fed cut yesterday. >> at the micro level, a new ceo coming back to nike. that's a big deal. and of course fedex, boy. rough, rough there on eps on the guide. >> yeah, we'll see what they have to see. triple witching tomorrow, and and s&p rebalances. that's going to do it for us here at "overtime." >> "fast money" starts now. live from the nasdaq market site in the heart of new york city's times square, this is "fast money." here's what's on tap tonight. a new top dog at nike. ceo john donohoe stepping aside. plus, did the fed give the markets the green light? the nasdaq surging 2.5%, the s&p and dow setting new records. while are investors crowding back into the growth trades, and will the momentum continue? plus, a populist-palooza. donald trump proposing a cap on credit card rates. how do the policies from both candidates stack up and do any of these price capping and free

money programs stand a chance of happening? i'm melissa lee, coming to you live from studio b at the nasdaq. on the desk tonight -- tim seymour, dan nathan, steve grasso, and julie biel. nike announcing that elliott hill will take over at ceo and president in october, replacing john donohoe. sara eisen has the full story. sara, finally? something's happening. >> reflection of the stock price how people were feeling about the leadership. the ceo announced with the board, came to the decision that he will be retiring as of october 13th. he's going to stay on until january 31st, 2025. the new ceo is elliott hill. he starts october 14th. he is a nike veteran. he was at the company for 32 years, startleed as an intern i memphis, worked all the way up to lead basically all the brands, including brand nike and jordan brand, so, responsible

for $39 billion in the pnl. and he has -- he stepped down in 2020, shortly after donahoe came in. they're bringing him back. he is, i'm told, extremely well-liked and well-known throughout the organization. worked in 19 different roles over his time there. came up through sales to really know the product. and that's what's so key for nike right now, which has sort of lost the innovative touch that it's known for. i want to share one comment coming in from tim cook, who is the independent lead board director on the nike board, he says, and i'll read you just part of it, elliott embodies the spirit of nike and will bring his deep connection to sport, passion for their products, and competitive instincts to get the company back at the top of its game. so, that is an acknowledgement that not only is it not only the top of its game, but why, you need someone in there who knows the culture, the sport, who knows the product. and that's what they see in elliott hill. >> why do you think he was not the right guy when there was the

opportunity to actually elevate him? >> well, because at that time, and this was just before 2020, tech was everything, right? and nike was becoming a digital-first company. john donahoe having led servicenow right before, and beforeebay, he was the tech guy. and nike was growing its direct to consumer e-commerce business. that was the future of this company. and it worked really well. during covid, we all went into lockdown, nike boomed because it was ahead of competitors on the digital side. and then the stock peaked in 2021, we came out of covid, and because donahoe was so focused on the e-commerce and digital channel, they broke off a lot of key relationships with the wholesale partners like a dil dillards, foot locker. it really shrunk the footprint there, so, the other brands came up, they got the shelf space, and then you had to completely do a 180, and try to get back into wholesale.

so, those were some of the problems that led the stock price toll lose almost 50% of its value from those highs. >> there's no question some of this was macro. athleisure has some of that, as well. before this news was announced, people were looking at fiscal q-1 and know what was going on with that supply/demand balance. and a question even that exists about donahoe as a coo kind of a guy, in other words, if he wasn't the visionary on brand and innovation, what was he? and where was nike really f failing? it's not just about they were losing ground on innovation, no? >> it was losing ground on innovation, also the channels was a big part of the story, and that's how he lost a lot of the, i think, confidence on wall street, when i talked to investors and analysts, because he did a complete 180 and had to turn that around. and just the culture, i think, of nike, is so important. you can blame the macro environment, and yes, china did slow down, north america slowed

down. but it's hard to do at a time when on and hoka and lululemon are still showing double-digit comps, when there's -- >> you wearing nikes right now? >> always. >> right now? >> i've been wearing nikes for 40 years. one of the things is, they have a very loyal -- you won't find me caught dead in hokas. >> i'm with you. >> no ons? >> tim's wearing the ons. >> i have some ons on. >> in my neighborhood, there was a flagship store on 21st and 5th avenue, what's going in there now? an on. donahoe did this huge restructuring, the timing looked good in early 2020, but when you think about the wholesale strategy, the direct to consumer strategy, the cutting out categories, but then there was onor thing and this goes to what i was saying about 40 years as a nike customer. they changed their whole marketing, and one of the cool things, they were awesome at marketing, right? the integration of sport and culture, all that stuff. so, do you think the new ceo will reverse a bunch of that

