>> okay. getting a little bit of lift in the green today. joe arch, that's you >> arch capital group, without question, records an all-time today and reports earnings at the end of july. a lot further room for the upside >> all right we're at the highs of the day for the most part. s&p's good for about 11 1/2 points and the dow near 90 i'll see you on "closing bell. "the exchange" is right now. thank you, scott welcome to "the exchange." here's what's ahead this hour. goldman sachs says there's now only a 20% chance of recession this year. have we gone from hard landing to soft landing to the economy taking off again our market guest says there's one sector in particular with the multi-decade runway. he's here to tell us which one, but even as a no landing grows, so are credit card usage and debt levels. how significant are the consumer cracks bubbling under the surface? the ceo of primerica is here with a brand-new report.

it is opening locations in the u.s., shares of piedmont lithium, and the ceo is ahead. dom chu has our numbers and we just keep climbing, dom. >> we do keep climbing we are just a stone's throw away from the 52-week highs that we saw on friday's session on the intraday basis and it's been green across the board for the major indices and the industrials are up .25% and 4519 the last trade and up 13 points, one-third of 1% and to give you an idea at the highs of the session, up roughly 16 points and then up -- or rather down one at the lows of the session and it's generally been tilting toward the positive side of things and the nasdaq composite about .75% gained and 14,212 speaking of, that techtrade overall. you may recall that the friday's session, one of the etfs, smh

hit a record high in friday's session. we are not far from that right now, but one other etf that has hit a fresh 52-week high is the i-shares tech software etf up 42% so far year to date and we'll put a little check mark there because again, a 52-week high, but keep an eye on the spread and the difference between the semiconductors and the software stocks, we are seeing a little bit of that growing out there. we'll see if there's a dynamic there that comes back toward with the mean reversion trade at some point watch technology, and then one of the stocks or industries that you want to look at is what's happening in evs tesla unveiled its first-ever cyber truck rolling off the production line from its texas factory just this past weekend that helping the power 2% gain there. meanwhile, ford coming out today saying they're going to cut the price of their f-150 lightning electric truck by up to $10,000 per model. that stock is down about 5% right now. so the ev price wars are

starting to kick up a little bit. tesla getting a tailwind from its truck and ford getting a headwind from its price cuts and we'll see if that dynamic keeps up. >> that's a biggie, dom. thank you very much. >> the market has been on a tear and the nasdaq soaring about double that up 5%, but my next guest says gains aren't over yet. he's turning to one sector in particular and here with me now is mike smith, senior vice president and portfolio manager at wells fargo advisers. drum roll, please. i just want to cut to it where do you see a multi-decade runway >> we're looking at semiconductors and that's the sector where i think you want to be last time i was on i spoke to you, kelly thanks for having me back on >> thank you >> the sector will take over all type of market share from all businesses, all type of market share and everything will change >> how much of this is priced in

what is nvidia up, 200% this year put that into context for us >> i have clients and the s&p 500 companies all over the country and when i talk to them they are just starting to have committee meetings about what they're going to do with a.i., and so when you think about that, i think we're in the first inning because we haven't really seen companies implement a.i. and we're not going to see that, i think, for the next couple of years. >> that said, the stocks always want to anticipate that, right nvidia is anticipating that all of these meetings will happen and there will be huge demand or not. do you think it's justified by the earnings projections that are feasible for the next couple of years >> if you used chatgpt you know it's justified when you talk to the executives at these companies they haven't used a.i. yet and they're hearing about it from their younger counterparts and when the companies start to see how you can make your company and your employees more efficient by using a.i., i think it will be a no-brainer for companies to implement this technology. >> maybe a lot of people would

