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Welcome to Catalyst. I'm Madison Mills. 30 minutes into the trading day. Let's get you the three catalysts we're watching this hour. First up, can the market rally continue as the first US-China trade talks since President Trump imposed 145% tariffs on the world's second largest economy.We break down where things stand that officials returned to the speaking circuit, warning on tariffs and in inflation expectations, bringing the details, and we speak to DraftKings CEO Jason Robbins after the company's earnings print and break down why March Madness weighed on the results.Half an hour into the start of US trading. Let's get a check on the markets brought to you by Tasty Trade. Look at gains across the board off the back of this post from the president on Truth Social that there are many trade deals in the hopper, all good or great ones in parenthesis here. The president also posting that we could see an 80% tariff on China as administration.are set to meet with Beijing officials over the course of the weekend here to discuss those trade deals. News of those deals among other individual news moving the markets higher this morning. But let's flip over to the bond market for a look at what's going on there because yields coming in just a touch. You've got your 10 year down about a basis point, your 30 year yield down about 2 basis points this morning and finally.Looking here at Bitcoin holding above that 100,000 level up over 4% here. Interesting off the back of some legislation that may not be viewed as hyperposit for cryptocurrencies, but maybe some deal making, some individual company earnings, lifting Bitcoin this morning as that risk off sentiment does continue to take hold on this market, at least for now.I want to bring in my co-host for the hour, Peter Chair, Academy Securities head of macro strategy. Peter is going to be here to give us insights throughout the hour. I'll ask you questions. You'll ask our guest questions. It'll be great. But Peter, I want to start on something that you pointed out this week, which is that the news on China chips and this administration's approach to chip curbs was a bigger deal than we might have initially.Made it at least in financial media circles. Talk to me about why you see that as a catalyst.

Yes, so I think when we had FOMC Day, Trump initially tweeted something about China tariffs. Things weren't going great. Then all of a sudden he came out something on chips and maybe reducing some of the restrictions on chips. Then even yesterday when we went through the whole UK deal, Nasdaq was doing OK. It was kind of drifting lower, then it went to Q&A and again he kind of focused.On chips in China, I think that's what's growing is and I think you know Jensen Wang has done a great job making sure he's talking to Trump and you know expanding on what he thinks the chip industry needs, and it seems like the president's being open to suggestions and it's going to allow chips to be sold to some countries where Biden had put some restrictions on at the lastminute.

Is that a signal to you that tech is the sector that brings us out of this moment of market volatility?

Yeah, and I think it should be, right? I go back when we were very bullish at Academy Securities kind of coming into this administration, we really felt there was going to be a focus on let's do things that are important for national security. Let's focus on producing those at home. We did think at home and you know some of our close allies as well. I'm not sure that's still on the table, but that's what we should get is build America build that sort of thing, and I think chips is a huge part of that. So it's good to see that focus being brought back toit.

And how would you advise.Investors in terms of just thinking about investing in tech right now, but specifically investing in chips given the weakness that we have seen in semiconductors, you know,

I'm kind of a little bit overweight for the first time in a while. I'm cautious. I don't want to do anything crazy though. I really want to see how this weekend comes out because I think I want to take some chips off the table, which is really hard because the last time the president said to buy stocks, you know, all you have to do is buy stocks, and you know 24 hours later you were rewarded with huge gains. I'm not sure that's going to be the case on Monday. I feel we.Could wake up to some disappointment. Um, again, to me, Trump's all about ebbs and flows, right? When things are good, he likes to stir it up. When things are bad, he steps back and calms things down. Things seem so good right now. I feel we're in that stage where we might get a disappointment coming into a week Monday, Tuesday next week, and that's when you want to start buying again.

So isthis moment in time the ultimate teacher of the lesson to be fearful when others are greedy and greedy when they're fearful?

Yes, especially, you know, I think we learned that during Trump 1.0 and he's right back to the table, right? He got very.on tariffs. The market hated it. He backed off. Now we're getting some deals that are OK. The market's comfortable. We're back above liberation Day levels, but I think he's kind of itching to like, well, let's push back. I want my agenda through, and he does believe that tariffs generate revenue. He does think it's going to bring back manufacturing. I'm not sure he's going to be right on that, but he does believe that. So I think you're going to see a pushback right now.

What do you think is the most overlooked defensive play in this market right now then, given that you kind of haveTo go against the tape in order to generate alpha in thisenvironment,

I think you kind of want to own bond yields globally. I think bonds again, there's some issues. I think we've had some selling pressure. The deficit's not really under control, but I think we do get this one time spike in inflation through the tariffs that keeps the Fed on hold. But after that it comes down and you look at real yields, 2.5%, even if we get a small inflation spike, I think it's a really attractive level. So I start, I want to own bonds. I actually like the Muni space in particular. So for a lot of clients we started.Buying back a lot of closed in munis and my recommendation accounts for individual investors. I think the closed in munis are interesting here. They traded a big discount. That's where I want to put some money in earn, you know, 6%.

