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tv   The Exchange  CNBC  June 4, 2021 1:00pm-2:00pm EDT

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finish line. i'm impressed. final trade is raytheon technologies >> good stuff. pete >> i'll give you microvision we saw some call buying in there. i think this is great area many the markets. anything in automobiles is doing well >> good stuff. great weekend, everybody "the exchange" is now. thanks, scott. i'm jon fortt. we'll speak with a five-star fund manager who is up 25% year to date. far out performing the markets and the gains haven't come from the high flyers, reopening trade or big tech. he will tell us what he's buying electric earnings. charge point getting strong guidance on its call today as it inks an ev deal with gm what would be next and the role the infrastructure bill might play multiple stock sales millions of shares issued. we'll look at amc's wild week.
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we begin with today's markets. >> all those concerns among fed, inflation jobs major aver ages are on track to end the week led by the nasdaq up 1.4%. worth noting the european stock averages have been hitting new highs every day once again trading higher by .4 consumer discretionary is topping the s&p. names like twitter following news of subscription service it's amc 185 million shares up. average trading volume is nearly quadrupled this year's average
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biogen is moving on heavy v volume bit coin moving down just about 4.7% completely isolated data points which do not make up a trend but are worth watching >> all right thank you. now stock picking is back with active funds crushing passiv nearly 70% of large cap funds baetsing equity benchmarks one manager seeing spectacular gains is eli portfolio manager of large cap value fund rated five stars. it's up 27% year to date outperforming the s&p 500 by 15 points eli, welcome i don't know this isn't supposed to be working. i'm told value is dead you're no in gm's game stop or amc. you're not chasing snow flake. what are you buying? how can it be working? >> sure. we all know for the last 13
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years but it's time for value. it's time for value over growth. reminds me a lot of what we saw 20 years ago where growth was in favor for an extended period of time in the 90s. value took over in '00 and ran for seven years and ran hard we're entering the same period now for the next three the five years. >> first thing to understand is higher inflation and higher interest rates you want to be in low duration and not high duration. not long duration. long duration is growth. low duration is value. that's where you want to be. >> that's a similar argument
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that i hear to people who are buying bitcoin and cryptocurrencies about the inflation side of this you are buying something that is very different from that, including jpmorgan p tell me why. >> we really like the financials a lot financials benefit in three ways let's start by talking about the interest rates it's very good for financials. it's completely misunderstood. loans are about the pick up as the economy picks up and the competition has moved out. it's all very good for financials >> you don't have big tech but that's not entirely true because cisco was pretty big what does it represent, that tiech company among your picks do you have others of its ilk
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and why will you hold onto it, if you will, for the rest of the year >> sure. the answer is we like cisco very much it's important to understand technology is a big weight in our benchmark. please don't misunderstand, we are not positive on technology we're positive on cisco. the long duration stock, the technology stock will get hit here >> as we head toward the end of the year, are there specific either catalysts or warning signs that you are looking out for whether they be legislative, whether they be economic signals that will effect how much you leaned into or away from certain elements of your thesis? >> yeah. obviously we're a bottom up manager. we go company by company, sector by sector. that being said from a top down
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perspective, we'll focus very clearly on economic growth what's going on in the environment. is pricing materializing the economic growth is baked in for the next six to 12 months. w >> when you look at the labor report and the signals on inflation we have been getting but how transitory do you think sit? do you see anything that maybe others aren't paying as much attention to that you think we should be paying more attention to >> i think some of the inflation is clearly transitory but much is not one of the most important things to focus on is in my 40 years, we have never seen this capacity covid destroyed a lot of capacity some of it is permanent. we believe that while some inflation is transitory, some is not. some will be with us for quite a
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while. >> old school stock picking and paying attention to those signals. thank you. s s >> thanks for having me. inflation continues to be the big word when it comes to the fed as investors try to figure out how hot they will let the economy run. we have more evidence of the rises costs. wages jumped more than expected. consumers are paying more for goods but is it another sign that fed could go from baby steps to bigger leaps when it comes to ss to tapering. what does this data show >> there's this mismatch between demand and supply. demand is strong consumer are outspending for all kinds of products whether it's durable goods or services spending businesses are investing in trying to keep up with that
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demand and increase their capacity there's obviously some real challenges there that's creating these price pressures which were evident in today's job report and evident in the inflation numbers as well >> we talk about price pressure but there's also wage increases. i've been seeing the stories about how much of the summer jobs are paying. it's a good time to be a teenager looking for work. are the wage likes also transitory will that affect how much people are willing to pay for things as the year progresses? >> there's similar dynamics which is that there's incredible demand for labor we see that with job openings numbers and there's some friction in terms of getting people back in the labor market into the jobs that would best suit them. i think the increase in wages, particularly, what you're seeing on the lower scaled part of the labor force seems to be partly a function of this it's probably going to slow
