have ben shannon scotia. >> short developed ex us equities. this amount of stimulus that germany is talking about is could end up being greater than reunification. >> okay. and joey t t for transparency took an initial. >> personal position in amazon on the close on monday. as it goes higher i'm going to continue to add. >> all right. i'll see you on the bell. the exchange begins now. >> thank you very much, scott, and welcome. >> to the. >> exchange i'm. >> kelly evans. >> concerns over. >> tit for tat tariffs are overshadowing. >> that better than expected inflation. >> report today. >> although the dow is now nearly. >> positive and tech is. >> leading the charge. the nasdaq up as much as 2% earlier. >> apple is still. under pressure though as you. >> just heard morgan. stanley cutting its price target. >> citing that delayed i update and the impact of tariffs. and speaking of tariffs, as trump's metal tariffs take effect, canada and the eu both retaliating. >> and that's the tit for tat we're talking about. trump says he will counter their counter. that's about the latest we've heard today. but we'll get you

the update and see where our guests are finding opportunities. our mystery chart is one of them. nearing an inflection point to the upside, our analyst says. and look at tesla up 8% right now, making it the best performer on the s&p. but beleaguered shareholders won't find that too much comfort. it's still on track for a record eighth straight weekly loss. as for inflation, the cpi cooling for the first time since september, rising just 2/10 in february, 2.8% year on year. same for the core on the month, up 3.1% annually, both readings below expectations, the white house says today's report shows inflation is declining. the economy is moving in the right direction under president trump. core consumer prices, the best measure of inflation, dropped to their lowest level in four years. now, despite softer inflation data and that sort of optimistic chatter, jp morgan's chief economist bruce kasman says there's still about a 40% chance of a recession this year due to u.s. policy uncertainty. so from his point of view, he warns the trump administration could hurt investment in the u.s. and to also undermine trust

in governance. let's talk more about the risks out there. tom simons is chief u.s. economist at jefferies. cnbc's senior economics reporter steve liesman is back with us as well. it's great to have you both here. steve. is there anything you would unpack? first of all, from the inflation number itself? i mean, is that the main point here that we're finally getting to levels that are significant in terms of, okay, inflation is still going up, but at a slower pace? >> yeah. >> a. >> couple of things. first of. >> all. >> if you're. >> going to go into a series here of price hikes that could come from tariffs, this is the best way you want to go in. well you could have done 0.1. instead you did 0.2 and 0.3. that's a good number. you had to squint. and even when i did squint i didn't see too much tariff effect, because we did have the 10% tariffs on china that were part of the early february part. those were later raised to 20%. we are still expecting to have in the months ahead tariff effects to come through. the question is how much passes through. and then the question becomes what is the impact on growth? kelly i'm still waiting for that report from somebody who tells me that tariffs will

decrease inflation, increase growth and increase employment. nobody sent it to me. >> yet in the long run in the 10 to 15. no, that's not well. >> it's not. >> the same. >> i'm waiting. >> for it. i'm not baiting you, but i'm just saying no. i'm waiting for that report. >> let's see. >> if tom. >> has it. maybe tom has it. tom, how do you read? >> shaking his head. >> okay. go ahead. >> yeah. >> unfortunately. >> i don't. >> have the thread. >> that ties everything together. aside from the sort of view that, you know, in the long run, this combination of policies may work a little bit better than the way it looks in the short run. but you really are, again, depending on a number of, you know, cooperation agreements from. different countries. and all sorts of other workarounds to offset the. >> the impacts. >> of tariffs domestically. so that remains to be seen. but i think to steve's point that he just made, if we are going to go into a period of time here where tariffs are going to raise prices on certain things, you would want it to be at a, you know, coming in with a little bit more disinflationary tailwind behind us. and i think that that's evident in the

report. the decline in you know things like airfare you know some of the wild cards and also just mostly. >> the reversal. >> of. >> a lot of those so-called january. effect annual price. >> increases that. >> we saw drive a much higher number in january. those have now proven, i think, to be more or less temporary and not the sign of a renewed wave of higher prices to come. >> so two big questions for you, tom. one, how many fed rate cuts should we now expect? i think you are still in the camp of maybe we get three this year, which would be a big deal. maybe the market's there now and then. number two, as we mentioned the jpmorgan 40% odds okay. we all know 40%. you know we don't want to we know that number is kind of a placeholder more than anything. but where would you kind of roughly put the odds of a recession at this point. >> yeah. >> so we. >> we have really stayed the course. >> with, with our rate cut views in total when just looking at how many we were expecting this year. we've been holding tough with our, you know, three towards the. second half. i did make a very small adjustment to which unfortunately is not

