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One week. Several infrastructure failures. One pattern. On Friday, the FAA grounded all departing flights in the U.S. after communications problems at air traffic control facilities. About 11,000 flights were delayed or canceled. Interestingly, the UK government recently asked its citizens to have food and water for 3 days stored at home, as a precaution, for no particular reason. Days earlier, Outlook, Teams and Copilot were down for nearly 24 hours. The outage also hit the

Rate hikes alone rarely break a market. Rate hikes plus a shock to a stretched market often do. In the aftermath of NVDA’s CEO exit, and considering how influential he has been for the development of the AI industry, and the next FOMC meeting, where the Fed is expected to hike, it’s interesting to look back in history to see the dynamic. A few examples: 📉 1973-74: Tightening plus the OPEC oil embargo and Watergate. S&P 500: about -48%. 📉 1987: Rising yields plus portfolio i

NVDA just lost its footing in minutes. Is this a bump, or a turning point? The chart says it all: a quiet session holding around $174-175, then a cliff after the close, down to a low near $156. The trigger wasn't earnings or a chip ban. It was governance. Nvidia shares fell more than 8% after hours on news the board is preparing to oust CEO Jensen Huang, and the company has lost more than $450 billion in market value since the probe was announced on Nov. 8. Over the last 30 d

October CPI: the Fed's December decision just got harder 🔥 Yesterday's print wasn't a disaster, but it was hot enough to matter. Headline CPI rose 0.4% m/m, down from 0.6% in September as energy inflation receded, while core rose 0.3% for the third month in a row. Consensus was 0.2%. A few details stand out: 1) The FOMC (Dec 8-9). Fed governor Waller had said a 0.3% core print would make him consider 50bp. He got it. A quarter-point hike is now the base case, and the debate

Three clocks are ticking on AI and rates today: CPI, the long bond, and the Anthropic IPO. 1. CPI, later today No year-over-year figure this month. Last year's shutdown left no October 2025 base. Consensus is headline +0.3%, core +0.2%. Waller spoke this morning: even a softer October wouldn't change his support for a December hike, and 50bp should be considered if core is around 0.3% or higher. December 25bp odds jumped to 96.3% from 76.3% after the speech. 2. The long end i

Trucking isn't collapsing overnight. It's quietly unraveling, and your next grocery bill will show it. Trucks move nearly three-quarters of U.S. freight by weight. Almost everything on a shelf, a job site, or a factory floor got there on diesel. Since the U.S.-Israel war on Iran began, the Strait of Hormuz has been largely shut to oil and refined products. Diesel is up more than 70% from January and hit record highs this fall, topping $6 a gallon in mid-September. Fuel is a f

The U.S. Treasury is planning to buy back up to $95 billion of its own debt over the next three months. 🏦 Here's the breakdown: 🔹 Up to $70B for older, off-the-run Treasuries, to improve trading liquidity 🔹 Up to $25B for short-term Treasuries, to manage cash balances This is not QE. The buybacks are funded by new issuance, so it's debt management, not monetary stimulus. Why it matters: Treasuries are the benchmark for pricing almost every other asset. When the market trad

Anthropic’s IPO share structure is one of the most unusual we’ve seen in public markets. When the company goes public later this month, investors buying Class A shares will get economic exposure — but almost no real governance power. Here’s the breakdown of the five share classes: Class A – The public shares. One vote per share, full economic rights. But the entire class is permanently capped at 49.9% of total voting power. Class F – One single share held by a Founder LLC (th

Today's jobs report: the labor market is stable, but it's no longer hot. Ahead of this morning's release, the Labor Department's own data tells a consistent story. please take a look at the charts below: ⚖️ Openings per unemployed worker are back near 1.0. At the peak there were two openings for every job seeker. Employers no longer have to compete as hard for workers. 🔄 Turnover is low. Hiring and quitting rates are back at or below 2010s levels, while layoffs remain histor

The market's first read on the midterms: not all AI trades are equal. By 9:50 a.m. ET on Nov. 4, the S&P 500 was up 1.6%. Under the surface, the moves by industry were very uneven. You can see that in the chart below: 📈 Solar and clean energy: First Solar +11.9%, Sunrun +10.5%, Enphase +9.2% 📈 Hospitals and insurers: Centene +8.0%, HCA +7.5%, Universal Health +7.0% 📉 Defense: Lockheed -4.2%, Northrop -3.8%, RTX -3.2% 📉 AI, data centers and power: the weakest block on the

