BUSINESS

Critics aren’t digging Tom Cruise’s new movie “Digger,” an offbeat satire that pairs the actor-producer with “Birdman” and “The Revenant Oscar-winning director Alejandro G. Iñárritu.

Midnight release parties were held for the highly anticipated ‘Threshing Day,’ the latest ‘Fourth Wing’ release. Details on book tour and ‘Threshing Day’ reviews.

Millions of Americans who own an S&P 500 index fund have a stake in the AI boom, knowingly or not. The fund holds Nvidia, Oracle, Micron, and Palantir because it weights companies by market value, and AI has made them heavy.

Michael Burry saw in 2008 what a government rescue is worth to ordinary shareholders. Washington stabilized the banking system, yet Lehman Brothers investors were still wiped out.

Now the “Big Short” investor says Washington has a deep stake in AI. In a Substack chat, Burry wrote that President Donald Trump’s team sees the AI buildout as the economy’s only real engine. “They cannot afford to let it fall,” he added, according to Stocktwits.

Yet Burry has been betting against the boom’s key players, and on Sept. 28 he sharpened those bets. He covered his short positions in Nvidia, Oracle (ORCL), Palantir (PLTR), Nebius (NBIS), Micron (MU) and CoreWeave (CRWV), Stocktwits reported, swapping all but CoreWeave into put options.

A put gains value when a stock falls, but unlike a short sale, it expires. Several of his run into late 2027.

“Fundamentally, I am moving timelines up,” Burry wrote, citing weekend research. He is betting on when, not just whether.

Burry separates political will from policy firepower

His two stances only appear contradictory. Burry thinks Washington wants the boom to survive but may lack the tools to protect it.

Burry argued the U.S. government is in its weakest position in modern history to fight a financial or debt crisis. Its remaining remedies, he wrote, are few and mostly blunt.

The spending data paints a calmer picture. Goldman Sachs Research expects AI investment to reach about 1.8% of U.S. GDP this year, a share it says sits “comfortably within the historical range” of past tech booms. By that measure, spending still has room to grow.

Meanwhile, President Trump’s own accounts sold between $5 million and $25 million each of Microsoft (MSFT) and Amazon (AMZN) stock on July 20, according to a CNBC analysis of his latest disclosure.

The accounts, whose trades CNBC says are made on his behalf, bought back smaller amounts days later. So the stake Burry describes is political and partly personal.

Michael Burry says Trump’s team cannot afford to let the AI boom fall, yet he just swapped his AI shorts for puts and moved his timeline up.Kevin Dietsch / Getty Images

Credit markets are feeling the strain first

The 10-year Treasury yield sat near 5.17% last week, its highest level since 2007, according to CNBC. That makes borrowing costlier for data center builders and for Washington itself, which fits Burry’s warning about blunt tools.

A senior private credit investor told CNBC that financing for neoclouds, GPU rental firms such as CoreWeave, will get harder because they have less cushion.

Related: Michael Burry just put a date on Big Tech’s AI reckoning, and Oracle’s $664 billion lands in crosshairs

Oracle shows how fragile that financing has become. It sent a force majeure notice, a legal warning of possible delays, on Project Jupiter, a New Mexico data center tied to OpenAI. Bankers and investors told Reuters the move unsettled lenders across the trillion-dollar AI infrastructure financing market.

Developer Blue Owl said financial commitments were unchanged. Even so, Washington can speed permits more easily than it can lower what lenders charge an indebted borrower.

Wall Street is on the other side of Burry’s bets

All five stocks he still bets against carry Buy or Strong Buy consensus ratings in S&P Global data compiled by Stock Analysis. Their results over the past 12 months, as of late September, show why analysts stay bullish and where Burry sees cracks.

Revenue grew 21.6% at Oracle, the database giant turned AI landlord, yet its market value has halved in a year. Analysts rate it a Buy, with a $237.97 average target.

Sales jumped 78.9% at AI software firm Palantir, but its shares cost about 99 times expected earnings. Analysts rate it a Buy, with a $195.57 target.

Sales grew about sixfold to $1.4 billion at GPU cloud provider Nebius, yet net income was just $42.4 million. Analysts rate it a Buy, with a $276.26 target.

Net income reached $192.9 billion at Nvidia, the top AI chip supplier, on sales up 83.4%. Analysts rate it a Strong Buy, with a $327.70 target.

Sales grew 167% at memory chipmaker Micron, whose shares trade near seven times expected earnings. Analysts rate it a Strong Buy, with a $1,515 target.

Burry is not alone on the neoclouds. Rothschild & Co Redburn started coverage of both Nebius and CoreWeave with Sell ratings, TipRanks reported. Palantir’s multiple is central to his claim that its valuation outruns the business.

More Michael Burry:

Michael Burry just put a date on Big Tech’s AI reckoning, and Oracle’s $664 billion lands in crosshairs

Michael Burry’s blistering message on economic inequality

Michael Burry sends stark warning on AI hyperscalers

The real question is who gets rescued

Micron reports earnings on Sept. 30, according to Stock Analysis, offering an early read on AI demand as borrowing costs climb. Burry put a date on large AI write-offs in 2028 or 2029 last week, yet most of his new AI puts expire before then.