reflected on the on the graphic. >> there. >> but instead of a kind of like every other rate cut. path at the end of the year where the fed brings the policy rate closer to neutral rather now i think that they're going to look at, you know, potential weakness developing by midyear and they'll want to cut back to back. so thinking we'll probably see something closer to like june, july, september. and then by then i'm hopeful that we'll have a little bit more uncertainty lifting, and maybe we can look toward some more specific policies that will be put in place that will help to boost growth in the second half of the year and then into 2026. and to the second question on recession odds. yeah, i mean, i'm always kind of loath to put numbers on them because you can just look at like a 40 or 50% number and say, well, that's kind of it either happens or it doesn't. exactly. but my view generally is that the underpinnings of the economy are still fairly strong, and that we need to see quite a lot more financial market pain in order to undo the wealth effects and, you know, weaken household balance sheets to the point where we're in an outright

recession. >> tom, i'm interested in where you see the weakness coming from. as you know, most recessions are sort of demand side recessions. it's where the supply side and the tariffs kind of attack and they change the supply side. i was reading kelly a report from princeton out of the 2018 tariffs. they talked about the deadweight loss from reorganization. right. you got ceos right now that are spending time thinking about, well, where's the best place to get this stuff from? i thought i had it nailed down. no. now it's not canada anymore. it's someplace else. and there's a cost to that from from that kind of reorganization. tom, do you expect weakness to happen through the consumer or the demand side, or does the weakness happen from the supply side? >> that's a. >> good question. and i guess i would say that i don't expect that we're going to get a huge shift away on the demand side, because again, even if we have some prices of things go up, and even if we have the markets go down a little bit and the wealth effect reduced a little bit, we're not in a kind of 2008 whe,

people are losing their jobs and thus losing their homes because there is this big, sharp contraction in consumption. now, it could, you know, i would think it might be just more on the margin. you know, we could get a little bit of a soft patch. i think that it's very reasonable to expect that you could have 0 or 1 handle gdp prints here in the first half of the year, and potentially even to the second half of the year. and i guess on a sort of second order effect, you know, thinking of having been in a very strong growth rate for the second half of last year and then coming into a much slower growth rate, that's a, you know, like i said, kind of a second derivative recession. it's not really an outright one. but on the supply side, you know, i don't think that we're likely to see as much disruption. and i'm pretty comfortable with the notion that, you know, businesses are still going to be very, very reticent to let people go en masse unless that's their last option to preserve margin. >> i'm going to leave it with the second derivative recession. i like that that, tom. thanks. i mean, i don't like it, but i'm just saying it's a clever way to think about it. tom. appreciate

it. tom. simon. steve. thank you as always. steve liesman joining us as well. my next guest says the sell off in equities this week is healthy and makes u.s. stocks cheaper now than non-u.s. equities. let's bring in emily rowland. she's the co-chief investment strategist at john hancock investment management. emily, welcome to you. the big debate u.s. you know international international has been outperforming. what do you think? >> yeah. >> it is remarkable to see the outperformance in international equities. and we look at it as a momentum trade that's not fully supported by fundamentals. we're still seeing a relatively better economic picture in the united states. tom just talked about that. we're seeing a relatively better earnings picture here in the united states. yet u.s. non-u.s. markets are absolutely ripping. a lot of that is based on some geopolitical developments. markets are just so myopically focused on what's happening from a geopolitical perspective, that the fundamentals are sort of being left to the side right now, and we're seeing huge momentum and potentially even short covering in non-u.s. markets. we continue to lean into u.s. markets, given

the fact that there's better quality here and again, more opportunities to look at areas that offer some value at a reasonable price. >> yeah. so you think u.s. equities are cheap, but not many. even with the, you know, correction. we've seen a lot of people still think things look a little bit overvalued or frothy or i don't know, i mean, we have come down sharply and quickly. so maybe the picture is changing. >> yeah. i mean, cheap is probably a stretch, but we went from about 22 times forward earnings to now 20 times. we're also seeing a healthy reset in terms of earnings estimates. analysts had been penciling in about 15% earnings growth in the united states this year. that's more like 11%. we think that's likely more in the ballpark. we're also seeing some really healthy breadth develop across markets u.s. mid caps, which is an area we've been favoring from some time, are holding in the best across the style box. in the united states. we're seeing sectors like health care do well consumer staples. so we want to look for those opportunities to

rotate into higher quality areas, more defensive areas, stocks that are paying dividends. we like things like infrastructure, equities, which should benefit as demand maybe starts to recede a bit in terms of consumer spending. but we're still going to see that more consistent demand for areas like infrastructure. >> it's interesting you mentioned mid-caps. that's been one of the top picks on this program the past several months, and people kind of going to that strategy, and that's working. the dollar is an interesting one here because all of a sudden it's weakened pretty significantly from the highs. does that have to continue to be kind of part of the idea that you should actually tilt back towards the u.s? >> yeah, kelly, that's an important point about this narrative. a good chunk of the non-u.s. equity outperformance has come on the back of the weaker dollar, which is down about 5% since its peak in early january. what's really notable is, again, the u.s. large cap underperformance. large caps should actually be helped by a weaker dollar, because 40% of the revenues of u.s. large cap companies come from overseas.

