저자: Kevin · 외국인
요약 보기
연준 파월의 매파적 발언과 근원 상품가격 상승으로 9월 금리인하 기대가 약화됨. 7월 고용보고서가 실업률 하락(3.9%)으로 나올 것으로 개인적으로 예상하며, 이는 금리인하 지연과 주식 강세로 연결된다고 봄. 빅테크(MSFT, META)의 설비투자 확대와 감가상각 기간 연장이 이익률을 부풀린다고 지적하고, 고용이 꺾이면 AI 거품 조정 위험이 있다고 경고함.
다듬은 글
So this morning is the morning after some really incredible earnings from Microsoft and Meta. Are they though? Well, we'll talk about what a potential change factor could be inside of Microsoft and Meta. But importantly as well, we've got to talk about workforce changes and well jobs because that's what JPAW tried giving us a hint about yesterday.
and I'm a little confused as to exactly what to take away from it, but I have my bias, which we'll talk about in this video. We'll also go through some of the notes from what was said in Microsoft and Meta's earnings call, which could be quite applicable to what's going on here. So, first, remember yesterday, Jerome Powell gave us a hawkish warning.
He hawkked at us. They told us things are good in the economy right now and to pay attention to the top line of the unemployment report which comes out tomorrow. Quite an interesting hint because often Powell can get a little early heads up on what the data is going to be. And despite the market pre-pricing in the odds of a Fed rate cut in September to the tune of nearly 70% by the time Powell was speaking after he spoke the odds plummeted.
That's because he refused to set up for a rate cut in September and instead suggested we might be higher for a lot longer. In fact, some would even argue that he somewhat suggested we might not see rate cuts until next year. Maybe Powell will never be interested in cutting rates and he'll leave his job in 8 months and somebody else will take the reigns of cutting rates.
Part of this could be because of inflation rates trending up at least in core goods. Here you could see for example the Federal Reserve Bank of Cleveland now casting that core CPI is coming in at three uh at about 3% for July. Now, we did get PCE data, but even PCE data this morning that came out, which is really just sort of a recombination of CPI uh and uh PPI data, we did see that uh goods pricing is increasing.
If we grab a little arrow here, we can see this black line and we can see goods pricing has actually been in deflation in 2023 and 2024. You're under that 0% line. So you've been in deflation in goods pricing which is kind of what you saw during COVID you know sort of during the shutdown not a surprise deflation.
Of course we had massive inflation following stimulus checks and bailouts and PPP loans and and all the goodies. Uh that said goods pricing has really been a source of disinflation and deflation recently. But following tariff announcements, we're starting to see this very very clear uptrend on goods pricing.
Now, fortunately, uh core uh sort of housing and core services excluding goods and excluding housing, both of these are rotating down and they're contributing to lower inflation, which is fantastic. We're on a nice downtrend for housing services inflation. We're in a downtrend for core services exhousing, which is great.
But this is really one big reason for the Federal Reserve not to cut rates. And JP Pal told us, hey, look, it's it's going to be potentially many months before we have as much data as we need. But his warning on this unemployment rate and the headline was very unique. It's something we haven't seen before.
But given that he paired it with hawkishness, it somewhat suggests that we should expect a beat on the unemployment report tomorrow. And maybe we end up seeing the unemployment rate come down from 4.1% potentially to 3.9%. Which is not what the market is expecting right now. The market is expecting the unemployment rate to go up from 4.1 to 4.2%.
Which would have suggested that if Powell knew he would be doubbish. So, it seems to me that either Powell doesn't know and he's like, "We're just not going to give you an answer. We're going to wait and see." Or he knows and it's going to come in hot. Tomorrow's jobs report is expected to show 105,000 jobs.
Uh we are expecting that unemployment rate to go to 4.2% which would be a tick up uh from the prior of a 4.1% rate. Now, we'll see. We'll know at 5:30 in the morning we'll be covering it and tomorrow will be a really big day because if we do end up getting a strong jobs report honestly the stock market should do exceptionally well.
This morning we've actually seen some institutional bleed on Microsoft which was really surprising given just the amount of money that's being spent uh on artificial intelligence uh infrastructure at both Meta and Microsoft. We'll touch on those briefly in just a moment to give you some things to pay attention to.
Uh but what's remarkable when you look at these companies and I look at my notes from the earnings calls when I went through these what you ended up finding was that headcount at Microsoft flat headcount at Meta year-over-year down 1%. Now, this is very interesting because you have companies that are promoting the benefits of artificial intelligence and that very promotion is leading to potentially less hiring, which then we look at the challenger job cuts report that came out this morning.
