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My mission is simple – to make you money. I am here to create a level a special Seattle edition of "Mad Money" from the iconic Space Needle. . So call me at 1800743 CNBC or tweet me at Jim Kramer. While we're here to take a bird's eye view of the wonderful city of Seattle , I've been thinking a lot about how the generative AI revolution is once again becoming a dominant theme in the stock market.
Today we saw how it can eclipse all others on average, as any stock that has an impact on what is essentially a whole new industry will explode upwards. That's how you get a session where the Dow Jones rose 63 points. The S&P is up 8%, while the tech- laden NASDAQ, filled with AI-related stocks, is up 1.37%.
Bye, bye, bye, bye, bye, bye. Generative AI stocks are soaring as pioneers in the field do everything they can to spread and commercialize the technology, which I assure you is real and potentially extremely profitable. And this is not a rumor. I know people, many people in fact , who think that all this growth in AI is overblown.
But, for that matter, I think most investors don't realize the lasting and powerful significance of this story. And even Wall Street is not yet aware of the events. And that's why AMD shares could jump almost 10% after demonstrating its new AI chips. While Alphabet rose over 5% when it spun off Gemini, an incredibly cool AI tool, Nvidia's technology rose over 2%.
I don't know, because it's because of the demand for AI semiconductors. And Amazon also grew by more than one percent. Amazon is our main focus when we air the second part of our interview with CEO Andy Jasse later tonight . The most immediate impetus for this growth is AI. Yesterday, at a keynote presentation for its product, AMD CEO Lisa Suh said that she believes generative artificial intelligence and its solutions will become a $400 billion industry over the next four years.
That's a huge amount in itself, but as she said in August, it could reach 200 billion. So it's clear that Dr. Sue is much more optimistic about AI than she was just now. You know, doubling the industry's prospects in 5 months is simply unheard of. I was looking for different options. I can't find anything like it.
But that's exactly how AMD shares could rise if they introduce new chips that could accelerate the AI revolution, because investors understand there's room for something bigger than just market leader Nvidia. I'm a big fan of AMD, and it was a significant asset to the trust before we made big profits.
But members of the CNBC Investment Club know we went all in. Nvidia, which has a huge software component in its graphics cards, is also a supply constraint on all fronts. Nvidia doesn't feel threatened by AMD because the company can't meet demand for its own chips, even if AMD's products seem pretty awesome.
Incidentally, Amazon CEO Andy Jasse told me that Amazon Web Services will use Nvidia's incredibly powerful Grace Hopper supercomputer chips for its cloud infrastructure platform, even as the company makes chips for artificial intelligence. Despite the reports you may hear, the relationship between Nvidia and Amazon is strong.
Clearly, migration to the cloud still has a lot of potential. I was stunned when Jasse told me that 90% of the computation was still done locally . Many of these are still being executed outside the cloud, even those customers who will be left behind by the generative AI revolution if they don't move to the cloud soon.
I think the competitive advantage of companies moving to the cloud is so striking that it's effectively a " do or die" situation, and the only markets that can handle the traffic are Amazon Web Services, Google Cloud, and Microsoft's Azure. I now see Microsoft as the undisputed leader in artificial intelligence.
The launch of its co-pilot platform was incredibly successful. From my conversations with the company, I know that Co-Pilot is unmatched in its ability to help business people do their jobs better. I like the idea that businesspeople who have difficulty, say, with the ability to translate new concepts into a digestible form so that , say, investors or banks understand that they can't understand it, or writers who are blocked and need inspiration or help with numbers, they can turn to Co-Pilot to solve their problems.
Until I got here, I had no idea that Co-Pilot was so far ahead of us in practical, everyday business use, but it is a reality, thanks in part to Microsoft's brilliant investment in open AI, the alpha version of GPT chat, although yesterday we reported on news from Alphabet, which is rumored to be well behind competitors in the space.
They've taken this giant leap forward by revealing Gemini, their entry into generative artificial intelligence, and it's impressive. Now you can watch the six-minute video I want you to shoot on X for the platform formerly known as Twitter, without any code. You can joke with Gemini and this thing can recognize shapes, colors, objects, movies.
