SOTS 2nd Hour: Black Friday Edition - Incl. L.L. Bean's CEO, Apple's Holiday Takeaways, & A Read On Luxury Demand 11/28/25

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Sara Eisen (0:45)

Good Friday morning. Welcome to a special Black Friday edition of Squawk on the Street. On this shortened trading day, I'm Sara Eisen with Carl Quintanilla and David Faber. We are live as always from Post 9 of the New York Stock Exchange. Coming up this hour, we'll bring you the latest on what caused that Sammy outage that halted futures trading this morning. Plus, the CEO of LL. Bean is with us with a warning about how inflation and tariffs could weigh on Black Friday spending. And it's the final trading day of the month. And while it's been a volatile November for tech, Apple has handily outperformed. We'll talk about whether the holiday shopping period will give the stock an extra boost this year. But guys, we don't have FedSpeak, we don't have economic data. So I did want to dive into the latest on what we did get from the Fed, which I think was underplayed because it came out late Wednesday afternoon. And that is the Beige Book. We know the Federal Reserve pays attention to this. And in the absence of some of the official economic data because of the shutdown, I really wanted to zero in on what we heard. This is anecdotes from around the country on labor, jobs. So here's the headline. Overall, despite an uptick in layoff announcements, more districts reported contacts limiting head counts using hiring freezes.

Replacement-only hiring and attrition through layoffs. A few firms noted that artificial intelligence replaced entry-level positions or made existing workers productive enough to curb new hiring. You know how every month we talk about the low-firing, low-hiring economy right now? We're not seeing as much job growth, but we're not seeing firing. I thought that was good color to explain what's happening, reducing head count and even a mention of artificial intelligence, David, having an impact on the company's hiring ability, which we sort of knew was kind of happening, but interesting to get it here from the Fed officially with their Beige Book.

David Faber (2:29)

Yeah. I feel like we do still rely a lot on anecdotal sort of things when it comes to the use of AI in the enterprise. I think next year will be much more definitive in terms of getting a sense from companies as they really can start to put in processes for the use of AI amongst their employee population in a more significant way. At the very least, we may start to see some of those promised efficiency gains and productivity gains, but again, unclear what it will mean for employment.

Sara Eisen (2:54)

Yeah, but what it could do is if you start to really see it in a meaningful way, higher productivity, higher GDP, weaker employment growth, which is an interesting dynamic. Just a little bit more color and anecdotes from the different regions because they all give us clues. So New York, from New York, Fed District. Hours worked increased at small and medium-sized businesses in the district as firms were reluctant to add headcount to meet demand. That's not good. Minneapolis, employment was down slightly since the last report. Surveys found that recent hiring demand continued to soften. In Dallas, headcount reductions were reported by firms in the service, retail and energy sectors. In Chicago, contacts largely reported softer labor market conditions, including low turnover, reduced absenteeism and easier hiring. Put it all together and you have a picture of a weakening labor market, one where there was a material softening from the previous period in the Beige Book. And so the Federal Reserve members will have this as they debate, which is a bigger deal that we have to get ahead of, the weaker labor market or stubbornly high inflation? Because we know that's the debate at the Fed. Some of them don't want to move because they're still worried about the high inflation. Others want to cut because they're worried about the labor market. I would say that if you look at the Beige Book, which we know they do, the labor market, the pronounced labor market weakening really does stand out and is pretty broad-based across the districts. And it gives those doves a really good reason to say, look, things are getting worse. We got to keep cutting. That was my takeaway. On the inflation front, it was sort of like more of the same.