we're also seeing rates coming down slowly. that means there's a lower cost of capital for those u.s. large cap companies. so there's a few positive developments happening here from across asset perspective that probably aren't being noticed as much by investors that are so focused on geopolitical developments. so u.s. quality, which has been expensive for a while, is actually starting to look like it might be on sale. and we're looking for opportunities to lean in. >> that was like our guest yesterday with this quality etf. and look at that. the dollar's flat now since trump was elected which is crazy. emily for now thanks. appreciate it. emily rowland at john hancock. still to come walmart having its worst month in nearly three years. and now the chinese government is summoning the retailer amid reports of suppliers getting squeezed by their tariffs. we'll get the latest from beijing on that next. plus, robinhood is down 40% from its highs just last month. the stock was emblematic of the surge in crypto during bitcoin's run up. so how are retail traders taking advantage of this market selloff? we're going to talk to their chiefrokerage officer. ahead find out what clients are

up to. we're back after this. >> this is the exchange on cnbc. >> nothing stands still. not technology, not the market and not franklin templeton. we've been a firm in motion for over 75 years, always innovating. today, we are a leader in public and private markets, digital assets and custom tax management, empowering advisors with solutions to build the portfolios of the future. today. franklin templeton, your trusted partner for what's ahead. >> we empower. >> those who act. >> those who see the correlation between things above and things below the surface. >> those who. >> navigate risk by meeting every turn with a heightened awareness of what's possible.

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with everyone in their area. oooh. you know, it's kinda like when you bring a really big cake for your birthday, and then there's only a little, tiny sliver left for the birthday girl. aw. well, wish her a happy birthday. happy birthday... -it's... ...to her. -no, it's me. have your cake and eat it, too. don't settle for t-mobile or verizon 5g home internet. get super fast xfinity internet you don't have to share. forty's going to be my year. sale and make your dream office a reality. >> welcome back. shares of walmart are now at their lowest level in four months. the latest is the chinese government summoning the retailer amid reports that walmart is pressuring its chinese suppliers to bear the brunt of those. u.s. tariffs. kind of swallow the cost. eunice yoon is live in beijing with more for us. eunice, what can you tell us?

>> well, kelly, local walmart executives were reportedly called in by the commerce ministry as well as other authorities and warned against shifting the cost burden of president trump's tariffs onto chinese suppliers. what's also interesting is that the state media has been quoting an anonymous cctv columnist who, during president trump's first term, was able to message on us-china relations. so this commentator had said that walmart's demand to significantly reduce prices is, quote, unilateral, that the move may violate, they say, commercial contracts. and they said that if walmart insists on pressuring chinese suppliers, the next step is, quote, beyond talks. so that is seen as a ckdrop of all of this is thatrs, we are seeing walmart and other

retailers, us suppliers, chinese suppliers all trying to figure out and negotiate who is really going to pay for these now additional 20% tariffs. also, what's interesting is that the state media has a suggestion for walmart on what it should do, and that is that walmart could, in quotes, play a positive role in us domestic politics. and so just to interpret that for you, that basically means that they're suggesting that walmart talks directly to the to the white house and figures out a situation where they could change the policy. and quite frankly, kelly, that's a tactic that we see in china quite often, where the chinese government will try to push the us companies and the us business community to lobby on their behalf. >> still, eunice, i have to imagine that walmart is one of the biggest customers for a lot of chinese suppliers, and it has a lot of heft, and it has a lot

of scale, and it's choosing to use that to say, if you want to keep doing business with us, then we need you to take down price. i'm sure that they could look to supply chains elsewhere, or if i were thinking it through as walmart, i would probably be thinking the same thing. so with that in mind, the chinese can push back, but i don't think it would benefit these small suppliers for them to potentially lose walmart as a customer either. yeah. >> yeah, sure. i mean, so in that way, the chinese government has to be really careful. they have potential options up their sleeve as to what they could do for walmart in the language from that state media report they make, they kind of suggest and use the same language for what they've suggested for other companies, which then eventually led to those companies being sanctioned, blacklisted, fined. so it's possible that that we could see something where walmart has some trouble with their own business here in china. and actually, frankly, a lot of chinese people like walmart and they love sam's club. it's been really doing

well. so there's something that the chinese could do, but it is a very delicate dance because as you say, you know, walmart has a whole lot of influence, especially when it comes to the supply chain and these manufacturers. >> that's a fascinating. and it makes you think about apple and some of the other large companies with a big chinese supply chain amid this tariff issue. eunice, thanks for now. we appreciate it. eunice yoon in beijing, meanwhile, tariffs are one of the reasons that retail stocks have been taking a hit this week, down about 5% in the past three days for the s&p retail index. and actually at 52 week lows. that's not the only reason, though. it's also a mix of declining confidence, lower spending power and a tariff overhang. i should say that's according to my next guest. although there are a few names she still likes, dana telsey is ceo and chief research officer of telsey advisory group. dana, it's good to see you. and what a mess. >> exactly what a mess. >> as you were just talking. >> with eunice. >> or you. >> take a look at this. >> stock prices. >> of the. >> consumer sector.