say nvidia is the obvious and the posterchild here and the biggest beneficiary, but are there other chip names and you can say semiconductors and a.i and then you say intel how specific is this call to the sector >> this will be a global f phenomenon so when you're looking at companies in taiwan and companies here at home you'll have to see companies that will compete in the modern age. so i think that all of the semiconductors will been fit from this new normal >> all of them even the likes of intel aren't the leader at the vanguard and they're making more commodity-like chips and cars and household devices and that kind of thing. >> absolutely. intel specifically, they billions of dollars and they were allocating to new plants here at home it takes a couple of years to build these plants and i think intel will be the story for the next year or two, but again, smh and all of the semiconductors is where you want to be long term. >> i know you like large-cap financials and i don't know if you see multi-decade runway

there or if this is a beneficiary after making turmoil and that sort of thing >> kelly, i'm a value investor, so when you're looking at the d different sectors and the banks have underperformed and if you look at what happened with j.p. morgan and wells fargo last week, these banks are making money on the top and bottom line and they're knocking it out of the park and wells fargo was $13 billion just as cash we're holding the cash as a bank so i think going forward if rates continue to go up which i think they will, given what's going on in the economy and the soft landing, i think that you'll see the banks start to shine because of the different ways they can make money from wealth management to asset management and credit cards, mortgages and if you look at a mortgage and your credit card they're at record highs over the next 20 years. >> the firms are the winners while some of the others will continue to struggle and come up with a business model that includes implicit government

backing with deposits. >> no doubt about it >> the regional banks got hit hard and they'll continue to get hit hard as rates start to go up you'll want to hide out in these large, money center banks and the federal government will have a difficult time making the large banks in the fall. so you have that in the background, as well from a safety perspective so, yeah, large banks and the revenue that they can make and because of the fact that you have the u.s. government as the biggest backer >> let me circle back. they're a value investor and most don't land in the i want to chase nvidia in the 200% bucket, but just to come back. value is looking at the stocks, over the years sometimes there are questions about are these value stocks or not? what are the criteria you're using and obviously, we're talking about the runway for a couple of decades and what are the financial criteria you're looking at sometimes does that just not matter when there's an obvious trend in front of you that has

value? >> listen, when i'm looking at all of the portfolios i'm making sure that we're not keeping names that are rung up 150%, 2 hun% 200% without trimming and e doing the same thing you have to make sure to say, listen if financials haven't done well and they're filling their numbers essentially if they've run up 200% and go to a sector that's undervalued. i would say to everyone that if you're in a sector that's the tech sector and smh and all of that, and you're up 100, 150% thing get slaughtered and sell -- i didn't sell all, sell a little bit and go into a sector that has more value and financials is one of them. >> so as we sit back here and look at the fact that gp is still growing and we're still adding jobs and goldman is taking in its recession odd, you're starting to pull out the, you know, the accolades for chair powell here.

do you think he's worthy tell me about the job you think he's doing right now >> it's not about how i think he's doing it's results, right? and captain sully because this thing is really going in for a smooth landing here. when you're looking at all of the different metrics that you can think of, in is he accomplishing his goal you're looking at inflation at two-year lows. you're looking at the cost of used cars going down across the country dramatically energy prices down the only thing that i've seen a big correction is real estate and that's because there's no is up rye have you talked to anyone looking for home in the major markets to see is there a lot of inventory? >> it's had the opposite effect and that is the neck name making the runs and do you think in a year you'll look back and say we should have known that this landing was going to turn out differently? >> listen, you know, chairman powell, just like all of us are looking at the numbers day by day. i know sometimes they're lagging and this is what he has to go

by, and he's making the right calls based upon what he's seeing, the cpi and all of the different rates of inflation and how they're going down, and i think that the s&p 500 is down 20% and there's a case for him to go higher and the street is pricing that in. >> for the market. >> yes >> good to see you mark smith, wells fargo advisers. there aren't many bearish data points to highlight lately, but one of the biggest concerns out there is what's happening with credit card uses and primerica is adding color to that showing a third of the middle-income respondents saying they've increased their card usage and 61% aren't able to pay their balance in full each month. glen is here good to see you, welcome. >> good to be back with you, kelly. >> can you give us the context of 61% of the people that can't pay their bills each month >> we are seeing the stress of middle-income family as they continue to deal with the

