. good monday morning. i'm sara eisen with carl quintanilla. guggenheim partners executive chair alan schwartz as bank results with a make or break earnings season and yellen's trip to china. calling this a show me market with some key econ data coming later this week we'll get his warning on the fed's excess tightening. satori funds dan niles where to look for value outside

of the magnificent seven next. market seeing weakness in tech mike santoli alerted us to mechanics driving some of that underperformance this morning. for the most part, sort of on watch for the data coming in bank earnings friday will get us started in the q2 season. >> you have to be watching treasury yields. the two-year in particular policy expectations, it's been moving higher. the stock market started reacting to it last week in a more meaningful way after that strong adp number, strong wages and the jobs report. i'll be watching this. cpi on wednesday expectation is we go to a 3.2% headline number. the month over month will be important. can it be less than 0.3%, which is consensus that's a big question, as we wonder how many more rate hikes we have to go. july is priced in. september more of a wild card. >> i would argue the strategist commentary, you can feel like they almost want to say september's a go, but not everybody can bring themselves to say it. >> because powell has said two

more is a good guess the dots, forecast of the fed members themselves, have suggested that two more is a go. so, let's see. they seem very intent on keeping inflation and core inflation is going to be the key here, moving down to the target without breaking anything. >> yeah. >> there are lags, as we know. >> another earning season right around the corner. our next guest says it's turning into a show-me market. signs that the ten-year at least can remain contained, proof of inflation cooling and excessive fed tightening into year-end it's great to have you talk to me about where you see the land mines in the second half and in the order of importance. >> we do think it's starting to be a show-me market. they need to have data so they can have confidence the fed doesn't need to tighten

excessively from here. we think that is the biggest risk if the fed doesn't have to ratchet rates up it's talking about two more times but that's just the current baseline so far the fed has been surprisingly to the upside if that continues, that will be difficult for the market certainly the inflation data, the expectations for the fed, if wage growth is going to be a problem. even things like the ten-year treasury yield which looks like it's breaking out here could add pressure to risk assets. so, there's a lot right now that needs to come in reasonably well in terms of data to calm the markets and get on better footing, including the earning season, which you talked about it's really a very data sensitive market right now, we think. >> that leads us -- bank earnings starting on friday. a lot of people have already been watching what's happening to bankruptcies, delinquencies, the expectations for both loan loss and loan loss provision do you think that's going to be reflective of the environment you're talking about beginning friday >> it is certainly people are going to

focus on those things. one big question is how much credit in the economy is going to contract. some of those markers you talked about will imply how much banks will be pulling back again, that could be a bigger concern if numbers are larger than people expected again, it's going to be data driven people are looking to see right now in the context of when we've had strong economic data, if there's too much pointing in the direction of tightening credit conditions, the fed having to raise rates too much and the idea that a soft landing, which we've been talking about and promoting for quite some time, we might be a little bit too complacent or market participants might be too complacent given how much the fed is looking to raise rates here. >> what have we learned about the credit situation it will be interesting getting the bank results, but that was the fear, right? both the fed and for the markets that we would get a more pronounced credit crunch, and we don't say it's not necessarily

happening, right we've seen signs of it happening. we don't know what those lags really look like >> it takes a while to play out. the reality is we don't know it's two-pronged it's partially on the side of lenders and also on the side of borrowers and borrowers looking to pull back are not able to commit their resources that lenders are requesting for certain projects or certain expansion. so, this is something that takes some time to play out. and you really have to sort of read into some data points as they come. we don't quite know how pronounced it will be. so far the indications are not severe, but, again, it's something that remains a risk out there in the marketplace especially as the fed is looking to raise rates here in july. as you talked about, maybe again in september or future meetings. >> one of the big talkers last week was some of the prices paid, metrics within the ism surveys. both services and manufacturing, and some of the work that came out of it is it's reflective of