I was impressed by his creativity and weird, dry sense of humor. Take a look at these two examples from Gemini and you'll get the point. I know what you're doing. You are playing rock, scissors, paper. Press this. What do you see now? The fingers are spread out, resembling butterfly wings. What is it?
A big ear and a barking mouth. Dog . What kind of movie are they playing here? I think they're reenacting the famous slow-motion bullet scene from The Matrix. Okay, that's what caused Alphabet shares to rise 5% today. While investors researched what they were doing in the AI space until yesterday, I think people were under the illusion that Google was still stuck in search mode.
Gemini's video shows that this business is much more than just search and YouTube. This is why stocks are catching up with the rest of the AI cohorts. As for Amazon shareholders, don't worry. Generative AI is already deeply embedded in Amazon's business. This is how Amazon understands what people around the world might want , even before they know what they want.
That's how they can send you supplies the same day. A great change that saves you from having to go to the Staples store and look for a salesperson to unlock the plexiglass. It is hidden behind. Just order them online. You'll go, go, go, go to the office, when you get back to your porch, when you get back.
One thing I know, people, a lot of people I meet, are still trying to figure out what generative AI really means, especially if you're my age. If you don't understand this, maybe an example from football. I always find this useful. Let me tell you this. Let me...This is cool. Watch Amazon NFL's presentation on Prime Vision using NextGen stats.
Trainers work hard to disguise their actions. But after about a quarter of football, Amazon Generative AI is now up to speed and ready to predict many moves in a complex game in advance, including whether a Blitz might come and who will make it. This is incredible. It's incredible how often they get everything right.
This thing is smarter than Bill Beach. At least when it comes to picking up the blitz. You can run away, but you can't hide from generative artificial intelligence. He knows everyone's next move, even the NFL's masters of disguise. So, let me explain the point. I know it seems old-fashioned , but generative artificial intelligence just continues to amaze us.
And as long as this is the case , the stocks behind it will also be surprising. Let's move on to phones. Let's go to Joseph's in Hawaii. Joseph, good morning, Mr. Kramer, and aloha from the big island of Hawaii. How are you doing today? Mahalo. I'm fine. How are you doing? I'm fine. This is my first time calling, but I'm a long-time viewer.
Thank you for answering my call. Perfectly. Uh, a big thank you to all your hardworking men and women on your staff and thank you for your invaluable wisdom and guidance over the years. You are good. My staff is incredible . Good. Well, our good friends at Blackstone have offered to buy Rover for $2.3 billion .
And yes, we all love our furry little ones. Jim, to give you some background, Blackstone acquired Hilton in 2007, taking on significant debt during a major restructuring, it was a leveraged buyout transaction, $26.8 billion, all-cash offering, a record amount at the time. Seven years later, in 2014, Hilton went public again.
The IPO was $21. Today, Hilton is trading at $168. Truly a story. Looking further, I have three main questions. What do you think about the Rover acquisition? Is it possible that some third party will submit a bid to purchase before the January 24 deadline? And finally, should I buy a Rover? Thank you, Jim.
Good. No, don't buy, don't buy Rover. Buy Blackstone. We already reviewed Rover earlier this week, it was right after Elon Musk's keynote, and I think it got a little lost in the Must shuffle, but it was a brilliant deal. Blackstone is a great company, and the other day a guy was criticizing it, and I said, "Do they know who they're criticizing ?" "You're betting on John Gray." Nobody makes money betting against John Gray.
The generative revolution in artificial intelligence is happening right before our eyes, and it's an impressive development. It leads to an incredible rise in the stocks that drive all of this. Oh, tonight I'm speaking to you from the Seattle Space Needle. When the CEO of Amazon joins you for the first time in 19 years , you can't answer all your questions in just one night, right?
Tonight, my conversation with Andy Jasse continues, and we dive deeper into the company's business. Then, builder stocks surge, hitting new highs as Toll Brothers reported earnings and profit beat. I break down the earnings and tell you whether this could be the last or many good quarters. And does T-Mobile have a strong signal in this market? I'm going to meet with the ? Visit madmoney.cnbc.com.
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