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down i don't anticipate we'll see wage growth of this magnitude much longer. that said, i do think we need to be careful with what we -- how we characterize transitory it could last given the incredible inbalance the longer you get the price ink increases, the larger the price increases are, the more it sets into expectations and be pe persistent >> does this shift the math on when we get a taper from the fed? >> i don't think it will really change the timeline too significantly. i think the fed is setting up very nicely and carefully for a change in the balance sheets for tapering in the next few month it's very much a function of the success and the labor market rather han this inflation narrative
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i think the inflation trajectory will influence timing of rate hikes. they are starting the baby steps in setting the stage for it. i think if all goes as planned they'll be able to send a more explicit signal. >> is this like the flip side of i've been couped up all year
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>> you see consumers want to go back out and live their life it's pretty impressive increase in entertainment services and spending there's still a lot more to coin terms of catching up in that category travel picking up in meaningful way. you're still seeing consumers spend on some of these durable goods. they are still buying home improvement stores, furniture, elect electronsics >> what are the anomalies. there's no way this will last or this is brand new.it's been dras
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in number of categories. you notice things like entertainment, leisure we're balancing off such low levels at some point it starts to become challenging to see growth rates continue at that magnitude. you start to reach a level where spending is kind of normalized or above and beyond normalized and you start to see some moderation there i think it's a sign that consumers are going back out they are reenaging and a lot more through the summer. we are clearly an unusual times and we're still seeing this pay back from the period of lock down in the pandemic >> i hope you have a good weekend and spend some money on
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entertain m services coming up, ev charging station network reporting disappointing results but standing by its full year guidance as the customer base continues ss to grow. we'll speak with the ceo about that bank of america is throwing in the towel on a couple of meme stocks say they are no longer trading on fundamental will other wall street banks follow suit? the exchange is back in a moment
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welcome back shares of ev charging leader is higher bullish guidance for q2. still down about 10% since its public debut in march. can this pioneer get a boost from the ev surge and president biden's clean energy push? let's ask the ceo. good to have you what are these dynamics that could impact both demand for your service and progress throughout the rest of the year? >> for us it's all about vehicles being sold into the consumer market. our business is driven by demand
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for charging. >> what influence from government includes the pace and rate to what extent do the pricing actions by some of these companies influence that too you seen tesla say we'll have t raise price a bit that we have seen globally. >> it's normal price dynamics in not only the auto industry but you're seeing across the board in all industries. prices move around with supply chain issues, availability, demand, et cetera. in general, evs you're seeing most heartening thing you're seeing more makes and mottles being introduced daily and price
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points the available models at lower price points accessible to consumer going up. that is the bigger driver to consumer adoption electric vehicles >> to what extent are you watching what's happening globally in ev adoption and how much do other markets affect how you invest and how you strategize about your growth >> we're investing heavily in europe and north america. the support for that is challenging and you can sell more than one market
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we need to be well integrated with in dash experiences and the ecosystem around that. they'll introduce those platforms around this. the global nature cannot be more critical >> on that commercial frill front, are we going to get more ev truck stops those seem like things that that could be a backbone for this kind of business how does that develop? is there anything you can do either influencing policy or coalition wise to bring that more to fruition, more quickly >> we're working with the national association of truck stop operators because they serve long haul and medium haul trucking as well as passenger cars that want to use facilities
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at many of the member truck and rest areas that are a part of that organization. the answer is a definitive yes there. our policy team is quite well distributed through the country, through not only our country but we have a presence in canada and the eu because helping to define good policy in how we can streamline the acceptance of vehicles and trucking segment that you talked about or the broader fleet segment and the consumer segment is all critical how you structure incentives, how you structure to get good infrastructure and those stranded asset s very important. >> i'm seeing more ev truck stops in the midwest i know something is going on for sure >> thank you
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>> thank you one of the largest digital sale companies is closing 200 million fund rounding. we'll speak with the ceo about,000 their investment in ai is starting to pay dividends facebook announced a penalty system who violate facebook terms of service under certain conditions we will discuss when we come right back ok, at at&t everyone gets our best deals on all smartphones.