>> more of them. >> are. >> at or. >> near their 52 week lows. >> given the. past few weeks. and the other thing that's really been impacting the retailers is the fact that forget the fourth quarter, because that's in the rearview already. you look at the first quarter guidance that so many companies have given. it's below consensus with the guidance for the year, anticipating or acquiring a significant pickup. now, you should always see a significant pickup in the back half of the year. but this is even more than expected in terms of what companies need to deliver. so whether it's tariffs, whether it's about inflation and the cost pressures that are out there, whether it's the fact that the r-word is being bandied about in terms of recession, that feel good factor is not here in retail right now. >> are there buying opportunities? you know, we look at this chart, this wall once again. and it's a reminder. you know we've got companies like gap doing incredibly well right now. home depot had a decent earnings report and stock reaction. same with lowe's best buy. i mean best buy was taken down because of tariff commentary but not because of an actual impact there. so where

would you say are places that investors should go, or should people be on the sidelines until the dust settles a little bit? >> there are definitely some companies to look at that are attractive down here near the lows. look at bath and body works for an example, which is trading at eight times forward, where the cfo just talked yesterday and mentioned the fact that the first quarter guidance for revenues is looks to be coming in at the upper end of the range, collaborations, product newness and innovation matter. brand leaders make a difference. i would say that some of the other names that are interesting, you look at warby parker, who just announced the shop and shops with target, and that is an addition to their 40 new stores they open each year. so that's going to be another driver of sales growth. of course value matters and that's the off prices that are out there. and the benefits that a tjx and a burlington could see. and i think you look at other names that are trading down near the lows. if you take a take a shot at some of these names, you look at abercrombie and fitch where hollister is still up 24%.

they said the month of february is positive. as we go through the anniversary of the significant success of the abercrombie brand. and then, like you mentioned, home depot and even dick's sporting goods, who said yesterday that yes, while they adjusted guidance, their customer is still healthy in moving through and looking at those activewear categories. so there is there is buys out there that are interesting. >> i guess my final question would be from your point of view, as you watch your metrics traffic, you know, you listened and talked to these different management teams, even hearing from the airlines this week about, you know, when you when delta says there's been like this sudden, sharp drop in bookings, can you tell us whether you're picking up on something broadly slowing down with the consumer? >> i think overall, definitely what you've seen, you've seen more uncertainty. you've heard about it from some companies in the month of february being weak. you're seeing it in terms of some of the traffic numbers. they've been down week after week in some of the mall based traffic data and outdoor strip center data that we've been

getting. so there is a pause out there and it's being watched closely because look at consumer credit and what we've been seeing there. it's to be watched carefully. and i think the first quarter overall, we're going to need to see an acceleration easters later than usual. the weather's been unseasonal and there's been more headwinds than tailwinds for the sector lately. >> all right dana, we'll leave it there. thanks for joining us today dana telsey with telsey advisory group. and still to come, the ftc asking to delay the start of its trial against amazon citing a staffing shortfall. we'll look at what that says about the antitrust environment under trump 2.0, and what it means for shares in their crosshairs like amazon, which is now positive since the election. we're still positive, i should say. you know what? it's actually fractionally lower, but we'll be back with lower, but we'll be back with more right after this. ♪♪ [inner monologue] we're sitting ducks.

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>> welcome back. the ftc asking a judge to delay the september trial against amazon over allegedly deceiving prime subscribers. the agency, citing severe budget and staffing shortfalls for today's tech check. deirdre bosa digs into the news and what it could mean for the rest of the government's antitrust cases. deirdre. >> so, kelly, that ftc request comes just days after the other major antitrust agency, the doj, moved forward with its case against google, confirming that it wants the company broken up. now, amazon if the judge agrees to delay the start of the ftc's trial, it could see some regulatory relief. and this perhaps signals how trump's regulators will be treating big tech and whether treatment could get preferential. now, jeff bezos, amazon founder and executive chair, has warmed to the president over the last few months, dining with him at mar a lago, attending the inauguration and pushing the washington post

