Yahoo Finance

Hello and welcome to Market Domination sponsored by KC Trade. I'm Julie Hyman. That's Josh Lipton live from our New York City headquarters. We are giving you the ultimate investing playbook to help tune out the noise and make the right moves for your money. And

here's Headline blitz getting you up to speed one hour before the closing bell rings on Wall Street.

Friday willmark the 30 day mark of the 90 day postponement and 10% cap on reciprocal tariffs, and we're looking at a situation where in Q1, a lot of companies stockpiled inventory ahead of liberation day. And again, if we don't see some tariffs come down quickly, I think we're going to see some notable hiccups by the end of the month. So I think the uh the equity market is a little bit ahead of itself in this rally.Tariffs are engineered to encourage companies like yours to invest directly in the United States. hire your workers here, build your factories here, make your products here. You'll be glad you did, not only because we have the most productive work force in the world, but because we will soon have the most favorable tax and regulatory environment as well.

Footwear company Sketcher said today it had agreed to be acquired by investment firm 3G Capital in a deal worth $9.4 billion. Shares of the company surging amid the news that it will go private for $63 a share, up over 25%.We got an hour to go until the market closed, so let's take a look at the major averages, Josh. We have kind of a mixed picture going on today. On the one hand, we did have one economic data point this morning. The ISM services or non-manufacturing reading coming in better than expected. On the other, we have still some tariff rhetoric hanging out around out there. The Dow up by 58 points, but it is coming back towards the unchanged line. The S&P 500 in the last little bit taking another little tick down off by a 25%.1%. So ending its nine day winning streak that it had been on and the Nasdaq up or excuse me, down about a third of 1%. Yeah, and the S&P

500, so even I take a bit of a breather here today, but that's after, of course, a very strong recent run. A couple of different cross currents, as you mentioned, Julie, obviously trade is always front and center. You did have some Trump officials giving interviews to the press, and they were seeming to suggest that maybe some good news on deals could be on the way, which did felt like it.What Trump was suggesting over the weekend, so I think investors are waiting on that to the extent that we see any kind of details on that. And then to your, to your point, economic data, I mean, the April ISM services did clock in better than expected, and I think some economists were saying, OK, well that's, they took that as somewhat reassuring because, OK, it seems like it's at least holding up for now in the face of this potential tariff shock, right?

On the other hand, the president floating the idea of imposing tariffs on movies made outside of the US, even, you know.So that's a little complicated because many movies are partially made outside the US, so how would that work? This just doesn't seem to me that there's much meat on the bone at this point. It was something he floated, but it is having an effect on some stocks today, and we're going to get more to that a little bit later on with our Alexander Canal. But if you take a look at the stocks that are moving today here too it is mixed. Even within the Nasdaq 100, Apple moving lower here by 2.5%.It is worth mentioning. Also, I want to point out in terms of what we are seeing in the Dow here, if we equal weight it, we'll get a better look at some of the big movers that we are watching are Apple, Chevron, Amazon taking a hit in particular here. So that's something to keep an eye on. And then on the sector and we have communications services doing OK today. Energy falling. OPEC plus, as expected, did boost its production targets and that.Even though that was expected, we are still seeing that cause a little bit of a pressuretoday.

Yeah, oh by the way, the Fed's being this week. Oh yeah, that too, yeah. For more on the latest market moves, let's welcome in now Tim Urbanowitz, innovator ETF's chief investment strategist. Tim, it's good to see you as always. So you say, Tim, for investors, there are 3 potential scenarios to think through in the months ahead. Walk us through, Tim, to start, what those scenarios are exactly.

Well Josh, it's, it's great to see you and, and right now we think it is incredibly important for investors to prepare their portfolios for maximum flexibility. Nobody knows the endgame when it comes to tariff tariffs. I'd venture to say not even the president himself knows the end outcome, and this could go many different ways, you know, on the bullish side of the spectrum, we could see very significant deal struck with all major trading.Partners which could very easily push the S&P 500 up in the 64, 6500 range. You could see legal challenges to these tariffs be successful, or you could see the president start to walk back some of what he's laid out thus far this year. That's that's the bull case, very good odds of one of those three playing out. And then on the bearish side, which is almost equally as important.to be paying attention here, you could see deals struck with just some of the minor trading partners. There's a lot of hair on deals when we look at things like China or the EU. If that happens and those tariffs stay on for a long time, you know, recession would become our our base case, in which case you'd see valuations de rate meaningfully. We can easily see the S&P going back to that 41, 4200 range, so.Right now, a lot of, uh, question marks need to prepare that portfolio for maximum flexibility.

So how do you go about doing that? I mean, because these, even though there might be some bleed over from some of these cases to one another, right, there might be some from column A, some from column B, but it seems as though there might be quite different outcomes in markets depending on what happens here. So how do you prepare your portfolio for any one of them to happen?

