of the U.S. government’s new fiscal year.
Even as the Labor Department prepared for a potential delay of its September jobs report in the event of a shutdown, this did not seem to be the key market driver, said Lindsey Bell, chief strategist at 248 Ventures in Charlotte, North Carolina.
“Investors are clinging to the positives,” Bell said, pointing to rate easing hopes and signs of economic resilience from recent releases including housing market and consumer spending data.
“The market is not going to shoot to the moon, because this is a risk. But investors can look through the potential for a shutdown, because if it does occur it will likely be resolved quickly and the market can resume focusing on the things that do matter, like earnings, monetary policy and AI investments.”
While shutdowns have not tended to impact corporate results historically, the imminent threat may have limited gains and kept trading volume light on Monday, according to Burns McKinney, portfolio manager and NFJ Investment Group in Dallas, Texas.
“The only reason it would truly move markets is if it affects the bottom line. Historically speaking, government shutdowns are brief and they don’t have an impact on profitability so investors tend to be forward-looking,” said McKinney.
“It’s just like smoke on a racetrack. They just keep the wheels straight, manage through the stress and move forward through the smoke.”
The Dow Jones Industrial Average rose 68.78 points, or 0.15%, to 46,316.07, the S&P 500 gained 17.51 points, or 0.26%, to 6,661.21 and the Nasdaq Composite gained 107.09 points, or 0.48%, to 22,591.15.
Investors were also monitoring Fed policymakers’ commentary for any signs of concern over the potential loss of economic visibility should a shutdown materialize.
Cleveland Fed President Beth Hammack, among the most hawkish Fed officials and not a voter on policy this year, said on Monday the central bank needed to maintain restrictive monetary policy to cool inflation.
St. Louis Federal Reserve President Alberto Musalem, a voter on rates this year, said he was open to further interest rate cuts but that the Fed must be cautious and keep rates high enough to continue to lean against inflation, which remains roughly a percentage point above the central bank’s 2% target.
Traders, however, are pricing in a roughly 89% chance of a 25-basis-point rate cut at the next Fed meeting, according to CME Group’s FedWatch tool.
Among the S&P 500’s 11 major industry sectors, nine advanced. With oil prices falling more than 3%, the energy sector was the biggest laggard, ending down 1.9%. Consumer discretionary was the biggest percentage gainer, adding 0.6%.
But for index point boosts, technology was the clear leader with big pushes from AI chip leader Nvidia, up 2%, and Microsoft, which added 0.6%.
Electronic Arts shares rallied 4.5% after the game publisher agreed to be taken private in a $55 billion deal, fueling hopes for broader deal prospects, said Bell of 248 Ventures, who saw the transaction as “confirmation that the M&A market is open.”
Lam Research shares advanced 2% after Deutsche Bank upgraded the rating on the chip-making equipment firm to “buy” from “hold.”
AppLovin set a fresh record high before closing up 6.3% at $712.36, also providing one of the biggest lifts for the S&P 500. Morgan Stanley raised the target price on the stock to $750 from $480.
After U.S. President Donald Trump shared a video on Sunday promoting the health benefits of hemp-derived cannabidiol, U.S.-listed shares of cannabis-related companies rose. Canopy Growth rallied 17% to $1.57 while Cronos Group rose almost 13% to $2.97 and Tilray Brands jumped 60.9% to $1.85.
Advancing issues outnumbered decliners by a 1.38-to-1 ratio on the NYSE where there were 337 new highs and 80 new lows. The S&P 500 posted 38 new 52-week highs and six new lows while the Nasdaq Composite recorded 116 new highs and 74 new lows.
On the Nasdaq, 2,525 stocks rose and 2,118 fell as advancing issues outnumbered decliners by a 1.19-to-1 ratio.
On U.S. exchanges about 17.91 billion shares changed hands compared with the 18.25 billion average from the last 20 sessions.
(Reporting by Sinéad Carew in New York, Niket Nishant and Sukriti Gupta in Bengaluru; Editing by Sriraj Kalluvila, Shilpi Majumdar and Richard Chang)
The president promised a “golden age,” but Americans buying actual gold to hedge against an unstable economy is probably not what he had in mind.
Gold—it’s not only the decoration of choice for Donald Trump’s White House, but, it seems, the asset of choice for investors skittish about the economy he’s overseeing.
Gold prices have been surging lately, climbing to a record high Tuesday amid declining value of the US dollar, political instability, and anxiety over the president’s signature tariffs—the latest sign that his economy may not exactly be the “miracle” he promised he’d deliver on the campaign trail.
“Investors turn to gold not only for its historical role as a safe haven, but also for its ability to hedge against inflation, currency volatility, and geopolitical risk,” said Juan Carlos Artigas, regional CEO (Americas) and global head of research for the World Gold Council. “While rising gold prices don’t guarantee economic headwinds, they often signal that investors are preparing for them.”
The alarm bells have been ringing loudly since this summer, when a bruising Bureau of Labor Statistics report showed the worst three-month stretch of hiring since the pandemic. Trump, furious at the numbers, fired the BLS commissioner, Erika McEntarfer, insisting that she had manipulated the data for “political purposes.”
“In my opinion, today’s Jobs Numbers were RIGGED in order to make the Republicans, and ME, look bad,” Trump posted on his social media site in August, taking a shot at Federal Reserve Chair Jerome Powell for good measure. (After her firing, McEntarfer told an audience at an event at Bard College, “Firing your chief statisticians for releasing data you do not like, it has serious economic consequences.”)
