sonali: welcome to bloomberg markets. earnings, elections are all top of mind. we are one week away from the big u.s. election plus a parade of earnings. big tech is starting aftermarket today. let's see what the mood looks like under the surface. the s&p 500 wavering into the morning and firmly up almost 2/10 of 1%. the nasdaq 100 has been holding onto gains throughout the day at 6/10 of 1%. the 10 year yield, every time i look at it is pretty stunning. it is at 432. this drift higher has been stunning. we had conflicting economic data

when you looked at jolts as well as consumer confidence. crude significant declines over the last couple of days. now at 67. only down about 4/10, about one half of 1%. we are going to bring in jess minton. >> you were just bringing up how the election is a week away but looking at what is happening with djt, trump media shares rising 13%. got halted this morning at least the fifth time this month alone and has been halted so a lot of volatility. looking at the poly market betting as far as how this could shape up with the election a week to go. looking at some of the bigger equity movers, have to point out the auto space when it comes to ford. stuck down almost 9% in the afternoon. if it holds that loss into the closing bell, still one of its biggest drop so far this year.

had to do with the cost-cutting especially warranties. . when you compare that to competitors, last week we had gm lift its profit outlook for the year for the third time. when you juxtapose it against competitors struggling too but looking underneath the hood for individual movers, looking in the retail space. look at vf corp., the owner of vans. up over 20%. on pace for one of its best potential days if they can hold gains through the close. some of the margin pain not as painful for this company. mcdonald's, those international issues weighing on the stock. dr pepper had a different shares sail down to where 5%. paypal holdings down 4.5% even though quarter earnings beat expectations. revenue outlook for the fourth quarter did not beat expectations for shareholders. sonali: interesting look under the hud because we do have eight

of the 11 industry groups lower on the day. don't just look at the index. we are going to dive under the hood with liberty elegy coanchor caroline hyde looking at some of the earnings and i think this says a lot about the market to look at the financial tech, -- financial technology companies at how paypal did. caroline: they are guiding towards low digit growth should the market want to see 5% in terms of a forecast for revenue growth. most of all investors are trying to stomach what has been a run-up in the shares. paypal has been having its best year in 2020. maybe you we are going to sell the news. this is a company that continues to guide and will be profitable growth. we are not going to have revenue at all expense. the deal with amazon, they want to break kind of the margin transaction and they got that. transaction did blow past

expectations. we focus on that sort of profit. sonali:sonali: the contained revenue outlook is interesting because to the point you have been making about the run-up, how high is the bar for these companies? if it was high for big tech, these are tech adjacent. caroline: for many it is also about the questioning of whether consumers are going to be particular the as week question what is happening in terms of the electoral outcome. we just had the ceo of sofi, similar tactics in many ways guidance for the market because they are seeing a pullback in terms of a pullback in terms of the share price he says is down to the fact shares are up 40% in the last trading month so people have been buying into this consumer outlook, the fact interest rates are coming down. he says the environment has never looked so good for his fintech. he is trying to say this is a business revenue is not going to go past your expectations but this is going to be growth you can rely on going forward.

sonali: you have paypal up almost 30% for the year and even if you sell the big jump in the last month, it has not been that great of a year. what a crazy thing because he has increased his guidance over and over again to caroline: record revenue after record revenue. he is desperately trying to reorient the business. i'm not just a one-stop shop for your loans. i'm going to be diversifying. the technology part of the business. he is driving up services revenue in particular. but with that diversification comes a re-understanding of the business. sonali: i know you cover mx closely. we have these at, other big card companies this week. what to we know about how these companies are doing in the face of investor worries? caroline: it is not have many worries about the consumer. the credit quality looks good. amex did have a larger right off

than expected. this is a company that continues to deliver. for many of consumer proves resilient in the face of what is going to be a lowering interest rate environment. sonali: these are reporting after the market and the stock has been up 9% this year. moving elsewhere in the financial industry. d.r. horton shares fell the most in more than four years after reporting disappointing fourth quarter results and a bearish outlook on homebuying. ceo's women ski saying we are seeing our buyers sit on the fence. a little less motivated today than they were in prior quarters. for more we are joined by a reporter who covers real estate markets for bloomberg. you have seen a rise in mortgage rates. you have seen four straight weeks of increases in mortgage rates. what does that mean for the outlook for new homebuyers and

the builders behind them? >> i think it is the volatility in part that is the story here. rates have risen pretty quickly. they were declining before so you go from decline to a significant increase. that scares some buyers away. sonali: how long does that last for? when you think about how clogged the pipelines are here, what are the ripple effects? prashant: d.r. horton said something interesting today. someone asked them what rate they would need before it would spark sales. they said it is not about the specific rate. it is about stability. it seemed like i need the quarter a lot of people were not buying because they were