opinion page toward maga ideals and away from its progressive leanings. google, meanwhile, has played it more straight, keeping a lower profile, maintaining traditional lobbying efforts rather than making these overt political overtures. now, that could leave it more vulnerable to regulatory scrutiny, especially as the doj pushes ahead with this breakup case. and that comes even as the trump administration is also eyeing cuts to the doj as well. now, within the new filings in the google case, there are some new developments. trump's doj wants to let google keep its investments in ai, potentially paving the way for more investment in anthropic, of which google already has a reported 14% stake. or it could open up strategic ai m&a for the company. but a forced divestment of google's chrome browser, which is intact. that's what the doj wants. that would overshadow any ai walk backs, as it is far more important for the google ai flywheel. and given the amazon ftc development kelly, one might wonder if google moves more aggressively on any kind of

political alignment. this is more of the big tech trump playbook that is difficult to read and very nuanced, but very interesting. i mean, this has always been a david versus goliath battle when it comes to these agencies taking on big tech. >> very nuanced. i absolutely agree with the way that you put that. and the wrinkle is the staffing issue. you know, when everyone was debating this after the election, nobody had. well, if they don't have enough staffers, then they'll have to drop these cases. >> i know, but they've never had enough staffers. you know, when you think about a government agency like the ftc or the doj, they've always been outmatched with the armies of lawyers that amazon and google and other megacaps are able to employ, and the billions of dollars that they're able to throw at this. so, i don't know, i that may be the case, but it will be interesting to see how this develops, especially as you know, there's reports that the doj could face cuts to. >> not true, deirdre for now. thanks. appreciate it. deirdre bosa out west. let's get to bertha coombs meantime for the cnbc news update. bertha kelly. >> the social security. >> administration is

considering. >> ending a. >> phone service. >> program used by 73 million retired and disabled americans to apply for and access their government benefits. according to the washington post. >> the agency. >> would instead direct people to. >> the internet. >> and in. >> person offices, which could disrupt operations at the agency. comes less than a month after d.o.j. staffers arrived at the agency to cut out alleged waste, fraud and abuse. a new york judge today tentatively set april 22nd to start the retrial of disgraced hollywood mogul harvey weinstein on sexual assault charges. the judge also ruled that he would allow a charge based on an allegation from a woman who was not part of the original case. and the maker of the roomba robot vacuum issued a going concern warning to investors today over the company's future viability and says it's initiating a strategic

review. it came after irobot reported lower than expected revenue and wider losses than expected in the fourth quarter. shares are down about 30% today. sometimes the technology is just not what people expect. >> they should try again, perhaps with the new, understaffed ftc. bertha, thank you very much, bertha coombs. coming up, how are retail investors responding to the market selloff? robinhood's chief brokerage officer will tell us what he's seeing as the dow turns positive today. but the major averages are still down about 3% this week. we'll have more after this. stay with us. >> techcheck is sponsored by >> techcheck is sponsored by comcast business. comcast business doesn't just power businesses. we help turn them into... ...logistics-mastering... ...supply-chain-transforming... ...seamlessly-restocking...

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to buy that stock... for exactly the amount she wants... no fees or commissions... what will gina do next? gina has roller derby at 6:00 pm. i'm there. get started investing for as little as $1. talk about easier investing. breakthroughs the state of the sector inside an analysis for investors john fort morgan brennan closing bell overtime for eastern. cnbc. >> welcome back to the exchange. retail investors have largely been in the driver's seat of this market in recent years. so how are they faring amid this sell off? we've got robinhood's february trading metrics, which show they still favor one seemingly out of favor stock. steve clark is chief brokerage officer at robinhood, and he joins us now. steve, it's great to have you. welcome to the program. and i love this. thank

you kelly. it's kind of the new way of getting the pulse of retail. what's the pulse. is there a pulse there. >> no there is definitely a pulse. >> i mean. >> as you said, we just released our metrics for february. and so across the board, if we look at just deposits, so are there people bringing in money to put to work? we're seeing records there. and then. >> on the equity. >> trading it's. a44 year high. so on the stock trading we're at about a. >> four year high and an option. >> trading we're at an all time high. >> and what they're doing. >> is putting that. >> money to. >> work in ways. >> that you know again we have younger customers. >> many of them are first. >> time brokerage customers. >> but the way that they react to this type of volatility is quite similar to what we see across the industry. people rotate out of single names and into broad based etfs because they have less certainty about which equity they think will bounce or have.