Is that a sign of just how odd this particular moment is in financial markets that you're talking to me about munies and international bonds? Meantime, the US dollar is still under pressure.

Yes, it's crazy. And when I talked to the large asset managers right now, so I look at the hedge fund community, I think they're.Much on balance, right, so they're no longer super bearish or super, you know, they were overly aggressive. I do think they have all these, you know, pairs trades on and I think that's where you see the pain and every day you kind of see like why did this pair do this weird thing and it's because some hedge funds started getting stopped out or decided to reduce risk and I think everyone's got to be very cautious. Liquidity is very low out there and so it looks very active, but if any big trade comes through it immediately moves that market up and down 0.5%, not 2% like it was doing a couple weeks ago, but I think the markets.Overreacting, so I want to be nimble. I want to trade this a little bit and take advantage of kind of these pops and you know, dips. And

when there is a pop, do you do what Bank of America's Michael Hart was saying this morning, which is essentially buy the rumor and sell the news? Do you sell any rally?

I thinkthat's what we've been trying to do is you sell the rally and to me this is all still going to come down to China and what's as neat, and we're starting to talk a little bit more is also budget 2026, right? That to me was ultimately going to be his, you know, prize. Can he deliver on that?It's starting to make its way through the process. That to me, I think, and I'd really like to see that because it can turn back to some domestic strategies where I feel everything we've been doing so far in tariffs has been very zero-sum game antagonistic. We can, I think, do a lot domestically through that budget that could spur growth without causing all this friction for us. Yes,

you mentioned three things that could move markets in the coming weeks here in the short term China, chips, and that 2026 budget.Where do you see that netting now? You say it can move markets. Is it going to move markets in a way investors like?

I think right now where we're at, I'm slightly cautious again, it's, I feel like everything's getting so well priced in. And the one thing that I'm still concerned about, and I don't think the UK did anything to address this yesterday, is I am concerned about American brand sales globally that we have done such a thing that, you know, US brands were aspirational and you know this is probably a bit of a stretch, but you go back to the Soviet.Union Levi's represented freedom, and I think to this day, right, people want to be associated with American brands. They like the affiliation. It's aspirational and I feel a lot of damage has been done to that by the actions we've taken against a bunch of these countries. You've seen, you know, tourism is way down. You've seen some other brands. I think Tesla most noticeably had for, you know, German sales were way down.Is that a trend? Is that a one-time bump? I don't know. I'm a little bit suspicious that with 40% of S&P 500 earnings coming from foreign revenue sources, that that could be a bit under some pressure and that we're going to see lackluster sales of US brands globally for, you know, the foreseeable future.

And how can you put that toothpaste back in the tube,

right? And I think that's a veryDifferent things. So it's one thing for the leaders to negotiate trade deals, but when people go to the store, they still thinking like, I want to own this brand because I like it, or do I not want to own this brand because now I feel America's treated us unfairly, and I think that's a risk that's not being priced into S&P 500

earnings. Really important context there, Peter. Thank you so much and I know you're going to stay with us for the hour for more context, so I appreciate it. Let's move to the Federal Reserve.Chicago Fed President Austan Goolsbee is delivering opening remarks at a Fed event focusing on perspectives from the Midwest. We're following his commentary on a busy day of Fed speak. We've already heard from Fed governors Michael Barr and Adriana Huler, as well as Fed presidents John Williams and Tom Barkin. Joining us now with the highlights Yahoo Finance Fed correspondent Jennifer Schomburger. Jennifer, what have you heard so far this morning?

Good morning, Mattie. Both Fed Governor Michael Barr and New York Fed President John Williams warning that President Trump's tariffs are expected to lead to higher unemployment and higher inflation, as well as slower growth. These comments echoing Fed Chair Jay Powells earlier this week as the central bank held rates steady. In a speech in Iceland this morning, Barr said the Fed could be in a difficult position if we were to see both rising inflation.And rising unemployment, though he noted it's too soon to know how tariffs will impact the economy because we don't know the final rate levels yet on tariffs. Like his peers, he believes interest rates are at a good level right now to pivot as things unfold. Now Barr sees higher tariffs leading to disrupting global supply chains and creating long lasting inflation. He anticipates businesses will have to change where they source.For their products, which will take time for them to revisit and reroute. He warns that big changes in global trade networks could mean the failure of some small businesses, as he says they have less access to credit and do not have multiple sources for supplies. Now speaking at that same conference in Iceland this morning, Williams said that we are experiencing a great moment of uncertainty and change, and that uncertainty is a.Characteristic of the economic landscape for the foreseeable future, he stressed the importance of maintaining inflation expectations amid this uncertainty. Williams says he personally expects considerably slower growth this year, and while the general view is for higher unemployment and higher inflation, the Fed doesn't know the exact mix of that and how that might play out as well as the time horizon, and thus it makes it difficult.For them to set monetary policy preemptively later this morning we will hear from Fed Governor Chris Waller and this evening from Cleveland Fed President Beth Hammock and St. Louis Fed President Alberto Musalem. Back to you,

Jennifer, thank you so much as always for the great overview. Coming up here, a lack of March Madness upsets weighing on DraftKings. CEO is here next with more on the state of the sports betting business. Stick around for that conversation and more on Catalysts.