compounding effects of inflation. while it's true that inflation is slowing, we're still seeing prices are up. they've not gone down and they've gone up more slowly and when you have a multi-year compounding of that, maybe 3% this year and on top of 7% or 8% last year and you have middle income families dealing with double-digit growth and prizes and there isn't enough money at the end of the month and they're bridging the gap with the use of the credit card and we're seeing usage increase, balances increase and all at unfriendly interest rates and it's become a real challenge for these families >> to put it weirdly or flip it around, i look at the share price and it's up 45% this year, why is that? >> well, i think if you look in the long-term scheme things we have periods where we underfor form like most stocks do i don't think it's directly connected to the circumstances of today or the circumstances of the survey

we're a company that's been around for 50 years and been public for 13 and we're out there every day trying to meet the needs of a market that generally doesn't have access to all of the financial solutions maybe that the wealthy would have so that serves us well when you served our clients well. >> would you say you're a beneficiary of higher rates because you're in a couple of life insurance businesses and those things which we tend to think of as, mae, ffinally we ct holdings >> there are higher rates and the way we run our life business is fairly capital. we are in the term insurance business so we're not holding assets like most of the more traditional companies that have cash value products. so we don't get as much benefit from the interest rate as the average life company and there is tailwind for there for us the flip side of this is some americans are benefitting with yield and i don't think it's as many americans as captured in the survey and they're facing

20% credit card rates right now and things of that nature. what would you say this data most correlates with historically is it back to pre-pandemic levels are we talking something worse than that? >> as we monitor the middle-income markets attitude that's the reason we created the financial security monitor in the middle of the pandemic was to make sure we can stay in touch and have our finger on the pulse of middle income families are dealing with we do see concerns increased obviously during the pandemic and as the pandemic started to ease, people got more optimistic and had more breathing room, but now the cost of living has overwhelmed that while we find middle income families eternally optimistic and it's amazing how positive they are in life with the financial challenges they race and we are seeing concerns rising and the longest we stay in this condition where the use of credit cards is bridging the

gap between their incomes which are increasing slightly. they'll acknowledge that and they haven't covered all of the ground that was lost due to the increasing cost of living and we're seeing those credit cards used and we're very concerned that if interest rates remain high those balances continue to compound and it will put more stress on these families financially. >> for an industry, the leisure and vacation industry that we see so much excitement right now. there is some concern expressed here 43% plan to spend less on vacation and activitiesthan they did last year only 14% expect to see a lot of people looking for free attractions and that kind of thing. i also want to mention to your point, you've raised the income threshold for the survey middle income is 3200 and now middle income is now 3230k, and i thought that in itself was an interesting development. >> as we monitor the survey and the types of responses we're getting we recognize it's a moving target as household incomes move and so we have expanded the range of the survey to make sure we weren't missing important data and the upper end

of the middle market and we do see what you described we see that non-essential purchases are something that you would expect and i don't think there's anything surprising and vacations and travel and that type of thing are on the list. what concerns us even more is the 72% that said they'd pause saving for the future. it's a concern now and it's a greater concern because they'll lose the compounding years that they need for their retirement and we're concerned about people not being able to take a vacation and that's important for our mental health and physical health, but financially, the bigger challenge is those postponing saving for retirement and can't make up those lost years >> glenn, thank you for bringing us these ruts. great to check in with you. >> glenn williams with primerica. >> still ahead, more disappointing data out of china, but my next guest doesn't expect big stimulus from the government we'll dig into the data and the

international ripple effects and plus are earnings expectations still too high for the market and our guest defies the bears who are throwing in the towel. as we head to break, let's take a look at the markets and it's the underperformer of a quarter-point cut. russell leading the way at 1.2% and the s&p at 4519, up 13 points and the ten-year down to 381. we're back after this. ♪ ♪ >> this is "the exchange" on cnbc ♪i'm hearing different ways for me to screen for colon cancer.♪ ♪it's time to use my voice,♪ ♪i've got a choice, more than one answer.♪ ♪i sat down with my doc.♪ we had a talk. ♪knew just what to say.♪ ♪i asked for cologuard and did it my way.♪ cologuard is a one-of-a kind way to screen for colon cancer that's effective and non-invasive. it's for people 45 plus at average risk, not high risk. false positive and negative results may occur. ask your provider for cologuard.