environments, at least in the past couple of decades, where cpi growth has been one, even flat i wonder if you think we're overdoing the read-through on those. >> we do think forward-looking indicators for inflation look relatively good. we think that takes time to play out as well. the question is going to be, can the data come in quickly enough that gives the fed confidence to ease off of it or at least pause and maintain the status quo in the coming months or does that just take more time to play out and is the fed a little impatient, wanting to bring inflation down more quickly than it's coming down in an actual way. there are a lot of questions here because the dynamics could take longer than people are thinking and longer than we originally thought and there are some indications that the fed is a little bit impatient here and wants to bring inflation down more quickly. >> so, what do you do as a chief investment officer nobody wants to miss, right, the end -- the positioning into the end of the tightening cycle.

are you saying it's too early to do that? >> well, we do think there's upside risk to longer term rates here in terms of extending out duration if you're thinking of -- thinking of the fixed income side, we think it's probably worth waiting a bit if rates can climb higher, which we think they could on the longer end. in terms of overall positioning, we think we still want to take a balanced approach here if the market starts rallying to the upside, given all the factors in play, we probably don't want to get too excited. on the flip side, if the market starts pulling back severely, it probably is a time we can become a little more optimistic because we do think those forward-looking measures of inflation are going in the right direction and eventually the fed is going to be able to take a much softer approach to the markets. and that could come in a month, two months, three months, but we don't want to get overly pessimistic if the market pulls back on some bad data because we do think it will be a very data

sensitive market in the coming weeks and months here. >> it's interesting. even a lot of the macro strategists who have been talking about, in general, a range for the second half of the year, and even into '24, they do add a caveat that is the generative ai story could pick up some steam i mean, maybe you get some follow-through on guides maybe not nvidia like, but something in that neighborhood that could allow for further upside how much are you allowing for something like that to happen? >> that is a wild card here. we think it adds the overall theme and the tech that it engenders. we think it adds an element of a backstop or willingness to come back into the market or at least into some technology names on pullback it is quite a tug of war right now in the marketplace we do think that that is a very strong and lasting theme that does add some underlying bid to the markets. but again, we do think that we need to see inflation and some

of those measures come in better, along with a stable earning season we do think it's data sensitive, but we don't think the pullback would be too severe if it happens, if data doesn't come in that strongly. i think that's why on a pullback we've become a little more optimistic here rather than thinking we're going down another strong leg in the marketplace. >> yeah, well, can barely put together a 3% drawdown we'll see what the next six months bring good to see you. >> thanks, carl. >> we're 1.3% off the 52-week high treasury secretary janet yellen has just returned from china. the list includes ceos eunice yoon is in beijing with what we learned over the weekend. i'm particularly interested in how it's being perceived in china? >> reporter: it's being very,

very well received in china. the secretary had left beijing with u.s./china ties, in her words, on sure footing at a press briefing at the end of her multiday trip, the secretary said over ten hours of discussions with president xi jinping's new economic team, she attempted to reassure her chinese counterparts that u.s. restrictions for national security would be, quote, highly targeted, that the u.s. didn't seek to decouple but to diversify, she said, supply chains, and that a biden administration goal to really pursue open dialogue would benefit both sides this is what she had to say. >> we want to open up channels so that they can express concerns about our actions and we can explain and possibly in some situations respond to

unintended consequences of our actions if they're not carefully targeted >> on the plane ride back home, a senior treasury official described the trip as successful because they were able to get a better sense of the workings of the new economic team. many of whom are unfamiliar in the west and by treasury the chinese state media has been describing the exchanges as professional but despite all the pleasantries and happy talk, the chinese government has suggested that their position is still unmoved. in fact, the finance ministry today said that china now requires u.s. action on beijing's concerns those are the next steps, which would include canceling additional tariffs on chinese goods, ceasing the, quote, suppression of chinese firms via sanctions or export curbs, and also lifting the ban on zen

