What a day, folks. What a day. Thank you everybody for being here. Welcome back to another episode of the market close.

What a day. That's really all you can say, right? What a freaking day. What a freaking week. There are a lot of things we have to talk about, a lot of updates we have to get into, but as everyone can likely see. We are going green, trying to not fully green, but we are at least not as bad as where we were in the morning. This is I think basically what we were doing the entire week. It's a little bit of a roller coaster ride, but we are back.

All right. So, what's going on? There's a couple of things that are happening right now. And the things that are happening are making it very apparent for why we are going green. Not fully going green, but Bitcoin. My goodness. Again, there's a lot of things to dissect and talk about. 103.8 on Bitcoin. It was at 99 in the morning when I left the market open. S&P was low. S&P right here 669. About 50 cents away from going green. we were at around 661 on the S&P. Um, and now you have 669. Bitcoin was kind of at like 101, 102, so Bitcoin was definitely not signaling that things were necessarily going bad in the risk on space. But, now it continues to break out.

You're seeing stocks that are still pretty red for the day, but they're not as red as they were. Archer was down 17, now it's down nine. Hims was down five, now it's down two. Soapfi going green. MP Materials actually up 13%. BitMine out of all companies, BMNR actually ends up being one of the best performers of the day, up 8.3%. That's because Ethereum is not slowing down. Ethereum right there trying to crush 3500. Meta was at 601 in the morning, now at 618 trying to go green.

What is going on? I think I finally have an answer potentially for all the volatility we've been seeing this week. Definitely the volatility we've been seeing today. You know, there were arguments about a labor market, arguments about the AI trade kind of getting into question. I think the answer is pretty simple, and I'm going to share with you guys what I think the answer is. And I think literally the reason we started going green about two hours ago, is because of this. It's the shutdown. Some ideas that the Democrats are trying to get Congress to reopen is what's getting the market to be a bit more excited.

Scott, we just saw a brand new offer on the floor from Chuck Schumer and Senate Democrats, basically telling Republicans that they will vote with them to reopen the government as long as Republicans can agree with them to provide a one-year extension of those Affordable Care Act tax credits that have been keeping premiums low. Uh, Democrats are also asking that there's a bipartisan group that'll work together, figure out some of the reforms that Republicans have said they wanted to see on those tax credits. Important to note here, Senate Republicans have actually shown a lot of openness to finding some way to extend these tax credits. They do want some caveats, some limits on them, but they do overall seem to be supportive.

When this came out an hour ago, that's when you really saw the the Vape on the S&P 500. I mean, we definitely got above the bottom a couple hours ago, but when this headline came out, that's where you saw this V starting to get formed.

However, the reason we're not fully green is because it looks like the rep Republicans are going to be uh rejecting the Democratic propos uh proposal.

>> And I am hearing uh from a couple of Republican aids that this offer now made by the Democrats that they will vote to reopen the government if Republicans provide a one-year extension of those Affordable Care Act tax credits is not going to be accepted by Republicans. I was told that this offer was actually made several weeks ago, that it was rejected by Republicans. We're also now seeing a statement come out from the White House on this. A White House official saying that Democrats are making clear they're holding the American people hostage for other spending. This is a huge climb down from their initial position shows they're under massive pressure. Um they go on to say that Democrats should reopen the government today and the administration then will meet with them on the tax credit and work on it. So going back really Republicans sticking with their initial position that they are open to talking about these healthc care tax credits but only after Democrats provide the votes to reopen the government.