restructuring? >> i do. and one of the things he's known for is having overseen consumer marketplace that included marketing, and some of the big brand campaigns. remember dream big with colin kaepernick? that was a huge success for nike. he was there. and oversaw that campaign. so, it's -- for a company like nike to produce hit after hit, it really does take someone who is deeply imbedded in the culture. remember, the last big successful ceo was mark parker who is now the chair of the board. he came up as a designer through nike. so, someone also very in touch. the hope here is that because of elliott's sales background, he knows the product, he can sell the product. and it really is about having winning product. and you can just look on the stock x's of the world, the second-hand retailers, to see who is out there, and look, adidas has come up lately, in the last year or so. it's always instructive. i go to those places, because those are the most highly coveted sneakers. there was the panda release, i don't know if you followed this one during donahoe's tenure,

which was popular at first, but got mocked. >> i don't know what that means. it feels -- >> it's a black and white. >> something i don't want to be apart of. >> do you think it's ever too late? do you think that the market has gone away from him? you pointed out all of the competitors they have, there's a bunch that are -- that are not public that are competitors, as well. do you think -- >> yeah, certainly on the apparel side. look, they've -- it's unclear. they are still nike. they are still dominant in the field. and the stock is only down a about -- if you look overall, since the ten your, about 20%, expectations have been recent lower, but they have, you know, an army of designers and products -- >> but they always did. >> they always did, but that -- the morale was down, i'm told, and they need someone who can come in there and understand how to bring it back up and get nike key to produce the hits again,

i'm not sure that they've ceded that much share, that all is lost, that is perhaps reflected in the stock. analysts, like sam poser, i will say -- >> sell rating. >> he had a sell early. he had questions if there was the rightal innocent the organization. >> right. >> who understood the product. so, i am curious what he thinks about this. >> to be fair, though, you know, when dtc was all the rage, investors lauded nike. >> they loved it. >> it was like the best thing that ever happened. >> that's all we wanted to hear was the dtc number going up and led to a valuation going up. >> right. >> higher margin and faster growth. and for awhile, throughout the entire industry, all the growth was in dtc. then we came out of covid and we started shopping again, and -- they just didn't have the kind of shelf space our the hits on the shelves thatthey did before covid. they pivoted. when i talked to donahoe about this, he said, yeah, we were all at home. he blamed it on the fact we weren't all together, so, we lost a little bit of the innovation touch that they're used to.

but ultimately -- it was tough to come back from. >> it's interesting. if you look at their annual results, both earnings and sales, last year, 2023, was the only down year they've really ever had. not meaningfully, like single digits percentage or something. it's interesting it comes after that. margins have been flat over the last few years or so. if you think about 70% of their sales is footwear, and what steve just said, they've always had competition, you remember reeboks, you are still wearing them, tim. >> never wore that in my life. >> that's how they were born. challenging adidas, which was the big one in the room. >> and they've all gone away, essentially so, the challenge with hoka and on, these are real things, but -- >> small, small percentage of market share. look at basketball shoes. nike dominates. >> what we had when we were growing up -- what the kids have now is, they have instagram and they have more social, so, a very tiny company can actually get on a bigger platform and start a trend where we didn't have that before. you needed that large-scale nike

advertising deep pockets. you don't really need that anymore. >> no. you do have to be close to your consumer. and that is something that i think is the lesson here, with a donahoe who came from a consulting background, came from a tech background, and clearly the company is now completely pivoting to someone who really understands the deep nike history and background. i got emailed his list of, like, favorite shoes and, within the running category, there's, like, four of them. i mean, this is a man that knows and has been there for a long time. >> sara, thank you so much for coming by. >> great to have you. >> happy to be here. >> surrounded that trade, huh? >> we're not done yet. >> oh. >> let's get more with simien seigle. what is your take here? >> hey, guys. well, i think sara said it perfectly, and i'm sorry that i'm not sam poser, i know she was looking for his opinion, but i think that she brings up a lot of really good points.

