all right. let's blast through our final trades. bryn, kick it off. >> energy transfer. one way to get the nat gas that bill was talking about. 8% distribution yield. >> steven? >> nvidia. it's more exposed than snoop dog, so it's got to deliver. >> sarat? >> paypal. i think the company's executing really well. more to come. >> bill? >> united rental's eps the last five times, they report next week and the money is coming. >> thanks for watch, everybody. we'll see you soon. "the exchange" starts ♪ ♪ brian, thank you very much. welcome to "the exchange," everybody. i'm tyler mathisen in for kelly

evans this day. here's what's ahead. boeing under pressure, and the company making layoff plans and warning of a much bigger third quarter loss than expected and this as labor strikes enter the third week and the stock down more than 40%. do you buy at this level or bail on the name? just wait. you'll hear the bull/bear debate coming up next. plus, the broader market making new highs. 45 of them so far this year for the s&p 500 alone, but that doesn't mean you can't find bargains even in the ai trade. you're looking at one of them. our market guest has two more picks when she'll join us in just a couple of minutes. plus china's stimulus update was enough to raise the country's gdp forecast, but one of our guests says investors should prepare for disappointment. that is ahead and we begin with today's markets and dom chu who has the numbers. >> ty, we have record highs to speak of right now. i will not bury the lead because you mentioned those record highs and there is a star and we'll

put it on the s&p 500 and you mentioned those 45 record highs and the dow industrials made its record high because it made the intraday record and the dow industrials up about 187 points. it's a one-half percent gain there. the s&p 500 is at 5857. it's up about 42 points, 0.75% and even at the lows of the session we were at 14 points and 44 points at the highs of the session. so again, just off the session highs and the nasdaq composite up more than .0.75%, 155 points for the composite index and we are just about 1.away from its own record high there. the broader move higher overall, but one big drag so far today. you mentioned boeing is one of those drags and the biggest drag is caterpillar shares and this is due in part to a morgan stanley downgrade and they're citing concerns about inventory

levels especially when it comes to construction industries and that's one of the bigger units there. so caterpillar, a huge focus, a dow component. we've seen outperformances in certain retailers that have, poesh y exposure and canada goose. all of that due in part to wells fargo downgrading each of those names and they explicitly mentioned for names like canada goose some of the lingering macro concerns in china. yes, it's been a tailwind as of late and can they continue, ty? i know you'll talk about the china trade later on. >> we will, indeed. thank you very much. shares of boeing meantime falling after preannouncing a huge third quarter loss of shares this year because of quality problems and profitability issues and the risk of a prolonged labor struck. it's already into the next week. one of our next guests downgradeded it to a sell, but

the other one says there are they reasons to buy right now. joining us are matt acres and richard saffron, senior aerospes and defense analyst at seaport global securities. matt, let's begin with you to make the bear case here and then we'll hear from mr. saffron on the other side of the argument. >> it does seem like a tough time to be making a bull case for boeing. why do you say it's time to sell. >> for a couple of years, the case is that they'll fix product, so i don't think that's the debate anymore and we should be looking at the balance sheet and the new call is 75 bucks a share and the bull chase that is $100 difference, about if you look at the next couple of years, they're below on cash. whatever resolution they hit

with the union, the 777 x development will take longer and as we get out to the back half of the decade, eventually we'll have to invest in a new airplane and that will be peak-free cash flow, right? you usually don't put as high a multiple on free cash flow at the peak as you do mid-cycle earnings. >> so what about the possibility of a capital raise? is that something that you are anticipating they will have to do? and that usually does not help the stock. >> yeah. i don't think it's a good thing and i think some people are pitching it as a clearing event and once that's done the stock can move higher. look, they'll definitely have to raise money in the fourth quarter because as you get into q1, that's an outflow. q2, they have a debt they have to pay off and they have to do it. to be clear, say they assume we raise $10 billion here. that's what we're assuming and that's pretty much consensus, that kind of is a drop in the bucket for the whole balance sheet and there's a lo to pay

out to return the debt. >> richard, let me turn to you. to be clear, you are among the majority of your fellow analysts who have this company rated a buy or a hold, at least not a sell. why do you see this? you give three reasons for why you think now is a good time to buy being. >> correct. it's not unusual for me to be -- it is unusual for me to be in line with my peers, so point one. i think there are they reasons, as you say, to buy boeing here. i think there have been two catalysts and both have been mentioned and an end to the strike and an equity raise. i think that the charges that were taken on friday, a lot of bad news now is already priced into stock, but most importantly, i think, and where i agree, is that this is all about the free cash flow story. pi think that the street's underestimating the free cash flow story.