Index-fund investors own cash-rich spenders and debt-funded builders alike, so the gap between a policy backstop and a shareholder rescue lands in retirement accounts.

The next phase of the AI trade may hinge less on who builds the most than on who can still borrow.

Related: Michael Burry keeps pointing at unloved stocks for a reason

Your phone is now the front door to your money. It holds your banking apps, your two-factor codes, your tap-to-pay cards, and years of photos you’d never want to lose.

Most people treat monthly security updates as routine upkeep. You tap install before bed and wake up to a slightly safer device.

I cover payments and fintech, and I install those patches quickly because they close holes that scammers exploit. That habit still makes sense, but it assumes the update won’t lock you out of the phone itself.

Some owners of Alphabet’s (GOOGL) Pixel phones just learned that assumption can fail, and the way back in can cost them everything stored on the device.

September update breaks PIN and pattern unlock for some Pixel devices

Google’s September 2026 update caused lock-screen failures for a small number of Pixel owners, Notebookcheck reported Sept. 27. The affected phones stop accepting the correct PIN or pattern.

Reports so far cluster around three models, according to Notebookcheck and Android Authority:

Pixel 10 Pro XL, where the unlock pattern resets after only two dots

Pixel 8a, where the phone treats one digit as a full PIN and rejects it

Pixel 8 Pro, where owners report similar PIN failures

One Pixel 10 Pro XL owner tried rebooting, Safe Mode, a connected mouse, and reinstalling the same software. Only a factory reset worked, and it erased the phone’s local data.

A Pixel 8a owner got back in after waiting out the “too many attempts” lockout timer. Google is contacting affected users in Reddit threads but hasn’t commented publicly, Android Authority said.

Google’s September update is locking some Pixel owners out of their phones.TIMOTHY A. CLARY / Getty Images

Why Google can’t bypass a locked Pixel for you

Most of your files sit in encrypted storage that opens only after you unlock the phone, and its keys can’t be released without your PIN, pattern, or password, Android’s security documentation explains. Nobody, Google included, can skip the lock screen to pull out your photos.

That’s why Google’s advice is blunt. “If you can’t unlock your phone, you’ll need to erase it,” Google’s support page reads.

More Technology:

Verizon takes on T-Mobile with new phone plan for customers

Microsoft CEO names one key concern with its AI

Mizuho makes bold call on SpaceX stock before key launch

An erase removes the apps, photos, and music stored on the phone. You can restore data backed up to your Google Account, but only if you know the PIN or pattern that was set when the backup ran, Google added.

The hardware isn’t the expensive part. The Pixel 10 Pro XL launched at $1,199, but unsynced photos and the authenticator codes guarding your bank and brokerage logins can be far harder to replace.

How Pixel owners can protect their photos and bank logins right now

If you haven’t installed the September update, back up your important data first or hold off until Google formally addresses the bug, Notebookcheck advised.

Either way, a short checklist helps:

Confirm your photos have finished backing up to Google Photos.

Turn on cloud sync in your authenticator app, or save backup codes for your financial logins.

List which apps hold payment cards so you can re-add them after any reset.

If you’re already locked out, try waiting out the lockout timer before you erase anything. It worked for at least one owner, and an erase can’t be undone.

Security updates still protect your money, so don’t swear them off. Just make sure a five-minute backup check comes first.

Related: Google is about to make a major change to every Pixel device

The recent Starship launch helps SpaceX with a number of priorities that could help its stock reach $900 over the long run, an analyst says.

Netflix investors are too worried about the U.S. and are overlooking gains abroad, Deutsche Bank argues.

A CEO peer support group helps leaders make sharper decisions and feel less isolated as AI and disruption accelerate change at the top.

Transcript:

Caroline Woods:Joining me now, Kenny Polcari senior market strategist at Slatestone Wealth. Kenny, great to have you back.

Kenny Polcari:Thanks. So it’s always a pleasure to be here with you. I wish I was in New York with you, but I’m in Florida next time.

Caroline Woods:Next time. Kenny. All right. Let’s talk about stocks. They’re on pace for a mixed September. But want to get your view on this market. Have we gotten a little too used to stocks only going up.

Kenny Polcari:You know what. It’s very interesting because I came into September worried about all the issues right. Whether it was the fed, whether it was interest rates, whether it was the ongoing conflict. But the S&P is actually flat. Right? Right. Where it was at on August 31st is about where it is today. Nasdaq is is a couple of points actually higher than where it was in August.

Kenny Polcari:Right. So the nervous is an anxiety that I thought was going to happen in in August. Hasn’t hit the indexes but it has hit individual name right. If you look at I look if I look at my own portfolio, I’m down 6% from September 1st till today. Not my not not our, our corporate portfolio, my own personal portfolio.

