and mid caps. today's a great example of nvidia stock price. a.i. is real. it's coming. no question about it, ultimately growth will start to slow and th they'll be a lot of other winners for a.i. in the small cap space just like we xausaw w the initial internet boom. we believe small caps are great, a great area to buy the early disrupters and innovators. on the other point with dell looking to sell their business. m & a has been increasincreasin. historically when m & a picks, small cap driver for out performance. kansas city, this week as well. m & a picks up, rates come down, m & a increasing and could help small cap performance as well. >> was that bank acquired out of a business of strength or weakness is the first thing that i think of. certainly because of what the current environment has been. >> no. so it wasn't a huge premium but it was a position of strength. it was another sort of midwest regional bank and we are, overrate regional banks in our small cap strategy and banks have been a

out of mega caps, go into small caps even with rate cuts because of what you said. you need everything to go right. you can't have concerns about growth and then want to go into small cap stocks, can you? >> you have to believe in a true economic acceleration. the only time we see sustained outperformance for small caps is really at the beginning of an economic cycle. fed cuts rates, you have interest rates that are low. and you're rebounding off of the lows. and economic growth is improving and accelerating. that's the time to go way overweight small caps. not when we're having this debate as to whether or not we could be near the end of the cycle and slipping into a recession. >> let's bring in our contributor greg branch of branch global capital. good to see you both. iya, good of to you back. you say volatility is likely to be with us for a while. we're going to be stuck on a roller coaster for a while? >> i think so. i think we've got a lot of global macro headline risks that could always, you know, disrupt markets. i think there's -- the focus, though, on the

split between large cap and small cap.ouraging story. even more importantly is what we see as an expectation for a 25-basis point rate cut at almost every meeting thereafter for the next year or so. we are looking at a period where the fed is in the position to cut rates into a stabilizing growth environment and that combination of lower rate plus stable or goldilocks growth is encouraging for u.s. equities. >> do you feel, meghan, the inflation story is done? we are not saying mission accomplished yet, but investors feel the story is done and we are looking at certain key cyclical parts of the market? >> i don't know the inflation story is done, but i do think that what we heard from powell and definitely what we have been seeing in the data is that the risk to the dual mandate, full employment and stable prices are now much more balanced than they have been in the past couple of years. so, you are looking at really not a recipe for reacceleration of inflation. if you look across the components. housing is finally falling

the small-cap 600 and the mid-cap 400 that you referenced with expected to see significantly faster profitan the s&p 500 which is expected to come in the low teens. we are looking at high teens to over 20% for mid and small-caps. obviously, we have to dodge the recession bullet which is the subject of much debate right now. we think that will happen. we have to remember that the recession-istas are like the boy who cried wolf. they told us we will have a recession several times in the last few years. >> i have to jump in. people are calling for small caps to rally are sounding like the people who cried wolf. tom lee and everybody else said the small caps would rally. we had a strong july. i want to hit another data point. you gave us great data, by the way. according to your data, the interest coverage ratio for the s&p 500 almost at 8%. with the russell 2000, it is 2%. you are expecting the rate cuts in september, they have more upside. we could see a 50-basis point rate cut. won't that benefit the small and mid-caps more? >> the big companies can coverage eight times with the ebitda with

but i wouldn't be a seller of any of these mega caps here. >> you just said small caps, which is a good segue for me because i wanted to go there anyway. your call with me months ago that the small caps could be up 50% this year. the russell's up 2.4 -- 2.5%, excuse me, year to date. do you want a mulligan on that? do you still feel you have tremendous upside but maybe not as much as you once thought? how would you characterize it yourself? >> well, you know, we're still very constructive on small caps. i think the upside is at least 50%, scott, because they're trading at ten times. the median russell stock trading at 7.5 times for 60 basis points faster earnings growth. but the timing hasn't worked out. i think small caps really shine when the market believes the fed is going to cut because it provides so much relief to companies that have high cost of money. whether it's biotech, financials, industrials, i think it's a real saving -- it's a life line for reducing the cost of money for consumers, which helps the banks. you have huge exposure in the russell. when the market believes the