i think there was these words, pivoting, it's pivoting back. so, this is one of those -- there are so many fun, potential titles to use here, but back to the future feels very appropriate. and so, if half the conversation is about product, and half the conversation is about channel and half is story telling and there's a lot more paths, but we need to know about nike. nike sells product and tells the story better than anyone else. i think it's really important to act n acknowledge they are still enormous. the stock has been knocked down, and the perception has been knocked down, but revenues really have not. >> why do you believe elliott hill is the right guy at this point, when he wasn't the right guy before donahoe? >> so, it's an interesting question. it's also unfortunately, or probably fortunately, my opinion doesn't dictate who they bring in, so, that's probably good. but i think that what we saw, and we've talked about this in the past where the dtc not being

all it's cracked up to be. our company put up a report about the blind push to dtc. the notion was -- common sense, let's get rid of the middle person, we'll make a lot of money. but the partnerships matter. and if you do them well, they are incredibly economic. and i think someone who understands that, someone who, tomorrow, is a culture booster, right? i think there's been morale questions. i think having someone who noms this business, who has been around this business, who understands all of that product, i think right now, we want to go back. it's an interesting ing juxtaposition. we spoke right after the starbucks announcement, everybody was saying, you have to bring in someone new -- i think what nike needed was actually the change that was the problem. if we go back three, four years, what they were doing, it really works, because it's very hard to compete with nike's size and scale, given their r&d budget and marketing buckets are just so large. >> you bring up a really important point, when you first

started, you know, talking to us. if they're not creedi ceding ant share, is it a perception versus reality thing? because under armour is outperforming them, sketchers is outperforming them if they are not giving up share, why is the stock price suffering so much? >> yeah, it's a get question. and it's not to say they're not giving up share, but they're not giving the share we think. and the reason that's important is all of us think about the latest drops, we think about the lebrons, the jordans. at $50 billion in revenue, by definition, the vast -- these units are dramatically cheaper units that sell to people that are just running on the street that are going to school, that are -- i mean, that is what this business has done that's so magical that they've been able to segment this incredibly expensive product that we talk about. that we compare against the hokas and the ons and everyone that we're referencing on, but to be $50 billion, that means you are selling so much more than just those products we talk about. so, i think that sometimes gets

overlooked. and that's why i try to remind ourselves to go to the revenues. the revenues do need to be reset. they did take some of these incredible franchises and stretch them too far, there's no question. it will take some time to get new products in there to replace them. but this is not a business that's watched revenues collapse. >> hey, but speaking of history and speaking of kind of what has changed and going back to the future, where have you been in terms of the multiple that you put on the stock? have you contracted the multiple? we can get into what have been some of the operational changes to the business, but generally, this is -- the number one athletic brand in the world, as you said, with enviable scale, in a sector that still has major secular tailwinds. isn't, you know, so, you have changed your multiple? i'm kind of curious from the analyst community, what's different, or what do you do now? >> it's such an excellent question. it's such a fair question to keep me honest. at the end of the day, unfortunately, in this nvidia market, the multiples get moved around a lot faster than the

earnings. look at the stock today. no one's changing their numbers today, and the stock is moving. so, by definition, the multiple is moving a lot. it used to be nike, starbucks, dollar stores, some of the big box. you had the hideouts in consumer that were viewed as consistent safety and not volatile. as you lost a lot of those, people paid a lot more. the multiples for tjx, a company i absolutely love, looks nothing like the multiple that it used to, not because the growth rate, but because of that consistency premium. and so, i think to your point, the nike premium, when things were great, were far -- far outweighed the growth opportunity. but it was okay, because you were paying for that safety. when you lost that safety, when the per seception changed, the multiple started coming down. and with the earnings not changing at all yet, because it will take time, you're still seeing the willingness to spe spending, nike inching its way out of the penalty box and back into that premium sector.

>> so, is it expensive? i mean, that's -- that's the bottom line. all that mean ing what at this point? right now, trading 29 forward. >> it's expensive for a reason. it's expensive for a reason. there's plenty of the best consumer stocks right now are incredibly expense ich. and this one, even where we're looking high 20s, that's still cheaper than some of the other premiums you're paying for consumer companies. >> all right. simeon, thank you for phoning in. appreciate it. julie biel, do you like nike here? is it worth the premium? >> no, i don't think so. i think there are a lot of challenges that are still ahead of it. i agree that going back to what works for them is probably a really good strategy, but there's still a level of execution, and to me, this starts to sound a lot like the problems that victoria's secret had, where they had such a dominant position, and they really saw it get eroded away by competition, of upstart, particularly during covid. i just think the competitive