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♪ ♪ ♪ welcome back to "the exchange." the economic data out of china overnight showinging for thor slowing. the country's gdp barely growing quarter on quarter for the three months ending june while youth unemployment rate reached a new record high. as a result, morgan stanley revised down its full-year real gdp estimate to china to 5% in line with the goals beijing laid out in march and concerns are mounting after global food prices after russia allowed ukraine to export grain over the black sea. it was a deal as seen as essential to keeping food prices stable archer daniels midland and rgp are both higher today.

a cnbc contributor we're not seeing a ton of agflation. which one is more significant? >> well, i think at this point there's a lot of concern about the deflationary potential that bee see in the chinese economy the data that we saw reported for june really shows how vulnerable china is to both global conditions, kelly, as well as geopolitical tensions and on the latter it shows why china has been so aggressive in trying to step up its diplomacy and also has outreached to foreign businesses begging them to stay put because a little bit, a modest amount of derisking, and we see just how little room china has for that, kelly. they're going to have to really figure out how to fund a domestic way to stabilize their

economy and grow and the data that we just saw has shown that that's not happening at all and the youth employment number at 21.3%, kelly, this is a real concern for many of us because we know what the political instability a number like that over a long period of time could bring to china >> sure. so we'll start with the stimulus aspect of this and people don't seem to expect much. why? why is there not much? i feel like beijing has the mentality and it can do whatever needs to get done and i find it hard that they would sit on their hands and not try to do more to stimulate the lagging economy. >> a lot of people are scratching their head especially those in the market who have been expecting this robust stimulus to roll out now for two quarters and i just don't see it happening, kelly, for a few reasons. first, i think with respect to the modest gdp headline figure, 5%, many people in the chinese

government still believe they can hit that number, but i think it is also important to note that china's spent a lot of time trying to de-risk its financial sector and de-leverage its economy and the fear is if you let it rip and if you turn on the taps, all of that hard work will be gone down the tubes and then we have to remember that there's a heavy, heavy debt burden at the local levels, kelly, which they still haven't grappled with because the local governments took on the lion share of what they needed to fund the zero-covid policies that xi jinping put in place so there's just a lot of concern about what it would do to the economy and all of the work that they've done over the last several years to deleverage if they turn on the tap >> sure. so if i were their leadership and i said okay, my new number one priority is fixing youth unemployment how would i go about doing that, exactly?

>> i've been debating this i'll tell you what i think, some economists may push back on this i think instead of focusing on supply side, i think it's time for the chinese government to get more creative and target households with stimulus like we saw here in the u.s. and people will say, there are a lot of savings in china and it is true savings are elevated, but those savings are a safety net it's not a license to spend. and so at some point you want spending to increase and perhaps you have to target households and try to get people spending again on big-ticket items and yes, there's been spending on local tourism and two numbers in the data that stand out to me. automobiles up 1.1% and construction materials up 6.8% and that tells me that no one is spending big and a property sector that was cooling slightly, that was heating up slightly has cooled again.

there will be creativity at the committee in the end of the month and you can no longer tinker around the margins, kelly. the economy is in trouble. >> i still wonder if they'll be pushing on a string. people are smart and even in the u.s. when we got the stimulus checks, they were long-term productive and things like warehouse jobs and things like that if we can give the chinese consumer, they need the safety net and covid enhanced the need for that and there will be less spend thrift going forward >> i think you're right. that is the challenge and many people find the checks with the mouse holds, but at this point, kelly. i don't know that they know. i certainly don't know what should be done, but i know what has been done is not working and so tinkering around the margin here isn't going to grow the chinese economy. so there is going to have to be some more policy innovation brought to the table we may see that at this upcoming standing committee meeting that will set economic policy for the next six months, but this is a