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investors are focused on cap ex spending.oth microsoft and alphabet have yet to recover after posting mixed results. so let's get to it for some thoughts on the apple trade. joining me now are my three guests. steve just made some ai adjustments to his portfolio and will tell us what they are. great to see you all. amik, kick things off with apple. where does this leave them ahead of the print? >> listen, i think the focus is going to be any update in terms oh of what apple intelligence can mean for apple iphone 16 launches. so how they guide will be critical and any insights are -- [ inaudible ] that's going to be the big focus is apple intelligence potentially trigger a super cycle for them. >> what's the cap ex line? what's the number you're looking at, what would set off some alarm bells here? >> listen, i think one of the things with apple, they're able to do apple intelligence and play their ai narrative cycle with a cap ex-like model. a lot of the investments are around some of the internal service they're building. bu

placed in non-electric cap onto a time fuze. crimping using blasting cap crimp. attach the cap to the five foot length of detonating cord. finally attach the fuze lighter to the time. fuze. when explosive assembly has been completed. fire intensely into the tunnel entrance to drive back any enemy who may be waiting inside. place the charge as deeply in the entrance as possible. then ignite the fuze and quickly withdraw a sheltered position a safe distance from entrance. while awaiting results. the entrance covered for enemy. these are the primary ways in which partial tunnel destruction is accomplished. in addition, unit commanders call in artillery or high angle weapons to demolish tunnel entrances entrances. the total destruction of a tunnel, a job which should be handled only by specially trained troops using equipment not normally carried in forward areas during combat operations. thus, it obviously requires more time and is necessary for the partial destruction just demonstrated. once total destruction has been the first step is to have another thorough reco

that's what gets you small cap stocks that can become large cap.f we stumble upon a recession or a deceleration of growth? >> well, those are two different questions. taylor: well-said. >> small caps can definitely do well if growth decelerates. particularly the day when the valuations on small cap are already discounting a recession. a recession is probably a little more problematic in the very short term but, coming out of that slow down, small cap stocks tend to be the best performing areas there and again, at less than 20 times earnings for small caps and less than 10 times earnings for micro caps, we think a lot of that is in the price of the stock. taylor: they did really well during the trump 2016 era, when small caps really took off. nancy, we want to thank you for your time. [closing bell rings] the as you sankey the dow snapping a two kay winning streak as we await the nvidia report. that is coming next. that's it for claman. "kudlow" is next. ♪. david: hello, everyone, welcome to the a special edition of "kudlow." i'm david asman in for

that's true for large caps and small caps.eeing the same leadership against ranges which confirms what we're looking at is correct. >> yeah, but you say that the economy is expanding, which okay, it is. it's not contracting. but it's slowing. the numbers are kind of undeniable in that sense, which is why some figure we're in late cycle, not mid. how do you respond to that? >> look, midcycles are not painless rallies. this happens every midcycle. i have seen every midcycle since the '80s, and it always happens this way. you get a period of growth and then there's concerns. but you need a true catalyst to end the cycle. for 1990, it was the gulf war won. in 2008, the financial crisis. in 2020, the pandemic crisis. you need a clear and present catalyst to truly end the cycle once and for all. i do agree they're slowing but that happens every midcycle. we have periods of better and slower growth. we shouldn't freak out and worry it's the end of the cycle because we have a few weak data points. >> no, but i phene if you think reces

so, they might have biotech or other exposure, small cap, mid cap, international.mportant to understand where there's growth and cash flow, and it happens to be rather concentrated right now. what about valuation, top of the program today, i read the list of how much valuations have come in, as these stock pull back from july, you know, double-digit percentage point declines. >> no question, values are stretched. market's priced for 15% earnings growth year over year, and that's the reason why we're seeing all this volatility, which should continue throughout the year. >> you mean valuations are still stretched in these stocks? >> yeah. we look at the cash flow and the growth of the cash flow, but multiple are stretched. there's still a lot of pockets of opportunity in the market now. >> where is that? >> the thesis is on utilities is we're underpowered in this country. we own two names, nextera and vistra. we've owned it since 2021. 2.2 billion, returning it to shareholders. keep in mind our utilities are in two states that have immigration -- population immigrati

, we still like large cap as way to play that theme. long-term, we're more cautious they are more levered. they tend to have less positive earnings, more of those zombie companies. but all that being said, if you get more volatility in the weeks ahead, we wouldn't expect this pace of being able to continue at this pace for the remainder of the year. if you get that volatility, fst your opportunity to use that to your advantage to get some diversification. >> i see you have a bias for large caps over small caps as well after we saw a this pullback at the beginning of august, i know that you went back and you had put the tech sector back to overweight after downgrading it. how much more room to you think tech has to run here >> it's a good question. since we upgraded in early august, the tech sector is up over 10% so what you're seeing is a ping-pong ing back and forth short-term it tuz seem like we'll have more momentum towards small caps that's the short-term phenomenon long-term, we're still like large caps as we get into the fourth qu