Yeah, I think there's a couple different options here. One would be looking at specific names in the market that are going to be more insulated. When we look at names like Microsoft, where they sell software, right? They're not going to be as impacted by the tariffs. They're also in the midst of this AI trade, which we don't think anything is slowing that down. You heard a lot of the spending announcements on recentEarnings calls from the metas, Amazons of the world, that trend is going to continue. So finding gems or diamonds in the rough like that is one way. We're also seeing a lot of interest from investors moving into strategies that help cover you on the way up and the way down. One idea that has been very popular this year, uh, managed floor ETFs like SFLR.Where you're targeting a 10% floor against losses on the downside, and then if the market goes up, you're participating in 70 to 80% of the gains. So we see both of those methods really finding those stocks that are going to be more insulated and then also hedging with options-based strategies like SFLR is really a good way to manage around and prepare for a wide range of outcomes.

What about retail names, Tim? I mean, you look at some of those names, they have been hard hit. You think broadly is a lot of the bad news not priced in?

I don't think so, Josh. Those are not the diamonds in the rough. I think we want to be very cautious on a lot of those names. You're going to look at either demand being hit or margins being hit if tariffs go into effect. So I think there's still a lot of unknowns. Retail names are going to be very vulnerable to that. If you look at the move that we saw post Liberation Day, retail stocks.Hit a lot harder than the broad market. So in this environment where, yes, there's there's a lot of chatter about good news, we still don't think that's a done deal. It's not locked in. Retail stocks are not, not the, not the way to go here.

And what about, you know, now we're coming off of a couple of weeks where we heard from a lot of big tech and it was a pretty mixed picture when it came to big tech. So then how are you approaching that group now, Tim?

Well, I, I think it, it depends on the name. Um, it depends on the different, uh, yeah, the, the different business lines that they're in. Overall, we still do think, uh, you know, especially like the bigger ones, we look at Amazon.Um, you know, you have so many different business units, you know, the cloud, Amazon web services, we think is still going to do extremely well given the AI tailwinds that you see. While on the other side, you know, the retail side is probably going to take a little bit of a hit from demand if these tariffs do go into effect. So overall we do think, you know, up in quality is still the way to go, which a lot of those mega tech names are. So, probably one of the best places to be if we look at this market over the next 3 to 6 months.

Tim Fed meeting this week. What do you expect to hear from Jay Powell?

Well, we don't expect any rate cuts, and Josh, we don't think there's going to be any rate cuts probably until September. I think the Fed is in a good spot right now. They they are very flexible in what they can bring and they can really sit back and be patient, see how things, how things develop, you know, how much the economy takes a hit from a lot of the fiscal policy and the tariff announcements that we see. So Powell and team, we think are in a very good spot. We don't think they're going to cut andYou know, if they were to cut Josh, we would be a little bit concerned of that. If you look at the intermediate longer end of the curve back September through December of last year when the Fed cut 100 basis points, you saw those yields move up anywhere from 70 to 90 basis points because that was spooking the bond market. They're getting more concerned about inflation. That's not something that we want to see. We don't think the Fed goes that route, but right now we see them comfortably sitting in a pretty good spot to be able to react.One way or the other.

Tim, lastly in sort of switching gears here, of course this weekend Warren Buffett announced at the end of the year he's going to be stepping down as CEO of Berkshire Hathaway, the company that he took over in 1965, and obviously he's investing icon. So I was just curious whether you think some of the lessons that he has talked about over the years are still applicable in today's markets and what's sort of most, most pertinent or relevant as far as you're concerned?

Oh Julie, we've been using a lot of Warren Buffett quotes here with a lot of our advisors here and one of the biggest ones, which he hammered home this weekend as well was just how patience wins over the long term. You have to be patient. You have to invest in good quality businesses, and I think when we're in this announcement here with just.Waiting on this, you know what the end result is of this 90 day pause. You have to be patient. You have to find ways to stay in the market, to stay invested, and when others become fearful, you look to capitalize.

Tim, thanks so much. I appreciate it.

Great to see you, Julie.

Berkshire Hathaway shares sliding SEEO Warren Buffett said he plans to step down as CEO at the end of 2025. He's still going to be, um, chair of the company though, so we're taking a look at how shares have outperformed the S&P 500 over the decades. Yahoo Finance's Josh Shaver joining us now with more. And as we just heard Tim say, patience pays off. If you, if you were an investor,you've been rewarded.

I think Warren Buffett is definitely.Considered a patient investor, and when you take a look at how Berkshire Hathaway shares have performed since 1965 against the S&P 500, you certainly see the patience pays, right? Berkshire Hathaway stock has increased over 5 million% going back to 1965. That's compared to the 39,000% that you see for the S&P 500. I mean, the chart is candidly just pretty staggering when you take a look at the difference in.Performance there and I think I was looking through also just the different years that Berkshire has either outperformed the market, underperformed the market, kind of trying to get some takeaways from within that. And what I found interesting within that within their, they include this in their annual shareholder letter. And within that you see that most times that the S&P 500 has fallen. I counted about 13 going back to 1965. Berkshire's only underperformed the S&P 500 in those years twice.So sort of my takeaway from that being speaking of patience one thing Buffett's always done is he's not always fully invested, right? He was talking a lot about this on Saturday, not the need to not always be putting all of your money to work, which is not necessarily how most fund managers would operate. They don't need, you don't give Berkshire a pile of cash and they have to go invest it for you, right? He's waiting and choosing good investments and choosing the right time to buy a company, and I think over time that's.Paid off and then also not selling winners, right? He's held on to American Express forever. He's held on to Coca-Cola forever. Yes, he started selling Apple, but he held on to Apple for about a decade. And so just the compounding nature of holding on to those stocks for a long period of time shows that picking stocks to some extent can work, I guess, at least if you're Warren Buffett.

