SOTS 2nd Hour: A Jenga-Tower Economy? Buffett's Alpha-bet, & Goldman's Small Cap Picks 11/17/25

David Faber (0:00)

Introducing Fidelity Trader Plus. With customizable tools and charts, you can access across all your devices. Try our most powerful trading platform yet at fidelity.com/traderplus. Investing involves risk, including risk of loss.

SPEAKER_2 (0:12)

Fidelity Brokerage Services, LLC.

David Faber (0:13)

Member NYSE, SIPC.

SPEAKER_3 (0:15)

We all take good care of the things that matter. Our homes, our pets, our cars. Are you doing the same for your brain? Acting early to protect brain health may help reduce the risk of dementia from conditions like Alzheimer's disease. Studies have found that up to 45% of dementia cases may be prevented or delayed by managing risk factors you can change. Make brain health a priority. Ask your doctor about your risk factors and for a cognitive assessment. Learn more at brainhealthmatters.com.

Sara Eisen (0:45)

Good Monday morning again. Welcome back to Squawk on the Street. I'm Sara Eisen with Carl Quintanilla and David Faber. We are live from Post 9 of the New York Stock Exchange. Coming up this hour, Bitcoin touching its lowest level in months, firmly below $100,000. We'll talk about what's driving some crypto investors to the exits. Plus, should you follow the so-called smart money? We'll break down Warren Buffett's new bet on Alphabet, moving that stock higher in early trading. And big volatility for the small caps. The group coming off a downbeat week, but Goldman Sachs says there are attractive opportunities. We'll talk to the firm's small cap portfolio manager about top picks here into year end.

Carl Quintanilla (1:21)

Government data is back. Let's get to Rick Santelli. Morning, Rick.

Rick Santelli (1:25)

Good morning, and holy cow, we actually have some data here. Construction spending, this is an August number. It was supposed to be released on October 1st. That number was supposed to be released two weeks ago, but nonetheless, up two tenths of a percent is our August read. And last month, which in this case was July, was upgraded also to up two tenths from minus one tenth. These two readings are tied for the best readings of the year. As a matter of fact, you have to go all the way back to August of last year to equal up two tenths. You have to go back to May of last year to find a higher number. So it is good news as we see the reopened government starting to put forth data. And of course, as the week progresses, we'll keep monitoring what's going to be released. Everybody's excited for Thursday when we get caught up on some of the jobs and claims data.

Right now, if you look at the 413 yield for a 10-year, it's down two basis points, 360 yield in the two-year is virtually unchanged. Sara, back to you.

Sara Eisen (2:31)

Thank you, Rick Santelli. Besides some of the data Rick mentioned, I'll be looking ahead to some of the retail reports for a real-time read on what they're seeing from consumers into the holiday shopping period. I mean, this is a heavy week for retail reporting. It starts with Home Depot tomorrow, Lowe's and TJX and Target on Wednesday, Walmart, the big one on Thursday, along with Gap and Bath & Body Works, Dick's Sporting Goods, which has been a good performer. Because we want to know what the heck is happening with the consumer. There are questions about affordability, there are questions about auto delinquencies, as we've seen in some of the data, questions about slack in the labor market, all of that. Perhaps why the White House did go through with something we were looking for and they were teasing last week, which is tariff relief on certain agriculture products to try to make it a little bit easier at the grocery store. So what's included in some of this tariff relief? Roll back. Coffee and tea, beef, bananas, oranges and tomatoes, cocoa and spices. And these are some of the products where we've seen the heaviest increases, going back a few years, but those price gains are cumulative. They don't come down. And so people are still really feeling the shock of these higher prices at the grocery store.

Interestingly, Bank of America put out a note saying who would be the winners in the consumer space of some of these tariff rollbacks. Some of the companies that have had to deal with a lot higher costs on some of these products. And coffee, Smucker, Kraft Heinz, Keurig Dr. Pepper. They say will be winners from this new policy. Spices, McCormick, cocoa, Hershey. So some clear winners in the corporate space. And then of course the White House is hoping that that makes things feel a little easier for consumers too. But obviously to our discussion earlier, inflation is broad. And there are other pockets of it. They're worried about housing inflation as well. That's why they're pitching this 50 year mortgage rate. Whether that works or not or whether that's feasible. You can tell they're clearly thinking about it. Right.