And we look at the challenger report, we see that job cuts are up 140% from the same month last year and up 29% from the same sort of pacing that we've had uh last year for the first 6 months. So we're well above average job cuts. And initially we think, okay, well that's probably because of Doge and government because that's what we saw early in the year, which is true.
But that's actually not where we saw most of the job cuts now. where we saw most of the jobs cuts in July were not in government with only 3,800 job cuts announced uh in June and 3,666 announced in July. We actually saw a 36% increase uh in the uh job cuts announced in the technology sector which is leading the private sector in job cuts with 89,000 uh job cuts announced in 2025 uh in July.
retail also with a weaker consumer and nonprofits with a massive increase due to less government funding. Uh and then automakers of course high interest rates, very difficult time to sell cars. So you have this sort of disaster where you've got a multiple problems I like to say going on and some of them are actually some of these problems quote unquote problems are actually fantastic for stocks but but think for a moment of the things that we face.
So what we have is core inflation rising. This means no rate cuts, right? Then we have at the moment, yes, cracks in labor, but you know, Powell's hawkishness suggests not enough to to be recessionary yet, right? In other words, like not enough pain in the job market to really send us into a recessionary and deflationary environment because frankly, you know, people always worry about the balance between inflation and labor because Jerome Powell says we have a dual mandate.
One is inflation, one is labor. What happens if we end up getting high inflation and a labor market that's falling? And the reality is we don't. If the labor market falls, we will have deflation. If labor falls, uh we will have uh deflation uh and a recession and cuts. Okay? And cuts. That's if the labor market falls.
This if Powell had a heads up on this, if Powell had heads up, uh he should have set up a 50 basis point cut for September. like if he saw a really weak set of jobs data coming up this Friday. Again, maybe he doesn't know and he's going to be just as surprised, but I just have have this weird feeling that he kind of knows this is going to be a hot report.
Again, maybe he doesn't. I just have that feeling. Then what you'll probably end up seeing is uh labor stays strong, stocks can keep going up versus that institutional selling that you saw. uh bonds sell off, yields jump uh and markets unpric any cuts in 2025. That's possible because then what happens is all we do if the labor market is fine, we're only going to focus on inflation.
See, that's something to remember. If inflation bad, you keep rates high. If labor bad, both of them are going to go down together. Like the labor market will drag inflation down. So the inflation problem gets cured through a recession. But you don't cure inflation through a strong labor market. You have to cure it through high rates.
So you really only have two paths here. Two simple paths. Okay. Path one, big layoffs. Uh inflation goes away. uh cut rates and then path two is no big layoffs uh fight inflation with higher for longer. So that's where we sit and JPAL really hinted at this. This was the JPAL hint right here. Now what do we need to know about the AI earnings?
Okay, so we went deep into this in the alpha report this morning. So I don't want to go so deep on it now. I I don't want to sound redundant to everybody who's already in uh the courses on building your wealth. Remember, you could use coupon code release the files. Release the files is the coupon code to use to join.
You pay once, you get lifetime access forever. Go to meet kevin.com, you pay, you're done forever. You're in it forever. So, if you want my Fed insights in five years from now when we're talking about Kevin Hasset or whatever, uh as as Fed chair, you can come back and it costs you $0 extra, which is great.
So, use that coupon code, release the filesme.com. But what I want you to think of is Facebook and Meta. Uh, well, sorry, I always do that. Uh, Meta and Microsoft. Meta and Microsoft have an incentive to butter out how far they are cutting their or or how like how far out they're writing off their expenses, right?
So when they invest in this artificial intelligence infrastructure, which both of them say they are, they're telling you bluntly that we are not worried about being conservative right now. And they say this bluntly as well. We are worried about gaining market share and we're going to throw as much money and as many dollars as we possibly can to make sure we get as much access to to this cycle as possible because it frankly I mean if you think about it pumps the stock right so it's fantastic but look at the balance sheet briefly at um Meta and you'll see some of the changes of what are going on you're really doing is you're turning cash into a depreciable asset.
uh at a pretty shocking rate, less so at Microsoft, which is part of the reason why I feel like it's somewhat ironic that Meta is so far outperforming Microsoft today. But look at this. In 2025, Meta went down to about $12 billion of cash, whereas they had about $44 billion of cash and their marketable securities didn't really change at all.
So, it's not like they bought a bunch of treasuries instead and moved it around. uh instead what you're finding is their plant property and equipment category has exploded. You've got about a $26 billion increase in plant property and equipment here and about a $32 billion decrease in cash. So you're throwing a lot into plant property and equipment.