- are getting quite used to regular changes in the energy price cap, it changes in the energy price cap talking about anybody on a standard variable tariff in england, scotland and wales. the last two times the cap went down a little bit but from october it will go up again, and 0ctober it will go up again, and essentially we are talking about an increase in wholesale energy prices. they have gone up in recent months around 20%. the regulator today saying 80 odd percent of the reason for today's increase, which comes in on the 1st of october, is because of higher wholesale prices. they are keen to point out that when you look at one year ago we are talking about energy prices lower than then and much lower than the peak of the energy crisis, but the reality then was there was extra government support in place and price is still much higher than pre—pandemic, pre—energy crisis. i think it will really reignite the debate you heard ed miliband talking about, about this decision to remove the winter fuel payment for around 10 million pensioners and move it to a means tested system, it will

the mean reversion trade for small caps relative to midcaps and large caps and megacaps, it's over. it's over. the remainder of the year. i've been skeptical about the ability for small caps to outperform their equity cap size brother and sister for the remainder of the year. everyone is going to come on the network in the next couple of days and say, this is normal, this is ordinary, everything is fine. i'm going to echo this. what the viewers have to understand, this is the month of august. the month of august and the month of september are the two worst months in a calendar year over the last 15 years. the real message is elevated volatility is going to be present during these two months and investors just have to be prepared for that environment and risk off days. today is a classic risk off day. >> you could say anything about the economy. i mean, this is not about the russell. this is about -- >> well, the russell. >> -- economic data -- hold on. economic data was weak. obviously the russell is going to be more sensitive to that. the. >> yeah. >> bond yields are falling. as i

i love the megaf caps. mag ga caps are crushing me. i acknowledge that there are areas outside of technology and large cap that you could go to. consumer discretionary, you talked about that being one of the leading sectors. you could look in industrials, helmet, train technologies, axon, that's all working well. financials, you've got your jpmorgan, goldman sachs, kkr, interact iive brokers, new holdings there are places you could go outside of technology if you stay high up. >> why not small or mid cap? if i told you that the data this week for many is going to confirm the belief that you're going to have the soft landing, fed's actually going to tpull i off, right growth is not fully stalling i know atlanta gdp came down today from 24 to 29. nonetheless, that's not bad. the fed's going to actually pull this off so why shouldn't i go to these other areas finally and believe in that? >> yeah, i mean, i guess i'm -- i think joe did a good job of what you asked me to do which is bridging what looked like a g

rotation out of mega cap into small cap stocks.our partner, scott, came on with us earlier this year in april, said buy small caps. you guys were about to get into buying small caps. that take was a great call. but does it have legs for the rest of the year, ryan. >> we think it does. our anticipation of the falling rate environment, it should allow for a tail wind behind small caps. the cost of borrowing goes down, the bottom line should improve. it's an area we've been excited about since april when we started making additions to portfolios for clients. we think there's legs for the second half. maria: are there areas within the small cap universe that will do better than others, sectors of small cap. >> for sure. we're always looking at sectors of small caps, really anything that's impacted by a.i. like you mentioned. we want to make sure we're on the cutting edge of technology, semiconductors, anything related to the future growth of a.i., we think it's a good play. >> that's a good point. you mentioned semiconductors and small

you don't want to be in small caps. you don't want to be in cyclicals, and so that leads you into by process of elimination to high-quality stocks. i think you also want to shade away from mag 7 so you have a high quality, nonmag 7 area andn the quality group and our research is focused heavily on quality at this point in the cycle and what you can do is buy dips and for instance, our fund was buying housing related stocks in july because those are high-quality stocks in the pullback and we rotated a lot of those gains into some of these tech-type stocks and sumi adjacent stocks into august. the high trend and the short-term pullback and stay high quality and stay large cap. >> so you're willing to buy some growth, just not at the highest levels of the market cap spectrum. >> yeah. i mean, but i'm not eaven reall nervous about it. we bought microsoft this month and so to me that fits the profile of everything i just laid out, and so it's just a matter of the indices are so top heavy at this point in time. you know, we'r