You're really

good

at

if you're Warren Buffett, if you're the best investor ever, then you can do it.

Josh, thank you, appreciate it.We're just getting started here on market domination. Coming up, our milking conference coverage kicking off today. Brian Sai, uh, sat down with Pershing Square Capital Management CEO Bill Ackman. We'll hear that on the other side. And after the closing bell, it's another round of earnings reports. We'll get you the latest from Palantirer, Ford, and many others. Stick around. Much more market domination still to come.

Descending on the Milken conference in California, a special guest here with me right now, that is Bill Ackman, Pershing Square CEO. Bill, good to see you. Big day for your company. $900 million investment in Howard Hughes. Why make this plan? Sure. Well, the story begins arguably when I began my career very early on, you know, Warren Buffett.Berkshire Hathaway letters beginnings of my investment education and the story of Berkshire Hathaway. Buffett buying, you know, basically control of a of a textile business and then transforming it over time into a diversified holding company. We know how that story is. It's not really years later, 60 years later, Mr. Buffett finally.remarkably at 94 passing the torch, but that was an inspiration for me that led me to go into the investment business and I entered the same way he did. I started a hedge fund and I became a shareholder activist, which he was, but you know the business plan was always to get to what we call permanent capital. We took a step in that direction. We took one of our funds public in Europe, but the, the kind of ultimate investment dream is to have a public company.where you can build with permanent capital, you can follow investment principles and build a business of significance, and that's what Warren has achieved and that's what we hope to achieve with Howard Hughes. We've had a long standing investment in the company. It came out of an investment made in general growth. We spun out of that company emerged from Chapter 11. We spun off a company called Howard Hughes Corporation which owned the real estate development assets of the general growth company.And General Growth had acquired a company called Rouse, and Row had a business of building small cities, what we call master plan communities. I think they're more like cities, but they're not incorporated cities, uh, in the Woodlands, uh, in Houston, Summerland in Las Vegas, uh, Bridgeland in Houston, uh, and, uh, that business is a remarkable business, but it's not one it's a long term play, uh, for the 1st 14 years, uh, it was, you know, consumed a huge amount.Cash today we generate the business generates cash. We reinvest that cash at Howard Hughes in the equity of buildings that we need in our various communities. So it's it's a very good business, much better business than textile business and you'll be executive chairman. So what we're doing here is so purging the funds have a 37% stake prior to today. The Pur management company, which is the business that manage our.Various funds that's owned by myself and our other partners and we brought in some strategic investors last year. It's that entity that's making investment in the company. I'm returning as executive chairman. Ryan Israel, CEO of Square, is going to become the CEO of Howard Hughes. The rest of the team is going to stay in place. Dave O'Reilly, CEO, and we're going to build a company. How can you pull the trigger?On the big, I guess the elephant sized deal that Warren Buffer will always talk about, we're going to start not with elephants, not rabbits, butSmall animals. What are you looking for? What are you looking for? We're looking for businesses that have great durable economic characteristics. It's an uncertain world, so you want a company that can withstand tariffs, pandemics, volatile interest rates, volatile moves and currencies, etc. We look for the kind of super durable growth company. We want businesses that earn high returns on capital that can grow as far as the eye can see.That are nondisruptible, and we're going to look for businesses of a scale that's appropriate in light of the scale of Howard Hughes. Howard Hughes today 11 $12 billion of assets, $5 billion or so of equity. So we are freely available cash today, call it a billion dollars, and then we'll work from there. How are you essentially you're building a modern day Berkshire Hathaway.How would you compare yourself to Mr. Buffett in terms of how you invest? He's got more experience than I do. It's a different approach to health than I do, but I aspire to have his longevity and his mental acuity. No cans of Coke for you, right? No cans of Coke. I'm not a huge fan of Coke. I think it's caused a lot of harm, but, you know, I would say I've learned a lot from him.Um, I would say we, Warren loves the same kind of business as we do. He hasn't, I would say generally been prepared to pay up for them. You know, he has very, very disciplined on, I, I don't, I'm not aware of a business he's purchased where he paid more than 10 times basically operating earnings. Uh, you know, I would say when we bought Chipotle it didn't look cheap.Many companies who invested in over time didn't look cheap at the time, but they became cheap very quickly by virtue of growth in the earnings cash flow of the business over time. But I would say very