The midterms just repriced three things investors care about: data centers, Iran, and the policy path for the next two years. Democrats are projected to take both the House and the Senate. Three implications: 1. Data centers: regulation risk just got real. Democratic governors won in Texas, Georgia, Michigan, Pennsylvania and Arizona. Texas alone holds about 27% of planned U.S. data center capacity, and these five states together hold roughly 39%. Several of these candidates

What a Democratic sweep could mean, and why markets may care less than you think Polls open today. Forecasts lean toward a Democratic House, and the Senate is the real toss-up. The Decision Desk HQ projection I'm watching shows a Democratic sweep (D 241 in the House, D 52 in the Senate). That's a projection, not a result. If it happens: 🏛 Domestic: Expect subpoenas and oversight hearings, and fights over spending bills. Democrats would have leverage on appropriations. A divi

Take a look at the chart below. Morgan Stanley estimates the US data center capacity shortfall will grow from 15 GW in 2026 to 43 GW in 2028. Demand rises from 97 GW to 180 GW, while supply only reaches 137 GW. So what does it cost to close that gap? A 1 GW AI-optimized campus runs roughly $35-40B all-in (Epoch AI puts it near $38B). About 60% of that is servers and GPUs, not concrete. Land and grid hookups are under 1%. $40B x 43 GW = ~$1.7 trillion That is the order of magn

Midterm years: first the drawdown, then the rebound. 13 times out of 13. Chart 1 👇 Every midterm year since 1974 has delivered a drawdown. 📉 The range runs from -7% (2014) to -35% (1974). 📉 The average is about -18%. 📉 Six of the 13 fell 20% or more. Chart 2 👇 Now look at the 12 months after the election. 📈 All 13 were positive, with an average of about +13.6%. Counting back to 1950, it's 19 for 19. 📈 The range runs from +1% (1986) to +27% (1994). 📈 The worst drawdown

The Nasdaq is down nearly 6% over the month of October, and I think the market is starting to price something it ignored for a long time: the AI buildout is increasingly financed with (debt) commitments, not just cash flow. You can see that in the upper chart below. Hyperscalers, NVIDIA, Broadcom and SpaceX now disclose $4.11tn of off-balance-sheet commitments in their latest filings. That's up from $3.29tn in Morgan Stanley's August estimate. The biggest: • Alphabet: $1,059b

Credit is flashing amber. Equity is being asked to pay the bill. Two charts, one story. 📈 Lower-quality credit (CAA-B OAS) has climbed to ~780bp. That's close to the 2016 peak, and every prior peak was met with policy support: global QE in 2008 and 2020, the ECB's CSPP in 2016. 📈 Meanwhile, net equity issuance just turned sharply positive. Q2 2026 is roughly $150bn, the biggest print in the series since 1997 and about three times the 2000 and 2021 peaks. For years, buybacks

The Fed held. The real decision is still ahead. The FOMC kept the target range at 3.75%–4% by a 10–2 vote, with Cook and Hammack preferring a 25 bp hike. Chair Warsh also announced that one meeting a year will become a strategy session with no rate vote, starting in 2027. Market reaction: a hawkish hold that traded dovish. The 2-year yield dipped as low as 4.678% after Warsh declined to give a clear steer on December. Equities rallied modestly, though narrowly, while the 10-y

What's the optimal gold allocation in a stock/bond portfolio? The data from 1970-2024 says ~14%. Incrementum AG ran a gold allocation sweep on a stock/bond portfolio (S&P 500 TR and US 10Y TR), using data from Robert Shiller and LSEG. Gold was added in 2% steps from 0% to 30%, then in 10% steps up to 60%. You can see in the charts below what the numbers show: 📉 Volatility is U-shaped. It starts at 8.28% with no gold, bottoms at 7.81% with 14% gold, then climbs. By 30% gold y

Anthropic just opened its books. Meta just went to the equity market. Together they tell you where the AI trade is headed. Anthropic's S-1 landed Monday. The headline numbers: 📈 Revenue grew about 1,300% to $16.3B in the first half of 2026, including $11.56B in Q2 alone. 📉 The net loss was $80.7B, but most of it came from fair-value changes on convertible bonds, which is largely non-cash. ⚙️ Q2 revenue was $2.08 for every $1 spent on compute. Operating income swung from a $

Moody's Analytics just updated its "What Could Go Wrong" matrix, which maps risks by likelihood and economic severity over the next 12–18 months. A few things stood out: 🔴 Four risks are on Negative Watch: an AI stock selloff, Fed missteps, Iran war escalation, and bond market turmoil. Notice that two of them (Fed missteps, bond market turmoil) tie directly to this week's meeting. 🔵 Newly added: a major AI cyberattack and a debt limit debacle. ⚠️ Highest severity (far right