Kenny Polcari:So, you know, I kind of expected to see somewhere between like an eight and 10% pullback in the market in September. My portfolio essentially reflects that. Yet the broader market, kind of tells you, if you look at it says, well, it hasn’t been so bad, right. And I think what we’ve seen is on any weakness, we have seen plenty of support.

Kenny Polcari:Right? We haven’t seen the bottom fall out, in the broader market, although individual names once again have gotten beaten up, some of them got beaten up more than others. But that’s just part of the cycle. But one way, the other, we got, you know, the one fed rate hike in the middle of the month, from from award.

Kenny Polcari:The market is now pricing in, a hike in October and a hike in December. And I would say that if oil stays in the mid 90s to the high 90s and diesel stays up where it is up and doesn’t offer any relief, and bond yields continue to take higher. You know, the ten year hit, you know, 5.21 5.22%, that is going to provide a headwind for the broader market, at least told us it’s going to put a cap on it.

Kenny Polcari:Right? So we’re not going to explode higher. And there is a possibility that as we move into October and start getting closer, closer to mid-term, that that anxiety will, rear its ugly head, and then we’ll see maybe a broader pullback in, in the indexes.

Caroline Woods:So that 8 to 10% pullback is now your October forecast.

Kenny Polcari:Well listen it’s happened to me in September I’m done. Like I said 6%. And the month isn’t over yet. Wait till Wednesday. That’ll be over I’m Tiger. But yes I’m still looking for a drawdown right. And like I said, if you look at individual names, then you’ll see it. You’ll see some things are down eight, ten, 12%.

Kenny Polcari:So if you look at individual names, you’ll see it. The broader market though hasn’t hasn’t pulled back. But I still suspect and I’m still in the calm that the broader market, both the Nasdaq and the S&P will see, volatility in the month ahead. So yes, I still suspect I wouldn’t be surprised if we saw a broader pullback.

Kenny Polcari:You know, somewhere in that in that range.

Caroline Woods:Well I was still in the Dow. The Russell in the Dow have been the underperformers in September. What does that tell us is that that does that mean the tracking out of rotation was short lived.

Kenny Polcari:Yeah. Yeah. But and also you look at the Dow transports because they have also been in underperform. The Dow transports have broken down and through their long term trendline support. Right. And that’s something to actually be concerned about because now if you look at the Dow industrials it hasn’t yet. But the Dow industrials are now below its intermediate term.

Kenny Polcari:And so now where it’s in between the 200 day and it’s intermediate term. So that’s going to be a key metric to watch to see if the Dow industrials then mimic what the Dow transports it telling you. Because remember the Dow theory talks about you know the Dow industrials make all these products and the transports transport them all around the country right.

Kenny Polcari:If not around the world. And so when you start to see when you start to see both of them in a negative pattern that suggest to you that the market in the economy is going to run into some is going to it’s telling you that the markets and the economy’s going to run into some problem. And if you look just into transports, it’s already it’s already raising that warning flag.

Kenny Polcari:Right. The industrials haven’t done it yet. But but we’ll see what happens over the next couple of weeks if it breaks in fact. But to today. And if it does then that would confirm Dow theory saying that you know the industrials and the transports are sending up the warning money okay.

Caroline Woods:So given that is now the time to get cautious or should we still be aggressive.

Kenny Polcari:No. So you I would never and I look at that as, as my own portfolio and as a wealth advisor I’m not getting aggressive at all. I always remain I always have kind of one foot in that cautious stance. And I look for opportunities on pullbacks in names that I like right there, a good solid opportunities. We’ll talk about them in a minute because you’ll see what I mean when we talk about not necessarily being aggressive.

Kenny Polcari:If you’re a day trader, you’re somebody trying to do on your own and you want to be aggressive, you know, go for it. But me personally, over the 42 years I’ve been doing this, I tend I tend not to, you know, I don’t ever get so aggressive in the broader market as I do. Kind of I’m much more methodical about it.

Kenny Polcari:And as a wealth manager, that’s kind of the position. You have to think. You can’t really get so excited that you ohmygod, I got to go all in. You know, as a trader. Yes. Or as an individual vessel, you could do that. But certainly somebody has a as a responsibility to find assets. You know, I don’t ever find myself in that position where I’ve thought, oh, God, I gotta jump in.

Kenny Polcari:I gotta put everything to work today. It’s not what I do at all.

Caroline Woods:Okay, so what does the portfolio of someone who has one foot in the cautious camp and that not the all in mentality actually look like where are you position? Where do you want to be? Where don’t you want to be.

Kenny Polcari:Right. So it’s not so much where I don’t want to be because I think there’s opportunities everywhere. It’s kind of where are those, where are those sectors in the cycle. Right. So again, right now I own tech, but I’m not necessarily buying any tech at the moment because again, I think it stretches a little bit. I think that if the market if grades keep going up, high growth things in the tech things are the ones that have outperformed, are going to be the first ones to get hit.