The S&P 500's longest winning streak in 20 years, it stalled out earlier this week, raising the question from investors. Was this just one of those flashy short covering rallies or the start of a race to fresh all-time highs? I'm Jared Blicker, host of Stocks in Translation. Well, today I have two bearish signals and 2 bullish signals, and we're going to go through this. But first I got to get to a definition market technicals. Market technicals analyze stocks and markets.Price action chart patterns and technical indicators. And first up is the 200 day moving average. We're going to look at the Kahuna, the S&P 500, and there's that 200 day moving average in blue and you can see we've been camped out underneath it for about 6 days. Until we get over that and it wouldn't take much, I still land in the bearish camp, so we're kind of on the razor's edge here and we've got to move along because now I want to get to sentiment.And the definition of market sentiment is the collective attitude of investors to financial markets driven by optimism, which is bullishness and pessimism, which is bearishness. And for that we have a number of examples. We have surveys and polls like consumer consumer confidence and consumer sentiment. We have fund flows. Where is the money flowing as opposed to what are just the prices? We have market internals and breadth, for example, how many stocks in the S&P 500 are advancing orDeclining at a certain time. Social media speaks for itself. Derivatives and options. We're going to circle back to that in a second, but then we have insider activity. What is the C-suite doing? Are the CEOs buying their own stocks? And then new ETFs takes a long time for these products to come into market and sometimes it's a contrary signal very much like magazine covers, and we're going to come back to those two, but I want to stick with derivatives and options for just a minute here and I'm going to take a look at the VIX and yes.The VIX is a sentiment indicator here, and here we see it is still in the low 20s and what I want to point out is that this is a 6 month chart first of all. Earlier last December we did have a little bit of a hiccup in the markets. It was a Fed announcement that came out a little bit hawkish, but it was the elevator up and an elevator down. It was very quick, but what we're seeing this time, and I'm going to put some candlesticks, you might have to squint, it's of a different character. It took a while to get up there and it's takingLong time to get back down. This tells me, as Steve, Steve Snosnick likes to say, the VIX is not a fear gauge. It is a kind of a barometer of institutional hedging demand, and we're seeing a lot of uncertainty in the institutional space. So there's other bearish arguments, but now we want to move on to the bullish ones. And here is history. I like history. Seasonality is one of those. This is not seasonality, by the way, but what happened in April was really interesting. We saw the S&P 500.It was down 10% and then it was up 10% in one month. This has happened 35 times since 1960 and over the next few months, even to the quarter, it does get a little bit dicey at times. We could actually see a return to those lows that we saw, but what's very bullish for me in the longer term is that one year out, 83% of the time we were up with median returns of 14%, and I think that would be welcome from investors this year.Now here's my second bullish argument, and this might be a little bit contrarian. Here is the Barron's cover from over the weekend. Where did the bulls go? So this is a clearly bearish take, but a magazine cover kind of like a new ETF launch. It takes a while to produce and it's kind of stored up pent up pent up sentiment as to where the market might be not going. And so we see this play out in different ways. I would also draw attention to the fact that they're trying to make.senses of Palantirer's lofty price. That was just days before the price crashed 10%, which was the biggest drop in the year. So you put it all together, we're we're having some mixed signals right now, but we are on that razor's edge, and we can flip pretty quickly into bullish or firmly bearish territory. So tune into Stocks and Translation for more jargon busting deep dives, new episodes on Tuesdays and Thursdays on Yahoo Finance's website or wherever you find your podcasts.

All right, Jared, thank you so much.DraftKings missing first quarter expectations and cutting its full year revenue forecast. Still, revenue rose 20% from a year ago. The sports betting company says a lack of March Madness upsets kept it from raising its 2025 guidance. Joining me now, Jason Robbins, draft team CEO and my Morri co-host.Smith, Jason, thank you for being here this morning. Let's start on the guidance. I'm I'm really interested in getting some clarity from you on this. You said you would have raised it if not for unusually customer friendly outcomes during March Madness. Can you break that down for us? Should investors just always expect your guidance to be driven by game outcomes?