expecting with the fed having started the rate cutting campaign that rates would be lower in the future. people have been holding back on purchasing. people may still believe rates are going to come down at some point. what is the urgency to buy right now? sonali: pricing, no? at the end of the day, we are all in new york city over here. you see the price of housing outside of the city. it is just exorbitant. at the end of the day, do people not worry it could get worse from there? prashant: prices could keep going up. that is the risk. you could -- maybe you are thinking if you buy today, you may be avoiding -- maybe you would be locking in a price. it is better to buy now than later. there is so much uncertainty. layer on the election and a lot

of people are staying away. sonali: i am glad you brought up the election. if you are in the housing market and you are constructing and selling homes like d.r. horton is an kamala harris is on the ticket and promising to add an extra supply of 3 million homes, someone has to build those homes. how much is that in the price or should it even be in the price given the uncertainties around the election and her plan? prashant: i think -- none of that is a sure thing. we don't know if she will be elected. we don't know if she will build, set the stage for the construction of that many homes. so i would say that is a total sort of unknown. so i am not sure how much it is priced in. sonali: we thank you very much for your time and reporting. a highly watched stock today.

one that used to count warren buffett as a larger shareholder. coming up, we have rhythm chairman and ceo and president michael nierenberg joining us to break down the latest earnings report and wider trends across the market. the company recently reported earnings as well. we will get a check at what is in his books. this is bloomberg. ♪

sonali: this is bloomberg markets and i'm sonali basak. it is time for the stock of the hour. we are looking at rhythm capital. the stock is higher after reporting in earnings beat with earnings at 50 earnings per

share. an interesting time for managers like this under the face of higher interest rates. we are joined in an exclusive chair with the ceo and president michael nierenberg. people have had their eye on rithm because just about a year ago you closed a heated acquisition, something that was a hard won acquisition by you, boosting your asset management arm. how does this change what rithm looks like? michael: just a frame where we are today and i will get back to your question, when you look at the firm today, we manage $80 billion in assets across our family of companies. the acquisition of scope was a key want for us because what we are trying to do is change the narrative of who we are as an asset manager in change the valuation of our equity.

it has not worked to well up to this point. sonali: what multiple would you like? michael: we want to trade something that is more of a multiple where asset managers trade versus where retrade. we put up as you pointed out very good earnings and results. . all of our business lines continue to perform extremely well. we are on the mission. we are on the path to do this and we are going to get there. we need to change the narrative around our earnings multiples. sonali: if you want to be training more like an alternative asset manager and you have sculptor under your wing, what a sculptor look like a year from now? michael: the one thing i said this morning on the earnings call and i would say to investors and lps and everybody that invests money with sculptor as well as rithm his we want to lead with results first. as much as everyone is in and a um game and you look at the

larger alternative asset managers, the results have been terrific. the results are going to lead to more a um growth at the platform as well. it will be bigger. we are stating to see inflows. the commercial team is out with large fundraising. that will likely have another close before the end of the year. that fund will likely be oversubscribed. returns for all the different verticals. leading with results. we will see more aum come to the platform. sonali:sonali: i feel now you are in to this acquisition, what else are you looking for out there? how big is your propensity to do more m&a? michael: it is big actually. we want to grow our platform. as i pointed out, 80 billion of

so-called assets under management, we are under skilled in credit. everyone talks about private credit, direct lending. i have been doing this forever. as a group we have been in the direct lending space. we have been in the unsecured credit space for many years. you are going to see hopefully more acquisitions by us to grow our credit business. we want to be prudent and thick about multiples you would have to pay for an asset manager. sonali: it seems like there are a lot of private credit acquisitions. i imagine that drives up the valuation. michael: when you look at some of the acquisitions done by some of the larger alternative asset managers where there equity is trading anywhere from 20 to 30 times, we don't trade there. we have to be extremely mindful of the acquisition price and where retrade overall in the public market. sonali:sonali: i went to go back to something you were talking about.

real estate. we have this a credible story on bloomberg.com, the bloomberg terminal about aaa mortgages going bust in the commercial real estate sector. you have not seen this since the great financial crisis. it is pretty bloody out there still. michael: i think there are certain office that is going to get hard. you -- look, we buy assets obviously. we bought an office building last quarter just outside virginia last traded in 2019. we paid $27 million for it. 50% leased up and we think that is going to be a good investment for us. sonali: less than a third? michael: less than a third. sonali: how much room do you have to buy at those prices? how big is that opportunity and how long does it last? michael: you have heard some of the larger real estate players start talking about whether we are bottoming out or not. every asset is different.