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welcome back here is your cnbc news update. in hong kong police stopping pro-democracy celebrations of the anniversary of the tiananmen crackdown. authorities sited the pandemic for banning events for the second year in a row, the singapore grand prix is being cancelled. it requires lengthy quarantines for mozamst visitors from abroa. they could bring a second race to the u.s. this year. back here in the u.s. and california severe drought drying out many reservoirs are
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averaging 50% below levels send it back to you. >> thank you face-to-face meetings became impossible enter out reach and ai driven platform to maximize sales close to $200 million funding round as valuation tripled to nearly $4.5 billion. what's next? out reach continues to grow post-pandemic. let's bring in cowill have founder and ceo manny. i want to put this in the context of what we see happening. consumers are spending again they are spending a lot.
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people coming back to the office there's money for companies to make if they invest correctly, i guess. h how does that fit into your hiring plan, growth plans, expansion plans. >> good to see you again >> out reach is doubling the head count again we sell seats ahead of sales demand we are seeing sale seats being bought quickly what we're expecting our customers to drive double digit growth sdp what's the mind set of these companies that are looking to drive sales? your pitch is sales efficiency we're beginning to get you the right leads and help you close them what's going to determine who wins most as the spending continues to pick up, at least
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people hope coming out of this pandemic sdplp tha. >> that's a great question the revenue innovator is a different job description that's changed since the pandemic it's a data driven digital first, predictable long building trusting relationship kind of seller what we're seeing is this influx and this growth of the type of seller that knows how to drive a digital conversation that's complimented with a hybrid approach it's a very predictable, very data driven kind of job description. what we're seeing is the growth happening across our customer bathe it's going to be very data driven and very innovator lead the system of action is taking
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place on top of the system of sales. the pandemic pushed more companies into thinking about their digital processes and being efficient. are you seeing a change in the make up of your customer base? the type of industries represented and the kinds of problems they are looking to solve? >> what we're seeing is all the companies that used to be in the mainstream are accelerating into the second wave of digital transformation the sec wond wave is to move it into the cloud companies are talking about how do you make me smarter how do you make my times more efficient? how do i live and thrive in this new hybrid environment
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they are becoming early innovators >> do the companies have the employees they need in order to get digitally smarter? if the companies weren't leaning as much into digital as they were before, it suggests maybe they don't have the knowledge worker base that it takes to use the software is there more demand for that worker are the companies able the find it is that a bottleneck for the industry >> that's precisely right. they nay motte have them they are getting the jobs. they are looking to drive this innovation within the companies.
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all people first this is the new wave of people coming into traditional companies that driving this transformation they are forward thinkers and their data driven as well. >> a deeper look at what some of those numbers in the jobs report might mean thank you. >> thank you, jon. bank of america is pulling its coverage of two meme stocks. wants investors to in longer rely on their past analysis on one of them. those names are coming up. bitcoin falling today. we'll head to the big ets bitcoin event in history to find out what the crowd of more than 50,000 people are saying about the volatility the exchange will be right back. machin if your money is working toward the same goals, why keep it in different places? sofi is a one-stop shop for your finances designed to work better together. spend with sofi and get cash back rewards that automatically go toward your goals.
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day since september on the heels of strong results. it's off more than 20% from recent highs shares of square after jack dorsey tweeted the company is considering making a hardware wallet for bitcoin jack dorsey speaking right now cnbc.com is there and joins us now. elon musk let a bit of air out of the bit coin balloon that was deflate frd a month ago. is he popular there or no. >> already michael sailor was among first movers to add bitcoin to the balance sheet appeared to take aim at sochl t -- some of the comments saying bitcoin was one of the most energy efficient assets in the
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history of the planet. jack dorsey speaking at the event today. he said he thinks that bitcoin is good for renewables and is good for the environment he also appeared to kind of take aim at elon when he said that he thought there was a consensus among notable figures in the space on that topic. definitely coming up also in conversations, i ask people do they think the step back has lasting power and they think it's a blip. >> how much talk shifts to jack dorsey who has been very much a proponent of bit coin and decentralized finance, has power communication through twitter and is certainly big in fintech through square this hardware wallet, possibly getting a lot of buzz, right >> yeah, absolutely.