And these are this is net, right? So net of depreciation which basically means you probably depreciated the other $6 billion away. Now this is interesting because when we consider depreciation these companies are now trying to write off their products over the longest terms possible 2 to six years at Microsoft this is the Microsoft 10K they do 2 to six year depreciation and Meta announced extended depreciation of 5 12%.
Now why does that matter? Long story short, again, refer to the video this morning uh in the course member live where we talked about the soggy box analogy, but basically what you're doing is you are reducing your cost of goods sold today to make your earnings look better today. Now, that's great as long as those assets create value for the long term.
So in the near term uh taking depreciating more now makes earnings and margins look way better today but borrows from the future. That's kind of the way to think about it. And the longer you you've depreciated over, you know, usually as an individual business owner, you want to depreciate as quickly as possible because you want to save money on the taxes, right?
But these companies are different because they want to show you big margin growth because it props up the stock which is good for employees. It's good for talent acquisition. When the stock goes up, it also implies that the business is doing well, which means other businesses want to hire the business to do business with, right?
Like you want to you want to have your own AI servers, call Microsoft. They'll install on-prem servers for you. You know, that part of their business is actually shrinking because a lot of people are going to the cloud. Maybe more people go to the cloud with Microsoft because of that. I mean, we saw the insane amount of seats that are being added.
We had uh, you know, UBS adding co-pilot seats for all of their employees. 25,000 seats being added for Adobe, Fizer, KPMJ, Barlays, 100,000 seats, up from 15,000 seats. Microsoft, seven times as many tokens uh, you know, being used in co-pilot uh, over the last year. So, like the AI adoption is real.
The question is how long does that ROI keep going and do you kind of keep milking these high margins now but borrow from an un certain future where all of a sudden if you have to write off some of these costs in an accelerated manner in the future because of either a recession or a slowdown or the valuation of these chips declines faster or your ROI is lower the margins are going to get hit really bad at Microsoft and Meta.
So, you're really at sort of like the one of the most frothiest moments right now where everybody wants to adopt AI, which is fine. But one thing I talked about this morning in sort of our public life, we we briefly talked about how really what's happening in the economy is everybody's lining up for and this is an analogy, okay?
And this is I'm not imputing whether or not you should take a vaccine or not, okay? That's not what this video is about. If if you're worried about vaccines, get yourself life insurance in as little as five minutes by going to betevin.comlife. It's paid partner of the channel. But take a look at this.
Everyone's lining up for the vaccine, which is basically like GPT co-pilot or whatever. But it's kind of like a parasite or virus being injected into everyone. Because the reality is when the more you rely on GPT or AI as a person, there's no simple way to put it. Well, I guess there is. It's just crass.
You become dumber, less critical thinking abilities, uh, or or, you know, fewer critical thinking abilities, uh, and and you become less well-rounded. This is just at least what MIT has been studying. And this is sort of something that we suspected. And so this is why I I say like as a hint, don't tell anyone, oh, I looked it up on GPT.
Like it sounds low IQ. I hate to say that. You just keep that in the back. Okay? Don't tell everybody that the because you put a highlighter over your name for first to get fired, right? Think about this. You know, I I always like to put ourselves in in the position when we look at house hack. We look at so many jobs that we had when when we were just doing machine learning AI, you know, before AI, it was AI.
We're just doing machine learning with wedgefinder uh which has now evolved into uh machine learning and LLMs. Uh and then LLM obviously and office work. These are incredible technologies and increase efficiency so much. But the amount of jobs that we just don't need people in the office for anymore uh that so many people have been affected by artificial intelligence.
We see it firsthand like we get so much more done with fewer people because you could use AI to just do just very basic things for you that otherwise in the past you'd have to pay somebody to do. I think corporations broadly, the big ones will eventually see that. We're already seeing weak small business hiring, right?
The Wall Street Journal had a big piece on this uh this morning. Uh in fact, if I go to the front page of the Wall Street Journal, I think it was on their front page. Anyway, it was it was somewhere uh on the Wall Street Journal about small businesses uh really with the smallest amount of job openings.
And that's probably where you're starting to see like, wait a minute, you know, every salary we save is massive money. Massive. I mean, there's a huge ROI in cutting people out if you can replace them with AI. Now, this is really sad because what it does is it it takes money from people who are the consumers of the economy and gives it to the corporations.
And, you know, I I see that as a long-term the rich get richer and the poor stay poor. I don't like that. I think that's that's painful. But, you know, sure, it's going to be good for corporations and good for shareholders of corporations presumably. But, take a look at this. This is my thesis. My thesis is that uh everyone is lining up for the vaccine, but corporations are really injecting a parasite or virus into everyone.