products she left a very good impression. there was one restaurant she ate that decided to create a god of money menu based on the dishes she ate. it's to honor the treasury secretary. >> that's cool >> we don't -- we don't use that term officially, but it would be a great title to have. the other thing i noticed today, eunice, was some ongoing dialogue regarding china/russia trade commitments. i wonder how that's playing as we see these ongoing tensions geopolitically regarding ukraine? >> reporter: well, china continues to repeat that it wants to maintain a very close relationship with russia it hasn't yet condemned at all the invasion there as we see, the u.s. continues to pressure china, very concerned in fact, the treasury secretary

said she brought up the invasion of ukraine as well as china's economic ties with russia in some of the conversations, warning them about in any way supporting more military -- military -- giving us more military support to russia -- or to russia against ukraine. that's obviously part of the conversation not something we're seeing really changing in terms of china's position towards russia at the moment. >> what's on the god of money menu, do we know >> reporter: mushrooms from southwestern china, as well as other specialty dishes from hunan. they're really good. it's a great restaurant. >> do they deliver, that's what we want to know. eunice yoon in beijing. alan schwartz will join us after the break on what we need to see from the banks on friday and his outlook for deal-making in the second half. we're looking ahead to

earnings pepsi, delta, wells fargo and citi among the names that will be reporting this week we'll help give you a preview. dow's hanging on to about 100-point gain it's half of what it was the s&p has gone negative, joining the nasdaq

after last week's economic data, nearly nine in ten economists are expecting a 25-basis-point rate increase

next week from the fed our next guest is in that camp he sees it at the end of the tightening cycle but the quantitative tightening will likely continue. joining us is guggenheim partners executive chair alan schwartz you think we're nearing the end of this tightening cycle >> well, yes, i think we probably are, but i don't think it means that we're going to then turn around and have an easing cycle let me give you a little background on what we believe coming into this period. when we go back to when the fed began raising rates during what my partner, ann walsh, later told me was a rolling recession. i thought the delevering of consumer balance sheets that occurred before that cycle started as well as the change in age demographics that is very significant would mean that rising interest rates would have less impact on consumption than

it had in past cycles. and, therefore, that economic activity would stay positive longer than many people expected at that time now that has occurred. as we sit here today, while consumers reduce their exposure to rising interest rates, the financial system took on a tremendous amount of more exposure to that duration risk or rising short-term interest rates. but it takes longer to flow through the system the first wave of that, obviously, as my partner jim millstein, the massive wave of exposure those banks took as lenderses and therefore the marks on their positions in high grade was more than their capital. that's why the fdic had to resolve that so, that has settled down. the deposit surge out of banks,

leaving the banks, has settled down but what we haven't yet seen, as i say while consumers reduce their exposure to rising interest rates, the whole financial system dramatically increased that exposure. we're just beginning to see some of that exposure hit in a real tightening of credit conditions. and i think, therefore, i just want to say, we still think, while we thought it would take longer to see a recession, we still think there's a recession on the horizon probably later this year and maybe in '24 so will i think -- oh, by the way, on inflation, there are some positive signs with supply chain and imports, et cetera so i do think the fed will pause i believe probably after the july meeting but i think they're going to stay on pause for a while until they see how inflation settles out over a period of time.

>> just explain more about what you're expecting for the financial system, because it sounds like you do not think the aftershocks of svb and tightening have really played out there. >> yeah. i think it's -- the svb was just one part of it i do think people will be paying attention to bank balance sheets, especially regionals, and they all had a lot of exposure but it's really -- the first wave was lender duration risk, but borrowers took on a tremendous amount of duration risk in the last cycle an enormous amount now the question is, as those loans start coming due, whether the borrowers who now would have to pay much higher rates for the same loans they're paying off will be able to do that and what's going to happen to that credit quality the banks are going to have less incentive to be lending. so we're just beginning the tightening of those credit

conditions and it's very hard to predict where it can go until you see what kind of impediments in the system. >> what does this mean for guggenheim are there green shoots as we near the end of the tightening cycle? as you say, it doesn't look like we're going into an easing cycle any time soon. >> i think it affects different sectors in a very significant way. i think over in the financial side, as they say, the amount of floating rate loans that were issued and put into clos, et cetera, like that, they're going to be coming due a lot of them were a single b. you're starting to see downgrades in those. and how that's going to play out, you know, as i mentioned to my partner, the team will have a

