The Exchange 8/12/26

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**Kelly Evans** (1:00)
Thank you very much, Scott. The AI trade is absolutely roaring today. I'm Kelly Evans, and welcome to The Exchange. Everywhere you look, the AI suppliers are soaring, from Supermicro and CoreWeave, which are jumping after their strong results last night, to Lumentum and Nebius Group, which is now up 27%.
It's even reviving the memory trade today, with the DRAM ETF up about 7.5%.
A trade Victoria Greene just told us on this show should not be left for dead. NVIDIA up 3% as well. And we'll talk to former NASDAQ CEO Bob Greifelt about the company's massive compute financing deal and whether he believes in compute as an asset class. Plus $12 billion, or is it 12.5 for the Los Angeles Lakers? And the buyers, Bob Iger and Josh Kushner's group, will have the latest on this stunning turn of events. But let's begin with the inflation data. We got the all-important consumer price index this morning. It came in basically as expected and just soft enough that economists say it could take the pressure for a September rate hike off of the Fed. This is also giving the markets a little boost today. Let's discuss it in our opening exchange. Nancy Lazar is the Chief Global Economist at Piper Sandler, and Steve Leesman is CNBC's Senior Economics Reporter. Welcome to both of you. Steve, I know you've been over this a couple of times already, but lay it out. What are the big headline numbers and takeaways?

**Steve Liesman** (2:20)
The takeaway for me is it's two out of three, which has meatloaf sang, which you're too young to remember meatloaf.

**Kelly Evans** (2:25)
Ain't bad.

**Steve Liesman** (2:26)
Ain't bad, right? So we have three reports before the last, before the next meeting. Well, we had June, which was negative, it's a surprise to the downside. This number reasonably well contained. I looked at it for one reason, which is trying to look at the way the Fed looks at it, which I know Kevin Warsh doesn't want me to do, but I'm gonna do it anyway.
Look for spreading inflation from the headline to the core. I didn't really see it there. Maybe in airline fairs, maybe further. And this is the road to the September meeting, okay? Tomorrow, PPI, tune in at 8.30. Where else are you gonna be? August 26th, July PC, you think you're gonna be on vacation? Turn on the television. Watch our coverage of PCE. Somebody said, yeah, it's sort of, any PCEZ is what they said. Anyway, and by the way, after the report at 8.3 tomorrow, I'll get Wall Street estimates for the PCE because we have both components, okay?
August jobs report, August PPI. If we can do three out of three on the way in there, September, I think, would be gone as a rate hike. We're going to inch down and we'll be on the right road to lower inflation.

**Kelly Evans** (3:27)
Now, I'm using you to set up, Nancy, because I think you're going to find this quite provocative. Nancy, come on in here because you have been on hold for your call for the Fed this year, which was out of consensus. Maybe we're coming around to that point of view. But you also looked at the report and saw some signs of stickiness. And I think you're going to talk a little bit more about how you're seeing inflation and tell us where you're seeing that and what you think it means. I mean, how big of a deal is this?

**Nancy Lazar** (3:54)
So looking at the individual pieces, I think you missed the bigger picture. We do a diffusion index of the core CPI. And in the month of July, and on average for the past six months, over almost 50 percent of the components, 46 to be precise, but almost 50 percent of the components are posting greater than 0.3 percent. That tells me indeed you're way above the Fed's target, if that's where the bulk of the components are coming in. And there are actually less than 0.1 percent readings. So I would agree with what Steve suggests. You are seeing inflation become more sticky. I don't think it's because of energy prices. I think it's because there's too much liquidity. Just listening to your intro.