>> an opportunity. >> to appreciate. they have more certainty that the market in general may rebound. and so you tend to see that in periods of volatility. >> so they're actually positioning for a rebound there. >> well some are. >> positioning for. >> a rebound. we do have customers that i can use my daughter as an example. because in addition to the 25 million plus customers i get personal interaction with her. she's a robinhood customer and she she invests on an on a on a monthly basis. and she said, dad, i am putting my money. we have a high yield product which pays 4%, she said. i'm putting my money in. >> the new. >> money in that until i feel like mr. toad's wild ride stops, then i'm going to be more comfortable. >> well, and that's why it's nice to have that option, right. you can move to cash, you can still get 4%. and i know that's a strategy a lot of people have used over the past couple of years. i want to shout out because people find this interesting, what's going on with a couple of the individual

names, these really kind of high beta stocks, emblematic of the market customers trimmed nvidia, they trimmed alibaba, they added to tesla. and the largest addition, you say by a wide margin. and that would capture its weakness. >> well i mean i think, you know, there's a lot of people that have strong beliefs in tesla. and that's and, you know, they are looking at this as an opportune time to add to portfolios. and, you know, they're a lot like portfolio managers. they're quite savvy. our customers, they rotate out of names where they see nice appreciation, and they rotate into ones where they think there's an opportunity. i think the other thing that's really interesting is a lot of this news is happening when the primary market is not open. so we allow customers to trade over 900 equities overnight. but we just rolled out futures trading. and so when you look at when a lot of this news is happening and when the moves are happening, it's not during the primary trading day. and so we're seeing a very big increase

of what's happening in the after hours as well. >> great point. we're showing there on the screen a few other names people are adding to, including shares of djt, the trump company, amazon and google. those also rank highly. >> yes. >> yeah. >> and so those rotations are happening. but you know, as i said earlier, if you if we look at our top ten symbols, we normally wouldn't see the broad based etfs like spider or q-q-q in the like number one or number two spot. you do see that now with the with the volatility. because as i said earlier, you know, there's a stronger belief in in being able to take a broad based index of stocks and add that to a portfolio. >> indeed, steve, before we let you go, my final question would be based on how much data you now have, would you say that this generally tends to act as, you know, kind of a contrarian sign? in other words, you know, that people buy sell stocks that are going to perform well and vice versa. or do you think it's

more of a leading kind of look into where the market's momentum might be shifting and heading next? >> you know, i think like if you looked at what's happened over the course of, you know, let's call it the last ten years, i would argue that retail has kind of has bailed out the market quite a few times. and they've really been retail traders have really been at the forefront of understanding when there is an opportunity. and they've been rewarded. so when we love to see that because we want what's best for our, you know, 25 million customers. >> yeah, even people, you know, there are different analysts saying, look, their presence is now equivalent to the presence of stock buybacks, for instance, and flows in the market. and significance. they're definitely a force. they have arrived and they're still positioning. it sounds like to some extent for stocks to rebound. steve thanks for joining us. we appreciate it today. >> thanks for. >> having me. is robinhood's chief brokerage officer. so that's the read on retail investors broadly. what about the wealthiest investing club tiger 21 reports its members are

actually favoring small caps amid concern that mega cap tech is overvalued. let's bring in tiger 21 chairman and founder michael sonnenfeld. okay, this will be an interesting juxtaposition with what we just heard. michael, welcome. >> hi, how are you? >> thanks for having me. >> so your members are looking more this is very different. nothing that we were just talking about with kind of the robinhood customer is in small caps per se, but that's where your customers are looking. >> well. >> you have a. >> general rotation in. >> the market. but you know, our. members are looking for long. >> term stability. they don't tend. >> to overreact. to changes. >> in the market. >> and they. >> have already. >> got their allocations set. we can. >> see the changes over time. we only have. 23% in. >> public equity. >> larger amounts in private equity. >> and real estate. >> and our members have. >> their portfolio set. so in our groups all over the country. and the world. >> this week. people are saying what to do. and they're saying, let's let the dust settle. >> if we have our.

>> portfolios set, let's. >> see. >> how. >> it works. >> we have a long term. allocation and we're. >> generally going. >> to stick with it. >> obviously, there. >> are people who are looking for bargains. and as the prior. >> speaker said, with. >> tesla, some people are believers in tesla. as all of the magnificent seven, magnificent seven is down about 14% for the year. some see that as a buying opportunity. >> yeah, but in general, i mean it's interesting. so their cash levels are also pretty low. still about 9%. it got down to 8% kind of just before the financial crisis. so it sounds like your members are still pretty bullish while at the same time, you know, being much more concerned about valuations in big tech, for instance, looking to those, we said small caps, the high dividend yield companies, they're looking to more of the contrarian plays. >> absolutely. our members are what i like to call meat and potato. so small cap stocks, high dividend yield companies and contrarian plays are all things that they're looking at. but they also have income producing real estate that they