similar principles about how we think about capital allocation, how we think about incentives, how we think about.you know the kind of people we want to do business with, the kind of people we want to partner with. So you were in that room or you were in at theerkshire meeting? What was that for those not there, take us inside there. What did you heard Mr. Buffett say he would retire at the end of the year, what went through your head?So, uh, you're in a room with 44,000 people or something like this, uh, all of whom, or many of whom Warren has completely transformed their lives, uh, from a financial perspective.I don't know how many millionaires, 10 millionaires, 100 millionaires, billionaires he's created just by virtue of them owning the stock, but you know there are also many people there that may not even own Berkshire but learn from Warren, followed his principles, build careers in the industry. I'm I'm certainly one of them. I don't own Berkshire Hathaway stock today, but I still go to Mecca because I want to reset, you know, make sure my investment values stay the same, and you know, I think all the shareholders have been nervously.Not looking forward to this day, I would say, but you know what a graceful way to pass the torch, you know, an emotional moment. Almost tears in his eyes, I would say. I think his longtime partner Charlie Munger passing away, obviously a massive blow, and but you know he still was remarkable. 94 3.5 hours of Q&A with like a 1 hour break. I mean.Nobody else is doing this. It's amazing. What are some of the biggest challenges you think his successor Greg Abel will be up against? So Greg, uh, I think is a spectacular operator and by all accounts. I'm sure he's also an excellent allocator of capital and the businesses that he's overseen. I would say the challenge for him is he's got $350 billion in the balance sheet that Warren Buffett couldn't find a way to spend, right? So that's going to be important, uh, and he's not going to be able to spend it all buying stock back.I don't think he's going to pay some crazy dividend, so I think the biggest challenge for him is to find places and ways to deploy that capital intelligently in buying businesses that are not currently owned by Virgil. It's a different challenge to think about buying a new company for $20 billion versus making the incremental decision to invest in this power asset or this subsidiary of. Is that elephant deal out there for Greg?Um, well, look, I think, you know, private equity is competitive, you know, 10 billion.They're not competitive at 50 or 100, but you know the universe of companies of that scale that are willing to be sold, I think is very, very small, right? Most public companies view it as a failure, particularly one of that kind of scale to be sold, you know, Burlington Northern selling itself to Berkshire was kind of a surprise to me.Most companies of that kind of scale want to stay independent. If they're underperforming, they replace their management. They replace the board, an activist shows up. They don't really sell themselves, so it's a big challenge. Can Greg keep Berkshire intact and should he? Because I think it would make what would make the argument, maybe Buffett has put so much trust in so many different executives that he hasn't necessarily fired people when they should be fired.Yeah, so I think they are very compelling arguments for why Berkshire should say one big diversified holding company, the most important of which is insurance is about half of the value of Berkshire. The flexibility that Berkshire has to invest the insurance company portfolio in equities, for example, comes from the fact that it's part of this extremely creditworthy enterprise. If for example you spun off the insurance company, you know, it's of enormous scale today, so it can still.A lot, but it's very comforting to the shareholders to the policyholders of Berkshire's insurance operations that there's a big huge conglomerate that's uncorrelated with insurance that's supporting if necessary, that company. So I think there's a lot of compelling arguments for it to stay together. I don't know that value would be created breaking apart the tax benefits, other other aspects. I say it stays together. Do you think he can run it better than Warren?Um, I think to your point, uh, you know, Greg has enormous credibility as an operator, um, and that was really not, I don't think of operations as Warren's top skill set. Um, I think setting up the conditions for an executive to succeed, creating the right incentives, I think that's absolutely Warren's down the middle of what he does, you know, I've talked to CEOs of virtual subsidiaries, and they talk about how.taking the truly long term approach while they watch competitors doing stuff in the short term to make earnings look good, Berkshire is prepared for any of its companies. They don't care what earnings are in the next quarter. They care about rebuilding long term value. That basic principle, I would say is going to certainly remain. Is there going to be a little more focus on margins, you know, optimizing businesses, you know, not for the short term for the long term. I would say that wouldn't.Surprised me under Greg's leadership ahead of this interview, Bill, I was thinking back to some of your investments that you still have in the portfolio Chipotle. I think Nike. I just talked to