Find out soon. Good evening, everybody, all that and much more ahead we start with some breaking news on nikola. Shares are down in the after hours, following a big up day. Bloomberg reporting securities and Exchange Commission will exam over the stock selling fraud and allegations, stock down 7 . Youre response . Again, i cant speak, i said it last week, i cant speak to the voracek asity of the shore seller report, acquisition of fraud, i have no idea, but what i stand behind, despite how the gm is structured, whether their investing money, the fact that gm would link their wagon to nikola and if these acquisition prove to be correct, i think the real deleterious thing could happen with shares of gm, in my opinion, potential for exponential move and gm perhaps didnt do the homework others did. Thats my primary concern looking at this entire situation. Tim, to be clear on the story and were trying to get phil up here any moment, you know, Trevor Milton said the other day were going to work with the srksz cc on this tobe clear thats not what this is. This is peers the sec is now poking into nikola, maybe not on the side of the short seller but from that angle. This is not some cozy deal between the two going after hindenburg. No i think ultimately the sec will do what they feel is just based on allegations of fraud and actual fraud what was brought tony vestors it is what it is guys brought up important elements that i dont think we could know based on if we read that report. This needs to be validated or invalidated. The fact the company came out and said we said the company was was that the truck was moving opposed to it was actually individually propelled by our own engine, et cetera theres some really, frankly, you know, that semantic hair trying to be split, i think, is crazy. I mean, that doesnt sound good or certainly not like what you would rest on, we were on our own with individual propulsion that doesnt read well for gm the issue is does it validate some of their fuel Cell Technology and their overall engineering prowess. Does the deal make sense when you consider like others nikola was going with assetlight strategy and tap into engineer and oem capacity that all makes sense the fact gm got this for free, to be paid 700 million for access to their technology i dont think its harmful to gm if this all turned to be a disaster for nikola. Fact is, gm pointed out theyve been in this space a long time and i think theres a lot there. Dan, you know, listen, tim actually hit on the one thing, in the rebuttal that stuck out to me as well, which is, yeah, the truck may not have run on its own but all the parts kind of worked on their own but together didnt really matter because were going to pivot to Something Else anyway. Theres a lot of pivoting going on at nikola and i wonder if investors should pivot away from the stock because they dont know how it will end up. Thats the main point they just dont know. On thursday the stock was trading at 38 and already had a big down day on the day before after that report came out my comment was okay well there was two opportunities to vet this story and i was a bit glib about it and said there probably isnt fraud here i had a very prominent short seller hit me after the fact on text who said be careful this is welldocuments and devastated. I read the rebuttal there was really nothing there from nikola i think its an interesting story. One reason i made that comment on thursday, ive been in this business 25 years, you know, if you want to create some sort of scheme to rip people off lots of money, doing it in the public eye in front of financial tv, investors who are very well innocentized to stiff it out and no shortage of regulatory bodies, its just not the place to do it this seems like a really creepy situation and when you dont understand something you just avoid it. Yeah i think thats wellsaid and i want to reiterate the news in case our audience is just joining us that the sec will now investigate at a top level the allegations of fraud against nikola, it doesnt mean theyll find anything, if they do it may not be that serious. Could have some sort of easy resolution just because the sec goes poking around companies doesnt mean theres a negative outcome thats very important to be said is there any reason to ever invest in a company where the sec is sniffing around maybe it does create some weird opportunity. Well, i guess i could point to tesla, the sec was sort of sniffing around when they made the statements about financing secured when musk wanted to do take private for 420 share. I guess that would have been one scenario but i agree with the guys on the panel, particularly this issue of whether it was selfpropelled we never said it was certainly one could reasonably assume that investors looking at that would think oh, that truck is going on its own. Makes you think, what else do they have out there in the market you know what are they sort of presenting that might not be actually as it appears. This is a black eye for gm im going to guess that maybe this deal falls apart. I think gm, i think as one of the guys said, they didnt actually put up any money it was putting up resources and advancing their ev platform. This say black eye for them. Its bad for them and im going to guess this deal falls apart. Quickly, karen, i want to come back to number one on the propulsion issue, the Financial Times did reporting who talked to a cameraman who said the truck just basically rolled down the hill all of us in our worse moments rolled downhills once in a while after few too many karen, do you think if this is worstcase scenario could gm ceo lose her job that i dont know i imagine that i would think the board probably not delighted by this it kind of i mean, maybe they did do their Due Diligence maybe they did know all the points in the extensive short report which i only read a little bit of. To be fair i didnt read the whole thing. They went through