lot of work having people think ahead. there's significant capital on the sidelines, but how that comes together and whether it opens up the markets for the more leveraged parts of the market, we'll have to wait and see. at the same time, investment grade companies, who are many times priced out of the market when people were able to use those low interest rates to buy assets, that now those corporates are coming back and looking at the opportunity to do some m&a as the buyer of, you know, maybe last resort, you might say. so, you're seeing an awful lot of corporates looking into see if they can now do some of their m&a they've been waiting to do and have been priced out we'll see how that plays out. >> where is the opportunity for you in this kind of environment where you're expecting the recession, right, and still worried a little bit about the health of the financial sector, but at the same time, the

consumer's not in bad shape? >> right well, the consumer is not in bad shape in general you're starting to see some of that now younger consumers that have particularly started to take on a lot of debt in this cycle, even if they didn't have as much coming in. so, you're starting to see some pressure there in those, you know, credit card debt and others in the younger demographic. that can have an impact on the economy as well. but we have to -- you know, we have a broad-based firm. we have m&a and capital markets and restructuring advisory, et cetera so, as i said, i think helping companies manage their balance sheets will be a big opportunity. bringing m & a opportunities, we're seeing we can bring in corporates that have strong balance sheets, get a chance to merge with companies that may be having strain on their balance sheets there's a lot of m&a opportunity. there's obviously capital

flowing into certain sectors you're seeing ai and its impact, data centers and things like that we have a fairly significant infrastructure bill. one last area i've talked about before on cnbc a long time ago, we've been focused heavily on sustainability and we believe there's going to be a major, major wave of investment spending on decarbonization and clean tech and all of those things. and what i think is important about that is that if you look at the things that the economy -- the global economy is going to be facing coming out of this cycle, the single best thing that can happen is a big wave in sustainability where there's a debate people say we should be investing capital and what's good for the economy, or we should be investing capital and what's good for the environment, actually in today's world, they are exactly the same >> what does that mean in

practical terms, what kind of investments do you like? >> well, you're seeing a lot of infrastructure in step one, the extension, especially with the i.r.a. coming in frau renewables in energy storage, in decarbonization, direct capture and carbon capture type of things there's going to be -- we're working with a number of people in government to try to get -- we need to get the smrs advanced nuclear started because there could be a big wave in advanced nuclear. and, you know, liquid hydrogen there's just a lot of things coming -- that come out of the lab and into the market now. and over time there's going to be a big global wave of capital into those technologies. that's exactly what the global economy needs to both reshore the supply chain that people are

realizing is now too concentrated in certain areas as well as bring some of the populations of the less developed world into a global economy where the developed world economies all have peaking and declining population growth. >> alan, thank you always interesting to hear from you and get your thoughts on the environment and the opportunities. alan schwartz, thank you >> thank you very much nice to see you. >> meantime, china just posted the lowest cpi number it's had in over two years. the story abroad and the close of europe is coming up next. watch out estee lauder citigroup opens a negative catalyst watch on the stock saying it could underperform on earnings shares are up lileita tt b back in a moment helping generate and move the energy that our world needs. ♪ welcome to a new era of energy.

welcome back to "squawk on the street." i'm bertha coombs. here's your cnbc news update flash flood warnings and flood

watches are in effect today in the northeast. meteorologist say thunderstorms will bring heavy rain to much of new england and northeastern new york comes after new york's hudson valley saw close to 10 inches of rain sunday. state officials say one woman died when she was swept away by flash flooding while trying to evacuate with her family dutch prime minister - >> we in government working with our partners on the ground have to work with our communities to build up resiliency, to be prepared for the worst because the worst continues to happen. >> dutch prime minister ruutu says he will not run for a fifth term in office following the collapse of his government he handed in the resignation of his cabinet friday, bringing an end to the country's fragile four-party coalition government. "the new york times" is disbanding its sports department hold on, the paper announced today that it will rely on the

