I was wrong about China’s tariff strategy. I thought they would wait until additional tariffs were put in place before they retaliate, but they went ahead with 10-15% tariffs on certain U.S. goods. China will also investigate Google and targeted Calvin Cline.
Speaking of Google, shares of parent company Alphabet traded down on a revenue miss, with some of the miss coming in cloud services. They also mentioned they will be investing $75bln over the balance of the year in AI capex. And speaking of AI infrastructure, AMD doubled their data center revenue, but maybe not enough to meet sky high investor expectations.
And speaking of data, but not data centers, the JOLTs data showed job openings of 7.6 million, which was below estimates. Job openings are now 1.3 million lower than they were a year ago. The hirings and separations remained largely unchanged. All of which plays to a “Great Stay” theme.
Trade remains a key topic this week, and probably for a while to come.
The textbooks teach us that some of the benefits of trade are:
-trade leads to efficiencies by allowing firms to specialize based on their comparative advantage
-trade creates an overall more efficient use of resources and allows for a larger basket of global goods that improve overall welfare
-trade can increase the flow of ideas and increase productivity
The textbooks also point to some potential drawbacks:
-trade can create winners and losers in different sectors
-trade can cause a loss of jobs in developed countries
The idea of tariffs, aside from the espoused border security topic, is generally to reduce trade deficits, which should increase domestic production. Whether that deficit reduction remains a key focus for the administration is still an open question.
On the day ahead we get ISM data and a treasury refunding announcement.
XTOD: Nothing drains a high performer faster than realizing their reward for excellence is cleaning up someone else’s incompetence.
XTOD: For those who can read cash flow statements, you'll see below that $PLTR doles out more cash in stock comp than it generates in net income to the tune of hundreds of millions each year. The entire business is a scheme built to move money from shareholder pockets to the company insiders, who systematically dump their issued shares onto retail bagholders Good thing the bulls can't read cash flow statements, or the insiders might have a problem on their hands
XTOD: Anyone can talk about themself. Even a child knows how to gossip and chatter. So what is scarce and rare? Silence. The ability to deliberately keep yourself out of the conversation and subsist without its validation. Silence is the respite of the confident and the strong.
https://x.com/leilahormozi/status/1886777206623342821?s=46&t=D2AESCsaw42dAEzgmjXHQA
https://x.com/ross__hendricks/status/1886546908769927647?s=46&t=D2AESCsaw42dAEzgmjXHQA
https://x.com/ryanholiday/status/1886867328304079037?s=46&t=D2AESCsaw42dAEzgmjXHQA
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