Well, not always. I think in this case we had a pretty historic March Madness. It was only the 2nd time ever that all 4 #1 seeds made the Final Four, and in addition to that, the first time ever that that happened and you had 3 #2 and 13 seed in the Elite Eight, so really a tournament where favorites were winning.Um, 82% in fact of the favorites won, so that was actually an all-time record for March Madness. uh, so I think it was a bit of an anomaly, um, you know, we've heard theories like NAL maybe driving more of that type of thing in the future. So obviously the models will have to take those sorts of things into account, but I don't expect that kind of favorite run to happen, uh, most years in March Madness or in any sport for that matter, but it does happen sometimes, which is.Part of the great aspect of the product, customers can really go on winning streaks on things like that, which isgreat.

So then let's talk about what you are anticipating regardless of game outcomes, especially for the next year here. Sales and Ebita for Q1 did miss consensus in part due to gaming taxes among other potential headwinds among the macro uncertain environment here. How are you thinking about the health of the consumer and the impact that could have on your business in the quarters to come?

Well, we included some material on this and uh because we knew the question on investors' minds we include some material on this in our earnings release, and it's pretty clear that gaming and online gaming has also really shown resiliency through macroeconomic downturns. Uh, we, we took some data from 2008, the Great Recession, and, and we saw that and obviously didn't have US online gaming at the time, but it was widespread throughout Europe and it.Grew quite nicely through that period. So that in addition to us looking at our own metrics and seeing very healthy customer metrics across the board, and we analyze everything really gives us confidence that we are pretty resilient to any economic environment.

With that in mind, how's that factoring into the guide right now, Jason and great to speak with you again, especially as we're in this period where we've heard TV ratings are strong for the NBA playoffs right now. How's that flowing through the DraftKings?

Well, strong ratings usually lead to betting and vice versa, so those are good things for us and hopefully they'll continue. The NBA playoffs obviously has been off to a fantastic start with these games, lots of great close games. My Celtics haven't come out on top so far, but still have a lot of way to go, so we'll see.Um, but really it's been a great quality product as we expected and the betting is following.

As aPhiladelphia fan who lives in New York, it's been quite rough for me as well, Jason, so I, I somewhat share I can imagine. So all things considered, as you're, as you're thinking through the sports events over.The summer that are going to be the key drivers for DraftKing's business as we're now in a summer that is going to be Olympic less but still potentially have some other major catalyst for the business. What would be those key drivers from how you're looking out into the next 3 to 6 months?

Well, obviously baseball is a big deal during the summer. It's our biggest sport. Um, we're really happy to see that in April baseball was up 16% on handle year over year. Live handle was up 36% year over year, so really strong metrics on both fronts. So hopefully that'll continue through the summer. We also have a lot of great enhancements we made to our golf products, our MMA, UFC products, and many other sports that will be occurring during the summer as well. So definitely not the, you know, most, uh, active time.year from a sporting perspective, it's still a lot going on on the sport calendar and we're seeing great customer metrics.

One thing I'm just personally interested in as a markets nerd more than a sports one, Jason, is whether or not the market volatility that we saw over the last quarter is a potential headwind for your business in the Venn diagram of sports fans that are also interested in financial markets. Does market volatility that encourages some riskier investing behavior like options trading, for example, prevent you from having those customers be more active on your platform?

You know we haven't really seen that um you know it's something that we talked about. I do think there's a bit of a difference even though I'm sure there's some overlap in the customer there is a different segment that that I think is more into that but.Certainly it's something that we are keeping in mind and um you know any time uh regardless of the reason that the customer has less discretionary entertainment income that's always a factor and I think you know you can look at that across the board but again for us we've really not seen and nor has the industry ever seen any of the macroeconomic factors out there affecting the numbers it's.Always been pretty resilient to any kind of economic downturn, so I don't really expect that to be differently here, play out differently here, but it's something that of course we'll keep an eye on.

And I want to go back to the tax question that I mentioned earlier. Have you had any conversations with legislators over the past quarter here about what any changes to tax regulation in particular could look like going forward for the business?

Well, we're operational now in almost 30 states, so there's always going to be some of that going on in any state. We're obviously educating and helping understand that there's still an illegal market out there. There's still other options like federally regulated prediction markets, so we have to be taxed fairly if we're going to be competitive, and I think most states understand that.

You know, as you're thinking about your average revenue per user right now and ultimately $108 in the first quarter of 2025, 5% actually decreased compared to the same period in 2024, where do you see the opportunities to extract more values on a per user basis, knowing that users are, as Matt was saying, being more discerning or looking across their spending, their finances and trying to figure out, you know, how much do I actually realistically have to gamble or continuously wager.versus a period where they might have a little bit more discretionary dollars.

Well, the reason that it was down was really those sport outcomes, and you know that just means customers were winning, which I think is a good thing for long term health. If you look at our handle, you know, as we noted in our call, we were up 16% year over year, which is the amount of money wagered. So that's something that we look at more in terms of the overall spend of the customer. Obvious outcomes can happen and that can drag down if you have a.Like that, the average revenue, but those quarters, even though we've had two in a row now, they tend to be more of an anomaly. We haven't had a string of two quarters like that ever before this, so, you know, great thing that customers were able to win, but also over time those metrics will normalize and we're really looking at the fundamental customer metrics like how often are people playing, what does retention look like, how much are they spending.