You know, Palanteer said this well. Corporations used to be skeptical of AI. Now they're all in. Spread the cheeks, baby. Take my data. Take everyone. Upload us to the cloud. Give everyone AI. Everyone feels great about getting the vaccine, but the reality is 30% of y'all are going to die. You're going to lose your job.
The first people to lose their job, this is a just a big like human warning for you, okay? The first people to get cut are the people bragging about how much AI they use. the the people, you know, putting every comment uh into GPT in a meeting or literally like sorting their GPT archives uh because they're all on GPT or worse GPT debating other people in the office.
Because when you do that, it's kind of like why why do you have to pay somebody a salary who's GPT debating? like you could you just debate GPT yourself. So what happens then is the corporation comes out skinnier, but the vaccine makers AI have a cyclical reaction here, right? So at first AI wins big.
This is your your Meta, your Microsoft, your super microcomputers still probably going to 71 bucks, your Nvidia, your AMD, you know, Coreweave to some extent, right? And so it's not really the corporation who loses in the long term. It's really the people. And so the more this gets injected, all these seats, the more I think you're going to end up having companies like UBS, I mean, how many employees does UBS bank have?
Uh, or or even KPMG, you know, an auditor like auditor, perfect for AI, right? What was another one? It was um UBS Barlays was another one. UBS uh how many employees? Okay, not to be confused with UPS, the shipping company that's laying off a bunch of people. 110,000 employees. So 110,000 employees, you give all these people AI.
Well, how many more people do you need to sit there to read earnings calls? You don't. You need one person could probably do 10 times the earnings calls or more and what would have previously taken a team of researchers. Same thing with uh earnings reports, discounted cash flow models, customer service.
It's insane. So eventually these jobs go away and that's your turning point for AI, right? That's your turning point. It's the cyclical reaction is you have to pay attention to that jobs market and that's why Friday is so important because Friday is going to give you a license to the moon or uh you know it it's some form of omen.
I think uh Jerome Powell's uh Wednesday warning uh was a heads up that Friday might give us a license for number one a moon in stocks and number two uh no rate cuts for a while. And frankly, this makes sense. You shouldn't want rate cuts if you're in the stock market. If you're investing in stocks right now, you don't want to hear the Federal Reserve saying, "Yeah, we need to cut rates because things are slowing down." So, this this is this is the the issue.
You know, somebody here in the chat says, "One smart person using AI can get the amount of work done of five people 10 years ago." Exactly. That's the problem. That's where all of these people lose their jobs. But what contributes to the economy for now, right? Uh until layoffs, the economy is 70% consumer.
It's about 2% AI. But how much of the stock market is AI? The stock market is probably 80% AI, right? In terms of valuation, the stock market valuation is probably 80% AI. So look at this difference. If the economy measured by GDP is 70% the consumer and it's 2% AI, you know, call it a trillion bucks, the rest is the consumer.
Uh the stock market valuation being 80% AI at some point when when layoffs hit, that's when you need to be worried about AI because that's when the the air comes out of the bubble because you just don't need that many employees. one capable person with with GPT can do so much more. And so the survivors will do very very well.
Uh so why would I use UBS at all if I could just go to AI? Well, exactly. Uh now, one of the reasons you would use a company like UBS would be investment banking. like you can't IPO yourself, but UBS might be able to lower the costs of you hiring an investment bank to IPO or a research firm to help you IPO.
So that way, you know, they have because they have lower cost, you have a lower cost and it's easier for more people to IPO. It's an idea there. So, um, somebody here says, but the Fed cut in 2019 as a midcycle adjustment. Why can't they do that for 2025? because in 2019 we had below trend inflation.
We had about one and a half percent inflation. Uh the and it was more of a pause than anything. Uh it was a pause in getting off of zero. We had very very low inflation. The Fed kept telling us inflation was coming but then GDP started falling especially following the Trump, you know, a year after the Trump trade war.
Uh that's the opposite of what you have right now because you have core goods pricing skyrocketing which is a problem. Uh, so it's not great. So I think that JPAL basically told us set up for a moon in stocks and recognized that what Microsoft and Meta gave us was actually really really insightful. I mean very incredible numbers.
So I mean we already know a lot of their their margins and their revenues and all this but I want you to see some of this some of the other comments that they had. So, uh, Meta is of the impression that they're going to bring super intelligence to everyone and that, you know, everybody's going to end up with Ray-B band glasses, otherwise you're going to be left behind.