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this isn't fnew. it's a continuation of things he said for years >> that hardware wallet would be interesting. security of bitcoin. one of those things is at lof people concerned about thank you. >> thank you coming up, tik tok's new data collection. facebook will no longer protection politicians all that in today's rapid fire first, it is friday that means it's time to look ahead to what's in store for your money next week here is your friday fast forward. >> apple, inflation and ipos that's all ahead, next week. investors and users alike are anxiously awaiting apple's
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worldwide developers conference on monday. shares lowered by about 6% this year two big ipos are coming down the pike payment start up is eyeing $12 billion valuation and debuts on wednesday. work flow platform is the nasdaq on thursday. we'll get quarterly results from stitch fix, chewy and game stop. the consumer price index print for may will give us a read on inflation. hotel ceos will take the virtual stage at the goldman sachs travel and lead your conference as summer travel heats up. colonial pipeline ceo testifies about his high profile ransom ware attack in front of the house committee and homeland security president biden will attend the 47th g7 summit which kicks off on friday in the uk. at yr id ft rwd.th'soufrayasfoar
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welcome back let's catch you up on a few stories that should be on your radar. time for rapid fire. here to break down the headlines, eli and deidre. first topic, tik tok giving itself permission to collect extensive data like face and voiceprints. it may collect information about images and audio something that other social networks practice. the other is biometric saying we may collect information as defined under u.s. law such as face prints and voiceprints from your user content. tik tok will ask for permission. i'm old enough to remember last year when the u.s. government was going to shut down access to
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tik tok and now tik tok can just collect all kinds of data. what is going on >> either they are already doing it and they need to cover their butts or they want to do it and t need to cover their butts. what other contracts would any business person sign that you never get to negotiate and they can change on a whim to favor the other side when ever the other side wants it. it's ridiculous. it's going a little too far. i think this is evidence of it >> while they are covering their butt, i'm wondering can you get biometric information from a butt can you tell it's tik toks butt? >> are a lot of butts on tik tok. >> they are and usually dancing.
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china is really big into biometric data collection. where is this stuff going? >> yeah. we're not really sure what they do with it my question is, does it really matter my favorite part of this story is the privacy policy wasn't actually of that much concern to its users but that pop up. there's a big outroar on how this was rolled out and users, a lot of them don't care about the privacy policy they want to get the button out of the way there's only two options okay or privacy policy we well know apple is doing this a different way. opt in or opt out. clearly decisions but this your only option is to read the privacy policy or stop using the app. i think that will change it's pretty funny that the roll out is what caused most attention within the tik tok community with some going viral making fun of it
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>> they want to get that out of the way to see the dancing butts. i don't know i guess. are there implications to where social media platforms are headed in information collection >> well, again, because i'm not looking to post videos of me strutting around like mick jagger or skateboarding into a tree, i don't worry about this i think object recognition with social media is not new. this is a little bizarre i think most users really could care less. i think the privacy policies that which they expect no one to read and largely no one will >> i think you can do well with a tik tok. don't sell yourself short there. >> thank you, sir.
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>> hold on, you follow up as we talk about facebook because we're not done with social media. there's another social media policy change. facebook is responding to its oversight ruling on the suspension of former president donald trump over the january 6th capitol hill insurrection. facebook reenforcing the suspension of trump for two years effective from january 7th. his accounts only going to be reinstated if conditions permit. the platform outlining heightened penalties and said it will stop the hands off treatment of content posted by elected officials. i don't know mix in your take there trump was very serious about putting u.s. tik tok in u.s. corporate hands. i don't know how knfelt about te butt covering on tik tok facebook spiked on this news does it matter in.
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>> the platforms need to have clear rules. you need to understand the rules and if you don't like the rule, you need to be able to push back on what they are tik tok is saying we're collecting this data your choices are okay or privacy policy that's not a choice. you can extend that up to trump who got banned indefinitely. facebook sent it to its own oversight board. they said you need to have some rules and a schedule of penalties for this to make any sense. you want to operate with legitimacy, you need to have a system that people can understand >> it's not lost on me that trump banned tik tok and he didn't do it with clear enough rules and facebook banned trump and the oversight said they didn't do enough clear enough rules. there's a lot of banning an not a lot of clear rules out there
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>> we have come full circle. facebook kicked the can down the road for two years this is going to be controversial. it's before another election we're going to hear from trump who knows where or on what platform about this decision i do aplaplaud facebook i don't know if they deserve a pat on the back but there's more to go on >> we know how long the road is that they are kicking the can down two years. bank of america securities throwing in the towel on two meme stocks. the firm terminating coverage of game stock effective immediately and moving to no rating on bed, bath and beyond. the analysts were writing that meme mania have taken over while it's game over, bank of america does see a long term turn around story for bed, bath