own privately. anybody can do that at scale. and they also have a lot of private equity where they can own companies directly. you know, when you buy a public stock, if you think you're buying a piece of a company, that's what warren buffett says to do. don't look at the momentum, look at the fundamentals. and in our groups all over the world, people are saying, where are the fundamentals, what's cheap and what's worth holding? >> yeah. and i take your point about, look, only a portion, about a quarter of their portfolios are even in equities, which means they get to hide their eyes from the mark to market losses that might be happening elsewhere or might not. i mean, we'll see with time. real estate, that's still a big area of investment as well. >> yeah. even even in real estate, you know, last year and for the last couple of years, industrial real estate has been very hot. there's some sense that that's cooling off. but it had a huge run. if amazon is successful, industrial real estate is successful because you got to have all the warehouses

from which to deliver all the last mile. so there's a little rotation going on there as well. >> all right michael, thanks for joining us. appreciate the picture of what's happening with high net worth investors. michael sonnenfeld of tiger 21. for more, you can sign up for robert frank's weekly newsletter, inside wealth, by scanning the qr code on the screen. or go to cnbc.com. slash inside wealth continue to get the pulse of what's going on with high net worth individuals. and coming up the homebuilder etf. the itb is lower today as tariff shifts weigh on both building materials and the builders themselves. horton, leonard, kb and tri point are among the worst performers. but lennar's newest community, which was just completed, offers an alternative to traditional home construction and may be just in time. diana olick is in texas with that story. >> two years ago. >> we came here. >> to texas to see the very start of what would be the world's largest 3-d printed community. well, it's done and community. well, it's done and we're back. we'll take you at&t has a new guarantee.

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meeting. >> welcome back to the exchange. just as lumber is getting caught in the tariff, tit for tat. homebuilder lennar's first 3d printed community in texas is now complete. people have moved in. diana olick is there with a look inside these homes. and what's different about them? diana. well, kelly, this is. >> the. model home for what is now the world's. largest 3d printed community. and yes, the walls do feel like hard, wide wale corduroy. and yes, they even continue well into the bathroom now. lennar partnered with icon, which is a 3d printing technology company. they printed 100 homes here and they actually, believe it or not, did it a lot faster than it would have taken conventionally. >> we have a durable product here that if you look at its

wind resistance for hurricanes, it's fire resistance for fire worn areas, the ability to adapt modern product to what we need for the future in housing, in building a healthier housing market, is amazing. >> icahn started two years ago with two printers but grew to 11 printers, and by the second year they were squeezing out two homes per week, each printer doing the work of more than a dozen construction workers. the systems operated 24 hours a day. the only part not printed is the roof. now the homes have all the amenities you would see in a regular lennar community, and each is solar powered. they come in two and three bedroom models starting at just under $400,000. >> we wanted. >> tall doors, taller ceilings. cement floors. >> somehow in this home just had everything. >> so really just. >> a combination of energy efficiency, the. >> practicality. >> the price point and then the esthetics. >> now, this was an experiment

for lennar, but miller told me he is all in. in fact, he said they're already in the planning stages for a second community about seven miles from here, which will have twice as many homes. and now that they've worked out all the kinks, he says, both the costs and the times will be cut in half. and just one thing that icahn's ceo told me is that all of this cement that they use in their building, in their construction, was sourced domestically. so yes, kelly, it is a housing tariff hedge, if you will. >> right. so there's no so there's no lumber used in the construction of that house. no. >> no, no lumber at all. in fact the roof which is not 3d printed is actually made of metal. so now you have metal tariffs now. so that might be difficult. but there's no lumber in the house really a all. >> and what you're standing next to shows the concrete material on the inside as well. so it's not like this is just in the walls. and then drywalled over. >> no, not at all. this is all the concrete material. it's printed around the outside. the inside. it's how they do the wall systems. and what's

interesting, the floor, of course, is also concrete is they even 3d printed the island in the kitchen, and they used the 3d printer in the technology so that all the outlets were printed around them. so you can put the electrical and the hvac systems into it. all through these models, which we saw two years ago, printing out, really spitting out like toothpaste, this concrete and doing it really quickly. and they expect in the next iteration of their new printers that they're going to do it again, much faster and much cheaper than they even did it here. they were working out the kinks here, but you know, they're ready to go forward with more. >> you mentioned 3 to $400,000. is the price point. is that cheaper than like lumber built houses in the area? and do you know, are these accretive to their margins as well? are they even less expensive to build even at that lower price point? >> so i asked miller that, and he said, look, this was the experiment and it cost more because they had to work out a lot of the kinks. if you look, this is a huge master plan development, and this is just one small subdivision of that development. the homes are expensive here because they're much larger. so these