Trump, of course, had been browbeating Powell about cutting interest rates—threatening to fire him, and seeking to oust a Fed governor as part of an apparent effort to exert more control over the independent body. (The governor—Lisa Cook—has contested Trump’s allegations of mortgage fraud and sued Trump, and the courts have blocked her firing so far.) The Fed finally did cut rates last week, but only after another troubling sign for the economy: a revised hiring estimate from the BLS that showed 911,000 fewer jobs had been added to the economy in the year ending in March 2025.
Trump has insisted that everything is running smoothly. “We are, as a country, as you know, doing unbelievably well,” he said at a state dinner hosted by King Charles in the United Kingdom last week. “We had a very sick country one year ago. And today, I believe we’re the hottest country anywhere in the world. In fact, nobody is even questioning it.”
A good many people do seem to be questioning that though: The economy, a signature issue of Trump’s winning 2024 campaign, appears to be turning into a polling vulnerability for him. Two of his most significant economic initiatives—his belligerent tariff regime, and the “Big Beautiful Bill” his Republican majorities rammed through on the Hill this summer—appear to be broadly unpopular with the American public. And his overall approval rating is underwater. His gilded White House—“That’s all 24-karat,” he has bragged of his redecorated Oval Office—doesn’t seem to reflect the mood of most everyday Americans, whom he’d promised in his campaign to rescue from their economic precarity.
Back then, he said he would usher in a “golden age” in America. In one sense, that’s true: Investors seem so confident in the economy he’s overseeing that they’re turning to gold.
The chairman of the Securities and Exchange Commission is weighing a major rule change for public companies. This week, on social media, President Trump said companies should not report earnings quarterly, but instead, just twice a year. SEC Chairman Paul Atkins told CNBC that he welcomes that idea. Wall Street Journal financial reporter Corrie Driebusch joins CBS News to discuss.
Alongside a two-lane road in Mountainside, New Jersey (population 7,020), is a small blue and white sign reading “YA,” which might be interpreted as an upbeat, blurted affirmative or as shorthand for a category of teen fiction, but is actually the logo of Yorkville Advisors. The firm’s office, a humble one-story building, is at the bottom of a small hill and hidden by hedges. Inside, billions of dollars in deals are engineered, including some for a very prominent client, a business associated with the president of the United States.
Donald Trump and his family’s efforts to cash in on his return to the White House are broad and audacious, from Trump’s millions of dollars in World Liberty crypto to the Trump Organization’s licensing of the Trump name for a mobile-phone service costing $47.75 a month: Call 888-TRUMP45 now to sign up! The multifaceted drive has also been wildly lucrative. Forbes, in March, estimated that in the past year Trump’s net worth has more than doubled, to more than $5 billion. The New Yorker, in August, calculated that Trump and his family had profited approximately $3.4 billion off of Trump’s two presidencies.
Some of the leaders of Trump’s new financial empire are familiar, such as sons Don Jr. and Eric, who are officially in charge of the Trump Organization, and Devin Nunes, the former California Republican congressman, who is now the CEO of the Trump Media & Technology Group, which operates Truth Social, the X alternative that is Trump Media’s highest-profile property. And some of the company’s institutional investors are financial industry heavyweights, including the Jane Street Group, the Vanguard Group, and Cantor Fitzgerald, the firm formerly run by Howard Lutnick, who is now Trump’s commerce secretary.
But Yorkville is largely unknown beyond financial circles. How did the previously inconspicuous firm become an integral part of Trump’s financial orbit? Yorkville and its founder, Mark Angelo, aren’t saying, and neither is Trump Media; both companies did not return requests for comment. Angelo does not appear to have donated to any of Trump’s presidential campaigns, though he contributed $1,000 to Hillary Clinton’s 2008 bid. Yet a July 2024 press release announced that Trump Media and Yorkville had struck a standby equity purchase agreement—similar to a line of credit, in which Yorkville agreed to buy a set amount of Trump Media’s shares at Trump Media’s discretion.
Last year Trump Media put the deal into effect, selling about 20 million shares at a discount to Yorkville and generating nearly $450 million in cash. In January came the announcement that an affiliate of Yorkville would serve as the registered investment adviser for Trump Media’s new financial services arm, Truth.Fi, which plans to offer exchange traded funds and other products that will invest in the “patriot economy.” In August, Yorkville Acquisition, a SPAC that’s affiliated with Yorkville Advisors and of which Angelo is the chairman, and Crypto.com teamed up with Trump Media to launch Trump Media Group CRO Strategy, a firm that said it was expecting to acquire $6.4 billion to buy CRO crypto tokens. A Yorkville affiliate would provide the new company with a $5 billion equity line of credit. Last week the Cayman Islands–incorporated Yorkville Acquisition announced that it would be renamed to Trump Media Group CRO Strategy.
On the surface the pairing seems unlikely: One of the world’s most famous, most powerful men is relying on an inconspicuous suburban financial firm. But in some respects Trump and Yorkville appear to be a natural alliance. “[Trump Media] is a risky, controversial, early-stage company without a lot of revenue, without a lot of operating history, and in need of cash. And that’s just the kind of company that Yorkville gets involved with,” says Justin Hibbard, a CPA and former examiner for FINRA who has written about Yorkville on his Substack, “Shortfinder.” “They do a lot of business with biotech companies, life science companies that are at a very early stage of development. They seem to pretty consistently liquidate their positions at prices that are favorable for Yorkville. They’re good at what they do.”