And I know in the past you've talked about how sports gambling is not an investment tool, but I wonder how you think about sports betting as an investment tool going forward. Do you see this as a market for investors to really and potentially gain some revenue in their personal lives moving forward?

No, I don't think at all. I think it's an entertainment product and people who bet don't expect to win over the long term. I think that there will be streaks like this where certainly there are customers that will make a lot of money, and that's a good thing, but I don't think people should look at it at all and certainly don't as a long term investment tool. Certainly it's an entertainment product.

All right, Jason, thank you so much for making the time for us this morning. Jason Robbins, DraftKings CEO, and our own Brad Smith for the conversation as well.It's now time for some of today's trending tickers. We are watching this morning Nvidia Cloudflare, and Affirm. First up, Reuters is reporting Nvidia is planning to produce a downgraded version of its H-20 chip for sale in China. Nvidia planning the new version to get around US curbs on chip exports to China. The company reportedly planning to launch the chip in July. Nvidia CEO Jensen Huan said earlier this week that China's AI market could be worth $50 billion and it would be a big loss.To lose access to it. I'm still here with Peter, my guest host for the hour. Peter, how are you thinking about Nvidia's movements here because it seems like any export control that's thrown at this company, they find a way to manage around it. What does that signal to you about the firm?

You know, I think they're doing a great job and you know when I look at Trump and analyze, he does value personal relationships. You see Jensen seems to be in DC a lot. He is trying to make this a personal relationship, which I think is the necessary thing. That's how Trump responds.deals with we go back one of our generals worked with Trump 1.0 Abe from Japan learned to play golf specifically so we could hang out with Trump and play golf with Trump, and that actually worked very well for Japan back in the time. So I think he's taking all the right steps to navigate this as well as we can, and it is this trade off all the chip industry like we need to sell products to China, but we also need to make sure that we bring and retain the superiority, particularly in AI here. So that's a balancing act. I think so far he's managing it fairly well recently.

All right, so learning to play golf still a good business investment moving forward here, Peter. Next up, we're going to talk about shares of cloud flare popping after the company reaffirmed its full year forecast in the first quarter, the software company reported a year over year sales increase of 26% and maintained its expectations for full year revenue growth of 25%. The shares are up over 7% at the moment. And what's interesting to me about this thing, Peter, is that I continue to hear investors that I talked to talking about the.of looking at software versus hardware amid the tariff driven policy concerns. How are you thinking about that?

Yeah, we think, you know, AI is here, it's continuing to grow, but the big part is people are realizing AI is only as good as the data that you can feed it. So I think there's going to be a continued growth in how do we build up the data, how do we make sure this data is useful for AI, and it's kind of this, you know, interesting cycle and what's been encouraging for me is over the last 6 months or so you're hearing more companies talk about how AI has helped their business.be more efficient and that whole first wave, everyone just talked about the hyper scalers and it was the companies that were generating the AI product that were making all the money. Now it does feel like you're starting to get some of those beneficiaries at the corporate level, so I think that continues that spend. So I think this continues to grow. It may be overbuilt here or there, but I think the trend is in a few years without a doubt we will have more data, more software, more things being appliedto

that. All right, well, finally here, let's take a look at shares of a firm falling after the company reported weaker than.Guidance shares falling despite a firm adding 1.8 million customers in the quarter. The company also announcing a new partnership with Costco and an extension of its partnership with Shopify through 2028, but the shares are down 11%. That disappointing guidance really hurting the stock here and it also makes me wonder if there's a lesson about the health of the consumer right now, given a firm is obviously attached to buy now pay later, and there's questions, to say the least, about consumer health. Yes,

Ithink that it falls into that camp right now.Where you look at auto delinquencies, all these things are kind of increasing. You're looking at, I think you guys did a segment earlier, restaurant sales. There's all these signs that the consumers tapped out a little bit and buy now pay later's been this phenomenal kind of relatively new invention. It's not very well regulated. It's not part of the banking system, so it's hard to tell what is out there, how the risks are, and how the consumer is going to respond because I think it existed a little bit with COVID, but at that point the government was so quick to support the consumer with checks.And low interest rates that I don't think anything got tested, so we might see this industry tested a little bit if the consumer slowdown isreal.