Chipotle CEO Scott Boatwright. Their business is slowing down because of tariffs, he told us. Nike, their big businesses, uh, where they make a lot of products, Malaysia and China. Does this worry you as as an investor in these companies that trade is really starting to have an impact? We care about the value of a business, the value of a business.the present value of the future cash flows. What's going on now certainly could be disruptive in the short term. I don't know I don't think it's likely to have permanent effects. I do think it's important that we get through the tariff negotiations quickly. I think it's important that we pause the tar negotiate pause the tariffs, or we certainly take them down from 145 to 20 or something like this. I think that puts us in a stronger negotiation.position with China and puts China in a weaker position stronger for us because our economy will be stronger in that world. You don't want to be under the gun, have the US economy weakening while you're trying to make a deal with China. Once we take the tariffs down with China, the Chinese are actually highly incentivized to make a trade deal quickly because if they don't, they're going to lose that much many more businesses that are going to move their supply chains elsewhere. 145% tariffs on China.How do you think that impacts a 2nd quarter earnings for companies, 3rd quarter, 4th quarter? It depends very much on the business. Most of the companies we own are not going to be dramatically affected or minimally will be minimally affected other than general economic effects, but not particularly pernicious effects on on those businesses, and I think what you'll see is that if you're like I don't know.You know, and everyone's stocked up on TVs and anticipation of tariffs, you know, it's a bit like the front loading of COVID. You could certainly see Q2 or Q3, you know, a lot weaker. I talked to Apollo CO Mark Roan told me that the trade war is damaging the US brand. Do you agree with that? I think the way that it's been executed has shocked the world.When you shock the world, it creates volatility, uncertainty. Trump has kind of a unique negotiating style, I would say it's good that it's unique because if it became the only way the US negotiated going forward, I do think it would have issues, you know, he's been effective in the course of his life in getting things done, operating the way he operates. I think people need to understand this is his sort of MO, but I think.The United States will still be, I think US exceptionalism is absolutely true. This is definitely the best house in the neighborhood. It's the best place to do business, and I think it's going to become a better place to do business with deregulation, with tax reform, and the resolution of and you're still a supporter, even though the volatility in markets has been that you're still supporting the president. I want to see the president succeed, of course. Lastly.Treasury Secretary Best just gave a speech here packed house. I want to get your thoughts on this before we go. He said the US is entering a new golden age of economic prosperity for both mainstream and Wall Street. You're one of the most legendary people on Wall Street in my view for the past 25 years. Do you think we're entering that golden age? I think it all depends on execution, but there are lots of reasons why Scott could be right.We've suffered from enormous bureaucratic waste and inefficiency. Doge is underway to address that. We have a thicket of regulation that's really holding back growth in the economy. We have the permitting process in America, federal, state, local, and you know there's obviously, I think I was listening to the Treasury secretary speak about the difference of doing.Today in Texas trying to build a plan and doing business in Illinois and we need to make it easy to do business in America and they're working very hard at that. I think they're going to be effective. Yes, we've seen the president use his influence to address these kinds of issues, and I think he's going to help there, you know, lower taxes for companies that build things in America, the deals that are being made.The trillions announced of companies and countries that are committed to build in America and also I would say an inflationary backdrop that's getting a lot more favorable. Energy prices are way down, you know, egg prices, if you will, the $2 egg is hopefully a thing of the past, but yeah, so I think we are.Absolutely the potential to get there. I'd like to see us through the volatility of the tariffs as promptly as possible. I think that's fair enough. Bill Ackman, Persian Square CEO. Good to see you. Big news $900 million investment in Howard's uses. Appreciate it. We'll talk to you soon. And it's not so much the investment in ours, that's important, by the way, we're paying $100 a share for a stock that's trading at 65, right? So obviously we think.It's enormous value in the company and we're a meaningful, a very significant change in strategic direction while maintaining kind of a core engine of that company today, which is the real estate business. Do you see yourself as the next Warren Buffett? Do you think like that? No, no, OK, Warren's an icon and he deserves his own place in history. All right, Bill Ackman, it was a pleasure to see you. Thank you so much. Appreciate it. All right, do stick around. Much more