real problem and it's not going away any time soon >> i would be very curious and it remains toward the weaker end of the recent reins and what's your reaction between them pulling out of the grain deal and putin making upset comments this morning >> we're seeing the results of a war that is not going in putin's direction. we respected the grain deal, and it's curious to me the timing is certainly fortuitous that we have the turkish government who helped to broker this deal with the u.n. agreeing to allow for finland and swede t and sweden to join nato last week and we have them talking about the war and then we get this announcement on the grain deal i think there are down sides to this the places where this will bite and hurt the most are places like africa and south asia, places that -- that russia and

china have really been trying to court and woo to their side. >> yes. >> and this, to me, is a shot in the foot. >> do you think the market -- there wasn't a huge reaction there seems to be more concern that there is actual kind of movement reflected with the prices so far. what does that tell you? >> that people believe this is likely a short-term sort of pout by russia. if you notice in the language they talked about turning it back on if certain conditions are met. this likely tells people watching this that this is a way to sort of blow off steam from what has happened over these last several weeks, but i don't suspect that this will go on over the long term because i think it hurts russia more than it hurts ukraine or the u.s., and it hurts the people in countries that russia really needs to keep on its side. >> absolutely. thanks for sharing your thoughts we appreciate.

dewardric with the world view. it is not stemming the outflows from cathie woods flagship fund, after all it's still down 70% from its peak and they exited nvidia before the stock's monster run. it's the subject of today's tech check ahead, and as we head to break, here's a look at the heat map on the dow 30 today. intel leading date along with j.p. morgan and amex and visa hitting a new 52-week high and on the flipside, verizon is the biggest laggard hitting a 12ear w.-ylo we have all of the details next. don't go anywhere. ( ♪♪ ) this is our task. this is our mission. we have a clear focus, and we have the ability to be agile and innovate. it takes years of dedication to get us to this milestone. it is all because of you. never doubt that a small group of thoughtful, committed citizens can change the world.

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the screens and s&p is down a quarter percent and the nasdaq leading the way today. the russell small caps doing good, as well. let's catch you up on what's going on with the telcos citi downgraded, including at&t down 6%. frontier down 14% and tds, telephone and data systems and the historical use of lead sheath cabling is likely to keep weighing on the stocks for at least a few months and maybe longer this all goes back to the wall street journal investigation last week tracing thousands of toxic lead cable across the country finding out there's been lead tainting and no one yet taking responsibility even though the company acknowledged it and has been aware of it throughout the years and they couldn't quantify the financial risks and it will likely keep investors away for now at&t hit the lowest levels in 30 years and verizon is trading at a 12-year low. absolutely an area to watch here with massive pressure on the

telcos until this issue is sorted out on the back of rising local advertising trends the firm raising its price target to 47 from 38 and even with the 10% pop today, we're about $5 shy of that the stock at its highest level in two years, up 54% since jan 1. for more on today's biggest analyst calls go to cnbc.com/pro now to tyler matheson for a cnbc news date speaking of pro, welcome back, ty >> thank you very much, kelly. >> an escaped inmate back in prison today after evading authorities for nine days. they captured michael burham after a couple spotted him in their backyard the couple dialed 911 and burham was apprehended in two hours and the investigation continues as to how the murder suspect got out of prison in the first place and now new charges, of course, pending against him. texas officials say the demand for power in the state will likely reach record highs as people crank up their air

conditioners to escape the blistering heat there, but the power grid operator has enough resources to meet the soaring demand it's hot everywhere, and in the mediterranean the scorching heat isn't the only problem there are wildfires there. hundreds of people and animals evacuated today as strong winds still take a quick-burning fire south of athens. police reportedly arrested one person for arson in greece meteorologists there have warned of the high risk of fire as the country recovers from a blistering heat wave kelly, see you in a half hour. >> tyler, sounds good. thank you very much. >> coming up, our forward earning projection coming too high my next guest thinks so and joins me to make his case and before we go to break, let's go to "show & tell," marriott nearing a new 52-week high after signing a deal with mgm for the las vegas strip with the bonvoy

program. spending in asia continues to be big after the china gdp data here's what marriott ceo told sarah eisen on "squawk on the street". >> into april in mainland china rev par was more than fully recovered in 2019 and in greater china so inclusive of markets like hong kong and mackao, we were just a cup of percente ag points from pre-pandemic