landscape is much tougher now than it used to be, and that needs to be reflected in the valuation. let's turn now to the major market rally, on the back of yesterday's fed rate cut. the s&p 500 surging above 5700 to post its first record close in more than two months. the dow had an all-tile high, while the nasdaq jumping 2.5%. take a look at some of the paragons of the growth trade. the semis soaring more than 4%. igb software etf hitting its best level since november 2021. and this after fed chair jerome powell signaled more rate cuts are coming and that the jobs market remains strong. so, did the central bank give the all-clear for markets and especially the growth trade? tim, you are making the case that it will look like all clear for stocks. >> yeah, i guess -- my feeling yesterday, the market came in at all-time highs and was a little disappointed. 2% growth out to '27 to me, where we're going to be focused on keeping the labor market supported, where i don't think the unemployment tickup was anything more than and increase

in the work force. we're watching the fed, who is no longer data depen dedentpend because we recalibrated. the growth trade today is back on in terms of, again, the relative outperformance of equal weighed and what not. that was not today. it was semiconductors reasserting themselves. high multiple tech. it was like the arc revolution stuff. >> i think the fed has been late, and when they go 50 basis points, they think they've been late. so, we have to decide on, is -- are we in a recession right now? and if the answer is no, the market's okay. are we in a recession right now, and the answer is yes, then the market's lower in a couple of months, so, are we in a recession? >> no. >> not even close. >> no, we're not. what i took away, and we talked about it last night, what powell said is the risks are balanced between their dual mandate and right now, they're cutting because they can cut, because they feel confidence that their

inflation target is going to be reached, but they want to support the job market. which, i think speaks to what tim's talking about. they're very close to being able to say mission accomplished on a safe landing, you know what i mean, a soft landing, that sort of thing. so, we won't know. i mean, to your point, i mean, maybe the economy is weaking under the surface, i mean, that was the view in early august, right? go back to 2018, i mean, it was a growth scare globally, we're not feeling that right now. we've come out of the pandemic and some of the stuff we've done to battle inflation, maybe better than a lot of other folks. i just think it's important to remember why inflation rose the way it did. it wasn't policy, it was a black swan event, right? and then it was an invasion causing, you know, gasoline and nat gas to go up a lot. and these were things that were very difficult. but at the same time, a lot of consumers here, which is 70% of our gdp, were kind of buffeted a little bit. so, again, i think -- they're very close to landing the plane -- >> you sound kind of bullish on this. >> i've been this way for the

last couple months in a way, because what became very clear to me is that things are okay. you know what i mean? the consumer is hanging in there. companies are not -- >> so, why -- i hear everything you are saying, and i thought he should have been cutting earlier, so, i like the fact he went 50, but 50 doesn't tell me that the economy -- that he believes the economy is okay. 50 tells me he's worried about the long and variable lags. >> no, because it is restrictive if inflation's going down to 2%, and they have fed funds at 5.25, then that's the sort -- >> so why zillsit on your hands july? i'm not disagreeing. it sends a bad message. >> so, you would fade this? >> definitely. i've been making sales. and i would. and the fact that we rallied so hard means that the market didn't understand -- everyone said, oh, 50 is -- is factored in. it's obviously not factored in when you have a blistering rally on the second day. >> to be fair, though, it's not just the 50-basis point cut, it's what he said in the press

conference afterwards, and the press conference afterwards, 4.4% unemployment is the line they're going to defend. if that's the worst case scenario for us to digest -- >> bring it on. >> that's not bad. if that's going to be peak unemployment, with steady growth, that's a pretty good scenario for stocks and we're seeing it -- it's not just the growth trade. we saw rsp doing well, equal weight s&p, in your world, small caps also doing nicely. >> yeah, really strong. i think everyone in small cap land have been really hoping and excited about any kind of rate cuts, because it should provide some relief, smaller companies tend to have leverage that's variable. and so, they should be beneficiaries. that said, they are more economically sensitive, and so, i think there is this kind of push-pull, if you're in small cap land, of not wanting to be too aggressive, because if we do see weakness, that's problematic. but look, if you look at kind of the misery index of adding up

unemployment and inflation, we're still better than 85% of the time we have been in the last 40 years. we're in good shape. the question is, is how sustainable is it? because we don't have a lot of cushion, either, in personal savings rate or in the government's ability to try to fight unemployment. >> so, are you skeptical of this rally? >> i just think that there is a lot of opportunity for broken hearts, right? it's only happened once before in our history that we have over 100 basis points of rate cuts and the s&p earnings up double budgets. that's only happened once. so, it's just high always make me worried. coming up, we are delivering fedex earnings to you. the shipper tumbling on its latest results. inside the numbers right after this.

