The rally itself to resuming, but weakening into the final stretch, all following yesterdays steep selloff, perhaps on continued hopes today and expectations of rate cut sometime later this year. We are going to bring in our experts on all of that in just a moment. Let me show you the major outages. We have been green all day but weakening as we enter the final stretch. We are Still Holding on, but the dow is only good for about 15 points. Nasdaq has been the out performer. Cut those gains in half, the mega stocks, many of them bouncing back. Nvidia is still positive moving toward 900 a share. Meta is in the green, as well. Apple, microsoft, alphabet, tesla, are all ready now. How about crowdstrike . Those shares are higher after his own earnings report. A lot coming in after palo alto and that stock went down, not so much for crowd. A lot in todays session, near 11 . That takes us to the talk of the tape, rally and risk, how many are front and center, given todays developments. Lets welcome in Steve Liesman, leslie picker, josh brown. He is here, post nine. Leslie, i want to begin with you, we have had a crowd over my shoulder for the better part of the last half hour. Is this stock open . It was halted, it has done about a 65 roundtrip today. Take us through what the latest developments are . The saga of the stock today is just a microcosm of what this bank has gone through over the past few weeks, or so. The announcement, quite striking today. A whole shift in the Management Team, a refresh of the board, really, an infusion of 1 billion in capital. You see shares currently somewhat stable compared to what they have been doing earlier today, so i can run you through the details here. The Liberty Strategic Capital that is the firm managed by the former treasury secretary steven mnuchin, as well as hudson bay capital, reverence capital partners, and citadel, hedge fund, not the security firm, as well as some other Institutional Investors are making a combined 1 billion investment in this company, subject to finalized Regulatory Approvals here. According to the terms of this agreement, nycb will be issuing an aggregate common stock at a price of two dollars per share. They are also giving investors 60 more in coverage to purchase nonvoting stock with an exercise price of 2. 50 a share. So, those are the terms of the deal. Again, subject to regulatory approval, and then there is a change in the c suite. You have joseph vaughn, who was formerly with the occ, former comptroller of the occ, sorry about that. He is taking the c suite row and becoming ceo. Sandra demello, who was just named ceo a week or so ago, is going back to nonexecutive chairman, a role that he held for just a short while following that moodys downgrade, and before he became ceo last week, and they are adding four new directors to this board, and shrinking the size of the board to being nine members. We saw one defection from the board once dinello was named a ceo, so this has been a saga, to say the least. But of course, the announcement today at least clarifying what is happening with this capital raise. As one alias described it to me, comfort capital for investors who just want to know what is happening, what the status of this bank is. You stay with me, leslie. I mean, for anybody that has been i dont know, stuck somewhere where you didnt have access to any Financial Market information today if you just looked at the screen today and you said, new York Community bank, the stock is up 3 it misses the whole story because the low of the day was a dollar 70. The high of the day, four dollars. So, we will continue to watch that. I have josh brown next to me, and i remembered half an hour ago that it was about a month ago where i think you bought this stock, you owned it for a minute. But nonetheless, you looked at something for a moment and said, hey, im going to take a shot. And then, when you saw things looking like they were going to get bad, you would like, i am out. Yeah, this is playing with fire. Anybody who bought the stock at a dollar 70 was probably gambling or had information, because the fundamentals here are absent a deal this thing was done. Once they get those downgrades, then you Start Talking about deposit flight, and you cant only equity of a bank when there is a deposit flight underway. For people that hadnt seen that happen in 08, 09, even in 2011, this was like a nice lesson for them. For people that had seen that before, they understand that. So, there were people that, i guess, won today by buying 1. 70, two ollars, prior to the halls. But, i think what is good about this, is this is almost buffett esque. This is the former treasury secretary of the United States now involved, and he took stock, in addition most powerful Hedge Fund Manager in the world, he is taking stock, in addition otting, who will be the new ceo, worked with mnuchin at bank west. So, there is a history of these gentlemen working together at a commercial bank. This is not something where it is just like, you know, lets throw a dart. So, i think the equity is okay. The longerterm ramifications of this, though, i think should not be left out of the conversation, which is, we are now going to take a second, third, and fourth look at a lot of regional banks and a lot of nontraditional lenders. And of course, there is an idiosyncratic issue here, which is the unstabilized departments which were so concentrated in new York Community banks books. Fine. There were also those idiosyncratic issues last spring with the Venture Capital concentration. But, when you have so many banks that each have their own issue pile up, eventually, it stops being a oneoff situation, and it starts to be something where we start using the term systemic more. So, i dont think we have gotten to that point, but it just reintroduces that fear back into that conversation, after a full year since the last go around. Steve wiseman, undoubtedly, any other day, the fed chair testifying on capitol hill and coming off more dovish than the market