That's a really great point to make sure that you're looking at names that didn't just survive because they got stimulus, make sure you're looking at some of those fundamentals in a world where we may not be getting any saving from the Fed or from stimulus more broadly. Peter, thank you so much. Great insights as always and for our audience, you can scan the QR code below to track the best and worst performing stocks with Yahoo Finance's trending at Ticker page.Coming up, let's look at where things stand between the US and China with trade talks set to begin. That's next when Catalyst comes back.Here's where things stand between the US and China amid the ongoing trade war. The US has 145% effective tariff rate on all goods from China. China has a 125% rate on all US goods, though it's reportedly made some exceptions for certain goods. So how did we get here? One of Trump's key promises on the 2024 campaign trail was imposing 60% tariffs on all Chinese imports to the.He took early action in February, adding a 10% tariff on Chinese goods, which he raised to 20% in March. Then, as part of his April 2 Liberation Day push, Trump announced another big hike, bringing the cumulative rate to 54%. China responded with a 34% tariff on all US goods. In the following days, both sides continued to ratchet up rates. On April 9th, 1 week later.paused tariffs on several other trading partners for 90 days, but boosted China's rate to 145%. China hit back with a 125% tax on US goods, but the president and members of his administration have hinted that China tariffs could come down significantly after this weekend's talks. President Trump on Friday posted on TrueSocial that an 80% tariff on China seems right.The Trump administration is waiting tariff cuts with talks set to take place between the two nations this weekend. Bloomberg reporting members of the administration are targeting a 60% tariff rate, while President Trump said 80% seems right. The president adding that the final rate would be up to Treasury Secretary Scott Besson. Bessen joined by US Trade Representative Jamieson Greer, will participate in talks.With Chinese officials on Saturday with more on what might come out of those negotiations, Phil Luck, economic program director at the Center for Strategic and International Studies and former deputy chief economist at the US Department of State under the Biden administration. Philip, it's great to have you this morning. What is your expectation for a tariff rate that we can anticipate coming out of this meeting, if any?

I mean, I don't anticipate anything to change out of this meeting right away. Um, I imagine this to be a meeting where they start to describe where they might want to go eventually. Um, I think both sides are indicating they're pretty far away from changing a thing.And I would imagine that the PRC would want pretty substantial change to this rate if, if they were going to lower their rates at all. Um, I, I would also say that, you know, both sides seem to be wanting to have the other one make the first move. Um, largely I think it's really good that they're talking, um, so we can start to move away from these incredibly high tariffs that are going to be very disruptive to both economies.

How optimistic are you that we actually are going to get that lowered rate and what is that timeline potentially going to look like?

I don't know how optimistic you should be here. I mean, look, we're already at a rate where you have tariffs that are way higher than you could ever imagine for a reasonable economic policy. Um, so we didn't get to the place where we are following sort of logical progression of activity. Um, I would also note, you know, your indication of sort of how we got here, which is actually very, very helpful, indicates that, you know, we got here through a sort ofBack and forth of lobbying of lobbying of tariffs. So, you know, it's gonna be hard. The trade wars are hard to unwind. They're pretty easy to start, but they're hard to back off from. Nobody wants to make any unilateral concessions, so you have to really negotiate for a long time. So, you know, I think we're gonna have high tariffs for a while. If they really want to remove these, I mean, you know, the Trump administration could take these off tomorrow if they wanted to.Um, they haven't seemed to want to. And I don't think that we're gonna have tariffs that are gonna be substantial on the PRC without them having substantial tariffs on

us. And Philip, my guest host has a question for you.

Yeah, one of the questions I had is, where do you see us headed on rare earths and critical minerals, right? That seems to be a subset of the whole negotiation, and it feels to me a very important one.

I couldn't agree more. This is something that I think is sort of underappreciated. Look, I mean, there's a reason that the last administration, uh, passed the IRA and invested an enormous amount in these technologies because the Chinese have a stranglehold on the processing and mining of these rare earth minerals. That's not just rare earths, which, despite their name, are actually not that rare. It's alsoThings like graphite, gallium, germanium, antimony, things that go in everything from semiconductors to brake pads to bullets, right? These are really important components. They have the ability to really clamp off the supply of these. Producers have some stockpiles, but some of these things you can't even stockpile that well. So, you know, I, I would imagine that hopefully there'll be some sort of, again,Um, backing off, but we do also need to realize that this is a capacity the PRC has. They have the ability to put substantial pain on the US economy through their leverage in the space, just as we can put pain on their economy through leverage that we have. Um, so we do need to be sort of entering these conversations with that inmind.

Yeah, that makes sense to me. It's been one of the things I've been a little bit surprised that we haven't made a bigger effort to be able to process and refine these because that to me is the missing component, right? It's not the minerals themselves or the extraction, it's the processing and to me we should have started that on day one here to try and move away, and I know Biden did some of that. What else do you see kind of in terms of the ability? Does China, who has the cards, is China really prepared to, you know, play nice, or do they have their own agenda and they're happy to stretch this out? Do you have a good sense on that?