So if this kind of continues this breakthrough might not be much of one at all and we might be kind of back to where we were where both sides are really dug in firm. And remember for Democrats in particular I I am I do know that there are some more moderate Democrats out there. They want to find a way forward. They want to reopen the government, but they are getting pressure from maybe more centrist or more progressive Democrats who are saying, "Look, we just got big wins on Tuesday. The American people are telling us that they want us to hold out and really fight for healthcare and we need to do that." So, I think undetermined yet exactly if there's going to be a vote today, what that vote is going to be on, and how much longer the shutdown's going to go. Scott,

>> I'm just happy we finally have some clarity. I think throughout the entire week, definitely this morning, there was a lot of confusion on why is the market tumbling the way that it is. And obviously, yes, it's healthy, consolidation, all that stuff. But at the end of the day, people want some reason for why Nvidia goes from 205 to 170, right? Like there and it's Nvidia, it's 8% of the S&P 500. So, there has to be some reason that is getting the market to be upset. And I think today, based on the price action that we've seen over the past couple of hours, the reason it looks like is this government shutdown.

As soon as that news came out that Democrats are offering a one-year extension on ACA subsidies, which has been kind of the lynch pin of why we have not been able to reopen the government, by the way, super bullish for Oscar if that actually happens. Oscar, right, they're up 7%. A lot of the other healthcare companies like Humanana, um then then the markets went green.

Now, like 20 minutes ago, the Republicans pretty pretty much made it clear they're going to be rejecting that offer. Uh markets aren't going to super green like they seemed like they were on the trajectory to go, but they're still recovered a decent chunk. The S&P was down more than 1%. Now it's barely down 02%. On the day I think the signaling of the negotiations is that maybe this is not the exact negotiation that will open up uh the government pound you right there going green as well 17792. But it's enough to say that we're getting closer to the government opening up.

And well, that's that's I guess the story. I mean, that really feels like the story of the day. Now, a lot of people might be saying, really, the government shutdown was the reason for all this volatility. Again, I can't be sure that's the only thing, but based on the price action and based on the movement on the price action, yeah, it seems like that is the number one reason for why we've had some pain.

So, the it kind of comes down to do we think in the next few weeks, and Poly Market right here has a 50% odds that we will open after November 16. Do we believe in the next coming weeks we will get some level of capitulation from the Democrats and Republicans on this healthcare issue which again has been the core issue so far right there 28 for why we haven't opened or will this continue to be extended. The fact that the Republicans rejected this proposal means that they're not willing to extend healthcare subsidies for another year which you know if that's their prerogative that's the prerogative but at some point they're going to have to negotiate it and the question just becomes uh what will it be like?

Having said that, I think it goes to show and and the reason I I I am at least happy to see some of this price action is that there was a lot of chatter today on is this fundamental, right? Is the AI trade messed up? Is there like an issue with valuations, corporate debt, all this stuff? And I think what we were talking about in the morning is that the earnings are really good across the board. The earning now like Open Door didn't have the best earnings, but you know, Open Door is not Google. Google had a phenomenal earnings. Meta is down because of a variety of things around capex spend and can they get an ROI but Meta still grew revenues at 26%.

So at its core to say these stocks need to be cut by 20 30% because their valuations don't make sense. It's like well wait a second we did a lot of work on valuations and some stocks do trade at aggressive multiples but the most important companies on the planet. They are trading at very reasonable multiples you know you're talking about 23 to 30 times earnings and they're growing earnings. So that's why it didn't feel like it was a fundamental issue.

And again, a fundamental issue turns into a bare market, right? If the fundamentals are messed up, you end up getting a prolonged selling cycle. If it's just this jitter of a headline or a macro or a news event like the shutdown, then maybe we don't have to deal with that type of pain. I think it's too early to tell exactly what it is, but based on the price action we're seeing today, it might be because of the shutdown because again, we are almost recovering everything that we lost as we get into the close. Fear and greed was at 14 at its lowest. Now we're at 20 just based on these headlines around the shutdown.

And so yeah, Meta at a 24 PE is not a bubble. Like it didn't feel like a bubble. You could understand why Meta is getting chopped and the narrative overhang, but that doesn't feel much like a bubble.

though. Uh I'm at least happy that it like given the fact that the S&P quite literally reversed most of the day's gains as soon as that Democrat healthcare shutdown headline came out. It it'd go to show me, oh, this is literally a game of alos that are toying with this shutdown headline news as the basis for how they're going to go up or down. It's not a lack of full belief in the broader market. And I think that's the positive thing for investors to kind of hang their hats on.