In April, Yorkville made a standby equity purchase agreement with Newsmax. The Fox News alternative can raise up to $1.2 billion in cash by selling shares to Yorkville, an arrangement that Hibbard has highlighted as risky because it could dilute the value of Newsmax stocks on the market. Chris Ruddy, the Newsmax CEO, declined to comment.
NEW YORK (AP) — StubHub received a lackluster reception on Wall Street Wednesday.
The ticket marketplace’s stock fell 6.4% from its initial public offering price of $23.50 per share on its first day of trading. The company’s shares are trading on the New York Stock Exchange under the symbol “STUB.”
StubHub offered just over 34 million shares and raised approximately $800 million. At the closing price, the company has a market valuation of about $8.1 billion.
StubHub plans to use proceeds from the sale to pay down debt and for general corporate purposes.
The company, which is based in New York, said buyers in more than 200 countries and territories used its platform to purchase more than 40 million tickets in 2024. It was co-founded in 2000 by current CEO, Eric Baker. He will remain CEO and maintain control of the company.
EBay bought StubHub in 2007. Baker left the company ahead of that sale and founded international online ticket exchange Viagogo in 2006. EBay sold StubHub to Viagogo in 2020 for $4.05 billion, essentially returning it to Baker, who then changed the name of the combined company to StubHub Holdings. It is among the largest platforms for secondary ticket sales. Its competitors include SeatGeek and Vivid Seats.
StubHub reported just a 3% increase in revenue to $827 million during the first half of 2025 compared with the same period in 2024. That puts the company on pace for slower revenue growth after notching a 29% jump for all of 2024.
StubHub President Nayaab Islam, left, and CEO Eric Baker pose for photos outside the New York Stock Exchange before the company’s IPO, Wednesday, Sept. 17, 2025. (AP Photo/Richard Drew)
Live Nation, which dominates the primary market for ticket sales through Ticketmaster, reported a 1.8% jump in revenue to just under $23.2 billion in 2024.
StubHub has come under criticism along with the broader ticketing industry over hidden fees and inflated ticket prices. The attorney general for Washington, D.C., sued StubHub last year, accusing the ticket resale platform of advertising deceptively low prices and then ramping up prices with extra fees. The company is also facing pricing and fee inquiries in Pennsylvania and New York.
Ticket prices for concerts and sporting events have been among the sharper rising costs for consumers over the last few years. Ticket prices rose 5.2% in 2024 after rising 6.8% in 2023, according to the U.S. Labor Department’s consumer price index. Rising ticket prices outpaced the broader increases for overall inflation in both years and that trend has continued through 2025.
The IPO market is on track for its best year since 2021. Other notable debuts this year include the design software company Figma, the buy now, pay later company Klarna, Circle Internet Group, which issues the USDC stablecoin and the cryptocurrency exchange Gemini, which is majority owned by the Winklevoss twins.
This story has been corrected to show the correct figures for 2024 revenue for Live Nation.
The Treasury secretary, in the headlines in recent days for allegedly threatening to smack one of his colleagues in the face, now finds himself in damage control mode after the release of a brutal Bureau of Labor Statistics report on Tuesday—the latest sign that Donald Trump may not be ushering in the economic “golden age” he previously promised.
On Tuesday, the Bureau of Labor Statistics issued revised job-growth estimates, sharing that more than 900,000 fewer jobs had been added for the year ending in March 2025. Much of the time span covered in the report was before Trump took office, as Bessent was quick to point out Tuesday. “President Trump inherited a far worse economy than reported,” he posted. But the ugly outlook is being exacerbated by Trump’s trade war and unpredictability—and runs counter to his lofty campaign promises to “end inflation” and start “saving our economy,” beginning on “day one.”
That’s bad news for the president, whose poll numbers are on the decline as voters express concerns about their pocketbooks. It also puts pressure on Bessent, who has positioned himself as a force of calm and stability in the administration and succeeded, to some extent, in keeping markets steady amid Trump’s threatening of the Fed and firing of the BLS chief over numbers he didn’t like. “President Trump was elected for change, and we are going to push through with the economic policies that are going to set the economy right,” Bessent said Sunday on NBC News’ Meet the Press. “I believe by the fourth quarter, we are going to see a substantial acceleration.”
But it’ll be a new challenge to maintain market confidence as the economic alarms continue blaring. And his fights—perhaps in the literal sense, it turns out—with fellow Trump officials would seem to undercut his self-styled “adult in the room” persona.
The most recent conflict, first reported by Politico on Monday, was with Bill Pulte, the director of the Federal Housing Finance Agency, who is leading the charge against Lisa Cook, the Federal Reserve board member whose firing Trump announced over social media. As the outlet reported, Bessent confronted Pulte at a well-attended dinner at DC’s Executive Branch club, with the secretary addressing rumors that Pulte had been bad-mouthing him to Trump. “Why the fuck are you talking to the president about me?” Bessent reportedly asked Pulte at the dinner. “I’m gonna punch you in your fucking face.”
“I’m going to fucking beat your ass,” he threatened, for good measure.
It wasn’t the first clash between Bessent and another administration colleague: Bessent also reportedly got into a fiery shouting match over the Internal Revenue Service with Elon Musk, who at the time was taking a “chain saw” to the federal government as the head of the so-called Department of Government Efficiency. (There was enough speculation that the shiner Musk sported at a White House event was courtesy of Bessent that the Treasury chief went out of his way to publicly deny responsibility. Musk, for his part, said the injury came from playing with his young son.)