Yeah, I mean, I, I, I don't think anybody seems to be in the mood to play nice necessarily. This hasn't been an especially friendly competition so far in this administration. Um, look, I think, you know, the PRC, um, you know, they don't have the necessarily the political pressure that we do in a democratic system. So I think that they think they have more leverage than, than I think we're assessing they, they think they have. Um, and, you know, we can certainly see from the, the COVID lockdowns, you know, they can keep policies in place for a long time, even.If they are not in their direct interest. So I wouldn't bet against the PRC being able to um retain some level of this policy. Um, look, I think we're, you know, from everything we're hearing, we're weeks if not days away from shortages here in the United States. I think the PRC knows that. um, so I think that's also something in their calculus.

Philip, thank you so much. Great context ahead of a very important weekend for our investor audience. Really appreciate your time.Thanks a lot. Let's take a look now at the major averages because it does appear that we are dipping into the red this morning. Your S&P is off about 0.2%. Your tech heavy Nasdaq also off about 0.1%. Taking a look at what's moving, the second biggest laggard in your S&P 500 is the tech sector. That sector specifically is off.About 6.1% this morning and taking a look, Nvidia does appear to be pushing down those shares. It is down by about 0.5% at the moment. Of course, your tech heavy Nasdaq also taking us down just a touch is off about 0.0%. We're going to have all your markets action ahead, so stick around watching Catalyst.Coinbase announcing a landmark deal to acquire crypto options platform Dareit for $2.9 billion. This announcement comes amid a wave of M&A excitement unleashed since President Trump has taken office and appointed David Sachs as the White House cryptocar. Joining me now, we've got Peter Christiansen. He is city's fintech analyst. Peter, great to speak with you this morning. Talk to me about this deal from Coinbase and how you rate it. Do you think that this is the right move?

Absolutely, and, and thank you, Madison. Great to be great to be here. Uh, I think part of Coinbase's mission is really to scale its liquidity. At the end of the day, it comes down to liquidity, um, because that's gonna be able to, to draw more capital and, and have the lower, lower fees and, and, and, and certainly access points. And there but.Is, is clearly a pathway towards that competitive advantage. Uh, first, it gives them more of a uh, uh, an international footprint that's something that Coinbase has been working hard on, on delivering. And then additionally it enhances their derivatives, um, uh, capabilities for sure on top of a 800.$800 billion of, of futures volume, they now add uh potential of uh um roughly $1 trillion in options volume on top of that. So it's really helped them on the institutional side.

And what does it signal to you more broadly about M&A specifically within digital currencies?

Yeah, it's been interesting. There's been a lot of activity and we, we hear of things uh constantly. Um, I think we're entering a new era for the crypto industry.Um, it'll be really interesting to see if traditional finance and crypto native firms come together, uh, and also just from the crypto native side, how these companies scale. Uh, I think there'll be a lot of competition, which I think will be good, uh, for the sector, uh, but certainly a lot of opportunities.We do believe and, and we, we've written extensively on this, that there will be a lot more public companies, uh, and, uh, uh, crypto native public companies to come out and, and in our dealings and speaking with uh a lot of them is they, they don't necessarily need the money. What they really do is crave legitimacy and they believe that Coinbase has had a bit of an unfair advantage being a public company, having publicly disclosed financials and CEO and CFO at a station. So, uh, I think a lot of uh crypto native firms want.Is that competitive gap versus Coinbase.

All right, my guest host Peter has a question for you as well. Yeah,

when you'relooking at investment possibilities, are you focused on companies that are going to be very focused on, say, Bitcoin or maybe into, you know, XRP, Ethereum, or do you go really for things that are playing further down in the kind of alt token space?

There's a lot of questions on, on, on what token sphere. I think uh a lot of, uh, where Coinbase should be focused. Uh, at the end of the day, I, I really think it's, it's about utility.Uh, and that's the promise of what blockchain offers. There's tons of, um, real world, uh, examples where blockchain can make a meaningful difference in, in the underlying technology, given its immutability, trustlessness, uh, and, and, and ability to scale. Uh, in fact, we, we often hear about the combination of blockchain and AI and it's not necessarily what AI can do for blockchain, but what blockchain can do for AI which is super interesting.But I, I really appreciate Coinbase's effort in going after utility, less so on the speculation side, creating real real world applications that can be used not just for crypto ton but for all sorts of technology. One area they're doing that is B2B.Payments, uh, that's an area that we we we're very interested in.

And you know, as the US government, you know, as David Sax and them seem to be kind of pushing towards some sort of crypto reserve or Bitcoin reserve, will Coinbase and these other companies benefit from that? How do you play that? Is that a great opportunity in the public space?