what's your expectation for small caps versus large caps? term, we still like large caps. partly because tech is a bigger part of our caps, and we still think the large cap tech story has led. on the shorter term basis, i do think they're mortgage-rate sensitive. talking about small caps. we're probably seeing at least performance in line or maybe a little better. but we're not at a point where we're upgrading small caps. because they are cheap and sensitive but the earning trends are much weaker relative to large caps. and typically need to see san accelerated economy to outperform. the environment we have now, we have a cooling economy. again, maybe a little bit more lip service from around the fed. and when we look at the data following the rate cut, small caps have actually underperformed relative to large caps in general. >> i mentioned the data we're looking at, jobless claims, real petito, tomorrow, pce. and of course, a jobs report of great import next week. which, to you, could influence the strategy moving forward, and what you rec

so where is the cap for me? what is this auoin where is the cap for me?e is the cap for me? what is this going to mean for— where is the cap for me? what is this going to mean for you? - where is the cap for me? what is this going to mean for you? i - where is the cap for me? what is | this going to mean for you? i can't afford it, this going to mean for you? i can't afford it. it's _ this going to mean for you? i can't afford it, it's as _ this going to mean for you? i can't afford it, it's as simple _ this going to mean for you? i can't afford it, it's as simple as - this going to mean for you? i can't afford it, it's as simple as that. . afford it, it's as simple as that. it's as simple as that. elizabeth in croydon, i mentioned you a few moments ago, you are here now. so, i bet you've got something to say about this, well, i know you have. well, i'm confused in some respects and angry and others. my husband and i have worked since we were 16 until we were 16 until with a 68. i worked when my three children were young, i had to work, we pay the bills,

see an annual cap of £1717.ectricity, 24.5 p per unit, and for gas, 6.24 p. it is also important to remember that that varies as well where you live and the price plan that you're on. but those are the average maximum unit charges under the new price cap. standing charges stay pretty much the same, just a shade higher, a fraction of a penny. electricity at about a 61p per day, gas at 31.6 p. standing charges apply even if you don't use any energy at all. the prices are not as high as we saw them last year, but they are an increase, and an increase as we going to the time of the year when households are using more energy, and so this will come as a concern for many households, including those here in doncaster. energy secretary ed miliband's constituency. we have been hearing from people about how they are already stretched. this will stretch those budgets even more. just to reiterate that in use. after empires or energy cap will increase to £1717. that is from october the 1st for a typical household in england,

cap regulations.mily. >> dom, republicans want to win the house next year and they need to hold on to new york and new jersey. moving over the races is the deductions on the state and local taxes. that is set to expire in 2025, but it is likely to come back. it is such a great way to help pay for other expiring tax policies republicans want to extend and there is debate with the cap helping the wealthy. this gives republicans in high tax states leverage as nick lolodo told me if this is not raised, a handful of republicans are set to pass that bill. >> i'm all in on the s.a.l.t. deduction. there are several house republicans that are all in and we will not vote for any tax bill that does not have a reasonable increase in the s.a.l.t. deduction. >> lolota proposed raising the cap to $60,000 and eliminate the penalty for married couples and take a $120,000 deduction. another long island republican said eliminating ithe cap is no possible, but supports a compromise. >> we are not looking to get up to the

but remember, the cap doesn't limit your total bill.and electricity. and these are the new average maximum charges. electricity at 2a.5p a unit and gas at 6.24p. but even these vary depending on where you live and your payment plan. i know this is not welcome news for many households, and i know many households still struggle with all of their bills, including energy. but what we're announcing today is a 10% increase in the price cap. that's the regulated price that we lay out that says that's the maximum a company can charge if you're not in the wider market, if you're not on, for example, a fixed deal. the local citizens advice bureau tells us that, here in doncaster, many people are already in debt because of high energy costs. around the country, millions of pensioners will now no longer get the £300 winter fuel payment, including some living here in the energy secretary's own constituency. look, the truth is that the mess that was left to us in the public finances is what necessitated that decision around winter fuel payments and u

you added trillions in market cap and losing a trillion in market cap. from that perspective some of this cleaning up is long overdue. i'm not surprised. i'm just surprised it happened so quickly and essentially in such a compressed time frame. >> the interesting thing of speaking with you, of course, is you're not only at a trusted observer, you're a shareholder in many of these companies. so take me inside your head today on how you're looking at the pullback, whether it's an opportunity you see or you're simply waiting because you think more is to come? >> all year i've been saying i would not buy these companies at prevailing market prices starting in march other than tesla which i added in earlier this year. at the same time, though, i would not be in a hurry to sell them because i think they remain, in spite of all the bad news you heard about them in the earnings report they continued to make money. relative to expectation my have under delivered but the revenue earnings numbers have come in surprisingly close to expectations outside of tesla, whi