had inspected expected would be the obvious lead. But here we are talking about Bank Stability and the irony is, so is the fed chair, because he was asked about it, not sarat sethi specifically, but this was unfolding as he was in his seat in the house today. Yeah, and i think as usual, josh put his finger right on the issue, which is the extent to which this is systemic. I have this formula that i use, scott, if you are interested, which is that the Systemic Risk nature is a multiple of the amount of money in question, multiplied by the opacity of the problem. The question here becomes, do we know where the losses are . Do we believe that the regulators understand where they are . And are they addressing those with the banks . Powell tried to convey the idea that he does answer both of those in the affirmative, that he is working with the banks. He said it is more small and medium, but i dont know if this has the potential to grow to becoming a Systemic Risk issue. It does not appear to be residing in the larger banks that are out there, and to the extent that they are, i do know that some of the banks have taken out reserves against those potential losses. So, we have to watch it, and we also have to know, i think mnuchin, who we know to be a smart guy, what did she see in this bank that worked for him, that made him come in and take the equity . Was it a benevolent bailout . Or, was there a profit motivator that he sees . And that can help out, by the way, other small and medium banks in there. I will mention one other thing, scott, that i think is interesting. One thing i have been impressed with is the ability of the market to distinguish between Office Commercial real estate problems and the other commercial real estate sectors that are out there, from the data centers, to the shopping malls, to the apartments. It does not appear as if all cre is being treated by the market with the same kind of response that they are saying, okay, this is an office problem, not a cre wider problem. I think that is exactly right. One of the end jokes right now on wall street is, every firm has a rescue fund they are lodging for cre, specifically. Right. Like, Goldman Sachs has one, everyone is already talking about the rescue before the crisis can even happen. So, it feels like there is a lot of capital, it feels like there are a lot of layers who are like, begging for a blowup. There is a kid doing 600 million square feet of San Francisco office real estate, i believe, right now. They wrote him up in the journal. There are a lot of White Knights. There arent enough crises for all of these White Knights to fund. So, it is a little bit ironic, and it doesnt mean things cant get worse. But, right now, when everyone is already launching the rescue fund, it is really hard to start panicking over the potential for Systemic Risk. But of course, we are all adults, so we keep it in the backs of our minds. Steve, i think josh said it best when you said that investors are going to be taking a second and third looks at the regional banks now, even if you believe this is idiosyncratic and it is not you are going to be going over these with find tube combs before you put money at risk. And i would gather that fed officials are going to be doing the exact same thing, making sure they fully thinks they know where everything is, so to speak. Yeah. I would just point out, usually, the thing that whacks you on the up side of your head or the backside of your head is the thing you didnt see coming. Maybe there has been enough visibility of this problem. Again, it doesnt mean that there would be losses, that some banks wont go down. But, how is the market treated . Is it treated that you hear news of a bank failure and you sell the entire original index . Or, is it possible that the market starts to make a differentiation between these banks . So, i think that is important here. Nobody said there wont be losses. There will be losses. There will even probably be some bank failures, but it is a question of how contained it is. And the regulars, how they say they are, if they are on top of the issue. This falls on the shoulder of banking reporters like our own leslie picker. You have sz b, you have this, and now i am sure you are trying to figure out exactly what all of the loan books look like, what the Balance Sheets look like, and what could be out there that you could be reporting on in the nottoo distant future, we hope is not the case, obviously. But, you just dont know. Ann scott, another idiosyncratic aspect to this bank in particular is, new York Community bank did two very sizable deals in the last year, year and three months or so, what put it above a 1 million threshold. They bought flagstar and some of the assets and liabilities. All of that together put them in this different bracket for regulation. They were getting this new scrutiny from occ, and part of that has created this pressure on them to mark their loans sooner rather than later. So, i think there was this idea may be in the Investor Community that they get this blessing from the regulators, to take some time, kind of work through, phase an approach to criticize phase for the criticized loans on their books. Instead, according to reports out there, they got this pressure to mark those pretty quickly and that came as a surprise to the market. You saw it in the Fourth Quarter earnings at the end of january, called them to set aside a lot more reserves, the dividend, and that is what really started that whole spiral for new York Community bank in the first place. Credit quality has been a big concern that is out there. There is, you know, it depends on the firm, the kind of disclosure you will get on that front, which makes it kind of hard for investors. Interestingly, this regulatory bracket that they have found themselves in has created an additional layer of difficulty as they move through those loans. Right, and one aspect of the idiosyncrasy is that this is predominantly new york state real estate loans, and we actually