The last time Trump got a bad BLS report, he fired the bureau’s then commissioner, Erika McEntarfer, and not long after nominated agency criticE.J. Antoni to replace her. If that doesn’t get him the kinds of numbers he’s looking for, perhaps a visit from his hot-tempered Treasury secretary could do the trick.
Stocks rose on Friday after Federal Reserve Chair Jerome Powell signaled a rate cut could be coming, during a speech at policy symposium in Jackson Hole, Wyoming.
The Dow Jones Industrial Average climbed 936 points, or 2.1%, as of 11:56 a.m. EST on Friday, while the S&P 500 gained 102 points, or 1.6%. The tech-heavy Nasdaq Composite was up 1.9%.
In a sigh-inducing sign of relief for investors, Fed Chair Powell said in his speech Friday that current risk conditions “may warrant adjusting our policy stance.” The central bank would continue to “proceed carefully” he said.
“Our policy rate is now 100 basis points closer to neutral than it was a year ago, and the stability of the unemployment rate and other labor market measures allows us to proceed carefully as we consider changes to our policy stance,” Powell said.
Despite mounting pressure from President Trump, the Fed has held off on cutting rates this year as it monitors the impact of Trump administration’s tariffs on inflation and the labor market. Powell’s speech on Friday, however, may be the strongest indication yet that policy changes could be afoot.
“With Powell acknowledging that it may be time for the Fed to alter its restrictive policy, this could set up stocks for a short-term relief rally,” said Bret Kenwell, eToro investment analyst, in an email note on Friday.
“When Fed chairs open the door for a rate cut, it’s quite difficult to close,” Ryan Sweet, chief U.S. economist at Oxford Economics. “The August employment report or consumer price index are unlikely enough to change Powell’s opinion.”
The central bank is tasked with so-called dual mandate of maximum employment and minimal inflation — a tricky balance to strike as lowering interest rates can boost job growth while causing inflation to tick higher, and vice versa.
On Friday, Powell noted that job force growth has “slowed considerably” and that the “downside risks to employment are rising.” Job growth came in weaker than expected in July, with employers adding 73,000 jobs. The Labor Department also revised job growth sharply down for May and June.
“Overall, while the labor market appears to be in balance, it is a curious kind of balance that results from a marked slowing in both the supply of and demand for workers,” he said.
Inflation has remained in check this year, although it’s still above the Fed’s 2% target. Powell noted Friday that tariffs have begun to push up prices in certain categories.
The Federal Open Market Committee (FOMC), the central bank’s 12-person interest rate-setting panel, is scheduled to meet next on Sept. 17. Interest rate traders now put the likelihood of a cut at 89%, according to the CME Group’s FedWatch Tool.
In stock markets abroad, Germany’s DAX returned 0.4% after government data showed that its economy shrank by 0.3% in the second quarter compared with the previous three-month period.
Indexes rose across much of Asia, with stocks climbing 1.4% in Shanghai and 0.9% in South Korea.
Mary Cunningham is a reporter for CBS MoneyWatch. Before joining the business and finance vertical, she worked at “60 Minutes,” CBSNews.com and CBS News 24/7 as part of the CBS News Associate Program.
To some people, the Bureau of Labor Statistics may not sound like the most thrilling place to work. But many of its two thousand-plus employees, who produce the monthly jobs report, the Consumer Price Index, and other official economic releases, are proud data nerds. In a recent podcast, Erica Groshen, a Harvard-trained economist who served as the commissioner of the bureau from 2013 to 2017, relayed an inside joke at the agency. Question: How do you spot the extrovert at the B.L.S.? Answer: The extrovert is the one who looks at your shoes in the elevator.
Introverts or not, B.L.S. employees play a vital role in the U.S. economy, putting together statistics that policymakers, businesses, and households use to make decisions. To draw up its employment figures, the B.L.S. conducts monthly surveys of sixty thousand households and a hundred and twenty-one thousand employers. Some of the respondents take a while to reply. As more data come in, the agency updates its previous figures.
On August 1st, the bureau released its latest jobs report, which indicated that employment growth was considerably weaker in May and June compared with the agency’s initial estimates. But then Donald Trump claimed the numbers had been “rigged,” and abruptly fired the agency’s commissioner, Erika McEntarfer, a veteran labor economist who previously worked at the Census Bureau, the Department of the Treasury, and, under the Biden Administration, the White House Council of Economic Advisers. Last week, Trump nominated a replacement for McEntarfer: E. J. Antoni, an economist at the Heritage Foundation who regularly appears on conservative media, and whose credentials have been questioned by economists across the political spectrum. On X, Dave Hebert, of the free-market American Institute for Economic Research, wrote that he had been on programs with Antoni and had been impressed by two things: “His inability to understand basic economics and the speed with which he’s gone MAGA.”
None of this should come as a total shock. In countries run by populists, there often comes a moment when empirical reality, as reflected in official economic statistics, clashes with the regime’s rhetoric, and something gives. Argentina provides a famous example. In 2007, as the inflation rate was rising sharply, the government of Néstor Kirchner—whose wife, Cristina, was running to succeed him in an upcoming election—fired a top official at the national statistics agency and appointed a loyalist, under whom the agency reported inflation figures that were widely discredited.