when a company -- comes to companies that are large caps, small, mid-cap companies, you have seen peopleflirt with the russell throughout august and then pull back. a lot of the worries come down to leverage. do you believe the worries are real? matt: a couple things around the smaller companies. they are typically in the bank loan market, the high-yield market, some in private credit. private credit access is there. set the darling that everybody loves now. i don't see that pulling away. i think it will help the space. bank loans it should benefit from the fed cutting. the company's borrowing, a lot of small-cap companies through the bank loan market, their borrowing costs will get cheaper. we want them to continue paying down debt. if the fed has to cut that's not as good as the fed getting to cut because they are getting the soft landing. there is a balance there. with traditional high-yield it's a little bigger cap. around 50% of the high-yield market. that generally won't be your smallest cap companies but overall, i think the biggest winner there will be from the bank loan market w

lifted that cap. it's lifted. lifted that cap.ou want to change career, isn't it? your thoughts hello there . michelle dewberry hello there. michelle dewberry with you until 7:00 tonight. it is friday. it's 6:45. so that means that dewsbury tavern is well and truly open. it's been a very tough week, cheers to everyone at home. cheers to you. there's a sensible one on the panel there's a sensible one on the panel. you don't drink. very sensible. i just when i thought my week couldn't get any worser, they've only gone and served me warm wine . warm wine, i mean, warm wine. warm wine, i mean, god, they're trying to kill me off or what? anyway, cheers to each of you at home, the story i want to discuss. in my bar tonight. bankers bonuses. i mean, you will remember this whole debate about whether or not they should be capped, i've got to say, the tories actually removed the cap so that actually, they could earn up to ten times the salary in some cases , where barclays has become cases, where barclays has become the first bank to get ri

give me the answer, alena, and he should bring a cap, a cap, a cap, we check the cap, caps, we come back great, that was the best answer, that's it, come on, come on, guys, come on! this happens when people answer a question before it is even formulated, what to do? what, according to the rules of the indoor pool, a visitor should bring with him for swimming lessons, obviously, ekaterina, i think it's fins, they help, fins fins help, of course, but should he bring shouldn't, shouldn't katya, think about it, no, think about it, i beg you, i urge you to think about it, katya, katya, yes. no, that 's later, towel, towel, towel, i changed my mind, towel, you came up with it, okay, towel, come on, there's a towel on the fifth line, alexandra, i'm sure you need to put yourself on and carry it first, then put on a swimsuit, swimsuit, swimsuit suit, bathing suit, those who don't wear a swimsuit, what no, that's my answer already, these are completely different things. swimsuit and these are different things, we'll show a swimsuit, everything's cool, we have it in one answer, anna, your version i

large-cap. the s&p 500 up the better half of 4%. also the best week since 2023. in terms of the yen, this is one of the scarier charts i have seen. it is dangling, waiting for sellers to come back in. when the yen was going lower, it was borrowed as cheap currency and then going to risk assets. in july the yen started to strengthen which method trade on wound and there was no longer than a few will for to far, too fast. this shows relative to the small caps when the dollar-yen strengthens, after that the small caps go higher. it really points out the relationship. all eyes are on the yen. scarlet: small caps are a beneficiary among other asset classes of the borrowing of sheep yen. i thought crypto was higher for the week, it is not. abigail: this is one area we do not have risk on. oil had been lower. i would say there is enough mixed signals. it is easy to think all of that is behind us. scarlet: one reason a lot of people think the worst is behind us -- abigail: interesting point. scarlet: ev

and on the small caps, i think he's right. just a warning shot, i bought the russell three times this year and stopped out three times, so if i buy it a fourth, run for the hills. but i do believe he's correct, valuation's much better. my favorite retail, costco, trading at 55 times earnings with 10-15% growth, and i just think that's really expensive, so i am a looking elsewhere and, hopefully, some things will show up on the screen. liz: yeah. hopefully. hope springs eternal, doesn't it? greg, gary, thank you both very much for joining us on the floor show. >>> first, warner brothers-discovery dropped to the fresh all-time low this morning and then suddenly bounced. could it be a new partnership its streaming service, max, just announced? who's this new partner? we will deliver the name and the news when we come back. look at that gain, up about 6%. and you've got to set your dvr if you can't join us tomorrow. we have the ceo of priceline on what's got travelers slowing down their excellent adventures. and niles' management