ahead on

Yahoo Finance.

Welcome back to Market Domination sponsored by Tasty Trade. We're checking in on shares of the automakers as President Donald Trump's tariffs on foreign-made auto parts began on May 3rd, with automakers receiving some concessions from the administration but still feeling the heat on others. Trump signed an executive order, remember formalizing the new rules late last week, which.Some carveouts to what would have been blanket 25% tariffs on imported auto parts. Everything from foreign made powertrain components to seats and airbags is affected. Ford set to report earnings after the closing bell today, Julie, so we'll see what they have to say forecast, guidance. uh Ford CEO Jim Farley has been out there as a critic of Trump's tariff policies, but as our, our colleague Praz Suanian points out, he's been recently offering.A more conciliatory tone. So we'll see what we see today after the close.

Yeah, the shares, by the way, up about 2% year to date, but um, Farley's also talked about giving more details on the specific costs tied to the tariffs. um, so we'll see what kind of clarity we get from the earning statement and from the call today on that front.

And remember GM last week put a bogey on that would take a 4 to $5 billion dollar tariff hit. So we'll see what Ford is going to share,

yes.Well, President Trump's 1st 100 days in office have brought a wave of uncertainty for what lies ahead for the US economy. A lot of businesses voicing their concerns this earnings season over ongoing trade uncertainty. Ford, one of the many automakers navigating tariffs, is set to report those latest quarterly results after the bell, with investors looking to get more color on the risks that lie ahead. Our next guest saying large suppliers and other industry leaders are finding tariffs harder to deal with than COVID, at least that's what he's.Hearing from them. For more, let's bring in Huntington Commercial Bank director of economics Ian Wyatt. Ian, thanks for being here. Um, you guys based in the Midwest, you have a lot of clients in the auto stack, so to speak, right? And you guys just had a meeting with a bunch of them. So what were you hearing from them? Yeah,

we had a few CEOs of Tier one suppliers speaking pretty honestly in Detroit. We had a nice, nice forum there and I got to hear a lot of what they're saying, so.I think first, yeah, you're right, um, in some ways tougher to deal with than COVID. One of the CEOs, I, I, I don't want, I like this line he said he called it Mr. Miyagi tariffs, tariffs on tariffs off, um, and that's their frustration really as much as anything it's, it's how on earth do we plan for something where day to day it just keeps shifting, you know, one way or another and this is really an industry where product cycles last years.You're planning production planning over years and so yeah they're they're very frustrated I think with the ability to adapt to this they say look we can deal with we've dealt with a lot of supply chain disruptions we've dealt with, you know, not just COVID but like the Japan earthquake all these times the auto industry goes through a few shocks over the years.Uh, but right now this is just day to day. It's really hard to adapt is one of the basic challenges.

Do you think I mean bottom line what Trump wants is he wants more auto manufacturing here. Do you think we ever actually see some American auto CEO say make some really big headline making announcements say like I had this massive plant in Mexico and yes, Mr. President, I am, I'm bringing it back to Ohio.

I mean I will say when I talked to companies like I was talking to a transmission manufacturer um in the Midwest and they were saying like they had more business they were turning away business because companies even you know back in December January were looking to bring as much production back to the United States as they could but what I'll say this guy says, and I have heard this for a decade from almost anyone in manufacturing is there is a lack of skilled labor. We are not training right people were probably not recruiting.Generally, you know, the college targeted kids who are the ones who have the intellectual capacity and skill set to do the really skilled manufacturing work, a lot of them aren't going into manufacturing, so that workforce in the United States, they're worried about current production levels, honestly, they say most of these guys are age 55+. I don't know when these guys are gonna retire and women are gonna retire, but I don't know where the next generation is coming from, and they're very they, they see that. So I think we can.Get manufacturing back and more manufacturing back to the United States if we don't have the labor force.

And so it's funny because I was going to ask you about whether you're seeing layoffs at some of these companies, but it doesn't sound like that, at least not with that specific example.

No, no, I'd say, you know, I think, I think companies have kind of realized that layoffs have their price and maybe they underestimated that price a bit. One anecdote I got from COVID from one company was this that all of a sudden we saw quality control issues we hadn't had before.And they didn't realize there were a lot of little nuances to all their machines that the people working on those machines knew and once they laid people off during COVID.Then you know those folks during COVID were able to find new jobs and so when they restarted production brought people back and they thought it was a fairly simple job in this running this machine or that machine they didn't realize all of a sudden there there was a reason the quality was better and it actually they had to deal with new quality control issues so I think this industry is realizing maybe a little more that labor is valuable but at the same time it's still a very cost pressure industry.They have a lot of sunk costs from EVs like in a lot of programs and EVs have been canceled like they and the parts suppliers were building plants to support parts and plants to support new EV initiatives and so they, they have that challenge to deal with and I think the other thing is just the reality is a lot of times you could have one plant that could supply the world or a large portion of the world with a single part.And to do the same thing in the United States and in Europe and in China and you're seeing this, you probably have 3 plants that are pretty similar and each of them are operating way below capacity and fundamentally this is just raising the cost of production is what it's going to do um by not having, you know, equipment operating at capacity and investing in that tooling is a tough challenge, but I mean they're having that conversation do we invest in the tooling do we.Start putting more plants here and I think you know I think the other thing we're hearing from them, the other big theme we heard from them is just they're.The Chinese industry they consider to be an existential threat to the auto industry was literally the words they use, so pretty dramatic.

How did they how did they propose sort of to get through that and navigating that. So yeah,

this is where it kind of gets a little bit. They, they partly see tariffs as necessary in that in that space, um, so, so it's not so, you know, tariffs bad, tariffs good, it's, it's more nuanced than most people would than most of the.Public takes are but yeah I think they're seeing that as a challenge. They see it as they have to figure out a way to adapt, but they, they think the and they highlight that those companies have are subsidized by the government they actually have to share all their IP I didn't know that that was something I learned recently that.All their investment is shared essentially in R&D across those companies and this is really a new challenge that they're gonna have to deal with um globally and do you just retreat back to the United States more um I think for most parts makers though they're global companies they have global operations and.The reality is, you know, a supply chain that I mean have an example of a supply chain that starts in Mississippi apart, gets put in another part in Mexico, gets put in finally assembled in cars in Korea and then become pretty affordable cars in the United States. Um, that's, that's how the current supply chain works. That's the

complexity to disentangle it. OK, so put all this together for us and put your sort of, um, big economist hat back on, right?You talk to these automakers, but you talk to a lot of other businesses too that do business with the bank. Are we going into recession? What do you think, given what you're hearing and also what you're seeing on the macro side?