for example, with respect to a new airplane. i think boeing spends about $2 billion on rnd. i think they'll have to launch a new airplane, and this is somewhere around 2027 or more so, et cetera. it was roughly $17 aier and when rnt dend spend, and by way, you hep this get delivered and i don't see a new airplane, for example, being an inal train bow will's flow. i think this is a good opportunity to buy the dip in general. >> am i being too harsh, saffron, when boeing has

introduced nude airplanes it hasn't always gone well and they've had cost overruns and other related issueses that have ended up costing them more than anticipated? >> not only are you not being harsh, you're being very realist being. so the 787 -- the 787 by all estimations was a debacle, and there were a couple of reasons for that. a new business model that boeing isn't likely to repeat where they put a lot of effort -- a lot of work to suppliers that they shouldn't have. i think that boeing estimated the cost on the airplane including concurrent technology development. one of the things that boeing is very good at is taking lessons learned, and i think any new airplane that boeing develops is going to have far less risk than what we've seen previously. >> let me turn back to mat and a lot to digest there. i know there's a point, counter point, how would you answer, mr.

saffron? >> we have very different estimates and we estimate 30 to 40 billion for investment and i would point to the new plane. it would be the first sort of high volume, narrow body that would be mostly composite, so i think additional production, and they need to figure out potentially an open roader and a prop fan engine and boeing is working on trust braced wing and a fuselage design. >> so what they're considering is of a different order and technology than what they've been building. so it's going to cost them more. >> so most of the planes other than a 787 which we talked about was a debacle and 777x and these are derivatives of existing airplanes so this new plane will be a completely new clean sheet design and it could be more on the high end of what people are thinking. >> other points that you want to address that mr. saffron made? >> again, we think that the free

cash flow will be more impacted by that than the development. that's the bottom line, and i think going back to the balance sheet, i think that's the thing people are missing. they keep a multiple on free cash flow per share. now we have 75 dollars per share. so you have to hit them for that. whether or not they fix that or not you have to take it out of your valuation. >> richard, let rae give you the last word. final thought. respond to matt. >> thank you. i think the development of the new airplane will be 50 billion. i think it will be more 17 billion over an eight-year period. i don't think that boeing will go with very sophisticated technology like an open roader. in fact, they will likely go with the derivative of a current engine and that will cut costs, but also consider that boeing -- the government right now is somewhat assisting boeing with some offsets. the f66 program is developing a new wing technology. so at the point in time when i think you have this new

airplane, i think the technology will be considerably more mature than a lot of people will expect and certainly more mature than when we saw the 787. >> richard, we appreciate you thank you very much. >> we appreciate you coming by. >> you bet. >> meantime, the dow and s&p hitting fresh record highs today as investors gear up for a batch of new earnings. our next guest has thee picks and sectors that she thinks will execute well. >> for that let's bring in kim from o.k. capital partners. >> good to be here. >> if i understand your argument correctly, we should get past the mark, whether it's geopolitical concerns and the election, for example and really focus company by company on which ones have got the attributes for success. am i understanding you correctly? >> i -- you are, and it's a

pretty simple message. >> you sound surprised. >> i am never surprised. you are one smart fellow, and we are going much on from that comment because now it looks like i'm kissing up. >> no. >> anyhow, but back to it. so things happen in the world and they're completely outside of an investor's control, but what can you do? crowe can look for companies that are consistent performers and that outperform their peers. so what are the markers of that? probably one of the biggest markers and it's really kind of goofy is that they have product marketing at some form in their company and what does that mean? that means they know who their customer is and they want to keep them as customers so they have to engineer products and services over and over again to keep them coming back, and that's what we look for, not who's going to be president and then what should we invest in.