but what we're announcing today is a 10% increase in the price cap.can charge if you're not in the wider market, if you're not on, for example, a fixed deal. the local citizen's advice bureau tells us that here in doncaster, many people are already in debt because of high energy costs. around the country, millions of pensioners will now no longer get the £300 winter fuel payment, including some living here in the energy secretary's own constituency. look, the truth is that the mess that was left to us in the public finances is what necessitated that decision around winter fuel payments and us focusing it on those who need it the very most. that's why this government is also driving throughout the coming months to get the people, the 880,000 pensioners who are entitled to pension credit and not getting it, to try and get them to take it up. energy prices are down from last year's peak. but with today's announcement and warnings of another possible rise injanuary, is now the time to lock in a fixed rate with your energy supplier? it is possible at the m

and trade deliver the greenhouse gas emissions and cap and trade authorized through 20 thirty seeing a way that the programs will not portal as well as other needs across the state project funding strategy hinges on the statewide partnerships in support of elective action to the cap and trade this allowsent in 2026 and 27 and i'm sorry i'm going to k information without the slides turning to the local level planning for increasedfuture sources the schedule adjustment for you this morni for the city and county to work together t develop local funding our 4 hundred to $500 million sources like the digital contributions as the development of consideration for a potential local funding measure and pricing and other mechanisms. regional level we have actually been in the discussions rarngd the regional measure for the transit wiener and others have set aside to all in the bayview for the perimete future measures and m t c is shaping a with the am for a measure to potentially b ballot as soon as and - potential future at a federal level the project will pursue other grant fund as mentioned

liz: but kenny are you bitten by the small cap bug? i can't remember you saying you were although you've come up with names that you really liked that weren't gigantic >> yeah, a small cap is a great place to be for sure and we have a position as a wealth manager in the small cap space, absolutely. you have to, right? but to our point is how is the message at the fed delivers is going to come out? is he cutting rates because everything is okay and we're not going off the edge and inflation has come down or is he cutting rates because they are getting more concerned that the economy is starting to get weaker. we saw this negative jobs number. is that going to play a role because cutting rates in that scenario is going to send a different message to the markets and while it's great for small cap companies because rates are lower if the economies not going to do well or they fear the economies going to go down the drain, that's going to cause everybody to pullback and so i think that's what you have to listen for in terms of how the fed d

small caps and big opportunities.0 showing its resilience, so is that where you want to be when rates drop? we're going to ask our next guest who's on connect with his expert analysis after this. ♪ ♪ i'm on my way, i'm make it. ♪ big time. ♪ i've got to the make it show, yeah, big time ♪ e way home. that's right james, it isn't. car, where are we going? we're here. (♪) surprise!!! the future isn't scary. not investing in it is. car, were you in on this? nothing gets by you james. nasdaq-100 innovators. one etf. before investing, carefully read and consider fund investment objectives, risks, charges, expenses and more in prospectus at invesco.com when the sawdust settles and the engine roars the thing you care about is a job well done. but when you get your tools from harbor freight something about the job feels different - your wallet. whatever you do, do it for less, at harbor freight. ♪ choose advil liqui-gels for faster, stronger and longer-lasting relief than tylenol rapid release gels. because advil targets pain

cap increase?le, definitely , >> for some people, definitely, because inflation is down now, as we know, to a 2% or whatever it is. and so the food prices have pretty much stabilised, even though there's still high, but for some people this this has been a lifeline to get £200 and have that taken away from them. and on top of that, they know they're going to have to pay know they're going to have to pay another 150. and the other thing is the timing of this people haven't got i was lucky i managed to save from january a bit extra pay, more on my bill every month. so i've got a bit of a war chest, but many of these people haven't got the opfion these people haven't got the option to do that, and certainly not now. with autumn and winter almost upon us. >> and william, how much faith do you have in ed miliband's green energy revolution? lots of money is going to be pumped into gb energy now. ed miliband thinks all the gb viewers will absolutely love gb energy because it sounds a bit like the channel b