It’s perhaps surprising that something like this didn’t happen during Trump’s first term. In his view, data is only as credible as it is convenient; he has long challenged statistics that aren’t supportive of his interests. During Trump’s 2016 campaign, when Barack Obama was still in the White House, Trump claimed that the real unemployment rate was considerably higher than the official one from the B.L.S. In March, 2017, when the bureau said that the economy had added a robust two hundred and thirty-five thousand jobs in the month prior, Trump’s press secretary quoted him as saying that the numbers were “phony in the past” but “very real now.”
The fact that job growth remained pretty strong until the outbreak of the COVID-19 pandemic, in early 2020, meant that Trump didn’t have much to complain about. In October, 2017, he nominated William Beach, an economist of well-established conservative credentials, to become the commissioner of the B.L.S. Beach has served as a fellow at the Heritage Foundation, a vice-president of research at the Mercatus Center at George Mason University, which was founded with funding from Charles Koch, and a staff economist for Republicans on the Senate Budget Committee. Given this background, some Democratic senators expressed fears he would be a partisan commissioner, but his four-year tenure at the B.L.S., which ended in 2023, passed without any major controversies, and he has now emerged as a critic of Trump’s decision to fire McEntarfer.
On the day of McEntarfer’s dismissal, Beach described the move as “totally groundless” and said it “sets a dangerous precedent.” In a subsequent interview with CNN, he pointed out that there was no practical way for the commissioner to rig the jobs figures, which are produced by the B.L.S.’s career staff. He explained that the commissioner doesn’t see the numbers until a couple of days before they are released; by then, the data are already locked into the bureau’s computer system. When I spoke with Beach last week, he reiterated this fact and said that, in the short term, “the ability of the commissioner to influence the monthly figures, and their trend lines, is very near to zero.” The B.L.S. staffers who prepare them are so keen to guard against the possibility of interference by a political appointee, or even the perception that such a thing could be possible, that they once locked Beach out of a room where they were working, he recalled. The professionalism and dedication to producing the most accurate figures possible displayed by B.L.S. employees impressed him throughout his time at the agency, he added.
This is reassuring. If a new commissioner were to try to massage the monthly figures, or to change how they are calculated to make them look more favorable to Trump, they would need the concerted coöperation of B.L.S. employees. A mass walkout seems more likely. “Theoretically, you could fire all the people who work there and change the culture,” Beach said. “But then you wouldn’t be able to produce the reports without their expertise.”
If an Argentina-style outcome seems unlikely in the short term, there is still reason to be alarmed at Trump’s latest effort to bully government agencies that have long operated without political meddling. In the vast U.S. economy, where annual G.D.P. totals about thirty trillion dollars, nobody can keep tabs on everything—so people have to rely heavily on the official statistics. Economists refer to things that everybody can use, and which serve the public interest, as public goods: think clean air, national defense, lighthouses, and so on. “Federal statistics are a very classic case of a public good,” Groshen explained on the podcast Moody’s Talks. “It’s easy to take them for granted, but when they disappear you are in trouble.”
Although the jobs report and the Consumer Price Index are unlikely to vanish, the danger is that they could be degraded over time, with public trust in the B.L.S. and its products eroding in tandem. Beach said these concerns also extend to the Bureau of Economic Analysis, which produces the G.D.P. figures, and to the Census Bureau. He noted that, before the firing of McEntarfer, the three statistical agencies had functioned independently of the White House, which inspired confidence. “They operated in a bubble. Now that bubble has burst,” Beach told me. “That’s what happened on August 1st. We can no longer say the agencies operate with an arms-length relationship to the White House. That’s gone.”
Another factor adding to the uncertainty surrounding the B.L.S. is that, even before Trump’s intervention, the bureau had been experiencing funding pressures, staff shortages, and declining response rates to the surveys that underpin its work. Since 2010, its budget has fallen by a fifth after adjusting for inflation, according to the Center for American Progress. Earlier this year, the Trump Administration called for a budget cut of eight per cent and imposed both a hiring freeze and an early-retirement program for personnel, which prompted the bureau to reduce its survey work in several U.S. cities. The issue of declining survey-response rate is one that other organizations, including opinion pollsters, have faced in recent years. The B.L.S. has moved to address it by, for instance, making it easier for the businesses and government agencies that it contacts each month to respond online rather than by phone or fax, and by incorporating some private sources of data into its statistics—but these efforts have been hampered by funding constraints.
Warren Buffett walks the floor ahead of the Berkshire Hathaway Annual Shareholders Meeting in Omaha, Nebraska, on May 3, 2024.
David A. Grogen | CNBC
Berkshire Hathaway‘s monstrous cash pile topped $300 billion in the third quarter as Warren Buffett continued his stock-selling spree and held back from repurchasing shares.
The Omaha-based conglomerate saw its cash fortress swell to a record $325.2 billion by the end of September, up from $276.9 billion in the second quarter, according to its earnings report released Saturday morning.
The mountain of cash kept growing as the Oracle of Omaha sold significant portions of his biggest equity holdings, namely Apple and Bank of America. Berkshire dumped about a quarter of its gigantic Apple stake in the third quarter, making the fourth consecutive quarter that it has downsized this bet. Meanwhile, since mid-July, Berkshire has reaped more than $10 billion from offloading its longtime Bank of America investment.
Overall, the 94-year-old investor continued to be in a selling mood as Berkshire shed $36.1 billion worth of stock in the third quarter.
No buybacks
Berkshire didn’t repurchase any company shares during the period amid the selling spree. Repurchase activity had already slowed down earlier in the year as Berkshire shares outperformed the broader market to hit record highs.