>> you have sort of three interesting choices here which really, i think, are emblematic of the idea of your belief which is that you need to stay diversified, that you don't need to concentrate in one particular area. you've got exxonmobil, as big as they get in energy. you've got micron -- >> right. there's a tech play and you've got urban outfitters, a retailer that has struggled, but seemingly has found some traction. so take us through your three picks. >> sure. let's start with exxon. it was just on in the last block of the last show, and i like them because they are really good project managers, and so what are their projects? getting oil out of the ground? not finding it, just getting it out of the ground. getting it to their customers and they also have a chemicals division. they operate worldwide, so that's diversification in

product and in geographic reach. so that's why i like that. micron, i'm a believer in ai and maybe not the crazy computer design it a car and out it pops. you know, that kind of wishful thinking and ai is the real thing and it needs tons of data and micron is one of the companies that provide data for that and it's called nand, n-a-n-d and we like them because of that. urban outfitters, they're a primary brand and one that's kind of off. right now urban outfitters, it has a new president and the president has been there for six months and we think this quarter should show some change in traction on serving their younger clientele which is in the urban outfitters brand, but

anthropology and free people have been killing it probably for the last three years. so we think this company is an excellent merchandiser, and it can do that over and over again and it's an old company. it was started in the '70s. so this company knows that the consumer changes and they seem to be able to anticipate those changes and keep delivering. >> kim, thank you very much. we appreciate your time today. kim forest, thanks. >> thank you. a quick programming note, speaking of micron, the ceo of micron will join jim cramer on "mad money" at 6:00 p.m. eastern time. you don't want to miss that. one of our next guests has a message when it comes to china's stimulus announcements. be prepared to be disappointed each and every time. that doesn't mean there aren't opportunities. he'll explain that next, plus, there is a new way hedge funds may be gaining an edge over the

competition. we've got the details ahead. "the exchange" is back after this. ♪ ♪ this is "the exchange" on cnbc. it all started with a small business idea. it's a pillow with a speaker in it! that's right craig. pulling in the perfect team to get the job done. i'm just here for the internets. at&t, it's super-fast! you locked us out?! and when thrown a curveball... arrggghh! ahhhh! [crashing sounds] we had everything we needed.

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welcome back to "the exchange." chines chinese markets finishing in the green after it would increase debt as part of the stimulus package. he echoed other measures

announced over the past few weeks and he was light on further details. nonetheless, goldman upped its forecast for china's gross domestic product to 4.9% annualized compared with 4.7% following the comments, but after another round of disappointing inflation and trade data overnight with deflationary pressures building in both exports and imports missing expectations this month, we asked whether china's stimulus is too little too late. joining us to discuss is the ceo of the atlantic council, fred kemp along with bca research strategist mike marko popic. you say greet every stimulus announcement with disappointment. why do you say that? >> well because the september 26th reading bid up a lot of excitement and it was pretty significant because the verbiage and the rhetoric had siggive in cannotly changed move away from

the moral hazard concerns toward the reintroduction of fiscal policy into sort of the policymaker purview and they'll do something about it and it's almost inevitable that investors will be there for disappointment by every single announcement if it doesn't meet expectations. however, it doesn't mean that when we look back on the last six or 12 months that these piecemeal moves will not form a pretty significant evidence that we've reached policy bottom and that approximately see makers have embraced fiscal policy as the ridiculous sit tool to avert the further decline of chinese economy. >> fred, let me turn to you. there have been these discussions of stimulus and some of these discussions -- or comments have been taken as lukewarm or not specific enough. is stimulus alone going to solve what's wrong with the chinese economy or do more structural

changes need to be made and then is xi the kind person to make the structural changes? >> i think you just hit the nail on the head. so the optimists over the weekend were saying that the finance ministry didn't give details on the stimulus because they want to wait until the national people's congress in a couple of weeks and they didn't want to steal their thunder, but each if the national people's congress comes out with hundreds of millions of dollars in stimulus, it's still going to be a band aid even if it becomes a larger band-aid because the problem with structural, we put out a path trying to report last week together with rhodium group and it shows that in every area of reform that's important, you know, financial, competition, trade, portfolio and direct investment, the china's been backsliding over the last decade