had a real change where the rentstabilized apartment business have been a great business for, i dont know, two centuries, or since 74. Yeah. Well, now, you have this situation where the landlord cannot to building wide improvements and push those through, the price increases, to the renters, which drastically changes the funding situation, the liquidity, the interest in these properties. That is why the marks had to move when they had to move, because there was a fundamental change on the ground in this specific market. So, i think a lot of people are going to look at this and say, oh, it is like new york city stuff, this doesnt apply to austin, texas. This doesnt apply to nashville. And they would be right you know what, steve . The other issue i think we are addressing here is the idea at least when it comes to financial institutions, it is why people like mike mayo suggest that goliath is winning. Because, do you think it is an accident that j. P. Morgan is at a new high in the last several days . Or, that bank of america is in the new high in the last several days . J. P. Morgan did his own deal in the aftermath of svb that was very beneficial to that firm. Right. You can certainly understand why you would continue to seek capital flows from investors going toward the larger in the financial institutions, because at least you can put your head on the pillow, you think, and sleep well at night. I think that is right, scott. I think that diversity in those banks, and their banking, their loan books, is something investors can feel better about, rather than this possibility that sort of what josh and leslie were talking about there is some regional banks someplace that has an enormous amount of office or commercial space in a particular city that is not doing particularly well because of the aftermath of the pandemic. That would not happen in the big banks. One other thing worth noting, though, scott, part of that whole thing is this other story that was a big park, a bigger part of the monetary discussion, was the coming apart of the basel three proposal. It is a big loss, i want to say, for this administration. It is a big loss for ichael bart at the federal reserve. They are getting their head handed to them on this one here. I dont know to the extent powell embraced all this, but he is not one cooler move away from the proposal. Now he is talking about the idea of if im using the word correctly broadbased changes or even repurposing brazile three. I would take a step back, scott, and watch the banks in however many years it has been almost 15, 16 years since the great financial crisis where they have essentially been very much i mean, not quite nationalized. But, words of the state s the best way to put it. But, here they are, fighting back against something from the government and appearing to win this. So, there might be some care or change here in the position of the banks, relative to regulation at the regulators in their success in beating back basel three. No one happier, im sure, in hearing the fed chair then mr. Diamond, solomon, and some of the others running the largest banks in those companies because they have been in those very seats on the hill in the last six months to the year railing against those regulations. Oh, and steve, by the way, the fed chair actually talked about Monetary Policy today. [ laughter ] may be what he said was a stimulant, in some respects, for the stock market, because you said earlier he came off more dovish than other people thought he would. And as a reporter, im duty bound to tell you that not everybody agrees with me. There were people out there who thought it was the same old. But, i thought this idea of saying big, more evidence is not a lot of evidence, just big, more evidence. And also him saying, we dont need better inflation numbers, we just need more of the same inflation numbers. That tells us, scott, that we are already there, even accounting for the january numbers, that we are kind of there. He thinks the number is going to improve because the old numbers are going to bounce out through the base effects. So, i think we are there, we just need to see as powell said these numbers repeat themselves, not necessarily improve, to set the scene for the rate at the fed. And i am going to keep going with new York Community bank stock. I want to go back to josh brown who is sitting next to me, what is your big take away from you know, yesterdays market selloff was rather dramatic, and you had the fed chair today not really he didnt tell us anything we didnt know, i think you could say. We still expect rate cuts to come later this year, he said as much. Where are we in this market with the otation that has been pretty substantial . Mega cap stocks remain a little unsettled. What is your deal . One by one, we are losing the magnificent seven. I mentioned on halftime yesterday, i am now seeing research notes, they are referred openly as the sensational six. I dont now if we become the fab five next, but, meta seems to be hanging in there the best other than nvidia. We have lost apple, it iss lower highs. We have lost alphabet, that is now below its lowest trend line, not looking great. Amazon is just okay. So, that theme feels really tired, and it should. These stocks have done a lot of the work. So, from my perspective it is not, do i no longer want to own tech . It is, where am i looking for my next opportunities . I just dont think it is a 500 billion tech stock. And there are others out there, there were some big tech names that i think were well positioned. But, we have done this ai theme to death at this point, and i just feel as though you are feeling this shift below the surface, you are seeing a lot more names in the s p 500 at 52 week highs hat have literally nothing to do with tech, and i love it. I really like that set p. I was going to Say Something that alluded exactly to that, that there are many other market periods within this rally over the last couple of years that you would say, well, if we lose