I'll say certainly the April auto sales data, all we can tell is that it was really good April so far. I mean, we've had end of March we saw consumers basically trying to front run the tariffs, um, across durable goods and certainly in this.Space so we and in general in the real time spending data we're still seeing the consumer holding up. I think the, you know, when you think of GDP and you break it down, that's the biggest component of GDP that if that holds up, I think we can avoid recession, but I do see investment pulling back. I think uncertainty whenever you look at research, Bernanke actually did a lot of research in the 80s. That was part of what made him famous um on, on uncertainty.And you know companies a lot of times they kind of freeze they don't know what to do, so they don't do anything and that's I think a challenge for the economy if we do see a big pull back in investment spending that that slows the rate of growth and we think, you know, getting below trend, but.Ideally, yeah, the consumer is still holding up. We still see job growth, job numbers were good. Wage growth is still solid. You still have, have the core, the biggest part of GDP is still holding up OK, even in like DC area. I was pulling the card spending data in the DC area and it was still looking OK. Yeah,

tariffs on tariffs off. And, thank you so much for being here. Great to see you.Well, OpenAI will be controlled by the nonprofit that started it. That's the word for now from the company OpenAI, which invented the chat GPT app, is walking away from plans to become a for-profit company. OpenAI announced in a blog post Monday that its nonprofit would retain control of the company even as it restructures into a public benefit corporation.Decision a reversal from its moves to complete a for-profit status, and it does come as a surprise. The Public Benefit Corporation, or PBC is trusted to consider the interests of both shareholders and the mission of the work. The AI research and deployment firm was recently valued at $300 billion and is backed by Microsoft. OpenAI's co-founders include Tesla.Elon Musk and originally started as a nonprofit research laboratory on a mission to safely build AI for humanity's benefit. OpenAI faced a number of challenges in converting its governance structure. One issue actually is a lawsuit from Musk, who accuses the company of betraying the founding principles that led Musk to invest in OpenAI.

And shares of Netflix, Warner Brothers, Discovery, and other media stocks moving lower today. That's after President Donald Trump called for a 100% tariff on all foreign produced films via Truth Social posts on Sunday. Trump speaking today said he expects to meet with some in the film industry.

Hollywood doesn't do very much of that business. They have the nice sign and everything's good, but they don't do very much. A lot of it's been taken to other countries and a big proportion, and I'm actually gonna meet with some because you know there's some advantages I guess, and I'm not looking to hurt the industry. I wanna help the industry.Uh, but, uh, they're given financing by other countries. They've given a lot of things and, uh, the industry was decimated. If you look at how little is done in this country now, you know, you think we were the ones we used to do 100% not long ago, 100%, now we do, uh, almost like very little. So we're gonna meet with the industry. I wanna make sure they're happy with it.Uh, because we're all about jobs, that's all what I'm, you know, it's very important. It's a big industry, but it's an industry now that's, uh, it's really left, it's abandoned the USA where it started, and we'll get it, we'll get it back.

Yeah, our finance's Alexander Canal joins us now with more Ali.

Hi Josh. Yeah, interesting to hear those comments from President Trump. Perhaps a suggestion that ultimately these tariffs, at least the tariffs that he had promised 100% on foreign made movies, they won't go into effect as he promised. But there's still a lot of unknowns about this. If we take a look at some of those media companies most exposed, you'll see names like Disney, Paramount, Warner Brothers, Discovery. They were under pressure throughout the day. However, significantly off those session lows, but the news certainly sent shock waves through the industry at large, which is still.With the after effects of the COVID-19 pandemic along with those recent strikes from the writer's side and the actor side, I did have the chance to speak to a few Hollywood producers this morning who told me that tariffs would considerably slow down the industry. Worst case scenario, you could potentially see a complete shutdown. One veteran producer described the tariffs as insane and devastating. She warned that they could actually wipe out those lower to mid-budget films, so I think those independent films that are susceptible to these higher.because that's essentially what would happen. Tariffs would dry up cost would really disrupt the the global order of things because making movies now it's become a much more interconnected experience from the editing process to the filming process to the distribution process. And on top of that, US tax incentives, they are not enough to offset bringing those films here. There's a lot of really good incentives in places like the UK, Canada, the Czech Republic, and that's why you're seeing a lot of these upcoming blockbusters, they're all filmed in.Those locations, so this is something that could definitely impact the traditional studios like your Disney's and your Paramounts, but also the streaming companies as well. and Netflix, for example, produces more films than any other studio and derives up to 30% of its viewership from film content. We know a lot of their content is more localized content, so you know something to continue to track, but again we don't know a lot about this. It was one post on TrueSocial. We've already heard the president wants to help the industry wants to talk to the industry to try and come to a resolution.But you know, this is something that folks were not expecting and it was a scramble. Yeah,

yeah, put it on the list. All right, thanks, Sally. I appreciate it.Well, President Donald Trump offered that unexpected twist in his trade war Sunday evening by floating the 100% tariff on foreign movies, but he did it in a familiar way by hinting that a national emergency declaration could be in the offing to achieve his ends. Yahoo Finance's Ben Worshko joining us now with more and this tool of this so-called National Emergency declaration. Talk to us about that, Ben.