or at least on moving forward at all. so it's really a political decision and as long as the party wants to have complete control. i don't think it will be that attractive with investors over the long haul because you have to fix things in a marketer yented way and president xi is not a person who believes in market oriented reforms. he believes in party control, so there will be that cost that investors will always have to pay with a president xi-controlled china. >> marko, talk to me a bit about china's consumer sector, if you don't mind. how healthy is it and where is it not healthy? is it not healthy in the luxury, the high end or the middle market? where? >> well, it's extremely unhealthy, but it's unhealthy because the largest source of net worth for chinese households is of course, real estate market which has had over 36 consecutive months of secondary

market declines in prices. so you have to put yourself into conflicts with the chinese consumer. they've seen their net work really decline significantly and it's very similar. it's actually the exact same as what happened in the u.s. or the western world post gfc when 2010, '11, '12 and '13 and you're going to tighten their belt. i do think what's very important is to unrest the decline in home prices and condos. so if that decline is rested and if households can look forward and see over the next three to five years that at least prices will stabilize, then perhaps you will see more consumption particularly in durables which have not really existed at all, and i think that that's where focus on arresting the decline

can reing night the engine of the chinese con ump istion. the bears will cite demographics and cite the 20-year cycles. that's fine, but remember, chinese gdp per capita is still at the level of malaysia and it's three times less than of south korea, even if the demographics look negative, there can still be upside in consumption as well as the increase. >> so, fred, let me get your reaction to that. my sense is that you believe, as well that the chinese consumer is not the healthiest cat on the block these days. do you agree with marko that fixing or somehow shoring up the property sector is the key to restoring consumer spending and confidence? >> i agree with marko that there's upside, and i also agree that given the size of the economy and given how the gdp is that that upside can be considered. what i'm arguing is that it will

always be limited as long as the ir? ities of the free market can't reign, it's going to be limited. so one just has to pick one's shots. at the moment, consumer confidence is low and foreign direct investment is clean and investors' confidence in china. that doesn't mean there aren't going to be opportunities at certain sectors at certain times. i just think for the economy as a whole, the 4.7 and 4.9% growth, probably, at least we don't believe reflects where they are and they're closer to 3.5 and that's not enough for as big of a country as it is. the market was right. the demographics isn't everything, but it's a lot and so there's just going to be a limited upside as long as the parties are in full control and as long as china doesn't really want to take on its most serious difficulties. >> marko, i'll come back to you in just a moment, but fred, i want to get your thoughts on two

things. one is very aggressive chinese military exercises around very close to taiwan over the weekend, and what that says and second, reports that the level of chinese espionage, personal, drill and others is far higher than we in the west like to concede. your thoughts on both of those? >> thanks for having those questions because i don't think these two questions are disconnected. so if you look at even what happened today -- so on monday, around taiwan in the air and around the sea were some of the most aggressive military exercises and combined military exercises in many of the different levels are happening a lot, but they were extraordinary in its scale and you can ask yourself does the troubled chinese economy make it less dangerous because it can spend less money on this or does it

make it more dangerous because it will be tempted to look for a nationalist distractions like threats on taiwan and both are true. it becomes less dangerous and it becomes more dangerous because it may have to distract its own consumers and its own citizens, so i would watch that closely. also, that will be related to what happens in ukraine and elsewhere in the world when america is distracted despite a time when president xi jinping rattles some sabers and thinks harder of whether he can block off taiwan and a blockade is something more serious and putting pressure on taiwan will be expected for some time to come. >> marko, final thoughts there. why don't you speak to the question of whether china is, can be a reliable economic collaborator at the same time that we are clearly geopolitical rivals? >> well, you know, we're not in