Now, is this a bit of a bull trap and Monday we get I mean, I don't know. we're going to see. But at least it's not the bottom falling out, which is pretty much what happened for the first three hours today during the market open. Ethereum right there 3,400, Bitcoin 103.6. A lot of people screaming that it is alt cycle now. You're seeing a lot of these old coins. I mean, Fartcoin being one of the leaders today, up 10%.

If it is altcoin cycle, um fortcoin now is up on the day, yeah, almost 12 to 15%. If it is altcoin cycle, then BMR is going to be a beneficiary. Ethereum is going to get some love right there. BMR 40.3 again. BMR was at 3579. The fact that this one is making such a nice recovery is also nice to see. S&P 500 again, we are so Oh, there you go. Green 670.3 there. That's the market telling you we think the shutdown is going to end soon.

Even if the Republicans ended up rejecting that offer, I think that's the market basically saying, you know what, uh, this shutdown will come to an end and it probably will come to an end soon and that's why we're getting that recovery. I mean, if you didn't look at your portfolio the whole day, uh, notice the level of carnage, but if you were tracking it in the morning, there was some carnage. And a lot of that carnage seems to now be uh a result of this government shutdown that potentially might be reopening going into next week.

June says we just needed any good news. Yeah, I think so. And I guess the the core good news that the market cared about was this shutdown. And you know, the thing that I think a lot of us were saying in the morning was that hey, the labor market might be the biggest issue. Uh because you know, that is the more fundamental picture that we're seeing right now. Grab still down 1%, Celsius down 7%. Uh pounder got to 168 at one point. counter right now 178. But the labor market might continue to be an issue at least on a day like today as these shutdown headlines come through. Maybe that's not the core thing that the market cares about.

And that's what we got. I mean, it's not a horrible close going into the end of the week. We got about four minutes until the market closes. Mr. Matt Money picked up some Rocket Lab this morning at 46. We were at 51. That's up 4%. I mean, pretty much every stock had a Vshape. That doesn't mean every stock went green, but like you have a lot of stocks that aren't really down at the very very lows that they were down for.

Even Micro Strategy was at 219, now it's at 240. You know, Nvidia, Nvidia got to 177 at the lows. Nvidia 188 basically going green or 178.92 on the lows. 188 right here, 10 cents away from going green. So, you're seeing across the board a lot of these assets go green.

And again, you know, it goes to show how the alos will take something up and take something down. Cororee still down 2.8% of the day. At one point it was at 100. Now it's at 103. Nebius was at 101. Now it's at 111. Not too bad.

What happened to Bur shorts? I mean, I don't know. But it is a dangerous game being short, the two biggest AI stocks in the market, Pounder and Nvidia, and having them go down not because of something AI. Again, I want to make this very clear. I don't think Nvidia and Pounder took a hit today because of something AI related, which is what I think Bur's waiting for. this like AI bubble to pop and then Nvidia and Palanteer end up getting wrecked and he makes billions of dollars.

It was because of a shutdown. Like that's what it feels like as we get into the it was like everything, not just Nvidia and Palanteer. Those guys were taking it a bit harder on the chin. But it was because of this shutdown stuff and now they're both recovering a decent amount which means maybe if he closed the shorts in the morning, he made some profit. But again, I don't think he's shorting it for it to go from 200 to 170. I think he's shorting it to go from 200 to 100. At least that's how Bur has typically done things. Maybe this time he's thinking of it in a different way.

But I mean to get Palenter to really collapse or Nvidia to really collapse, I think you need a market collapse. I don't think those two individual names, given how highly liquid they are, how many options are traded around them, and ultimately their fundamental growth stories, I don't think they easily just go down if the market doesn't go down. So Bur's kind of making a bet on the entire market, dude. It's not really Palanteer and Nvidia.