so, $5 billion market cap before today, so at 40, it was a $40 billion market cap.o, it is that fallen angel that is getting some attention right now. a huge percentage gain just in -- look at that. >> sometimes timing is everything, right? >> you got to go back ten years and you get all the way back to the $40. >> it is bad. if you look at that overall, look at that trend line. >> there it goes. there it goes. i predicted that. i'm really good at predicting the past. the future is much harder to predict. >> i'm going to work on that too. i'm not good at it either. >> future is much harder to predict. >>> we got a lot more coming up including hugh johnston, he'll join us in a moment to break down the results from the entertainment giant and the decision to raise streaming prices. "squawk box" coming back after this. i can't believe you corporate types are still at it. just stop calling each other rock stars. and using workday to put finance and h.r. on one platform. tim, you are a rock star. using responsible ai doesn't make you a rock star. it kinda does. you are n

so under a caps budget we said these are must pass. we have to keep investing in our munitions in the industrial base because we have to keep getting that. we are seeing with the japanese, we want to take on tomahawks. i don't want say no. we want outlets up artist be on the fight with us. i want everybody to have as many tomahawks as avakian. we put direct investment into solid rocket motors last year both in december and doesn't partners and into indian war for settle down the potomac year to make sure we have an ability to build some capability as well. >> a broad question here. what your priorities in the 25 budget in terms of, like getting through, didn't get on time, getting a 24 supplemental? you know, what are your priorities if you tell congress hey, this is why we need you to work on the sake of the navy. what would your message be? >> without a doubt the fy '20 four supplemental. to some extent that's a position of luxury. three weeks ago i was anxious and nervous. we had a full active fully developed plan. i secretary, you

to small cap.re's some structural impediments in the way of the small caps. while lower rates are potentially very helpful to them, these are the most economically sensitive companies, and many of the companies in the russell 2,000 don't make money. so it doesn't mean it will make it easier to raise money or become profitable. so i remain very cautious on the russell 2,000. i think that was a bit of a breakout through 2100, looking like maybe it's a false breakout as we retest that. we'll have to see. but the value stocks are doing better. >> sure, if it's a false breakout, what does that tell you, where would you be in the market, especially now with what rates are doing? >> right now, you can't go too wrong with value stocks, dividend stocks, with the rates coming down. if you're getting a nice, solid dividend from a company, very importantly from a company that has the cash flows to support dividends, if you're going to be invested in the market, that's a safer place to be. because right now, yo

they will have to invest in cap ex.nd they have the apple intelligence on the cloud portfolio. >> neil, it is arjun here. i want to pick up on the artificial intelligence. what is the strategy to monetize this? is it through the services business? is it a subscription model? how do you think that pans out? >> that is a good question. we have advertising on apple. this is a high tech investment and high cap ex. what you have on the device is fine, but there is a hybrid element and a cloud element. there will be a cost and apple has to pass on the cost with the hardware or in terms of software services. for instance, it makes it more lucrative for apple to pass it down with the apple subscription model. we believe apple will consider $10 to $20 per user per month for apple intelligence to have more premium features and the p beauty of a.i. is, as you use more and more, it learns about you and you get locked into the model itself because you can't bring your apple to android. it is a lock-in for apple. once your model is t

before it was the mega cap tech stocks rolling over.e i think the concern of a slowing economy, reflected in the jobs numbers, ism, and i think what people are not talking about, but looking at is government spending which is huge. it's 6-7% deficits of gdp is propping up the economy. when that goes away, when republicans win something next year, government spending is going to come down. liz: well, here we go. we're looking at the s&p down 97 points, but those small caps that generated so much rotation excitement, hey let's get out of large mega cap tech like the smh, the vaneck semiconductor etf. that's been on a terror and yet now it is significantly pulling back. is that where you're seeing most retrenchment where people are yanking their money out of? >> we really haven't seen a lot of flows yet, liz, and that's why i keep talking about you have to adjust to this new market so yes, smh our semi etf is the darling along with nvidia but we're saying listen. growth has run up so much against value. it's almost as bad as 1999 so we've

at the end of the daysing, mega cap has so much waiting. we are, until that math changes, we are at their -- >> it's never going to change. it's not going to change any time soon. these stocks have such a heavy weighting within the s&p so at the index level they remain critically important. the way that the s&p goes, you know, as so goes the s&p or as goes the s&p, so goes these mega tech caps. >> my point -- solace doesn't do -- as i said, we don't do any mega cap techs. we've got to come up with ideas. >> what's the idea? what have you come up with recently. to you that says, you know what? this finally looks fine to me. >> an idea -- a riff off of the consumer, if you will. the idea that streaming was here, was going to dominate and that was going to be the end of it, and that's proven not to be the case for some time. so when you look at things the consumer could do based off of that, when is it shifting when streaming isn't the only place for movies to go and for consumer spend to go. there are areas that are offshoots of that idea tha