athletic for coverage both in print and online "the times" says there are no layoffs planned in the 35-person department i like "the athletic," it has a sort of liveliliness to it. >> and useful for those who follow sports. thank you. is it time to dump tech? not yet says dan niles reasontoets g bearish on tech in the second half stay with us

couple hours into trading. s&p nailed that 4400 let's get a look at what's moving with bob pisani. >> remember the old closing high, 4458 only 50 points, essentially, away from a new closing high if we maintain that i've been traveling a lot. i can tell you the hotels, the restaurants, cruise lines, all packed we're hitting new highs on some of the big travel names. here norwegian cruise line since the end of may, beginning of june, that jobs report june 2nd or 3rd, these cruise lines, all the travel stocks have been moving new highs today on american airlines new highs on marriott. these stocks have been moving a big factor in why consumer discretionary sector has been doing very, very well this quarter. unfortunately on the other end, on the cyclical end, on global fertilizer names, for example, material names and commodity names, energy, not much help here at all for the overall

markets. here's mosaic, one of the big global material names that i watch. one decent day on friday on the jobs report and then essentially nothing. most sectors are down 16, 17, 18%. most of the energy names are also down on the year. commodities have not been performing very well obviously, some of this has to do a little bit with the slowdown in china. want to mention on the ipo and direct listing business, we may have a nice one down here tomorrow we'll have, perhaps, the first direct listing for the year. this is surf air mobility. they're supposed to be pricing tonight for trading here at the new york stock exchange tomorrow we'll see if that happens. this is an electrified aircraft company. remember here, sara, we have a direct listing they're selling existing shares directly to the public no intermediary. i'll be here covering that. >> yes, can't wait thanks, bob. let's turn to the notes catching our attention this motion boat load of bearish sentiment on what to expect in the second

half barclays saying it doesn't see the tech-fueled rally broadening to the rest of the s&p bernstein saying he struggles to recommend an overweight in the tech sector for the second half. and from citi, it may go on pause despite a solid first half our next guest predicting downmarket between now to year end. joining us is dan niles. it's always good to hear from you. thanks for joining us. >> my pleasure >> so, were you surprised by the first half outperformance in tech and the overall market before we get into the outlook >> absolutely. i thought the -- if you go back to what we were saying when you had all the bank failures, our view is the market would rally just because the government would step in. we've seen this since the global financial crisis every time there's a problem, you've got tons of stimulus. and you have about $400 billion expansion on the fed balance sheet right when you had all those bank failures.

we thought the market would get up to 4200 one big thing happened may 24th nvidia reported guided revenues 50% above consensus for the next quarter i've been doing this for 30 years. i've never seen that kind of revision up in a big cap company. so, at that point, you had a 7% rally in the s&p nvidia was up over 35% since may 24th and, you know, the market's gone to 4400, well above the 4200 that we thought it would peak out at yeah, it's definitely been surprising to some extent with nvidia and what happened, it makes sense. you know, people love stories. they want to chase the next greatest thing in that regard i guess it makes sense. >> well, it was nvidia it wasn't just nvidia. if you look at dunes rally, it definitely brought in doubt on this idea that growth is not going away we still have that inflation is moderating. that's a good recipe for stocks

and earnings expectations. >> well, yes and no, because remember nvidia's numbers went up a lot but we're going to have to see how everybody else looks at reports. since then you've had companies off quarter like accenture was supposed to benefit from companies consulting over ai the numbers went down. micron you need high bandwidth memory they reported -- four numbers went down, stock went down so, you've got to remember, nvidia is in a special class because they basically have a monopoly on how to enable ai the money spent on nvidia is coming out of some other budgets. it's not like the economy is going gang busters and companies have tons of money to spend everywhere it is the year of efficiency, to quote mark zuckerberg for a reason you're hearing that from every company. this earnings season is going to