and everything seemed to be okay. Thats a bit of a stretch for me to believe so i think the stock had rallied on that, on the deal, so it would be reasonable to, i mean, you know, going to sell some stock, i think this is a black eye for them and for her and i think shes fantastic. She is, ive had the privilege of meeting her gm stocks are down 1 perfect it is a difficult situation for gm and investors when literally a couple working days after announcing a big deal, one full week, you got the sec poking around on the company that you just kind of got into the board room with. Yeah its concerning. And were all trying to be really careful because obviously non of us know where the truths are and are not. Again, i want to emphasize if theres any truth whatsoever in those 90 pages of that short seller report, i think its really, believe it or not, i think its more of a negative for gm than for nikola i know it sounds ridiculous but people will say how could you possibly get into whatever agreement it is. Whether its a clash deal, whether a collaboration thing, whatever it is, how did you partner with potentially something that isnt what you said it is to me thats a really scary notion and i think its the tail risk that gm is facing right now. Obviously were not wishing for this were just trying to point out what could happen. Thats sort of our jobs here yeah, it certainly is, tim, by the way, bring up nikola. Gm now at 2 but nikola continues to lose steam now down 11 , rose 11 in the normal market and down 11 , wiped out the gains for today. Given all the noise around tesla and options activity in, nikola and now this, evfuel Cell Hydrogen car space now looking, maybe perhaps less macro attractive than it did just two weeks ago. Well, actually, perversely this validates the macro the back door listings for Ev Technology and producers, i think, if anything as more competitors have entered into the fray the irony of course, tesla which ive pointed out, theres a lot of competition out there, tesla has really outperformed in the face of just the stock stories. So, look, i think the gms ultimate Battery Technology and engineering prowess and involvement in autonomous, i think that announcement on tuesday last week this was a trigger to validating a lot of that is it invat validating that . Is gm worse off if this goes bad, absolutely not. I realize if Due Diligence isnt done and theres more glaring fraud, none of us know, were just reaccessing to headlines about a process thats nfolding. Thats all were hear to talk about. We have to be very careful, to me im longgm i dont think it puts gm in a worse spot, if anything, puts them in full spectrum and they did pick the wrong partner here they certainly will find another one. Yeah. And lets bring in now phil i know youve been reaching out to nikola. Dont think youve reached mr. Milton but the stock right now is giving back all of what it gained today as far as noon news, of the sec investigating into nikola, dont know what if anything they might find of course theres a preassumption of innocence but when you read that nikola admitted we faked the video, the truck did roll down the hill, the parts worked but the whole thing didnt work together, how should that be reacted to in the automative community. Two ways to look at it, brian, some people will look and say, well, come on, when you see the automakers reveal a new vehicle at a auto show or they talk about a model coming out somewhere down the road, you know, a lot of times those are not fully functioning vehicles and thats wellknown in the auto industry. The difference is when you look at the video shot in 2017 the impression that was given to the person who is looking at this, is that it is a functioning Hydrogen Fuel cell semi truck. No other way to get around that. The impression thats given is that this truck is powering it self and now they come to tell us, well, no, it was in motion, it would not selfpropel no way around it anyway you look at that, that looks terrible terrible 100 for nikola the question you guys were discussing is what are the implications for General Motors. Keep this in mind, nikola was seeking out an original equipment company, oem in the industry, automaker, to build the badger electric pick up truck and General Motors offered the most attractive package in terms of the technology they brought to the table and yes, General Motors didnt the have to spend money, they are not buying nikola but are getting 11 stake as part of the agreement to work with them, will it buy gm as a bad move if it all falls apart, at worst its embarrassing because she came out and said we did Due Diligence and think this validates our technology if it ends up not validating the technology it all fall as part, but is not the end of the world. The technology and hydro tech is still extremely valuable and can be used not just for General Motors vehicles but other automakers in the future. What about, and again, phil, were just going to talk about what is in the shortsellers report, publicly available information without editorializing or making assumptions. Part of this was the personnel and one of the short seller allegations was some of the highranking employees may or may not be unqualified for their job given the complexity of the technologies what can we talk about Trevor Milton brothers travis who was a home builder in hawaii and another chop executive running a golf course three years ago. All that is publicly available on linked in, by the way do we care about the executives pasts . I think you care about their pasts if it is really out of left field and youre like whoa what is this person doing. The flip side is that, look who put together the nikola spec steve g former gm board member, widely respected on wall street for his year as a an analyst and work in the auto industry. This is not a johnny come lat y lately whose this ive never heard of these guys lets put a deal together. Steve