under a cap budget we said these are must haves.we have to keep investing in munitions, and the industrial base we have to keep getting that you're seeing with the japanese. they want to take on hot tomahawk's i do not want to say no to them but we want allies and partners to be out there on the fight with us. u we want everyone to have as many tom hawks as they can hurt to book direct investments into solid rocket motors last year both into some of our industrial partners and into idiot head or fear or doubt of the potomac to make sure we have an t ability e capability as well. plus a broad question. what are your priorities in the 25 budget in terms of getting it through pretty getting it on time. picketing a 24 supplemental. what are your priorities if you could tell congress hey this is what i really need you to work on for the sake of the navy. what was your message be? without a doubt the question is thel. supplement some nuts and luxury three weeks ago was anxious or nervous. but a fully developed plan secretary can actually

mega cap names? anywhere else in the world?> lots of exciting new companies with emerging technology leaders, like in india. we also see through the u.s. market that there are several areas just emerging in terms of productivity gains to be had from artificial intelligence, appreciating it even in some of the contract manufacturers, where we see trends towards deglobalization, towards a focus on higher supply chains. some of the best ai spend is actually trickle-down to some of the companies that will have to manufacture. that's not just tsmc for nvidia, but the servers, the storage that will be made for many of these hyperscalers. we think you will start to see that accrue to certain names further down in the market cap. caroline: that's interesting. again we are talking about the infrastructure layer. where will the money go for the application layer, at some point, do you think? >> it just takes time. when apple launched the iphone in 2008 and then you had the ipo of uber, those years of developing the app store, application

and trade to deliver the greenhouse gas emissi cap and trade is authorized through 20 way off withoutthat the have the funding including the portal as needs across the state and given the project strategy hinges on the statewide partnershipsctive action to reorganize the cap and tis allows the commitment in funding for 2026 turning to the i'm sorry i'm going to keep on talking easy information without slides turning to the local level pled local future sources the scheduleis morning provides time for the÷;unty to work together to develop target is 4 $500 million requires the existing sources digital contributions as well as the development of consideratio a potential local funding measure and mechanisms. >> at a regional actually been participating in the discuss regional ballot measure for t system and by wiener and others have set aside to allow for a row set in theor the perimeters of the future measures and m c is shaping a proposal still with the am for aentially be on a ballot as november 26th ntial future measure. >> at aevel the project will pursue other grant mentioned earlie

at least the small caps and mid-caps having a bit of a catch-up trade.hat could pause for a bit until the rate cuts get underway. think that is a possible scenario as well. scarlet: we are looking at a live shot of the white house as we await president biden to make some remarks on the prisoner swap with russia. the catch-up trade in markets is probably still intact and has room to run even if it does pause for now. where are we in this rotation trade overall? are we in the ninth inning? i'm curious to get your take on how much distinction investors are making between different centers in small caps. yung-yu: in the early stages, everything is going to rally. we are possibly in the thir fourth inning. we do have small-cap earnings expected to accelerate by the end of the year and into next year. if that continues, the rotation or the catch-up trade, as we should probably say, is likely to continue well into 2025. and there is a question of whether or not we get tariffs if former president trump should win the white house. that could deliver more friendly

from a market cap perspective, the small-cap etf and the mid- cap as well.an kind of see relatively good across the board, but the large-cap outpacing what is happening with the mid-cap and a little better than the small- cap. very good on a weekly basis, with regards to the ectors in focus for the larger s&p 500, as of now, every sector all 11 are higher for the week and notably the technology sector, the consumer discretionary sector and the financial sector are the three best performers so far this week. for those people who look at the economic cycle trade perhaps that does vote well for where the momentum is. tech, discretionary financials doing very well. stock wise, computer chips are very much at the forefront on a one-week transaction basis on the s&p 500. supermicro, nvidia and micron, three of the top five performing in the s&p 500. we will see if that momentum continues. a couple of news driven stocks have been among the best performers. shares of starbucks with the ceo change and nike shares, these have been languishing, but nike after disclosur