♪ ♪ ♪ welcome back to "the exchange." goldman is lowering his recession odds to 25% sending cooling inflation and the strong labor market he goes on to say he will hike the rate cycle and those economic conditions are giving earnings projections a boost and raymond james isn't convinced just yet and writing that the projections look materielly too optimistic if the economy continues to slow. joining me now is the institutional equity strategist at raymond james good to see you, welcome >> you are not allowed to be

bearish anymore. doesn't it feel like that? >> yeah. you know, i think the market was completely convinced we were going to have a recession about a year, year and a half ago, and kind of got bored waiting around for it. >> and the only thing i'm highlighting this morning is, you know, the economy is still slowing on a year over year basis in nominal terms and when i look at consumer spending and industrial production and we'll get tomorrow and the nominal gdp. all of these year over year trends look the exact same and everything is decelerating and earnings have been decelerating for the last four or five quarters as well, but when you look at the expectations for the second half of '23 and '24 it's for a significant re-acceleration and at the end of '23 it has the same similarity and seasonality to 2021 when we were re-opening, and then '24, expectation at

this point are 20% off of '23. i would say it's completely undoable, but something's got to break. either the economy has to start improving year over year and these earnings have to come down >> do you think it would just maintain the status quo, the way that we're treading water, let's call it and we were able to do that for another six months and would we be able to meet those eps projections or no? >> my guess is it would be probably not maybe more this year and next year it would have to come down significantly, and i think you hit those numbers. at some point here we get reacceleration in trends. >> i've seen people highlighting the ford move this morning, as a disinflation risk to earnings and in other words, you may have seen the news that you cut the price with the f-150 inflation like you were talking about nominal gdp, it does boost revenues and it does boost earnings and it does catch up with you on the bottom line, but going the other way on disinflation, it's great for the consumer and great for the fed and it can be a problem for

corporate america, can't it? >> not for every company, but for the index when you kind of piece together 3,000 companies was pretty clear from covid is that inflation is a benefit to earnings and probably disinflation will be a negative earnings we'll see if that's the case it will be a political problem if earnings are benefitting from inflation. >> what would you say is the most vulnerable? >> i think some of the areas that are more cyclical, traditional cyclical so industrials which have been very strong for the last six to nine months, consumer discretionary, you know, those are the areas that right now we have not seen the big earnings drops yet, and you'd have to believe a lot of those companies and those areas have been benefiting from inflation. so as inflation cools down, it is more earnings risks than the consensus numbers. >> let's bring the industrial

chart back and it's a microcosm for what's going on in the economy where we could say hey, there's no ay, look at this levitation, and this is totally unsustainable and the flip side of that is there's massive fiscal stimulus and we talked about this the other day with robert kaplan, formerly of the dallas fed so if we have a strong impulse from the pickal side with a lot of '24 sunset deadlines by the way, and maybe it makes sense these stock are doing it and they are achievable. >> as we battle for a legitimate, secular tailwinds to industrials and it's a broad sector and it is not across broadly with the industrials and some big pieces of it and then there's a cyclical headwind that's coming and i don't know what the answer is in terms of which will outweigh the other, but i think the industrials in the first half of this year the market has been focused on the secular tailwinds and we're thinking about the potential cyclical headwinds that could be just around the corner here as a

lot of these companies finish up their rebuilding inhavventories over the next year >> so what gives then? why is the market so strong? are not we all looking at the same numbers and don't we all acknowledge to use the earlier phrase, something's got to give? >> this has to be a one-hour ted talk, but i think, like -- look, every -- every time the fed hikes rates and goes through the cycle and we're going through it, and i agree with july is probably the last rate hike and every single time the market thinks we'll get a soft landing, very rarely does that actually happen, but it's important to recognize that once the fed stops hiking, all of the outcomes look the same right now there's no way to know it's all planning and it looks the same and a hard landing look and it's the same as a mild