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welcome back to "fast money." we've got an earnings alert on fedex. shares are plunging almost 10% after the company reported a miss on the top and bottom line. the company slashing its 2025 outlook. let's bring in cnbc's frank holland with the very latest. frank? >> hey there, melissa. the call begins shortly. we're going to be looking for any information about the strategic review of the company's freight business that many analysts believe could lead

to a spin-off. you mentioned the eps amiss. it also paints a very different picture than the previous quarter, where the company appeared to be doing a built of a turnaround. so, in june, fedex changed its operations. the biggest change having express and ground packages delivered by the same trucks. estimates they don't quite capture this change, but based on the new bfinancial reporting we saw declined revenue for express and ground by 1% and 3% decline in freight revenue. we saw an overall margin decline for the corporation, a metric that's a proxy for efficiency in transports. the again, the call starts at 5:30 eastern. we're seeing shares falling, but the company once again, is this an issue for fedex or an overall e-commerce and freight issue? melissa, back to you. >> frank, thank you. frank holland and fedex. they said higher costs, those things would be applicable to the u.p.s. story, but here, it's

a freight, freight was a weak spot. >> it's an interesting time to be thinking dow theory, in terms of whether, you know, is this telling us something about the economy. but when you hear the company say -- a company that had previously guided on '25, now just low single digits. they have said that weaker demand is being offset by lower pricing. these are not things you want to hear. and i just think this is not what the market expected. it seemed like things had stabilized in terms of pricing. not the case. >> they were beating on every metric compared to u.p.s. u.p.s., the chart looks materialable, but probably ripe for a bounce. i'm surprised that u.p.s. didn't bounce off of this, because it's already been blistered. but the bigger takeaway is the barometer on the economy. so, if we're all looking at the economy, maybe they're offering us insights as to how weak the economy might be. >> all of a sudden, we're all dow they arie ist theorists.

>> always wanted to be one. kind of fun to be a theorist for a day. >> all of a sudden, the transports are going to tell us how the economy is doing? >> probably invested a lot in gen a.i. i agree with what steve's saying. there's going to be plenty of situations as we get into q-3 earnings and hear q-4 guidance, and it's going to give us a decent mosaic of how the economy is doing. so far, if you go back to what fed chair powell said yesterday, you just mentioned it, 2% growth at 2% inflation, that's kind of what we were doing for years and the stock market continued to go higher. we haven't had a recession in a long time. but i do think this is slightly troubling. coming up, both presidential candidates ramping up the populist candidates. ony d e econigould shape the ecomanthelti rht after this.

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you get comfortable being uncomfortable. ♪♪ the enemy is always adapting... deepfake: hey handsome. ♪♪ [inner monologue] ...always iterating. ♪♪ former president trump proposing a new populist policy, promising to put a cap on credit card interest rates, if he is e legged. the republican candidate make his remarks at a rally last night. eamon jaifers has more on that plan and a host of giveaways coming from both sides of the

aisle. eamon? >> yeah, melissa, that's the trend. it's all populism in this election. the former president last night at a rally saying that he wants to cap the interest rates on credit cards at 10%. here's how he put it. >> while working americans catch up, we're going to put a temporary cap on credit card interest rates, we're going to cap it at around 10%. we can't let them make 25% and 30%. >> now, the american bankers association reacting to that proposal. you might not be surprised to learn they don't like it. they said, why don't know the specific details, aba has opposed similar interest rate cap proposals in the past, including one from senator bernie sanders and congresswoman alexandria ocasio-cortez during the 2020 campaign, because they would result in the net loss of credit for the very consumers who need it most. so, melissa, what we're seeing here is, you know, populism on the economic side, in a way