Kenny Polcari:We’ve seen that so many times, so I own it, so I’m not chasing it. But you talk about basic materials, you talk about healthcare, you talk about financials that are all been under pressure. That’s where I think there’s opportunity. So for me personally as well as, you know, for the firm, we’re going to be looking at those sectors where they’re not running away.

Kenny Polcari:There’s still high quality names that are just going through part of a cycle. The thesis to own them hasn’t changed. They’re just under pressure because the cycle is causing them to be in a pressure. So those right financials like health care, basic materials, even parts of the industrial sector. Look, we’ll talk again. We’ll talk about it today.

Kenny Polcari:But granola is a perfect is a perfect example. Right. It’s in the industrial space. The stock is the stock had gotten, sold. Right. It was down over 22%. It is now finding its base starting to rally back. But that’s the opportunity where I’m saying, right, I love the name. I love the space. The stock is pulled back.

Kenny Polcari:So that’s where I’m buying. I’m not buying at its highs. I’m buying it on a pole.

Caroline Woods:Yeah 20% off the highs for GE for Nova. So what else would you buy today aside from GE for.

Kenny Polcari:No. Well listen there’s another one that’s actually on fire. Is ASML right. ASML is you know we can talk all day long about the chips that ASML is, is the company that manufactures those very very high end machines that that make this very specific chip. That’s another thing that is pulled back. It is a favorite right.

Kenny Polcari:The firm owns it. It is a favorite. But that is also pulled back. And today it’s up on a 1.5%, I think, on, on some, you know, on some good news on some those that came out as, as a, it’s problems as well as just kind of like there’s a market reaction because of that backed off.

Kenny Polcari:And then when good news comes out you get the trade offs, the algo that jump right in and take it higher. But ASML is a name that we all know that we like. And again on weakness we started adding to our cover position. Right. So and then let it ride. But on a day like today when it’s up you know 1.5% or 2%, I’m not chasing it.

Kenny Polcari:We bought it on the way down. Right. You buy it on weakness because the pieces, you own it as a change. The stock is just going through, through part of the cycle.

Caroline Woods:Can you give us some names that aren’t tech names that you would buy today or you wouldn’t wait? So back for.

Kenny Polcari:So that I wouldn’t buy today? That’s just thing.

Caroline Woods:Know that you would buy today, that you don’t need a big.

Kenny Polcari:Push that I would. Yeah that I would buy thing right I wouldn’t that’s like wait for a pullback. So I’ll tell you. JP Morgan Bank of America I would buy because they’re in the financial space. The whole sector has gotten has come under some pressure. So those are the names that I would buy their names that I own, but their names that I would buy, outside of that, I would buy Merck in the healthcare space.

Kenny Polcari:I’d buy Merck, I’d buy Lily. Now, listen, you and I have had this conversation. I’m. I’m biased to Merck just because of, some of the medications in the cancer space that they that they developed that, you know, actually saved my life. And so therefore, I, you know, I’ve looked at it on the chart. If you look at Bach, Merck had pulled back.

Kenny Polcari:It was kind of underperforming for a long time. It’s built the base. But right in here, you know, I’d continue to buy Merck, you know, at its lows now it’s rallied off. So it’s starting to do better. But I would continue to buy Merck. I’d also buy, you know, if you look at the, the emerging market space.

Kenny Polcari:Well, not any specific name, the ETF, the M ETF, which represents kind of the emerging market has done very well. In fact, this year I think it’s up. Let me just look real quick. Emerging markets are up 23% so far this year. But you know, they’ll pull back a little bit and I’d buy I’d buy some of that as an ETF.

Kenny Polcari:Okay.

Caroline Woods:So give us what’s on your shopping list for if and when we do see that 8 to 10% pullback.

Kenny Polcari:So then I would go into the tech right I’m looking for tech to go on sale right. So I’m looking for some of the bigger names. I’m looking for Microsoft once again to go on sale because we’ve already seen that once we saw Microsoft go from 520 or 530 down to 350 and rally back. But on any pullback, if we see a pullback in the broader market and tech gets it, Microsoft is going to be one of the names we could hit on any pullback.

Kenny Polcari:I’d be buying Microsoft I’d be back. Apple ID buying Amazon. I’d be buying meta. But meta is not. That is actually on a run right. We bought some meta. And meta is now actually on a run. So I, I’m not going to be chasing better. But if meta does pullback, if that is part of those names that gets drawn into the draw down.

Kenny Polcari:Certainly meta would be a name that that I would buy, but I’d also buy, you know, other names in the space. I’d buy, some of the cybersecurity names because I think cybersecurity, you know, for it for for Fortinet, CrowdStrike are going to be names that, that I’d like to buy, continue to buy because cybersecurity, the more the more advanced I and this technology becomes, then the more demands is going to be on cybersecurity as a, as a whole in the sector, but on some of those individual names.

Kenny Polcari:So CrowdStrike and Fortinet, it might do for Kenny.

Caroline Woods:What are your three highest conviction AI names right now.

Kenny Polcari:On the field? Would you possibly.