For sure, yeah, one thing we've learned about Trump in these 1st 100+ days is that there's a lot of emergencies in his mind going on. He's had 8 formal national emergencies that he's declared since taking office, 3 on his first day in office alone. These are on issues from energy to the border to um to most, most notably reciprocal tariffs on liberation Day, and it's also something he brings.Up a lot just just even if he doesn't follow through formally this Hollywood Hollywood example is just the most recent example. He's talked about California water as an emergency under emergency powers too. It's something that Trump and his team have been studying for a lot of years, the 4 years of Joe Biden's presidency, his allies were focused on emergency powers as a way to get around Congress and to move.Quickly and as this Hollywood example shows that their bar they bring up a lot of things under kind of this emergency language, the Hollywood things, even though what we're seeing in the last 4 days, as Ali pointed out pretty aptly, Trump said last night everyone's going to love this, this tariff. Hollywood clearly does it and he's backing away. So, so, but he's still under this idea of an emergency, which I think we're going to see a lot of going forward.

A preview of things to come. Thank you, Ben. I appreciate it.When we come back, you won't want to miss the big takeaways from the trading today. We'll have everything you want to know on our top trending tickers that's coming up.And now time for some of today's trending tickers. We're taking a look at shares of Sketchers, Tyson, and Twilio. First up, Sketchers has agreed to sell itself for a 30% premium to the investment firm 3G Capital. The stocks soaring today on the news that 3G will pay Sketchers shareholders $63 a share in cash. The deal expected to close in the third quarter of this year. Um, Sketchers are a really fascinating company. I didn't know that much about it, but the CEO Robert Greenberg.He is 85. He founded the company in 1992. His son is also an executive at the company, and both of them are going to stay on after this deal, and they're taking a piece of it, by the way. They're also going to be investing in it. So just an interesting little tidbit there. Yeah,

I'mreading through the analyst research. Piper Sandler saying news is positive for the footwear names they cover. should provide a valuation floor. They said positive laterals for Crocs and Wolverine worldwide.Evercore on that same theme, saying the deal sets a hard floor for valuations across the sector in the near term, says the deal is a bet on tariff deals getting done and this sector operating profitably long term. Yeah,

I mean 40% of Skechers stuff comes from China, so obviously it's with, it's, it's vulnerable here. It withdrew its guidance in April. On the flip side, 3G rang a bell for me, and that's because this is remember.The company that was founded by those Brazilian billionaires, the trio of Brazilian billionaires, they don't run it anymore, but they're still invested in it. Remember they combined Burger King and Tim Hortons, which is now owned by Restaurant Brands. They invested in Kraft Heinz alongside Berkshire Hathaway, although that deal wasn't as profitable for them anyway, so it's just kind of interesting to see them on Burger King the footwear exactly.

All right, moving on. Tyson Foods sinking today after reporting lower than expected.Quarterly sales amid weaker demand for beef. Tyson also warned that tariffs could also trigger some sales disruptions. So this one under pressure. They did report better than expected quarterly earnings, but it does look like losses of the beef business. That was really wasn't focusing you we're down about 8% in today's trade. Bloomberg noting they have lost money on beef sales for this was 1/6 straight quarter, uh, severe cattle shortage in the US, not expected to ease.Anytime soon.

I didn't know there was a cattle shortage. Did you know there was a cattle shortage? But Donnie King, the CEO, saying Tyson is managing through the most challenging beef environment we've ever seen. Um, so you know, that's really the thing that seems to be hitting the stock here. And analysts are saying it still seems like the beef might be tough, although maybe it's troughing to some extent here. The company has gone, has really leaned more into chicken.Um, but apparently because the prices for corn are coming up a little bit, maybe the margins on chicken aren't gonna look quite as good as they've been looking either. Yes,

stockdown this year and over the past 4 months, most in the street still looks like it'll hold here.

Um, speaking of an analyst call, let's talk Twilio. Those shares getting a boost today. Analysts at HSBC getting less bearish on the cloud communications company, citing early signs of a revenue momentum and a more reasonable valuation. So they go to hold from reduce and raise the target price on Twilio to $99 from $77. Basically they were encouraged by the recent earnings, but they do remain.Skeptical they say about long term margin guidance.

Yes, they go to a hole in terms of the upside risks to that call. They told their clients stronger than expected market or macroeconomic environment. They talked about, uh, higher than expected success in new product launches, lower than expected competitive intensity in Toyo's and markets. Stock is basically flat this year, but, uh, bit down, but up about 65% in the past 12 months. Nice. It has had, yes.All right, while we are wrapping up today's market domination, don't go anywhere. We've got you covered with all the action from the closing bell, including the latest earnings reports from Ford, Palantirer, and many more. Stay tuned for market domination overtime.