recession and it is decelerating anywhere, and whether this ends up being a soft landing is really just where the growth declining and the deceleration starts to stabilize. and we haven't really seen that yet, if it happens back up this year, and then perhaps it may get a soft landing, but historically, it would be hard you know, the fed's even kind of saying they want to see some market weakness. so, yes. there's a lot there. >> that's the big issue. >> i want to see the ted talk. that is a challenge issued and if you make it short enough we can play it on the show and maybe ten minutes. >> i can tavis, thank you very much, and clearly laid it out and i appreciate your time >> tavis mccourt with raymond james. investors taking profits this

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♪ ♪ welcome back bailing on the cathie wood flagship ark innovation etf, the stock seeing three quarters of a billion in outflows. deirdre bosa spoke to her herself during tech check on friday hi, d. >> maybe it's not despite that rally this year, it's because of that rally the ark collection fund suffered heavy, heavy losses in 2021 and '22 after the big pandemic boom, but some investors are saying, okay, we've made a little bit of those losses back so now is the time to sell we've seen about $230 million net outflows this year a llone,

and more than 700 million. i asked cathie herself and what this perhaps signalled to her. have a listen. >> our asset retention has been spectacular. i think everyone would agree with that. asset retegz through '21 and '22. we are up more than 50%, some of our fund 60%+, so there would be natural profit taking and i do think we're beginning to see investors shift from the nasdaq 100 or the nasdaq take, maybe losses or gains there and into our innovation fund because i think the values when it comes to innovation are in our fund. >> so, kelly, she calls us natural profit taking and if you go back to let's say the flagship funds inception back in 2014, you would actually be underperforming the nasdaq and the nasdaq 100 and it urges us

to think long-term and we had a huge pandemic boom, but overall, it has been an underperformer in terms of tech stocks over the last -- since 2014 and that's a long timeframe >> one of the most fascinating stories, right to see cathie everywhere and so many people piling in and having a change of heart and not back to when they were pre-pandemic and performance has a lot to do with that, as well do we know about talent retention and they've expanded in size considerably over the last several years and it seems like that's still largely intact >> that's a good point, but i will say though, that her fees haven't changed all that much, right? she's still bringing in money, the fee that she collects is about 0.75%. let's take the qqq, for example, that is 0.2% so even though the value of her assets under management is declining, she's still raking in money that way

so it's an interesting question, will she have to sort of scale back and like she said to me she thinks people will put money into her because she has been the underperformer, as well and they'd rather hold ark and then the nasdaq or the nasdaq 100 >> so often with active management. >> totally, people end up coming out of the cycle and next time i'll stick with the index and it is a lighter load. >> over time it's been a better bet. >> deirdre, thank you very much. deirdre bosa for this edition of foet tech check. peed monday lithium was named idea best of 2023, and shares have jumped nearly 35% this year and they're planning on building new mines in the u.s we will talk to the piedmont ceo about that next.

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welcome back, everybody. lithium producer piedmont up more than 30% this year as global demand for evs and their key battery component continues to rise. piedmont lithium in the process of opening two mines, maybe more, two mines in the u.s., north carolina, the other in tennessee, and already has

customer agreements with tesla and lg chemical to start deliveries in the second half of the year joining me for mow is keith phillips, piedmont lithium's ceo. welcome. >> thanks for having me. >> so much to get up to speed on you're tog about the kinds of lithium and yours is more in quarries in north carolina and sounds like tennessee soon. >> all the lithium in the world came from north carolina from 1950s to the 1980s i was a mining investment banking for a long time and didn't know that two-thirds, 60, 65% of the lithium comes from quarries, mostly in australia. there's a mineral, we're going to produce our from sponjamean concentrate. we have projects in north carolina, quebec shipping now and in ghana and africa and chemical projects in north carolina and tennessee. >> does itnd up in the same product that might go into a tesla battery or from a quarry in your case a dried salt bed