Kenny Polcari:Micron because of memory? Right in the I’m assuming that that fits in the AI space because it’s all about making sure. Hey, of course micron be one Microsoft is going to be another. I think that’s just a core name. I love Microsoft, I’ve owned it for a while. I’ll continue on it. I think they’re doing great things in the space.

Kenny Polcari:And so therefore I’m assuming you’re okay with that name as well. As the third one. Let me think about that for a second. I would say probably something, I’m going to go something in the quantum space. So one of the names there I like is ion Q that’s struggled for a while. It’s kind of doing nothing but ion queue like IBM.

Kenny Polcari:IBM is also got big, big quantum presence. Right. So, IBM could be another name, but if you want specific quantum, I’d pick ion q okay.

Caroline Woods:So ion QS almost 50% off the highs. Microsoft’s down about 70% off the highs and microns off what, more than 10% off the highs. Right. And for any of those you you would wait still for a pullback. You wouldn’t put money to work to that.

Kenny Polcari:Well Mike look they’re down right. What do you just say that down 10%. What do you say. Micron is down 10%.

Caroline Woods:Right 13% from the highs.

Kenny Polcari:30%. So micron that falls into the position where if you want to buy something today that does understanding that if we get a broader pullback micron like to a lot of the names are going to get hit again. So I wouldn’t put it. You know if you allocate a certain amount of dollars to it I’d buy a little bit and then keep someone you know keep some dry powder on the side.

Kenny Polcari:Take advantage. If we get that pullback, which I do think we’re going to get. Look the buckets and the pressure again treasuries at trading at 5.21% today. There are a couple of basis points. And so I think that’s what you have to be concerned about.

Caroline Woods:Yeah. In your note, your latest note, you said this 5.2% ten year Treasury is going to cost some investors, especially the ones who are more risk averse to say, why am I taking equity risk when I can get paid more than 5% to own a risk free treasury and sleep at night? So why should I take equity risk?

Kenny Polcari:Well, because here you go. It depends on where you are in the life cycle. If you’re somebody in their 60s or 70s, then that’s going to be that’s going to that’s going to feed right into the way you think, because you can’t afford to think that much risk if you’re somebody who’s in their 40s or 50s and you’ve still got 25 or 30 years to go, then you shouldn’t be so concerned about, you know, the ten year Treasury.

Kenny Polcari:I mean, unless you’re completely risk averse. But if you’re if you’re somebody in your 40s or 50s, you should still be, you know, at least market weight risk, if not a little bit more. Right. But certainly someone in their 60s or 70s at 5.2% that you can guarantee riskless sleep at night sure doesn’t mean you take it 100% of your money putting it there, but you may take a sizable chunk of it and say, you know what?

Kenny Polcari:I’m going to take this risk off the table. I’m still going to have some risk to the market, but I’m going to take this risk, and I’m going to put it this in this treasury and look at maybe someone who says, I’m going to take three years worth of my living expenses and put it in this 5.2% treasury, and I have to worry about it.

Kenny Polcari:And then the rest of it, I you know, I don’t I don’t need it because I’ve taken my three years worth of living expenses and I’ve guaranteed it. Now the other one kid can run with it.

Caroline Woods:What level on the ten year would make you change your overall market outlook? Or what sort of pullback could happen that would make you realize it’s not a buying opportunity, it’s something more concerning.

Kenny Polcari:Well, so if we see look, I thought 4.75% was the danger zone for ten year Treasury. In fact that’s run right. We’re already at 5.2%. And the market is still essentially closer to my eyes than not. So what I’m what I’m assessing based on how strong the economy is. If you look at some of the economic data, you saw that consumer sentiment was, well, our finest bit of a sentiment was was, better than expected.

Kenny Polcari:I’m guessing that the ten year Treasury could probably push a tiny bit higher before it gets really anxious. So where’s that? Is that 5.3 5.5% in there? I think that’s really now the danger zone because we’re at 5.21 and the market is not panicking at all. And so you have to assume, you know, bonds take a little bit more of a hit and treasuries could go a little bit higher.

Kenny Polcari:But if I think we get the 5.3, 5.4, that’s I think when the market’s going to start, people are going to start and they’re going to start to, you know, question themselves and say, okay, what about am I willing really to pay? What do these companies have to earn with the ten year Treasury risk free rate at 5.3 of 5.4%, that’s going to change that.

Kenny Polcari:That’s going to change the math. And so now while I thought it was maybe 4.7 or 5, that’s been proved wrong. So now I got to move my target up. So it’s got to be somewhere above 5.2 because we’re already there and the market’s holding in. So it’s got to be somewhere you know 5.35.45.5 somewhere in there.

Caroline Woods:But does that mean if we see that level you you wouldn’t take part in a pullback. You would say now is the time to be very cautious and maybe.

Kenny Polcari:I will.

Caroline Woods:Take money.

Kenny Polcari:And if we get there I would be more cautious. I would be I would said I wouldn’t panic and sell everything I own because the names I own are all high quality in the sectors they’re in. But I would take back, I’d sit back for a minute and I’d let the I’d let the market turn to see where it’s going to go.