a cold war. we're not in a bipolar world although that is what many american approximpolicymakers be are in. the reality is in a multi-polar world which we don't have much experience and in a not lived experience. in a multi-polar world there is beliefs that enemies and rivals actually have to continue to trade with one another and it's not because of decisions made in washington, d.c. and beijing. it's because of decisions made in the rest of the world. when it's difficult to delineate into two spheres of influence, the rest of the world, even if they're allied with the u.s. they will continue to trade with china and that will force the u.s. to also continue to trade with china and vice versa also. it means china cannot withdraw from the rest of the world, and so i think that's the dynamic that many americans underestimate, but over the past five years, derisking,

decoupling, blah, blah, blah, it doesn't prus those outcomes and it's not what washington policymakers want. it's because of the global con flicks that we're in. >> marko popic, thank you, and always good to see you. your dinner at the general assembly was terrific. fantastic stuff. >> it was grade to have you along with elon musk and others. >> indeed it was. he introduced georgia meloni and she was very interesting, i have to say. fred, thank you and marko, as well. coming up, millions of floridians returned to this company before, during and after hurricane milton. we've got the name and we'll hear from the ceo in today's tech check. and as we head to break, check out bitcoin up more than 4%, holding above 65,000 and on track for its best day since augu august 22nd. we'll be back in two minutes. if we focus on the mortgage market and follow the life of a loan from origination right through its pricing in the capital markets,

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♪ ♪ >> welcome back to "the exchange." i'm julia boorstin with your cnbc news update. the u.s. embassy in lebanon is strongly warning american citizens to leave the country. the embassy said today the additional flights it was setting up for citizens, quote, will not continue indefinitely and added those who chose not to

depart at this point in time, quote, shouldn't rely on u.s. government assistance for evacuation. >> fema aid to several communities in north carolina impacted by hurricane helene was temporarily paused over the weekend after reports of threats against fema responders. according to "the washington post" it was due it armed militia threatening workers. was unclear if the threat was credible. out of an abundance of caution its crews were relocated to fixed looksen stead of going door to door. an hour ago, nasa's europa launched to one jupiter's moons check for existing life. it will take five and a half years to get there. back over to you. >> thank you very much, julia. coming up, nearly half a million people are still without power and more than 70% of florida gas stations are without

fuel after hurricane milton and we'll look at the increasing alste.tin storms and residenal re eat we'll be right back.

not ♪ ♪ welcome back to "the exchange." nearly half a million people are still without power after hurricane milton slammed florida's west coast. president biden pledged to send $6 million in relief to states impacted by both milton and helene. we've been tracking the storm's impacts across various sectors and today we dig into restaurants with guggenheim's gregory frankfurt and isaac toradano. let's start with you. let's start with restaurants, which chains are likely to be affected and for how long? >> it's a very important question for sitdown dining and not so much for fast food because a storm as severe as this, you're going mcdonald's and burger king and you're not going sit down and have a meal at chilli's and applebee's.

it's definitely restaurants and the headquarters of the company is about ten miles from where the storm made impact on florida, but the impact as a whole it's 10% of chain, cash all dining restaurants are in florida despite itbeing 4% of the population. it's a big eating consumption state. so what is the hit to revenues and potentially your earnings per share from these twin storms and how much damage, and it's obviously not just the damage. in the restaurants it's the damage for the people who would be the patrons of those restaurants and what they're having to dale with. >> absolutely. it's devastating to the coast. we looked at hurricane ian the last week of september of 2022, and we get pretty high frequency data where we can actually isolate a few days and look at the impact on some of these

chains. some of the most exposed that have 20%, 30% of florida saw 20% sales hits for a few days. when i look back at this period of time, 85 restaurants out of the 500 were closed for a few days and ten were closed for more than a week. when i go back and look at google and some data on the ground it looks like you still have seven to ten restaurants that remain temporarily close to the brand. so we expect to continue here to be a sales impact, but as you look at the full quarter and you think about this for me, for the three-month perspective and generally proves to be transitory even though it's heavy in the near-term. what i'm hearing you say is that really, it's probably a matter of a few days of lost revenue and disruption and not weeks or