somewhere else, are those different or no? >> they've different process flow sheets to get there, but there's wonderful assets in chili and argentina, brine deposits, assets in australia and others around the world including ours, they get to the same place we believe sponge ja mean is more environmentally friendly and the impact on the land we think we're in an area where, you know, it's easier to do, can be done more quickly the car companies will rely on lithium supplies. >> how does the economics work is the inflation reduction act or all the incentives primarily responsible for the new round of investment, or would this have happened on its own anyway >> it's a good question. electrification is happening electrification in the vehicle business is more than double

we'll double penetration and every one needs battery and a lithium. what it's done is brought the supply chain to the u.s., so right now, over 80% of the lithium chemicals are produced china. raw materials are in australia, chile, argentina, elsewhere, but the downstream processing in china bringing that here, where it all began and all started here in north carolina. >> do you do some of the processing yourself or regional partners >> we will do that we're building teams to do that and we're going to build a chemical plants in ten sni a city halfway between chattanooga and knoxville and we should announce our permits soon. >> how much of a boost or lift does the government tax credit get you? 30% on what the bottom line would be >> there's several programs. the most important -- the program people talk about is 30 d tax credit, where a buyer of an electric vehicle get a tax credit on their return for buying it, depending if that car

uses sufficient domestic minerals and a certain income level. there are other credits, 45 x credit, which is really a tax credit for us as a producer that's significant and came with the ira. that's what's happening people like us advance our projects, finance them and bringing in the lgs and others of the world to build more battery plants et cetera here in this country. >> how many jobs are we talking about for stuff like this? >> we should have over 500 between carolina and tennessee we'll have another several hundred in our partnerships in ghana and quebec thousands and thousands, so you've seen some, you know, in the traditional carbon boost which is over time just going to be transformed into electrified business, it's a different automotive manufacturing process, but the battery process is very significant and labor intensive. you'll see jobs -- >> watch those jobs move out of the traditional car producing areas of the country to regions you're mentioning that aren't associated with that real quickly, very short term

but we are seeing signs of over supply of evs right now, lithium prices are all over the place. what are the next 18 months mean for you in terms of whether that demand starts to slow down, kind of normalize the marketplace >> yeah. i think we're in the new normal. lithium prices went up 8x from 2020 to 2022, we're up 4x i think a reasonable place for them to stay i think they will stay there for a decade or more it takes a couple years to build an ev plant and a couple years to build a battery plant and a decade to build a mine, a long time for the raw materials - >> you know better than anyone how difficult a business it can be. >> mining is hard and chemical business is hard and producing pure materials rts battery needs is hard. we're up to do it and we hope to benefit the country and our shareholders. >> investors seem excited. stock up 6% today. thanks for talking to us about it appreciate it. >> thanks for having me.

>> from piedmont lithium. that does it for "the exchange." next on "power lunch," senator elizabeth warren is urging the sec to investigate tesla in a new letter the potential impacts. tyler is back and i will join him t oeridofhionheth se ts break. this thing, it's making me get an ice bath again. what do you mean? these straps are mind-blowing! they collect hundreds of data points like hrv and rem sleep, so you know all you need for recovery. and you are? i'm an investor...in invesco qqq, a fund that gives me access to... nasdaq 100 innovations like... wearable training optimization tech. uh, how long are you... i'm done. i'm okay.

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i remember being on aau trips, high school games. my mom would always say, "you need to fuel the body and you need salt." i would always be the kid not cramping, ready to go. fast forward 20 years and i go from eating salt out of my palm to drinking lmnt. welcome to "power lunch," everybody. alongside kelly evans if she would assume her position correctly in time, i'm tyler mathisen she's there. stocks once again higher today the dow heading for six straight days of gains, five for the s&p 500 and nasdaq perfect scenario seems to be playing out with inflation subsiding a bit, maybe enough to keep the fed on the sidelines. plus, we've got hollywood's bad signs, the strike raging on no writers, no actors and a crucial