brings a lot to the table and certainly i think people would sit there and say, you know, would he have set up this spec in his company in facto would they have set up this fact if they felt trevor and nikola was the house of cards reasonable assumption, no, they would not have done that so i understand when you hear people say look, i dont i think Trevor Milton is on social media and is not somebody all together in it for truly making this a Great Company i understand people say that but on the other hand theres people who have looked at nikola and that includes people at General Motors and you would think that if this was a house of cards somebody would raise their hands and say stay away from this thing. Well the stocks are down 9 and by the way, just to be fair, thank you both very much nikola saying travis milton, trevors brother is a talented construction guy, perfect for Building Hydrogen gas stations and kevin link ran a golf course before is talented engineer so defending the employees as well. Im sure more will be on cnbc all night right now lets get to earnings alert for lenin, ar. Its a tweet beat for miamibased lennar earnings up 33 annually q3 revenue came in at 5. 9 billion versus estimates of 5. 8 billion but changed year over year new order up 16 year over year. Lennar says theyre accelerating their Housing Starts interesting, revenue from Financial Services business came in huge at 135 million up 80 from year ago. Thats the strong Mortgage Business clearly benefiting from rock bottom Mortgage Rates and refi boom. Guidances 100 million to 105 million and robust Market Conditions and miller expects home sales to stay strong for the foreseeable future and president said home prices remain flat but struggling with limited availability and materials in certain markets q4 guidance came in reported an alltime q3 low in sgna and so lennar have really cutting cost and benefiting on demand remember heavy in the florida and texas markets, very hot. A great beat but notten the irely unexpected not entirely unexpected. The stock not reacting positively again another situation with home depots and lowes couple weeks ago where the numbers are tremendous but the market doesnt care because it probably already bided up the stock is up 45 in a year. Have we seen to quote sticks, the best of times already for the Home Builders . I dont know. I think that we saw stock like peloton which had a huge run up and huge earnings and traded higher in the after market only to be down maybe 18 from there today. Tims been talking about this. Are we sort of you know, is the housing trade going to blowup great numbers but the last quarter was really great too and they talked that they would continue to see margin improvement. They clearly did big revenue beat and big eps beat i like the space i think theres more to come i dont think this bubble is about to burst im long lowes and home depot thats the way ive been playing the housing space. So i agree with karens a sessionme assessment on the space. Im very bullish on the space. Ultimately, think about the tail wind for Home Builders, zero interest rates, migration from cities into regional and suburban areas some are better positioned of course is this National Migration that diana talked about into texas and florida so the valuations and Home Builders are tough i think you want to own terms and Resource Companies and if you look at the break downs of the charts and valuations those are a lot more attractive. They have pricing power. There is inflation. You make a good case. If you want to jump in hot and heavy on Home Builders you have to be a renegade but id never say that coming up, two big tech deals front and center today all of the details when we return plus, what this chart is telling us about what the stock market may say before election day. We are just 50 days out. Inreintestg volatility stuff ahead of november 3rd. Back after this. Stick around look here, its your very own allinone Entertainment Experience xfinity x1. Its the easiest way to watch live tv and all your favorite streaming apps. Plus, x1 also includes peacock premium at no extra cost. This baby is the total package. It streams exclusive originals, the full peacock movie library, complete collections of iconic tv shows, and more. Yup, the best really did get better. Magnificent. Xfinity x1 just got even better, with peacock premium included at no additional cost. No strings attached. All right. Welcome back to fast money. Double dose of technology deals. One, nvidia buying arm holdings from soft bank for 40 billion and oracle tik tok, the latest, as you pointed out on our call, julia, dont call it a buy out. It is not a deal what exactly is it then . Well, its not an acquisition. Its definitely not an acquisition, brian, but what theyre doing is saying theyve chosen oracle as their trusted Technology Partner and part of tik toks restructuring, not the sale of tik toks assets but rather oracle is to become tik toks cloud provider the proposal was received over the weekend and trump will have technical discussions with oracle ahead of the september 20th deadline for when the deal would be done. As cloud provider oracle would take responsibility for privacy and Data Security issues and would be key to address u. S. Government concerns about china this in response to president s demands. Sources tell me things are definitely citile fluid and could be others participating in this deal such as walmart who continues to have an interest in tech it okay investment and tik tok investment and now things are in talks and to be determined what percentage would go to oracle or walmart or any of the u. S. Investors sequoia and atlantic could increase their stakes as part of this as well learning if theyre negotiating just tik tok u. S. Assets or perhaps more back over to you. Basically oracle could end up running the data center u. S. A. I. Asset part of the company, otherwise the company tik tok j