months and that very few, if any of these locations of these chains whether it's first watch or chili or whatever have been destroyed and that they're not going to be usable for months. >> the first location that's in asheville, north carolina is still temporarily closed. so there's going to be some rebuilding that happens of a handful of restaurant, but generally, the american worker has an incredible ability and the american consumer to bounce back from tragedies and situations like this quickly, and we expect that to largely be the case here, too. severe impact, but quite a resurgence relatively soon after. >> very interesting. >> greg, thank you very much for your perspective. we appreciate it. greg francfort. now we turn to real estate and the impact of the recent storms and insurance, homeowner association costs already rising precipitously because of those

more frequent natural disasters. pressuring home sales in cities like west palm beach, tampa, miami according to redfin, but our next guest is developing both commercial and residential properties in some of those very same cities. joining me is isaac tola dishing ano. welcome. good to have you with us. did these twin storms affect your projects and you have lots of stuff going on down there. any of your projects in long lasting ways? >> thank you for having me on the show. >> thank god, no, we were not affected, and unfortunately, due to global warming, there is no escape from mother earth and the natural disaster that we see around the world. thank god that the governor and the state officials are doing a great job and the storm was not really the category 5 that everybody expected, but we still see a healthy demand.

we still getting emails from people. yesterday i got an email from a potential buyer from chicago looking to buy a condominium in naples, florida, and yesterday i visited our sales office in west palm beach for our wits carlton project, and ritz carlton residence is enjoying a very, very healthy demand. so we still see a lot of people moving to florida from other states from new york, chicago, california and other states. >> let me probe you on that a little bit because there are some signs in some of the data that some of that in migration seems to be slowing for three basic -- for two basic reasons. one is concern over these large weather events and two, is the rising price to insure a home. are you seeing that? it doesn't seem like you're seeing a slowdown in migration or inquiries.

>> we don't see a slowdown. exactly the opposite. since the last drop in interest rates we see the sales center are more busy, more people coming from other states, more brokers bringing clients from south america, still south florida and florida in general is enjoying a very, very strong momentum for the last five, six years. we see a lot of companies moving here and a lot of families moving down to florida. as far as insurance costs, unfortunately, it's something that we deal with that for the last few years, and i talked to some of my 14sfriends and partn from other states and they see insurance costs, as well. they're getting stabilized and we hope that things are going to get better and better and definitely the drop some interest rate, we think that this is going to be a good sign for real estate and history shows that when rates are going down, real estate markets are doing very well. >> is there a shortage of available housing in florida?

>> in other words, is demand outstripping supply? obviously, you've got a lot of properties and a lot of units under construction. >> so we do see a real demand and we are having a housing crisis. there is more and more team that want w wants to exchange their houses, their houses to condominiums and from condominiums to houses. the parents are leaving the house so parents are moving to a smaller condo. we see people moving here from europe, from the middle east from israel from south america, and i still see a lot of people moving to florida and we have seen our sale center and the buyers are telling us where they're coming from and we see a very healthy demand from other states and it looks like people are not getting nervous or scared for this natural disaster and unfortunately, you cannot escape it. we see floodings in europe and earthquakes in other parts of the world.

so really, this is not something that can be can control. >> all right. isaac, thank you very much for your perspective, thank you very much. >> thank you for having me. >> you're very welcome, sir. >> meantime, as residents recover from milton one platform they're turning to for news and updates, nextdoor. the social media network says activity has shot up 50% in the affected area. deidre bosa sat down with the ceo this morning and has the latest on tech check. >> nextdoor is a hyperlocal social media platform meaning it's centered around neighborhoods and users have to verify home addresses so it can provide realtime information and localized emergency alerts and here is the ceo and found or the role that his platform has played before or after milton. >> we have 6,000 partnerships of sort and the florida office of emergency management, the miami

police department. those are the kinds of agencies not just fema on the national level and it's the local agencies that know the information that you need in your specific community. >> he says that the official partnerships, they can help crack down on dis and misinformation and help clarify what's going on in real time. that has translated into greater engagement, as well. a 30% increase in activity across florida. as tyler mentioned a 50% increase in directly affected areas in the days leading up to and during milton, but the bigger question here for investors, guys is how nooks door can engage when there aren't major disasters. they can take it from sarah fryer and is now cpo since it opened in ai in 2021. you can see it's been crushed and less than $1 billion and

expected to be down 10% in the pickal year. he was passionate about building in public saying that he wants to play in the major leagues and innovate like the start-up and not the discussion that has been a hot topic in tech over the last month or so. guy, it's interesting when they were private they were valued more than they were on the public market. >> where does nextdoor come in when there are not sort of crises moments and how would it be used to create traction? >> if you're looking for a local tutor for your kid or your lost dog and you go on, but this is sort of the question. is there reason to log in weekly or daily and that's one of the problems with the business model. people aren't going in on a regular basis if there isn't a rally need to. so engagement, they need to really get up and the business model is advertising, right?