You know, if they were this these were two two random AI stocks that were super hyped like in the nuclear space, I could understand shorting them specifically. But pounder and video are core core parts of the market. I mean, even in the options trading market today, the top 20 stocks that were traded, what are the top three? Nvidia with four million contracts traded, Tesla with 3.5 million contracts traded, and then Palunteer with 1.2 million contracts traded today. These are household names in the stock market.

Then you have AMD, Meta, Apple, IBIT, Open Door, Micro Strategy, Amazon Hood, SoFi, Sound, I Ren, Google, Coinbase, Intel, Archer, Microsoft, and Meta or uh or I should say Marathon. Like for those names to go red, I think he really does think the entire market has to either collapse or take a really big hit. And at least what we're seeing as we get into the close today for Friday is this government shutdown news might be enough to potentially avoid that.

We do have a headline right here on OpenAI. Open AAI asks the US to expand chips act tax credit to data centers. Wow.

Holy crap. Bloomberg. Uh, OpenAI asks the United States to expand Chips Act tax credit. The Chips Act is from when Biden was president to data centers. Didn't this guy just say we don't want the government to backs stop any of the I thought he I mean this is not really a loan to an well it's a tax credit right it's not a loan but it definitely is a subsidy that's for sure

yeah there you go Bloomberg just now literally three minutes ago openai asks the US to expand chips tax credit to data centers that's probably why the CFO slipped up and said this whole government backs stop thing which she apologized for I mean the reason she said it is because They probably knew they were getting ready to make a request and they had to officially get it out there.

>> Professor, I appreciate you reacting so quickly to the news of this moment as we see it obviously impacting how this market is trading. With less than an hour to go in the week, I want to steer you though to what I think has really been the story of this week and that is anxiety over this AI trade. I'm wondering what you make of it. The fact the NASDAQ has certainly come off its worst levels, but it's still down more than 3% on the week and many of these big AI related stocks have obviously been extraordinarily volatile this week. What do you make of it?

Well, you know, uh, two weeks ago, for those two weeks, they shot up and and I relative to the market, I I often, uh, chart, uh, the the the tech stocks relative to the market, it was sort of, uh, shooting up and shooting back down. And now it's right back at the trend line. And the trend line is still that these stocks over the last six months, over the last year, after two years, are still moving up relative to the next uh to the rest of the market. Uh, you know, that trend certainly can't continue forever.

Um, what what I think though, Scott, whenever anyone says it's the beginning of the end, and when everyone starts saying it's the beginning of the end, I begin to say, "Hey, no, that's not the way it works." Well, it's usually when when everyone is totally optimistic that you see the market begin to crumble. So, I I still think the AI trade is on. I mean, I hear the arguments against it. uh you know Meta is having particular problems because of all its uh you know capital expenditures and uh you know it it is true because I've done the research for firms that do a too much capital uh spending actually have underperformed over decades in the market and we will put a meta in that category but the rest of them uh are generating those profits with that expenditures

Trump just now says the United States Senate should not leave town until they have a deal to to end the Democrat shutdown. Okay, so at least Trump is on the side of getting a deal. He just tweeted, "The United States Senate should not leave town until they have a deal to end the Democrat shutdown. If they can't reach a deal, the Republicans should terminate the filibuster immediately and take care of our great American workers."

S&P is up right now after hours probably on that tweet by Trump because that tweet is signaling that um he really wants a deal and if he really wants a deal then the Republicans might really try to find a way to get a deal. Now granted I I mean is Trump okay with a year's extension of the ACA subsidies?

I don't know because Mike Johnson's been complaining for the past 40 days along with Trump that we cannot let the Democrats open up the government for these healthcare subsidies to be extended to illegal immigrants. But if that is the only way they get the job done that I don't know. This was Trump this morning when he was speaking uh in the Oval Office about the shutdown as well.