Yeah, I mean, well, I mean.Bitcoin is, is a major, uh, component of, of Coinbase's uh uh uh financial model. Uh, I think they have, uh, uh, a reasonable share in on-chain Bitcoin activity. Clearly, they have exposure by supporting the majority of, of ETFs that are out there. So, um, no, it's, it, it, it's really important to their model. In fact, I think it was demonstrated this quarter more than, more than any.Uh, Bitcoin has actually performed fairly well compared to other tokens which have, which have not, and, and still Coinbase produced some really meaningful results and a lot of that wasUh, afforded by strong Bitcoin performance. Yeah,

and I want to turn to my guest host here on set with me, Peter Cheer, for this next question because it's interesting Senate Democrats on Thursday they voted down that motion that would have allowed the taking up of that GOP-led cryptocurrency legislation and there's some concern about whether or not that is going to be a blowback, but you rightfully point out that the powerful figures of the administration.President Trump himself obviously are very pro crypto. Do those sort of intermediate headlines matter in terms of how you talk to clients about their Bitcoinallocations?

I don't think so right now. I think Trump hasn't really taken a full bite at the apple to get this thing. You've got David Sachs there. You've got his own family very involved. Howard Lutnick's firm, Cantor Fitzgerald had to step away from, they're very involved in the space, I think even.Besant talked about how the stablecoins are huge buyers of T-bills, so I think this administration really views that ecosystem is important. So I think they're going to push through and find ways, and I would not bet against Trump finding a way to get something done. So I think the next thing is up. I think we can go above the $105,000 highs wherever we got them Bitcoin. I think it's the wrong step. I don't think the government should be messing around.Much as they are, but it's not for me to say what they're doing. I'm here to figure out what they're trying to do, and I do think if they have that success, you will see a lot of the red states in particular follow through, and you'll see crypto kind of make its way into public finance much more, and I think that pushes it higher for

now. And that's something that investors should be keeping in mind if it's an asset that you see going higher, then maybe it's one you want to get into Peter Cheer, thank you so much and of course thanks to Peter Christensen for joining us. Appreciate it.Great, thank you. Thank you. Let's get a check on shares of United Airlines. The company racing gains this morning following an ABC report that Newark Airport radar screens suffered a brief outage. Newark, of course, is United's biggest hub. Now the outage comes after travelers have experienced hours long delays and other hardshipsid FAA staffing levels, runway construction, and technical issues that have thrown a serious wrench into operations at the airport.United Airlines is waiving change fees and fare differences for flights out of Newark between May 6th and May 17th. Passengers are also advised to subscribe to flight notifications and monitor flight status before arriving at the airport. You can see those shares down about 1.5% as part of this ABC report and part of why we might be seeing a little bit of this action here reporting that air traffic controllers could be heard telling a FedEx plane that their.Went dark asking the aircraft to tell their parent company FedEx to put pressure to get the problem fixed when it comes to some of the air traffic control challenges. Of course this is something the president also mentioned this week that he is efforting fixes to this as well amid the Department of Transportation announcing plans for a new state of the art air traffic control system made what they call an antiquated system that is currently in place. We're going to have much more ahead for you here on Catalysts.US stocks have rebounded from the losses we saw following the president's April 2nd tariff announcement, but according to one financial adviser, sentiment isn't quite bouncing back. Our next guest saying some of the sentiment among clients that she's seen is reminiscent of 2008. I want to bring in Jamila McCloy, black wealth financial financial advisor for this week's FA corner, brought to you by Invesco. Jamila, great to have you this morning. Tell me what you're hearing from clients. What is the sentiment that you're sussing out?

Good to be here. Uh, there's a lot of fear, the same fear and anxiety, uncertainty, and just avoidance that feels very reminiscent of 2008 after the housing market crash. Obviously a different, uh, reason and result that that's happening now, but it's the same type of fear. They don't wanna open statements, they don't wanna look at their accounts. They just want to avoid it, kind of blind optimism and hope that it goes away.

Yeah, I think a great point that people have to look at their accounts. It's the reality of the world, you know, the one thing to me, it feels like we're in this world where Trump wants to change the world. He wants to change how business is conducted globally, and it's easy for me to see a world a year from now we're either up 25% or down 25%. But to me, if we're up.25% I'm comfortable missing some of that rally because my job will be good, my house will be good, my family's probably well off. I'm more concerned where if it's down 25%, not only did I lose my portfolio, I've maybe lost in my job. I've lost with the family. I've lost that. Is it right to kind of think that way, or is that being too conservative?

I believe that's a great way to look at it because like you said, maybe we don't catch all of those big games, but if we have the security around the things that can help us over the long term and keep us financially secure, then we're OK with giving that up. So it's a good point to to kind of look at the overall picture.

Jamila, we got to leave it there. Thank you so much for joining us. I appreciate your insights and interesting to hear some of that pessimism that you're getting in from clients given the comparison to the global financial crisis. Really appreciate it. That was this week's FA Corner brought to you by Invesco.Coming up, wealth dedicated to all of your personal finance needs, our very own Brad Smith, he's gonna have you for the next hour. She'll keep you here for more.