AI’s CapEx Frenzy Hits Wall of Fed Hawkishness | Weekly Roundup
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The fact that they're not gonna have the jobs data for that December meeting exploded odds. Now we're only at, like, a 29% odd of a cut in December.
The forward inflation is actually rolling over as nominal yields are rising. This is causing, I think, the liquidity suck and everyone's selling the riskier parts of the market. But it really hinges on Fed forward guidance because as soon as they take the punch bowl away, quickly these things can reverse. The cuts need to happen at some point,
and they're going to happen at some point. So basically, it allows them to get more juice in 2026. They're gonna have to spend like bats out of hell. That is the formula, and it's going to have to happen. Otherwise, it will be an absolute bloodbath.
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I I have no actual insightful read on this other than a funny comment that, you know, we always talk about how the whole world and everybody's retirement and lives on Nvidia's stock price. It's funny how it's jokes, but it's a stereotype. There's a reason it fits because it's true. You'll hear people in public talking about Nvidia earnings that should absolutely not be about it.
It's literally Groundhog Day for the market. All show up and just see whether they saw their shadow or not.
I can't help but think, like, if you're that sent in Trump, what is, like, one of the lowest and this is, like, complete speculation, but one of the lowest, effort, risk reward type of, like, manipulative things you could do is just in the same way that Elon never really I mean, I guess he got a little in trouble for the $4.20 buyout thing. They should have the auto pen giving Jensen a auto future pardon. So he can just, like, every earnings call just make up increasingly ridiculous numbers. So then the market just, Oh, it's next forward five years, trillion of revenue. And then it's, it's sic
That would be insane.
It's kinda wild. My only read is, you know, the implied move was, like, 7%. It's up three and a half. Most market, I think you're you're gonna get this is one of those event risk things that rolls off. Everyone was worried about it. Could have cracked, but now, you know, the VIX was kind of inverted. So the front month VIX was bid up relative to, you know, three month VIX. And, theoretically, we'll see tomorrow if if that kind of rolls off, meaning everyone's protection that they bought from downside just in case things got ugly should roll off. But I don't know. There's I don't know if this h
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