>> We have a shutdown as you probably know because the Democrats have gone they're they're crazy. They're crazy but they don't care if they hurt the country. But we've uh approved it 14 times. We've approved a opening up 14 times and they keep rejecting it. And uh I guess maybe they will again. Let's see what happens. Uh they want to have a lot of bad things happened. Bad things for our country. We're not going to give $1.5 trillion to people that came into our country illegally. We're not going to do it. Uh to people came from prisons. They came from mental institutions. They're drug dealers. They want to give them medical care. we have a shutdown is

>> On consumer sentiment today, um, and also a small impact on consumer spending as well. But, you know, markets are most focused on what's really driving earnings and overall market momentum right now, which goes back to the AI bubble debate that we were talking about earlier. And on that point, I think one of Jeremy's comments was was really key where um if you were afraid of a bubble, I mean, you would want to see the kind of action that we're seeing right now where we're all debating the quality of capex, how much we're tapping debt markets. And I think we need to continue to watch this activity, but also

relative to the last time we actually had a bubble, most of that spending was all leverage financed and they were all scrappy startup companies. And so I think the reality is there are still really powerful strong incumbents powering this AI wave. The AI wave is broadening out to companies with inferior fundamentals and we need to be cautious but investors need to also have a long-term perspective um and maybe write out some of this intra week.

Valuations are absolutely key here. And I think the challenge is we're investing for AI for business models that are still so nent. We don't know the pricing mechanisms behind them all. We don't know what the end user demand is going to be. Chat GBT for instance only converts about 5% of its users into paid subscribers. So the uncertainty is warranted given that you have spending on this exponential curve. Compute costs and compute needs are on an exponential curve. Needs not costs. Um, and I think that all warrants caution, but what we're seeing is really strategic long-term planning.

And so, see, this is this is the reason why the AI trade coming into question this morning was a bit weird, right? Because all of the big tech companies guided for cumulatively, if you put it together, it's around 450 to 500 billion of capex spending. And that's just the max 7. When you have all the other companies that you put into the mix, you get closer to 600 billion for 2026. That's a lot of capex.

I mean, they said that last week, the market digested it, understood it, was able to kind of price it in, and that's where you saw the S&P 500 kind of get to 690. And then today you have everyone or at least what it felt like is everyone questioning the state of all that spend as if Google didn't say they were going to spend $93 billion in 2026. And so it's kind of this like back and forth of the market trying to ask themselves, do we actually believe this spend is justified and do we believe the spend is worth it?

And for Meta, they obviously do not think the spend is worth it. That's why Meta's got wrecked. But the other names have been relatively okay. So I feel like this is where you have to make a subjective decision as an investor. Do you believe that the AI capex AI spend story is not slowing down? Regardless of the uh bond markets that are getting involved, regardless of the lack of awareness of like what Meta is going to build with all this capex, you still trust and believe in it because if you don't, you know, that is kind of the market jitter that I think has been around all week. If you do, then you buy the dip because you don't care because you know that inevitably there is going to be return there.

This is their credit default swaps for Cororeweave. which is tied to the bond uh market for them. Look at that. Pushing 500. And basically, as these swaps, as the bid spreads on the swaps continue to go higher, that means the market wants more of a return for the debt that they're taking on. This is this is similar to Oracle as well. Those started going higher this morning as well. And part of the reason for that is because the market is a bit, you know, concerned about the uh the type of debt that these companies are taking on.

And you know, Cororeweave has a 318% debt to equity ratio, which is a bit aggressive. So, you're seeing the bond market start to price these things a bit higher. And I think that's why Oracle stock was down today, 2% down to basically the worst levels it's been since September. It actually got to 232, which is exactly where it was in September, right before it ran to 350. So, anyone who bought after that is kind of down on these shares right here as the market tries to figure out exactly what to do with that corporate debt.

>> Uh, the stock market's up, right?

>> Stock market ended up going green. It ended up going up.