that's really not traditional republican party economics. an idea for the government to tell credit card companies what rates they can charge their consumers is sort of a regulatory big government kind of an idea that you would not have seen traditional republicans proposing, but this is a different republican party now. this is a party that views itself now as the party of working americans, does not necessarily view itself as an an anti-regulatory all the time party. does not necessarily view its as an anti-tax increase all the time party, and it's matching the democratic side, with the increasing embrace of populist proposals like kamala harris, her idea for a $25,000 tax credit for first-time home buyers. this is a race to push out the populist proposals on both sides. >> and then, of course, there's also the big issue of high drug prices, there's the big issues of supermarkets charging too much, eamon. it's -- the list goes on and on, it seems this political season. >> yeah, look, and the question is, how much of this could you

actually pass if you were in charge of the white house and in congress? you know -- maybe a republican congress with a president trump re-elected would pass this idea. they're billing it now as temporary, you heard the former president say temporary, the campaign says temporary, but this is the kind of idea that, if it's passed, you just don't see a congress in the future voting to allow credit card companies to raise your rates, right? once they're capped, they're going to stay capped. so, if this happens, it's going to be a long-term thing. and i can see why the banking industry is a little bit nervous about it, right? >> yeah. eamon, thank you. >> you bet. >> eamon javers. it's really interesting. if i said, you know, if i said, i'll give you a proposal and you guess which party has proposed it, you would not be able to guess anymore. >> also to steve's point, steve, you are going to keep getting points here. >> thank you. >> there's $1.1 trillion in credit card debt here in the u.s., right? the average household has about 9,000, the average interest rate is about 25%.

where else in this economy, though, do we have that sort of usury rates for people who are actually spending a lot? that's a big part of this resilient consumer, right, is consumer debt. so, i mean, it is populist, i think both sides probably have a good argument for it. we see this current administration, they've taken a shot at junk fees, at banks, at airlines and stuff like that. >> quoting the aba, why -- you are going to kill credit. you're going to kill the ability to get credit. especially if people who have terrible credit are capped to 10%, people are going to be like, you know what? i'm not going to give them credit. i get it. i don't think there's any way this would get voted through by a republican congress. there's no way. but it is upside down day and for both sides of the aisle. they are both very deficit unfriendly, too. >> and just coming out of xhs g kamala harris, pharma, child care, but when you start to look at this, if i give you the

headline, teamster members are voting 2-1 supporting trump, so, maybe it really has flipped on its head and this populist groundwork they're doing is gaining traction. >> no tax on tips, no tax on social security benefits. julie, i mean, yes, if you are not taxing -- you're not collecting revenues. >> where do you raise the money? >> i don't think anyone has said it better than my fiance who said this race really does feel like a high school election for class president where they are offering us free ice cream and no school on fridays. there's no realism with regards to the deficit that we already have. and the potential for us to lose our status as the reserve current si if we continue to spend the way that we are. and then it doesn't matter how much we cut interest rates, right? if the rest of the world doesn't want to use us as a reserve currency, interest rates will stay really high and it won't help anyone out. i wish there was a little bit more realistic assumptions on what price fixing does economically, like, you can't ignore the laws of economics,

i'm so sorry. coming up, lennar shares lower after the homebuilder's latest earnings report. how the fed's rate cut is impacting that trade, next. (woman 1) all right, here we go.

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welcome back to "fast money." stocks soaring today with the dow closing above 42,000 for the first time. the s&p jumping to its own record close. and the tech-heavy nasdaq soaring 2.5%. and take another look at nike shares surging afterhours after the company announced the ceo change. ceo john donahoe will retire and longtime nike veteran elliott hill will return as president and ceo effective october 14th. there's construction going on upstairs, it's very noisy. china stocks rallying today. the moves coming in anticipation of a rate cut by this country's central bank. expected to follow the u.s.'s rate cut on friday. and of course they are facing ever worsening economic data, tim. would you buy the moves here? >> well, i think -- i think the china move is less about a china policy than it is about u.s. policy. if i had to guess, as an em guy, i think this is a great back

group for e.m. to outperform. decent trend growth. we've had some dynamics with alibaba, they had some news out today about a.i. dynamics that are giving them a little fuel. closed above that may high, that june high, i think, which is a really important level, around $87.50, $88. i think they go higher. the china news -- we know china is underweight, underloved. i like the trade. coming we're going to sit down with rick heitzmann. plus, lennar dropping after reporting earnings. we'll dive into how the fed's big rate cut could impact the big rate cut could impact the home.people person. but he is an ent with a plan that's right for him. let our expertise round out yours. we always had dogs, they're like my best buddies.