Kenny Polcari:I wouldn’t necessarily jump in on the first down date, because I think that I think there’d be a bigger story there, right? If that if treasuries tick up there, then I think there’s, you know, we’re in for we’re in for some low volatility. So I’d be happy owning what I own. But the cash that I have to invest, I’d leave sitting in a government money market fund earning 5.4% while I wait.

Caroline Woods:So if you kind of expect an 8 to 2, I know you don’t have a crystal ball, but if you kind of expect an 8 to 10% pullback correction, that would be healthy. If we do see the ten year at 5.5%, what sort of pull size.

Kenny Polcari:Pullback is then I think because then.

Caroline Woods:Not fair.

Kenny Polcari:Market I think the both yeah I think the pullback yet or really like the I think the pullback is at more than 8 to 10%. If we see the ten year Treasury tick higher then I think you know you’re you’re into you could be into a 15 or 20% pullback. And so that would make me more cautious in terms of okay what am I going to do with this cash I have to invest?

Kenny Polcari:I’m going to do nothing with it. I’m going to let it sit and earn 5.4%, because doing nothing and leaving your money in a government bucket fund is an investment decision. You are making a decision, right? It’s all it’s just sitting here earning nothing. It’s earning 5.5%. When the market could actually suffer a 10 or 15% drawdown. That’s going to offer stability for the balance of the portfolio.

Kenny Polcari:So that’s what I would do if it got to there. Then I’d be more cautious, say, okay, I’m willing to sit this one back, sit this one out. I’m going to keep what I have. Unless of course, the thesis has changed on why I own Apple or Amazon or JPMorgan. And I don’t think the thesis is going to change that much.

Kenny Polcari:That would cause me to say, okay, I’m not a get out because the things I owned are not like that. Right? I think I think the only name I own that would be like that would be Iron Cube because it’s so volatile. But I’m not even sure that that would be true, but it would cause me to just sit back and say, okay, I’m going to wait.

Caroline Woods:Okay, so we have a lot of retail investors who tune in as they think about the Q4 playbook, knowing that we could have this pullback in store. A lot of them probably are sitting in S&P 500 funds. What’s their strategy, which they do.

Kenny Polcari:So listen.

Caroline Woods:You got to kind of prepare.

Kenny Polcari:Your point. Yeah okay. So here’s the point. You’re sitting in an S&P 500 fund. You realize how much of that is exposed to tech. It’s close to almost 40% right. Though the tech weighting in the S&P is I think close to 40%. So all these people that say, oh look I’m in the S&P fund. I’m okay. Be careful because you’ve got a lot you’re out weighted in technology.

Caroline Woods:So so what do they do okay.

Kenny Polcari:So what you have to do is you have to diversify the way you might want to think about going into an S&P equal way fund. You have to be equal way fund. You realize the has to be equal. Weight is up almost 10.5% this year. And when the S&P is up 12% right now okay this is up 12% because it’s got a big tech weighting.

Kenny Polcari:But if tech gets whacked then the S&P the market weighted S&P is going to get whacked. But the S&P equal weight won’t react as much. So you may want if you want the exposure because you want broad market exposure. Then they put more money into the equal weight S&P versus the the regular way S&P because because you’re you’ll be overweight in technology.

Kenny Polcari:And then if you own the S&P and then you say oh I’m going to own the X okay. Or I’m going to own, you know, the the IVs that, you know the tech ETF, you’re going to be even more overweight in technology. So you have to understand if you’re going to play the game in ETFs, you have to understand what those ETFs own, what the exposure is and then ultimately what your exposure.

Kenny Polcari:If you’re going to play with individual names, then you have to spread it out. Make sure that you’ve got you’ve got, representation across the sector, right, to make sure that you’re balanced.

Caroline Woods:So, Kenny, if I gave you all my extra cash today, not my retirement, but just my extra cash, and I said, start a portfolio from scratch for me today at these levels, what would you do?

Kenny Polcari:

Caroline Woods:So I would.

Kenny Polcari:Start. Yeah. Yeah. No, it’s great advice. No, it’s great that, so first of all, what have do is I have to sit down and talk to you, just assess kind of what your own risk profile is, right? Because because I don’t know what your risk profile is. So you can give me all the cash you want.

Kenny Polcari:But if you say to me, look, I’m, I’m, I’m I’m more risk.

Caroline Woods:I want to be risky. It’s my extra cash. I want to be risky. I’m a long way from.

Kenny Polcari:Okay. So you want to be risky, right? You’re young. You’ve got 25 years to go. You want to be risky. So I would start. I wouldn’t take it all today and just plop it in. But I would start to feed it in, and I would start to build a portfolio of the broad, equal weight S&P 500, not the market weight.

Kenny Polcari:Be equal weight. I’d put you in, health care. I’d put you in, industrials right separately. Either we can play. Yes. If you want to eat that type portfolio. But if you if you want an individual name portfolio, I’d pick things like JP Morgan, IBM and Bank of America, Johnson and Johnson, Amazon, Apple, Microsoft. Those are all the names that I would I would, you know, I put you in the SPV which is he has a B value trade right.