>> do you do you still know why we got this reversal or or No,

>> I couldn't tell you. I have my own suspicions that I mean, I know that they teased negotiation that was slapped down, but

>> I also think there was a big buying opportunity. Yeah, that that seems to be the number one reason. As soon as the Democrats came out with their proposal to end the shutdown by extending the ACA subsidies, that was literally at 240. Boom. And then I know the Republicans rejected it, but the fact that they even offered that is getting the market happy. I don't know if that's enough, but it feels like that they

>> is enough for today. And you know why the market needs, not that they want, they need a resolution sooner than later. Correct?

>> Why?

>> Because they need the data to come out to force the Fed's hand to cut. They cannot have the Fed not cut in December. And if we don't get job, if we don't get unemployment reports, if we don't get other key indicators, that could put them in a situation we got to wait for the data to be data dependent.

>> And uh we I I I actually posted a tweet last night saying that, hey, look, basically saying like, look, we there's some news that's like falling under the radar over here that the Senate is going to basically vote for ending the government shutdown this weekend. I think it said it was supposed to be today or this weekend. I don't know which one, but um just looking at the moving average, the fact that it was supporting the 50-day moving average on SPY and looking at the technicals for other things and crypto being strong, it didn't necessarily seem like we're going to start plummeting further downward. So, I made the decision to basically reverse the trends that I had done this morning. And uh I actually also got back into BMR at like 3950.

>> Look, I do believe that Palanteer is going to trade between 150 and 200 at this point. I said that it's going to trade sideways for a while while it grows into the valuation. The fact that they couldn't blow out because remember the big sell-off didn't happen the day of earnings on Monday. So the fact that they the fact that they couldn't blow through all-time highs on the most incredible earnings report that they did to me says that a short-term top is in or a midterm top is at. Now it the question is what range does it trade at while everything happens? I think it's between 150 and 200 because the fundamentals are so good. And this is my projection for their revenue and free cash flow.

And I think that I'm pretty spot on. Now, look, time will tell, but if you go to the Seeking Alpha and you look at the revenue projections, the only two analysts that are willing to put projections out from the street are just over my number at I think 20.6 billion for 2030. I mean, that's a that's a big big number when you think about this. And then you think about going forward past 2030. I truly believe Palanteer is going to be a trillion dollar company which is what 1 point 120% return from here.

>> No, it's all it's all good. It's all good. Um, so the earnings were actually good. Like when it comes to this particular earnings, I don't think the financials really matter. Like almost all of their revenue is from Bitcoin, right? So they only had like $7 million in AI cloud, but that's kind of expected because they're still building out the AI cloud and making the pivot. So there was like a lot of negative connotation with that on Twitter where it was like, oh look, this is all they making cloud. Well, yeah, because they're going to be wrapping it up. But then now they're projecting, I think it was about $3.4 billion AR by the end of next year. And a lot of that is with Microsoft. Microsoft is $1.9 billion ARR. So I thought that was very surprising.

>> It's always going to be Amazon. Always. Amazon will always be one of the top companies in the world. Their mode is insane. E-commerce is still growing even on an emerging market scale. You even see with Macali, I think Maccatali is an amazing buy today as well. E-commerce is going places. They're the largest hypers scale in the world. They're only going to start reacelerating to next year most likely. I I just It's always going to be around. It's always going to be around all the time.

I'm going with Tesla, dude. I'm going with Tessie. I Amazon and Google are more rational. 100,000%. And if I was pure rationally, it would be like Amazon, Google easily. But in terms of upside potential, I think it's Tessy. I think it's the robots. I think it's self-driving. Uh I I I I I want to say Nvidia, but at some point, you know, the chips stop getting sold and so Nvidia can't be putting up the types of growth they were putting up. I don't Tesla hasn't been growing for a couple years. So Tesla's eventually in the next maybe two to we're talking about 10 years, right? So 2036 by around 2029ish, even if it takes three years to get back to that scurve of growth. I think that happens if not sooner. And I know it's a a bumpy ride with Elon, but he's incentivized to make a trillion dollars.