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. welcome back to "fast money." earnings alert on lennar. the home builder lower despite reporting a top and bottom line beat in the latest quarter. diana 0 lick has the story on this. diana? >> that revenue beat was due to a 16% increase in home deliveries, partially offset by a 6% decrease in average sales price. the price, $422,000 for a lennar home. but deliveries came in higher than estimates. new orders increased 5%, but

were slightly lower than estimates, so, kind of a mix. the backlog of under 17,000 homes is down from q-2. lennar's chairman stuart miller said in the release that affordability continued to be tested during the quarter, but while strong demand enabled by incentives and mortgage rates, buydowns has driven the market over the past two years, we expect an even stronger and more broad-based demand cycle as rates move lower. home building gross margin of 22.5% was lower than expectations. guy dance on new orders and deliveries within expectations, but margin guidance disappointed, and melissa, that may be why the stock is lower. >> just quickly, dien yan that, the rate on the 30-year mortgage went up today. it is expected, though, it will go down longer term. >> that is the trajectory. why did it go up today and yesterday, as a matter of fact? it's because it was all baked in. we've seen mortgage rates come down a full percentage point just since july. and that's because of the

expectation that rates would be cut, and that, you know, we're seeing inflation mold rate. so, that's why it came down before. when the fed cut, it had to go back up, because it couldn't go any lower. but the trajectory is to go down. >> diana, thank you. julie, if you believe the fed, in terms of capping unemployment at 4.4% in terms of growth, 2% long-term, all of these things, that should be great and rates coming down, great for home builders, no? >> the most important thing for the home builders is just the strength of the labor market, right? because we have a nice setup in terms of supply is still con trained, even if people are eager to get out of their houses. they're not really able to do it when they are locked in still so low. so inventory is probably constrained for another 100 basis points from here. and there's still a ton of demand for it, so, for them, the setup is great. as long as the labor market maintains strength. if not, then it's really going to be challenging for them. >> you need activity.

and if there's going to be less incentives, it's great for their bottom line, but you need activity to come back. the problem is, most people have a mortgage rate that is much lower than where the mortgage rates are now, and they're not falling in a precipitous fashion. until that happens, you're not going to see the activity pick up, so, these stocks are just trading water. and then, it's the consumer. does anyone have money? i love the fact that you think the fed has a crystal ball, i don't believe so just yet. >> isn't this the stock has gone up 75% in the last 12 months and the stock knew that the fed was going to start cutting rates. talk about the ultimate, shouldn't you been selling the fact on something like this? you can't tell me we didn't know yesterday was going to happen for home builders. and you can't tell me we don't know that there's not an enormous amount of pent-up demand out there. so, i just -- you know, these things don't go to the moon. i think that's part of the story. coming up, rick heitzmann

will join us for a dp eedive inside what the fed rate cut means for venture capital. and services businesses, deliver global financial solutions. so our client can keep investing in innovations for patients around the world. without pause. for the love of moving our clients forward. for the love of progress. - so this is pickleball? - pickle! ah, these guys are intense. with e*trade from morgan stanley, we're ready for whatever gets served up. dude, you gotta work on your trash talk. i'd rather work on saving for retirement. or college, since you like to get schooled. that's a pretty good burn, right?

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financing getting a post-rate cut boost today. tesla surging more than 7%. the best performer in the nasdaq 100. for more on how rate cuts could juice the market, let's bring in rick heitzmann, he's an early investor in airbnb and pinterest. great to get your perspective. >> yeah. great to be back. >> so, what happens? writing more checks now? >> companies have longer life spans, but the key thing that's going to happen is hopefully this is one of the first unlocks of the ipo market. the ipo market, you know, lives in fear of risk. w one of the risks was interest rates, one of the risks is the election, one of the risks, where's the economy? this means the fed is really serious about where the economy is, and this will spur enterprise and consumer spend, in addition, as rates go down, more money shifts into equities, equities go seeking risk. best part of the risk curve, hopefully in the public