be very interesting because i think you're going to see some companies do well off the ai theme, but i think you'll see others go, yeah, our ai business, just like accenture, like micron, that part of the business is doing great but all the other parts of the business are slowing down to our forward numbers are coming down. i think that's why this earnings season you're going to see a lot of stocks getting hit pretty hard off it. others are confirming they're doing well off the ai theme. >> with consensus down nine year on year, goldman's take is that would be trough earnings you're not in that camp? >> no, i'm not in that camp. the economy's like a battle ship we've had ten raises so far. i think we're going to have another raise at the end of this month by the fed and then one after that at least, at a minimum. it takes a while for that to filter through the economy and those bank failures just happened in march. lending standards have tightened but it's going to take time to

work it's way through. the bank earnings coming up this weekend i'm going to be watching very closely unlike the rest of the market, banks are trading 30% below what their historical average is. and we all know numbers are going to come down net interest margins are going to get compressed, loans are going to be harder to get and investment banking fees are obviously down estimates are going to go down if stocks go down despite them being at a 30% discount to what they normally trade at, that's going to tell you something about the rest of the earnings season and how high or low expectations actually are. i think with the tech companies that have been on a tear ever since nvidia reported, there's going to be some interesting puts and takes here in terms of, well, ai is hurting this if you have a very high pe ratio, that could be a problem we like meta, that's our best pick it was one of our top five picks coming into the year

you've got high single digit revenue growth you've got a 23, 24 pe against the market of 20 times that's really interesting. you compare that against an apple growing revenues at 1% to 2% at a 33 pe, you know, that's a lot more challenging and so i think valuation is a piece that nobody's really focused on i think at these levels, especially with the three-month t-bill at 5.4%, guaranteed, risk-free, against the market where if you take the inverse of, you know, where the s&p is trading at just over 20 times, that's less than 5%. the data looks interesting, especially if rates go up from here. >> dan, thanks for coming on, summarizing your second half views. always appreciate it dan niles. >> thank you. last year our top state for business was north carolina. your next clue on this year's winner is coming up after the break. plus, why shares of fox,

wells fargo goes underweight on the stock this morning over continued cord-cutting pressures and declining viewership n'gonyanown a little less th 1% dot awhere. maintain our financial strength and stability. and deliver solutions that meet complex needs. massmutual. partnering with financial professionals, benefits brokers, and institutions. the first time you connected your godaddy website and your store was also the first time you realized... well, we can do anything. cheesecake cookies? the chookie! manage all your sales from one place with a partner that always puts you first. (we did it) start today at godaddy.com

the big reveal of our annual top states is tomorrow our scott cohen joins us with more methodology behind this year's ranking and another hint, please, scott. >> sara, this -- we've been doing this since 2007. it is now officially a tradition

that at some point in the day before our top states reveal we get cohn to kayak or some other water craft and see if he drowns so far so good but there is a serious study behind all of this and for 2023, here's how it works. we rate the states based on what the states are selling this year with people in such short supply, everyone is talking about their workers. so, workforce carries the most weight where are workers moving, where are they the most productive and the best trained next, infrastructure with $1 trillion in new federal money, roads and bridges, ports and airports, broadband, sites for development. we look at the economy, which states are growing, life, health and inclusion, the cost of doing business, technology and innovation, business friendliness, education, access to capital, and the cost of living

>> you can read more about our methodology on our special website, topstates.cnbc.com. tomorrow we'll reveal america's top state for business so, where am i here's another hint. beat the rush. beat the rush. if you're with scott cohn in a kayak, will you not beat the rush topstates.cnbc.com more hints throughout the day. you can read all about state competitiveness at that website. >> beat the rush, any thoughts, sara beat the rush? >> no. looks like there's no rush there. >> whoever writes the clues needs to be a little more generous >> that would be me. actually me and my wife. like that is another -- that's a ritual now we work on the clues together. i think they're pretty good. >> we'll see >> i do wonder, scott, on a serious note, the way in which certainly rhetoric about business at the state level has changed, you referenced this in