The conglomerate had bought back just $345 million worth of its own stock in the second quarter, significantly lower than the $2 billion repurchased in each of the prior two quarters. The company states that it will buy back stock when Chairman Buffett “believes that the repurchase price is below Berkshire’s intrinsic value, conservatively determined.”
Stock Chart IconStock chart icon
Berkshire Hathaway
Class A shares of Berkshire have gained 25% this year, outpacing the S&P 500’s 20.1% year-to-date return. The conglomerate crossed a $1 trillion market cap milestone in the third quarter when it hit an all-time high.
For the third quarter, Berkshire’s operating earnings, which encompass profits from the conglomerate’s fully-owned businesses, totaled $10.1 billion, down about 6% from a year prior due to weak insurance underwriting. The figure was a bit less than analysts estimated, according to the FactSet consensus.
Buffett’s conservative posture comes as the stock market has roared higher this year on expectations for a smooth landing for the economy as inflation comes down and the Federal Reserve keeps cutting interest rates. Interest rates have not quite complied lately, however, with the 10-year Treasury yield climbing back above 4% last month.
Notable investors such as Paul Tudor Jones have become worried about the ballooning fiscal deficit and that neither of the two presidential candidates squaring off next week in the election will cut spending to address it. Buffett has hinted this year he was selling some stock holdings on the notion that tax rates on capital gains would have to be raised at some point to plug the growing deficit.
Apple CEO Tim Cook introduces the Apple Card during a launch event at the Apple headquarters in Cupertino, California, on March 25, 2019.
Noah Berger | AFP | Getty Images
The Consumer Financial Protection Bureau ordered Apple and Goldman Sachs on Wednesday to pay more than $89 million for mishandling consumer disputes related to Apple Card transactions.
The bureau said Apple failed to send tens of thousands of consumer disputes to Goldman Sachs. Even when Goldman Sachs did receive disputes, the CFPB said the bank did not follow federal requirements when investigating the cases.
Goldman Sachs was ordered to pay a $45 million civil penalty and $19.8 million in redress, while Apple was fined $25 million. The bureau also banned Goldman Sachs from launching new credit cards unless it can provide an adequate plan to comply with the law.
“Apple and Goldman Sachs illegally sidestepped their legal obligations for Apple Card borrowers. Big Tech companies and big Wall Street firms should not behave as if they are exempt from federal law,” said CFPB Director Rohit Chopra.
Apple Card was first launched in 2019 as a credit card alternative, hinged on Apple Pay, the company’s mobile payment and digital wallet service. The company partnered with Goldman Sachs as its issuing bank, and advertised the card as more simple and transparent than other credit cards.
That December, the companies launched a new feature that allowed users to finance certain Apple devices with the card through interest-free monthly installments.
But the CFPB found that Apple and Goldman Sachs misled consumers about the interest-free payment plans for Apple devices. While many customers thought they would get automatic interest-free monthly payments when they bought Apple devices with an Apple Card, they were still charged interest. Goldman Sachs did not adequately communicate to consumers about how the refunds would work, which meant some people ended up paying additional interest charges, according to the CFPB.
It also meant some consumers had incorrect credit reports, the agency said.
“Apple Card is one of the most consumer-friendly credit cards that has ever been offered. We worked diligently to address certain technological and operational challenges that we experienced after launch and have already handled them with impacted customers,” Nick Carcaterra, vice president of Goldman Sachs corporate communications, told CNBC. “We are pleased to have reached a resolution with the CFPB and are proud to have developed such an innovative and award-winning product alongside Apple.”
Representatives from Apple did not immediately respond to CNBC’s request for comment.
Two stocks are getting the call-up from our Bullpen stocks-to-watch list. We’re initiating positions for Jim Cramer’s Charitable Trust in BlackRock and CrowdStrike . We’re buying 17 shares of BLK at $1012.44 each. We’re buying 60 shares of CRWD at $305. Following Wednesday’s trades, BlackRock will have a roughly 0.5% weighting in the Trust, the portfolio used for the Investing Club. CrowdStrike will have a roughly 0.5% weighting. BlackRock is the world’s largest asset management manager and leading provider of investment, advisor, and risk management solutions. It offers a broad set of investment products in equity, fixed income, multi-asset, alternatives, and cash across different client types like Institutional, Retail, and ETFs, around the world. About 43% of its base fees come from actively managed products, 42% from ETFs, 8% from Index, and 7% from cash. Blackrock reported a strong set of third-quarter results last Friday. Total revenues increased 15% year over year to $5.2 billion thanks to the positive impact of markets on average assets under management, 5% organic base fee growth, and higher performance fees. And that 5% organic base fee growth was the company’s highest level in the last three years. BLK YTD mountain BlackRock YTD BlackRock lived up to its reputation as a premier asset gatherer, generating $221 billion of net inflows in the quarter – a company record. The company is having a huge year. Through the first three quarters of 2024, net inflows already surpassed the full-year net inflows of both 2022 and 2023. Assets under management stood at about $11.5 trillion at the end of its third quarter, up $2.4 trillion year over year. Profitability was another highlight. The company continues to deliver sustained asset and technology services growth at scale while remaining disciplined on expenses. Adjusted operating margins expanded 350 basis points year over year to 45.8%, leading to adjusted earnings per share of $11.46, well above estimates of $10.40. The company bought $375 million worth of shares in the quarter, slightly reducing its weighted average diluted shares. The company also pays a dividend yield of about 2% and has increased its payout for 15 straight years. One of the company’s biggest strategic pushes right now is in alternative strategies like