Kenny Polcari:Which are value names. Right. So they’re not as sexy as the growth names, but they’ll offer stability especially, you know, on a drawdown.

Caroline Woods:Okay. And what do you need to see for me to get even more risky and just go into, you know, bigger tech again?

Kenny Polcari:Wow. Listen, you should everyone should have tech exposure again. It’s going to depend where you are, right? You’re younger than I am. I have tech exposure, but I’m 65. My tech exposure is going to be a whole lot less than somebody who 40 or 45. Or at least it should be right just because of my age and where I’m at in the life cycle.

Kenny Polcari:So again, that’s all part of this conversation of which I’m happy to have with you if you want to have a conversation. But, you know, that’s all very that’s all very individual. You can’t just it’s not like a one size fits all question. Just because I don’t know anything about you. I don’t know about your family.

Kenny Polcari:I don’t know what what what what you’re trying to provide for. All that stuff plays a role in how I might help design a portfolio.

Caroline Woods:That’s when your fee starts kicking in. All right, I guess it’s with them. All right, Kenny.

Kenny Polcari:But I listen, I’m kind of nice to you.

Caroline Woods:All right? Kenny, I think this is a great time to pivot to our rapid fire round of this or that. You know how to play. Quick questions. Quick answer is no. Hedging is you can help it. Yeah. Are you ready?

Kenny Polcari:All right.

Caroline Woods:There we go. Yep. Bull market intact or cracks forming. Cracks forming Q4 take some risk off or stay fully invested.

Kenny Polcari:Stay fully invested.

Caroline Woods:Stocks by year end higher or lower from here.

Kenny Polcari:I think they’re going to end right here. So I don’t think they’re going to be higher or lower. I think this is where we are.

Caroline Woods:But a bumpy road to get there.

Kenny Polcari:But bumpy road out the.

Caroline Woods:Dow or Nasdaq from here.

Kenny Polcari:I think. So that’s that.

Caroline Woods:S&P or Russell.

Kenny Polcari:Staying the low I have to say S&P because the grades go up Russell the spins are going to get lack.

Caroline Woods:Mag seven or everything else.

Kenny Polcari:Everything else.

Caroline Woods:Buy the dip or raise cash.

Kenny Polcari:You’re tying my hands on that one.

Kenny Polcari:You got to buy the dip. Unless of course you see those other things, right? I’m not trying to hedge, but if suddenly we see treasuries go to 5.4%, then I’d say, you know, not necessarily raise cash, but don’t put any more to work. Don’t buy the debt. Right.

Caroline Woods:Better my next pullback. No I get it. We appreciate the context. It’s okay that buy on the next pullback tech or something outside of tech. Yeah.

Kenny Polcari:I say tech.

Caroline Woods:The number one stock. You’re definitely buying on a pullback.

Kenny Polcari:

Kenny Polcari:IBM.

Caroline Woods:You’re seeing the pullback for IBM right. You buy it buy here. Yeah one sector you want to own in Q4.

Kenny Polcari:One sector healthcare.

Caroline Woods:One sector you don’t want to own in Q4.

Kenny Polcari:Consumer many discretionary.

Caroline Woods:Micron ahead of earnings buy now or wait.

Kenny Polcari:Buy it.

Caroline Woods:Nvidia or AMD.

Kenny Polcari:Us.

Kenny Polcari:I can say Nvidia because I own it. I don’t own AMD because that’s the way I played it. So I’d have to I have to be loyal.

Caroline Woods:Okay. Switching gears, is Nike ahead of earnings bargain or steer clear.

Kenny Polcari:Steer clear I.

Caroline Woods:Nike or Carnival which is also reporting.

Kenny Polcari:You’re killing me. And neither I, I don’t like either one of them. They’re not names that I own. So you know, I’d be I’d be okay with the. I’d be poking, carnival.

Caroline Woods:Consumer stocks pick selectively or just avoid here.

Kenny Polcari:Consumer staples.

Caroline Woods:No. Consumer discretionary.

Kenny Polcari:No. I would stay away from I don’t like consumer discretionary okay.

Caroline Woods:The one stock in your portfolio you’d never sell even in a crash is.

Kenny Polcari:

Kenny Polcari:Bike racer.

Caroline Woods:And finish this sentence.

Kenny Polcari:I wouldn’t sell the market. I wouldn’t have Amazon. I wouldn’t sell my game. People it either.

Caroline Woods:Okay, we’ll take all of us. Finish this sentence. If the market pulls back 10%, the first thing I’m doing is it’s up.

Kenny Polcari:In London right now. First thing I’m doing, I would, I would, I would, I would rebalance the portfolio.

Caroline Woods:Kenny Polcari senior market strategist of Slatestone wealth I always appreciate you joining us. Thanks for flying along. Thanks for all your picks and your insights.

Kenny Polcari:Thank you for letting me play along. I always enjoy that. Next time I’ll be with you at the New York Stock Action.