the last hour, has changed the methodology overall, how governors see pro business policies has evolved in the last couple of years. >> absolutely. it's evolved and so different from state to state with the culture wars going on. we tried to address that what we generally try to do is focus on results you know, which states are gaining the most workers, where are crime rates higher you can look at life, health and inclusion, which is an important category and increasingly so because the states are talking about it and you can look at empirical things like state law and things like that we try to keep it as objective as we possibly can, focusing on results. and, again, as you saw a moment ago, it's based on the -- the categories are weighted based on what the states are talking about. we're trying to grade states basically on their own report

card. >> scott cohn not only talking about the methodology -- >> where do we think the cameraman is, or woman in that shot it's awfully steady. >> oscar molina on the shore there is doing a fine job. but i haven't given him much reason to -- i haven't fallen -- >> just be careful don't tip on live tv >> beat the rush, for shopping, when you leave the concert early. i don't know there's something i don't know when we come back, sara silverman suing meta and openai over copyright infringement. we'll get an explanation on today's "techcheck" next. watch shares of schwab, calling it an interesting trade e st earnings season thock's up more than 1%. we'll be right back.

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hollywood writers and content creators are leading the charge against a.i. over copy right infringement pretty interesting case here >> yeah, it's one of the big early questions around a.i. is the copyright infringement sarah silverman and others are suing over the bots, and of course this is not just an issue for meta and open a.i. but

questions the copyright lawsuits, and they are probably only just beginning. rbc writes, we're also keeping our antenna up for the data points, and it seems like the risk antenna is up more broadly on wall street look at chatgpt monthly traffic, it fell for the first time in june visitors declined as well as the amount of times users spent on the site google, microsoft and deed have under performed. guys, just as we are getting into the second quarter earnings season, a lot of the wall street notes i have been reading this

morning talking about how a.i. may not be relied on the same way as it has the last quarterly earnings reports >> just to understand the allegation here. do we know what sarah silverman says they have used, quotes or what >> she said it was the entire book there's summary websites on the internet that take passages from that, and she says then the chatgpt as well as meta takes some of that in a separate lawsuit, and takes some of the summaries to basically summarize her book, and that's what the other authors are claiming as well >> it's just the beginning and it's starting in hollywood you can imagine the business case as well, if you have particular models, you have

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the tech gains we were talking about in the first half were largely sparked by a.i. enthusiasm julia has news on that >> now it's starting to disrupt financial planning vcs have been pouring money into personal a.i. finance tools, over $1 billion invested, and public has a new a.i. research assistant called alpha and that analyzes public filings and answer calls to answer questions about stocks, crypto and the like, questions which would otherwise require exsperpertise

extensive research to answer >> alpha basically gives you an answer >> the next generation of alpha will be hyperpersonalized to explain how specific assets could fit into each particular portfolio. >> it makes that research so fast and so easy and therefore also democratizes it for everybody, because you don't have to know where to find the information, you just fire away and ask. >> and another startup called wally gpt is based on the tracking of the users' spending bills and budgets. cnbc learned jpmorgan chase uses a.i. to help select investments, and morgan stanley is rolling out an advanced chat bot to help the banks' army of financial

advisers the question is will the a.i. tools replace financial advisers there are an estimated 330,000 much them in the u.s., or will it democratize access to their services >> that's what we are all wondering. a new survey predicting that robo advice from a.i. services will boost returns and attract young investors. what does it mean for the asset managers the same survey says one-sixth will see a lot of big changes and consolidation coming out of the disruption and space

>> the tech innovation and the demographic innovation, as the boomers retire and pass along whatever wealth they created in the massive wealth bubble. >> and a.i., incredible. welcome to "halftime report." i am scott wapner. we will debate the road ahead with the markets with the investment city. joining me, bryn talkington and joe terranova. we have the dow in positive territory still, and s&p has gone negative and the nasdaq negative we h