private markets and infrastructure. Earlier this month, BlackRock completed its acquisition of Global Infrastructure Partners, a leading independent infrastructure fund manager. The company believes this combination “will provide clients access to investment and operating expertise across the infrastructure landscape.” Blackrock believes infrastructure is a $1 trillion market today and will continue to be one of the fastest-growing segments of private markets in the years ahead. The deal brought in an additional $116 billion of client AUM and $70 billion of fee-paying AUM. It also added long-dated, non-redeemable assets to Blackrock’s business, which the company likes because it diversifies its revenue and earnings mix. Management believes these private market assets will positively impact the company’s overall effective fee rate by 0.5 to 1 full basis point. The stock has had a big move this year, gaining roughly 24% but we think the gains can continue. It’s a pretty steady business with market-leading organic growth, margin expansion, plus a dividend and buyback. Also, BlackRock should see an acceleration of inflows into Fixed Income as central banks cut rates, pushing some of the record amount of assets in Money Markets to flow into bond funds and ETFs. CEO Larry Fink addressed the large cash holdings of investors on the earnings call, explaining that “investors will have to re-risk to meet their long-term return needs.” Fink sees opportunities for investors across several structural trends like “rapid advancements in technology and AI, and rewiring of globalization, and the unprecedented need for new infrastructure.” Fink is a thought leader in the banking industry. We’re starting the position off on the smaller side given its recent run to new highs, and we’ll take advantage of pullbacks to add to our position. Our price target is $1,150, which is roughly 24 times the consensus 2025 EPS forecast of $48.47 per FactSet. CRWD YTD mountain CrowdStrike YTD Next up is CrowdStrike, the cybersecurity company led by its co-founder and CEO George Kurtz, who Jim has had on “Mad Money” many times. CrowdStrike specializes in endpoint protection through its AI-native platform called Falcon. The Falcon platform operates entirely in the cloud, allowing for rapid updates, scalability, and ease of deployment. There’s a good whitepaper on CrowdStrike’s website published by IDC that explains the value of the CrowdStrike Falcon XDR platform. It stops breaches. But it also saves time by speeding up threat protection and response while also helping security teams do more with less. It saves money by reducing the cost of cybersecurity – companies can get rid of less effective platforms and consolidate point solutions. The IDC report found that customers realized a $6 return for every $1 invested with a 5-month payback period after they used the Falcon XDR platform. CrowdStrike was virtually unstoppable this year until July 19 when a faulty software update to its Falcon Sensor security software system caused a global problem with computers running Microsoft Windows. It was a major blow for a cybersecurity company, especially one with a pristine reputation. There was a lot of speculation that the outages would hurt their business from customers revolting, resulting in a loss in market share. However, when CrowdStrike reported at the end of August, the results were excellent with revenue up 32% year over year and adjusted earnings per share of $1.04 versus the 97-cent consensus. Even better, the company showed a gross retention rate of 98%, a sign that virtually no business was lost from the event. More recently, the company held its annual Fal.Con conference in September and it seemed to get a great reception, with attendance up 30% versus last year. Microsoft CEO Satya Nadella spoke at the event which suggested the two companies have buried the hatchet. They’ve had this rivalry for years, but ironically the incident brought the two companies closer together. Shares of CrowdStrike may be up almost 40% since bottoming in early August, but it is still down more than 10% from the July 19 incident and about 23% from its closing high of $392.15 on July 1. This could be an opportunity since virtually no business was lost. Our initial price target is $350, which is roughly where the stock traded right before the July 19th outage. We think the stock should return to these levels since virtually no business was lost. You might be wondering if adding CrowdStrike to the portfolio means that we are heading to the exit on Palo Alto Networks . Does having two cybersecurity companies violate our rules about diversification? We typically don’t like to double up in one area, but we think there is room in the portfolio for both of these best-of-breed names because of position sizing. Palo Alto Networks isn’t that big of a position in the portfolio anymore because of all the huge gains we’ve locked in. Cybersecurity is a great area to be invested in. We’re in an elevated threat environment given all the hostilities happening around the world. Artificial intelligence and Gen AI have made bad actors more sophisticated, so corporations need to invest with the leaders in the industry to stay protected. We’re almost a year into the new SEC rules surrounding the disclosure of cybersecurity incidents, and greater awareness of threats has been a tailwind. (Jim Cramer’s Charitable Trust is long BLK, CRWD, MSFT, PANW. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
Morgan Stanley on Wednesday topped analysts’ estimates for third-quarter profit as each of its three main divisions generated more revenue than expected.
Here’s what the company reported:
Earnings:$1.88 a share vs $1.58 LSEG estimate
Revenue: $15.38 billion vs. $14.41 billion estimate
The bank said profit rose 32% to $3.2 billion, or $1.88 per share, and revenue jumped 16% to $15.38 billion.
Morgan Stanley had several tail winds in its favor, starting with buoyant markets that helped its massive wealth management business, a rebound in investment banking after a dismal 2023, and strong trading activity. The Federal Reserve began taking down rates in the quarter, which should encourage more of the financing and merger activity that Wall Street firms capitalize on.
“The firm reported a strong third quarter in a constructive environment across our global footprint,” Morgan Stanley CEO Ted Pick said in the release.
Shares of the bank rose 7.5% in early trading.
The bank’s wealth management division saw revenue jump 14% from a year earlier to $7.27 billion, exceeding the StreetAccount estimate by nearly $400 million.