Caroline Woods:Can’t wait. Kenny, if you enjoyed this street talk, check out our full interview with Brent Schutti. He’s also in the S&P 500 is to concentrated camp and says where to move your money now.

Jim Cramer has a warning for investors hunting dependable income: Generous dividend might be hiding a costly problem.

On the Sept. 28 episode of “Mad Money,” he argued that some high-yield stocks have become increasingly dangerous as rising bond yields and weakening businesses undermine their appeal. 

Those quarterly checks offer little comfort when share prices keep falling. For investors accustomed to treating dividend payers as a financial cushion, that challenges a familiar playbook.

Buy an established company, collect the income, and wait out the turbulence. But what happens when the turbulence hits both the stock and the payout?

Cramer examined multiple recognizable companies whose sizable yields have failed to protect shareholders.

His concern goes beyond disappointing stock performance. With Treasury bonds offering increasingly competitive income, investors have greater reason to question the risks they are accepting. And the biggest yields deserve the toughest scrutiny of all.

Cramer says big dividends can hide bigger problems

Cramer’s warning is that a big dividend just can’t rescue a weakening business, especially as government bonds offer investors a compelling alternative.

“But lately, high-yielders no longer represent safety,” he said on Sept. 28. “If anything, they represent complacency, even danger.”

He cited a 10-year Treasury yield of 5.24%. Separately, the Associated Press reported the benchmark at 5.23% Monday, after it touched its highest level since 2007.

That competition matters. Investors need a reason to accept uncertain dividends and volatile share prices when Treasury income becomes increasingly attractive.

Cramer pointed to VICI Properties (VICI), yielding 7.93% but down nearly 18% for the year, and General Mills (GIS), yielding roughly 7.3% while down 28%, according to his figures.

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His concern was the businesses underneath those payouts. This includes sluggish growth at VICI and declining sales, earnings pressure, and higher input costs at General Mills.

UPS (UPS) faces another combination of threats, including lost Amazon business, competition, and fuel costs. Edison International (EIX) carries wildfire liability risk.

“Who cares about a high dividend yield if the earnings estimates are coming down?” Cramer asked.

The danger can eventually reach the payout itself.

He cited Campbell’s dividend reduction and the company’s projection of annual sales declines of 2% to 4% as reported by Reuters.

Still, Cramer remained optimistic about Kraft Heinz’s (KHC) turnaround, showing his argument is selective. A high yield needs operating support. 

Otherwise, investors risk collecting income from a business that is losing the financial strength needed to sustain it, while a falling share price erodes their invested capital.

The S&P 500’s 10 highest dividend yields demand a closer look

Dividend yield is a measure of a stock’s annual dividend per share divided by its share price, expressed as a percentage. 

For example, a stock yielding 7% would provide $70 in annual dividends on a $1,000 investment, assuming the payout remains unchanged.

But a bigger yield doesn’t necessarily mean a better investment. Falling share prices can push yields higher, even as a company’s outlook weakens.

That said, these are the S&P 500’s 10 highest-yielding stocks, according to Quant500’s September 28 closing data:

VICI Properties (VICI): 7.93%

General Mills (GIS): 7.26%

United Parcel Service (UPS): 6.96%

Edison International (EIX): 6.82%

Kraft Heinz (KHC): 6.79%

Altria Group (MO): 6.42%

Crown Castle (CCI): 6.33%

Clorox (CLX): 6.14%

Amcor (AMCR): 6.08%

Healthpeak Properties (DOC): 6.07%Source: Quant500’s S&P 500 dividend rankings, as of Sept. 28, 2026. Yields fluctuate with share prices and dividend changes.

 Jim Cramer warns that generous dividends may conceal growing risks for investors.Slaven Vlasic / Getty Images

Make the dividend prove it deserves your money

Investors have to treat Cramer’s warning as a reason to review their income holdings, starting with how each company funds its dividend.

Compare annual dividend payments with free cash flow after capital spending. 

If payouts consistently exceed that cash, investigate if borrowing or asset sales are filling the gap. For property REITs, examine adjusted funds from operations and its calculation.

Next, check debt maturities and earnings forecasts. Refinancing at higher rates can squeeze cash available for shareholders, particularly when sales are weakening.

Then ask whether the yield adequately compensates for those risks.

Against a 5.23% Treasury benchmark, a stock yielding 7% offers 1.77 percentage points more headline income. That comparison excludes dividend growth, price changes and taxes but exposes how small the apparent cushion can be.

Focus on total return. A hypothetical $10,000 investment paying $700 in dividends still loses $800 overall if its share price falls by 15% before taxes.

Avoid building an income portfolio around one troubled sector simply because its yields look generous. Consider spreading essential spending reserves across cash and treasuries, with maturities that match upcoming needs.

Longer Treasury bonds can also lose market value before maturity. For stocks, prioritize sustainable payouts and cash-generation improvements over yield rankings.

Related: Bank of America has a blunt message for S&P 500 investors

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