it was 1407 broadway or something like that with the aaa's hit. every asset is going to be different. you have to be patient to we are going to see more capital coming into the sector. we will be patient. sonali: what about the housing sector? you are watching the steady decline higher in mortgage rates. what does that mean for how the system might work in the next six to 12 months? michael: when you think about this going back to the so-called covid crisis, homeowners were taking out mortgages at 1.5 to 2.5% should those folks have nowhere -- no incentive to go anywhere unless family sizes are growing. when he thing about the housing market, it is a little stuck. you look at home prices, we are at historic highs. counter to that is the stock market is almost at historic highs so people have made more money. housing is less affordable. you are seeing home sales a little lower.

that will continue the trend. we are in the middle of an election obviously and i think both candidates, there is going to be inflation. need to continue to issue more debt because the deficit is going to continue to increase. where we settle out and how that correlates to the mortgage market which is how mortgage rates get set remains to be seen. sonali: you think there is a lot more upside room in mortgage rates as well? michael: mortgage rates today, if you take six and three quarters or 7%, something like that today, do mortgage rates go higher? the answer is yes. sonali: that makes it difficult to buy a home. you have one of the candidates, kamala harris, saying she wants to build another 3 million in excess of the existing plans for supply. can she do that? michael: it sounds like a good tagline. where are you going to get the land from? unless you are going to take federal land and build houses on

federal land and how does that relate to the job centers and where people are going to work? i'm not sure how that works and you have to think about the homebuilders today. if the homebuilders are out there and they have access to land, they are going to buy the land and they are going to build homes. sonali: you do have trump saying he also wants to use federal lands. can he succeed in doing that? michael: i think this is all campaign rhetoric. if we have a divided government which i think would be the best for the country, my sense is we are going to be in the standstill for a long time. sonali: big prediction ahead. best opportunity in the markets. you are looking at private credit, you are looking at the mortgage market and before i forget to ask you, you may have more transactional activity around the corner of your own should a lot of people want to know about new rez and if it could list in public markets. michael:michael: it is a big debate of ours. if you look at a couple of the peers, they are trading a little north of 1.5 times.

one .5, are equity trades a little bit below book. when i pointed out i didn't earnings call this morning, we deployed 5.8 billion dollars in capital since 2021 without raising equity. all of our subsidiaries sits in one bucket and all the cash flows into one pod. it is likely i think at some point we explore and we have explored bringing this company public and it is probably a 25 event. sonali: that is rithm capital chairman, ceo and president michael nuremberg on the heels of earnings. some of the biggest executives are in saudi arabia for the future investment initiatives conference. here's what some of them had to say about the election. >> it is a waste trump is favored to win yet it is almost a coin toss. >> see investment liberalization if there is a change in government to >> my hope would be there would be a fresh look on how we can ensure regulation is important to keep guardrails

on the economy and keep the economy moving in an appropriate way. >> i feel more optimistic a trump white house because the biggest impediment to progress we are experiencing is regulatory -- overregulation. ♪

sonali: this is bloomberg markets.

i'm going to bring you breaking news. openai building in house chips with broadcom and tsmc according to reuters. can see shares of broadcom spiking on news. you are watching a lot of interest in the ai story. you have a lot of earnings this week where a lot of capex will be weighed on the heels of a lot of these earnings report but broadcom in particular up 3%. openai seems to be a magic word for this company. in the ai world, there is more news about eli musk and x ai. i talked to raise funding at a value of $40 billion. last valued at $24 billion a few months ago. it rates $6 billion in the spring. a lot of capital needs for these companies and a lot of partnerships. i'm sonali basak. that is it for markets.

more markets ahead. this is bloomberg. ♪ it's our son, he is always up in our business. it's the verizon 5g home internet i got us. oh... he used to be a competitive gamer but with the higher lag, he can't keep up with his squad. so now we're his “squad”. what are kevin's plans for the fall? he's going to college.

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>> from the world of politics to the world of business, this is balance of power. live from washington, d.c..

joe: it is one weekend counting. welcome to the fastest show in politics as the candidates deliver dueling speeches with the polls tied seven days out to election day. i'm joe mathieu alongside kailey leinz in washington. to the tuesday edition of balance of power. voters have quite a contrast today. kamala harris on the ellipse invoking images of january 6. donald trump in allentown talking issues and hoping to get past some of the rhetoric from sunday night in madison square garden. kailey: allentown, pennsylvania noteworthy because it does have a heavy concentration of puerto ricans. the first latino mayor of that town is currently in office as he tries to shift focus from the comedian that appeared at his rally in madison square garden calling puerto rico a floating island of garbage. , hera striking a different town than we expected when we hear from her at the ellipse this evening. perhaps a bit more positivity.