Equity trading revenue rose 21% to $3.05 billion, compared with the $2.77 billion estimate, while fixed income revenue edged 3% higher to $2 billion, also higher than the $1.85 billion estimate.
Investment banking revenue surged 56% from a year earlier to $1.46 billion, exceeding the $1.36 billion estimate.
Investment management, the firm’s smallest division, also exceeded expectations, posting a 9% increase in revenue to $1.46 billion, modestly higher than the $1.42 billion estimate.
Morgan Stanley’s Wall Street rivals also posted better-than-expected Wall Street revenue. JPMorgan Chase, Goldman Sachs and Citigroup topped estimates on strong revenue from trading and investment banking.
This story is developing. Please check back for updates.
David Solomon, Chairman & CEO Goldman Sachs, speaking on CNBC’s Squawk Box at the World Economic Forum Annual Meeting in Davos, Switzerland on Jan. 17th, 2024.
Adam Galici | CNBC
Goldman Sachs is scheduled to report third-quarter earnings before the opening bell Tuesday.
Here’s what Wall Street expects:
Earnings: $6.89 per share, according to LSEG
Revenue: $11.8 billion, according to LSEG
Trading Revenue: Fixed Income of $2.91 billion, Equities of $2.96 billion, per StreetAccount
Investing Banking Revenue: $1.62 billion, per StreetAccount
Asset & Wealth Management: $3.58 billion, per StreetAccount
How much will falling interest rates help Goldman Sachs?
Over the past two years, the Federal Reserve’s tightening campaign has made for a less-than-ideal environment for investment banks like Goldman.
Now that the Fed is easing rates, that positions Goldman to benefit as corporations that have waited on the sidelines to acquire competitors or raise funds begin to take action.
Goldman’s asset and wealth management division is also positioned to benefit from rising asset values across markets as rates decline.
Last week, rival JPMorgan Chase set expectations high with better-than-anticipated results from trading and investment banking, factors that helped the bank top earnings estimates.
Wells Fargo also exceeded estimates on Friday on the back of its investment banking division.
This story is developing. Please check back for updates.
Wells Fargo stock hit new multi-year highs on Monday after Wall Street analysts praised the bank’s third-quarter earnings report. The news Shares of Club name Wells Fargo jumped more than 3% on Monday — a close above $63 would be the highest finish since January 2018. That’s on top of Friday’s more than 5.6% post-earnings rally, which extended its recent run to six straight sessions. Investors are mulling a slew of positive analysts’ calls after Wells Fargo’s better-than-expected quarterly earnings . While missing on revenue, the bank impressed with a surge in fee-based income streams that offset weakness in other parts of the business. WFC 5Y mountain Wells Fargo 5 years In response, Barclays raised Wells Fargo’s price target to $75 apiece from $66 on Sunday, implying roughly 23% upside from Friday’s prior close. The analysts cited both “increased confidence of a soft landing” and “improvements in operational risk and compliance, which should ultimately lead to [the] removal of its asset cap,” which was imposed by the Federal Reserve in 2018 following misdeeds before Charlie Scharf took over as CEO. Barclays maintained its buy-equivalent rating on the financial name. Piper Sandler hiked its Wells Fargo price target slightly to $62 from $60. “We are keeping our neutral rating, but note that the story becomes more interesting as net interest income begins to find its bottom, the fee base gains momentum, and regulatory issues seem to move forward,” analysts wrote in a Friday note. Big picture Big bank earnings are off to a great start. Not only did Wells Fargo post solid results, but so did JPMorgan Chase . On Friday, the Jamie Dimon-led bank topped analysts’ expectations on earnings and revenue on continued strength in non-interest income streams. Wall Street behemoths including Bank of America, Citigroup and Goldman Sachs are set to post results before Tuesday’s bell. The Club’s other financial name, Morgan Stanley, releases earnings on Wednesday morning. Getting a look at Goldman Sachs’ quarter and then Morgan Stanley should be interesting. Although Jim has previously said the Club would rather be in Goldman than Morgan Stanley, we’re taking a wait-and-see approach to the stock. That’s because Morgan Stanley can turn things around if Wall Street dealmaking picks up and eventually boosts the firm’s investment banking business. Bottom line We’re not surprised that Wells Fargo’s getting the recognition it deserves. After the earnings release. the Club on Friday raised our price target on the bank to $66 per share from $62. We also reiterated our buy-equivalent 1 rating on the stock. “What an amazing quarter,” Jim Cramer said Monday. “Friday was Charlie Scharf’s day.” Similar to the Wall Street analysts, we’re upbeat on the progress Wells Fargo is making toward convincing the Fed to lift the $1.95 trillion asset cap. The removal of this growth lid is crucial to Wells Fargo’s turnaround story and a big reason why the Club invested in the stock in the first place. In fact, in Jim’s Sunday column , he argued that Wells Fargo’s earnings report may be the best of the batch so far. He said he was “astounded that Wells Fargo had been able to start changing its business model to the point where it was more of an investment bank” than previously thought. That’s why we do have one qualm with Piper Sandler’s commentary, in particular. We don’t agree with the research firm’s choice to leave the stock at a hold-equivalent rating. (Jim Cramer’s Charitable Trust is long WFC, MS. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
Wells Fargo bank signage is seen on Broadway on April 12, 2024 in New York City.
Michael M. Santiago | Getty Images
Wells Fargo stock hit new multi-year highs on Monday after Wall Street analysts praised the bank’s third-quarter earnings report.