so they need people to be on the platform more often and it faced criticism with surveillance neighborhood. people passing around disinformation at times when there isn't a natural disaster. so these are some of the challenges it faces and i asked hem how you kind of keep those engagement levels up, and he goes back to him being a product-led founder. he thinks he can do it with tools it like ai. >> deirdre, thank you very much. deirdre bosa. >> shares of sirius xm climbing after berkshire hathaway said it bought 3.6 million more shares last week. i guess warren buffett likes stern. berkshire was already sirius' largest shareholders and it is now holding top -- excuse me, 108 million shares. sirius hit a new low, and now up 18% since then.

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all right. coming up, concerns persist about chatgpt replacing jobs in everything from social media to hr to newsrooms. and not even wall street is immune. we'll explore how hedge funds are using ai to gain a trading edge. that's next.

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my job is to work side by side with the individual and let them focus on how resilient they are. whether they're struggling with hardship, mental health and substance abuse, i give them tools that they can use to achieve greatness in their lives. i get to go through these doors and i get to be great. and you can too. at contra costa college, we all can. welcome back to the exchange. wall street trying to cash in on the ai craze, not just by buying stocks lick nke nvidia and metat by deploying artificial intelligence to try to beat the markets. >> full circle there, using ai to buy ai stocks, potentially. so portfolio managers, they've been using ai for decades, and machine learning, i should say. but this new world of generative ai is really starting a new arms

race for hedge funds. so these modern versions of ai can learn from their mistakes, they get smarter along the way. they require less human intervention, and with the rise ofopen ai and anthropic, they are more what they call off the shelf models that tend to be cheaper. ai does have certain advantages over human traders. it can measure sentiment of articles or earnings transcripts in seconds. it can comb through thousands of documents or spread sheets. doug clinton is one of those investors using ai for an actively managed etf. it's actually a lack of emotion. >> i think that is actually ai's superpower right now. you compare ai to humans, it's just that ai has no emotion. and i think emotion is what tends to trip up human investors more often than not. if markets are down, we sell when we shouldn't. if markets are rallying, we have fomo. there's so much beyond just simply looking at stocks, understanding quantitatively and qualitatively, is this a good

investment. >> there are some risks, some are pointing to what they call the quantity quake back the '07 when funds crowded back into the same positions. that brought a lot more volatility. and as ai becomes more common, some of these advantages for funds are getting competed away. it's becoming sort of the norm out there. all of this raises the bar for everyday investors and makes it a lot harder to compete. >> so how important, kate, is wall street for some of the tech companies like open ai or anthropic? >> it's a big revenue opportunity. open ai just raised money at $157 billion valuation. in order to justify that, they've got to get a lot of the enterprise customers, some of the companies in the s&p 500 to use their products. wall street is really a great match for this. they've got troves of data, there's a lot of analysis that needs to be done. and that is sort of a perfect match for what generative ai is offering here. they see it as a big opportunity. you talk to folks at these companies, they're looking to partner with the banks and with

hedge funds, so it could be a good opportunity in the enterprise side of the business, which is higher margins. consumers are lower margin, higher margin side on the enterprise, is really what they want to get going in terms of that fly wheel and growth side of their businesses. >> kate, thank you so much. good to see you, kate rooney. >> good to see you. >> that'll do it for this edition of "the exchange." and for kelly evans, i'm tyler mathisen. "power lunch" is up next. see you on the other side of this quick break. i'll be right there. g) (♪♪) (♪♪) (♪♪) (♪♪) (♪♪)

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