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and beyond both stocks making out sized gains in the past month along with the rest of the meme names. tim, i don't know opinion analysts tend to chase stocks a little bit too often it seems like these meme stocks are running too fast it's not based f d on fundament. how would you cover these things do you trade them? >> i don't i think the question that i ask myself is real or reddit when i'm looking at the move. we can pick on analysts all we want when you look at what's going on with amc and you look at gamestop, there's a penl story there are management changes but there's still no getting away from balance sheet dynamics or broken industries or parts of their business while an analyst can talk about where a balance sheet has been
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repaired, amc has done a lot to take care of short term liquidity. i don't think they have done anything in the longer term. throwing in the towel right now and saying we can't make a call, i think is a problem i think they are the ones that are supposed to be making the fundamental assessment analysts take into account liquidity dynamics and technical factors when adding in their entire picture that's what you have to do here. >> we have been having this conversation on tech check some people think that traditional valuations are debt. what are analysts supposed to do i don't know what do they do? >> maybe they need to meet a new cohert of investors where they are comfortable. i don't know how they do that. i think to tim's point they do serve an important purpose and
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throwing in the towel isn't necessarily good enough. who knows. over thenext few months and years we could see the rise of more youtube investors and analysts a few of which are very good that i follow myself >> all right yes. i don't know about memes and analysts reports can pdfs have memes in them. finally, bitcoin got dumped over twitter crypto is down 4% following a tweet from none other than tesla ceo/techno king, elon musk now it's a bit above musk tweeting a break up meme along with bit coin and a broken heart emoji. he was making out with bitcoin a few weeks ago, tesla and now he's hanging with the doge he changes hi mind a lot too i wouldn't be surprise if he's back making up with bitcoin.
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>> oh, yeah, absolutely. >> i would ask a broader question what is the difference between a meme stock and some of these crypto swings. you buy them both in an app. it's super app super seamless make some money and leave. i think for the average investor this stuff all looks the same. >> tim, back to you on that connection isn't it amazing that he can move stuff as much as he can >> look. i've referred to and i'm sure i will be added to tes-lemmings. the presence is as significant as anyone. tesla is a high growth company with largely a great product but where the stock made no sense, the balance sheet under pressure
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and then fake it until you make it i think there's also many other little threads of parallel here. the balance sheet is incredible and we know where the market cap is the role of elon musk of where to influence asset prices is up to that retail investor or institutional investor to decide i think they have issues with this. >> the market is still hot on this thank you. and speaking of amc ceo adam aron communicating directly with investors. some of the company's movers this year could slow enthusiasm for the stock. "the exchange" will be right back
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welcome back what a ride it's been for shares of amc up about 88% completed the sale of 11.5 million new shares in mere hours yesterday but that's not the wildest number coming to amc seema mody has that story.
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>> amc is capitalizing on the enthusiasm with stock sales this week selling $230 million worth of stock and then another 11 million shares of common stock to the market amounting to $580 million. before this week amc raised $1.6 billion january tomato pay down the debt at around $5 billion. but these stock sales come at a cost 80% of the total stock is issued over the last 12 months. and ceo adam aron says more sales could be in the cards and asking shareholders to approve a proposal to issue more shares but not this year. >> if the shareholders approve a new 25 million share tranche, theoretically we could use them quickly in 2022 or use them
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spread out over a long period of time we would only use them if there's good opportunities for amc. >> that's aron with youtube permit trey collins followed by meme traders aron tried to embrace the younger retail audience that helped them stay afloat and for how long >> the way this used to work, the way this works, the way when you buy stock you pay for future earnings per share and when the demom nater is bigger, the answer is smaller. that's generally how this works so that's the piece that a lot of people crazy about amc on twitter don't seem to be focused on. >> that's why to the prior conversation the 2,300% rise in shares of amc no analyst can justify the stock appreciation we have seen in amc. given the metrics that you just
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point out. short interest is slowly rising today at around 21%. a few days ago at 19%. time is of the essence for this ceo to claim this meme status and take advantage of it which he clearly has as one would do given the distress amc is under to raise money. >> who knows what next week will bring? thank you. >> yeah. bank of america trying to get ahead of the next meme mania. head to cnbc.com/pro coming up on "power lunch" a look at how inflation and the supply chain crunch is impacting the nng durycaininst that's after this quick break. your mover, rob, he's on the scene and needs a plan with a mobile hotspot. we cut to downtown, your sales rep lisa has to send some files, asap!
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from the world's #1 selling nerve care company. nervive contains alpha lipoic acid to relieve occasional nerve aches, weakness and discomfort. try nervivenerve relief. welcome to "power lunch. i'm morgan brennan with tyler matheson 559,000 jobs added in may. unemployment rate down to 5.8% will that change anyone's mind about the economy, inflation, the fed's next move. despite the job gains businesses saying they cannot find workers to fill the openings same time many companies dealing

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