equities, is ipos. and you're beginning to see an unlock of an ipo market that's been closed since the great depression. >> wow. you mentioned the three risks, and two of those risks don't get solved with the fed cutting rates, in terms of the economy and the election. >> correct. so, but you're starting to s see -- there's a light at the end of the tunnel, hopefully that's not a train. you're able to see, you know, hey, are you going to get to a point where you're going to have an election resolved in two months, hopefully, you know, resolved for at least four years at that point. so, at least you know the rules of the road. and then you assume, given the fed's ommentary, that if this isn't enough, 50 basis points isn't enough and no one believes that that's going to be it, that the fed will continue to cut to push the economy forward, which especially for software companies, which tend to be somewhat long-dated as sets as a stock, but also in terms of cap exand spend, they will benefit on both sides. >> eick, let's go to the entrants here. you have this great track record

focused on consumer, but you do a lot of enterprise software and the like. what are you seeing early stage away from generative a.i.? it seems like every morning, you know, in the axios, gen a.i., gen a.i., what else are you seeing? >> you're really seeing a downturn, right? so, amazing -- even though we invest at the earliest stages and we hold for, you know, 8, 10, 12 years, so, we shouldn't be looking towards the exit environment, but what really shuts it off is our investors, limited partners, foundations, big endowments, universities, need that liquidity from an ipo market, or from a good m&a market, which has been a little bit cut off due to especially the ftc and the current regime, is that, you know, you're not seeingly kwidty. without the liquidity on the back end, there's not as much capital flowing into the early stage, and that's cutting off that oxygen for the early stage investors. >> in terms of where you are writing checks for at this

point, outside of a.i., what are the hot areas? >> we still believe that digital health care is a big opportunity. and, you know, health care has always been a laggard on technology, and now you're seeing health care really open up. both in terms of, you know, it's the biggest part of the economy in terms of percentage gdp, the fastest-growing part of the economy, and they're starting to use even the institutions, technology to better service their customers and patients. the payers are starting to say, hey, i can pay less for better quality of care, and consumers are demanding it. >> okay. and ro, you are a backer of ro, so, glp-adjacent, are you doing anything else there? >> we've looked at glp-adjacent, we think it's a megatrend. we think this is going to be something that's going to continue for several years, at least. we're looking, we haven't done anything yet. but we think that that's going to pull a whole bunch of things forward. and if that's knock-on effects in terms of the way people eat or travel, we're aware of that

trend. >> so, we were talking in the break before the segment started about the early check that you wrote to airbnb, you got in super early. you wrote one $38 million check, early, early on, and the returns that you've gotten so far. can you -- do you think that in a new higher forever interest rate environment, where we don't go to zero, presumably, ever again, that you'll be able to have those opportunities still, that you can have those massive upside returns? >> i think -- and you've seen it in industries, you know, the best investment for a long time in gen tech, that was a 1970 investment, still a questionable economic time. facebook was, i think, '05, and jim breyer and excel had several thousands times their money returned on that, and that was a little bit of a normalized interest rate environment. so, you are somewhat tied to interest rates. we had some very good investments in the financial crisis, where liquidity was very

tight. so, there's a supply and demand of capital, which determines the pricing in the venture market, but innovation continues, and you're going to see breakthrough technologies and folks who are willing to take the risk are going to see fantastic returns. >> rick, thank you for stopping by. >> thank you. >> rick heitzmann. up next, final trades. you need them. they need a retirement plan. work with principal so we can help you with a plan that's right for your team. let our expertise round out yours. what tractor supply customers experience is personalized service. made possible by t-mobile for business. with t-mobile's reliable 5g business internet. employees get the information they need instantly.

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time for the final trade. julie? >> for high quality software name in small cap, clearwater is really interesting. >> tim? >> for a less high quality of the money center banks, i think you go to citibank. part of that quality rerating is where you want to be. >> dan? >> yeah, i think intel's ceo

sadly is probably the next one to go. >> or not sadly for shareholders. >> yeah, bring it on. >> steve? >> yuuber. good headlines today. >> see you tomorrowfor more "fast money." "mad money" right now. my mission is simple. to make you money. i'm here to level the playing field for all investors. there's always a bull market somewhere. and i promise to help you find it. "mad money" starts now. hey, i'm cramer. welcome to a special west coast edition of "mad money." welcome to cramerica! other people want to make friends i'm just trying to make you a little money. my job not just to entertain but to explain. so call me, 1-800-743-cnbc. tweet jimcramer. everybody on wall street loves to be a contrarian. which is why so many commentators keep trying to mi