particularly this experiment, the homes might be a little bit more expensive. but again he said when they do the next one they're going to be much cheaper because they're going to do them faster. they're going to have worked out all the kinks. and a lot of those kinks, of course, involve labor. it involves the cooperation between lennar and icahn and all their teams, but they're going to be able to use actually fewer workers. only one construction worker per printer, whereas now they were using three. so they've really modernized the systems and they're going to make them cheaper. most of the homes in this area are kind of in the 4 to $500,000 range, but the conventional homes would be bigger than these homes again, because this was the experiment. >> amazing. it arrives just at the moment that materials and labor might be in more scarcity going forward. diana, thanks so much. it's amazing. look at what housing might look like in the future. diana olick coming up, shares of the big three automakers are also lower today, as trump's steel and aluminum import tariffs go into effect. stellantis is down about 4% since the inauguration, while ford and gm are down about 6%. but one fund manager says this

is creating a buying opportunity for a different kind of auto stock. we'll explain next when stock. we'll explain next when we (vo) what does it mean to be rich? maybe rich is less about reaching a magic number... and more about discovering magic. rich is being able to keep your loved ones close. and also send them away. rich is living life your way. and having someone who can help you get there. the key to being rich is knowing what counts. >> shopping online comes with digital threats, so turn on nordvpn and encrypt your online nordvpn and encrypt your online traffic. get 72% off new projects means new project managers. you need to hire. i need indeed. indeed you do. when you sponsor a job on indeed, it's easier for talented candidates to find it. which makes it easier for you to hire them.

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kids and i've never felt better. changed my life. >> check your eligibility in minutes. >> at. >> get lifemd.com. >> welcome back. the auto stocks are lower after president trump's steel and aluminum tariffs went into effect

overnight. they are expected to increase costs for automakers and suppliers and could trickle down to the consumer. that's why my next guest is constructive on the used car market. in fact, it's already seeing a boost in sales, according to manheim, as shoppers hunt for value, something dana telsey flagged earlier as well. brian sponheimer is portfolio manager at gabelli funds. brian, it's great to have you here. so we've seen actually some outperformance among the auto parts, retailer names and that kind of thing. is that what you're talking about? >> it's a. >> little. >> bit of the auto parts. >> retailers like an autozone and o'reilly. >> but i think. >> we can. >> start with the auto dealers. so companies like autonation and. >> penske are companies that would be net beneficiaries, or. >> at least would be hurt less by some disruption within the new the new vehicle market. if we were to see production go down in north america. so just to put some numbers behind this. in north america, there will be about 16 million units produced this year. about ten four will be in the us, four two in mexico and the remainder coming from

canada. the dealers really don't care where necessarily the cars themselves are coming from. but the beauty of the auto auto retailer model, the dealer model, is that they generate about half of their profits from parts and service. and that's as we see vehicles get more complex. if consumers aren't buying new vehicles, they're going to need to get those vehicles serviced. so a company like autonation, based in fort lauderdale, the second largest dealership group in the country, would be less hurt. terrific cash flow generator and a company that we like. yeah, you know. >> carmax as well. i mean i was just going to call that one out because that's an individual. that was our mystery chart. it's also interesting brian, because you do a lot typically with the dividend and income trust fund. so you're kind of you have to think through, you know tariffs and the impact on the auto sector on the one hand. and then kind of figure out, you know, from a factor position how the market's going to be treating these stocks as well. >> yeah, there's a great substitution effect. if consumers aren't buying new they're going to look to the

used vehicle market. and a really interesting dynamic with a company like carmax is that the cohort of the market that they really excel in is the 1 to 5 year old car population. and if you think back to covid in 2020, that population has declined and is going to inflect in the middle part of this year. so they may get the double boost of consumers looking to the used vehicle market in a market where supply is going to come back. so that's something that we're looking forward to in the back half of the year. >> and quickly, on dana and garrett, those are two more of the names that you're watching. why? >> so within the oe supply space, these are suppliers that help make the vehicles dana, which is based in maumee, ohio, is a producer of driveline for light vehicle, off highway and commercial vehicle equipment. and it's a catalyst rich stock. they're looking to sell their off highway business stocks trading around $13. we think after they sell this business you're basically buying the rest of dana for about $2 a share for a stock that's trading around 13. that's really attractive to

us. a company like garrett motion, which is the old honeywell turbocharger business, is about a 1.9 billion equity cap company that really in kind of a worst case scenario this year, is going to generate around $250 million of free cash with a great balance sheet, and they're buying back a lot of stock. and if we think about the ev market, maybe being in an area where there's a little more pause from a consumer standpoint than there otherwise would have been, consumers are going to be driving more internal combustion engine vehicles. and so the length of time for the life of the turbocharger market is going to be measured in decades. so another another name we like. >> great point. i love the way you tie some of these big trends to the small. and again, this could ultimately just push people into the used car market and benefit those sellers and suppliers and, and, you know, servicers. brian. thanks, brian sponheimer with gabelli funds joining us today. you got it. and that's it for us. thanks for watching the exchange. and i'll join brian sullivan for power lunch right after this quick lunch right after this quick break. it's time to feed the dogs real food in the right amount.

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