Uh, I'm not super convinced that everybody needs glasses because we could just use the phones and, you know, the glasses have some downsides as well. I know Mark thinks they're the most stylish thing ever. But what's interesting for Meta is they are seeing a lot more user engagement in their content.
uh they are seeing increases in uh engagement on Facebook at 5% and Instagram at 6% increases with more conversion of ads as well. 5% more conversion Instagram 3% more Facebook because of AI. So you're actually seeing real benefits of sort of AI giving us what we want. You know how AI glazes you when you talk to the chat bots?
They're really good at figuring out like where your head is and mimicking you. And if they can give you the content that you want, that's fantastic. Uh, and so giving you the content that you want is is uh a great way to keep you on the platform. Somebody says uh uh let's see here. Somebody says, "Lower rates.
If companies can borrow at lower rates, wouldn't that improve their profit margins?" Well, no, because it it depends why you're cutting rates, right? If you're cutting rates because the economy is slowing, your revenue is going down anyway. Nobody cares about margin at that point. In fact, if you listen very closely to what Microsoft and Meta tell you, they say, specifically Microsoft, they had a whole segment on this.
They say, don't focus on the margin right now. Focus on revenue because if we can get market share, the margin will come. So listen to that very closely. They said margin does not matter right now. What matters is revenue growth and market share. This is why Microsoft spent basically all of their intelligent cloud revenue on uh uh on on investments into AI.
I'll show it to you so so you could see it directly in the document. And mind you, you know, I I read these documents because I kind of get entertainment out of them. Uh I'm not the biggest fan of uh relying solely on AI myself. Uh so I'm a big fan of just reading them. I feel like I get the nuance and the nuance lets me read between the lines.
But anyway, here's what the intelligent cloud sector is. So we know this is obviously Azure and you know the products as people are very uh gung-ho about intelligent cloud. But what I want you to see is the intelligent cloud rev and we're going to compare that to the cash flow. And so if we look at intelligent cloud right here, here's Intelligent Cloud, that's supposed to be insane.
The income's pretty insane. So look at the revenue. Intelligent cloud revenue is $106 billion. Mind you, this is for uh 25 in billions. So this is a year because of their fiscal year being over or whatever. Their cost of revenue was 40. Some of that includes depreciation and their operating expense is about 21.
So they had operating income of around 44 but some of that is depreciation. You can add back in potentially you know call it somewhere between 44 to 65 billion uh was their operating income from the intelligent cloud. 44 to 65 billion. Keep those numbers in mind. How much did they spend reinvesting into plant property and equipment?
Well, here it is. Additions to plant, property, and equipment, $64 billion. So, in other words, my belief is they basically took 100% of their intelligence cloud net income adding depreciation for that very investment back in. otherwise you would be double counting it in that um so 100% and threw it back into infrastructure.
So they're kind of like cool outside of depreciation we net about $64 billion from intelligent cloud and we have to estimate that because they purposefully tell you that they do not break out their depreciation. They don't they don't want you to know exactly what the depreciation is. Uh, and that's strategic because I we know they're buttering this out.
They're buttering this out because they want to pump their margins. So, they literally say that. Uh, oh, if I could find the comment. It's It's actually pretty impactful in my opinion to see them say it. Uh, so I'll pull it up for you really quick. Uh, oh, and this is where they depreciate. This is where they give the time frames.
It must be in the management notes just below. Oh. Oh, there it is. Boys and girls, this is the stuff that AI is not going to find for you. All right. It is impractical. Impracticable. Well, that was like a pilot word. It's impractic. Yeah, I know. That's right. For us to separately identify the amount of amortization and depreciation by segment that is included.
In other words, they don't want you to know the details of the depreciation because it's the perfect way to hide uh how they're buttering out the depreciation to essentially uh uh drive this this uh you know high margin or this appearance of high margin. Really what they're doing I mean imagine this.
It's kind of like I I'll give a quick sneak preview of it. I if you if you my soggy box analogy briefly soggy box simplified let's say the soggy box pays you $1,000 this year but it costs you $1,000 and at the end of the year it's totally worthless. Okay, super simplifying here. Okay, and I'm being extreme on purpose.
But then you buy the soggy box and you actually tell me it's going to take 10 years for it to be worthless. then you're going to recognize $900 of profit and only $100 of expenses. That's why you hide depreciation. You don't want people to know that one of the reasons your margin is so high is because you're spending a 100% of your net income intelligent cloud back into those chips.
And there's always the question of, okay, well, what what's the long-term residual value of those chips going to be if you're writing them off over five and a half years? And mind you, they're both doing that. Watch this. We'll we'll Google it together. Okay, look, private browser. Uh, let's do uh what are we going to do?
Oops. Uh, stay on that. Uh, Microsoft depreciation schedule. Nvidia. I I don't think I have to put Nvidia chips in here. Microsoft depreciation schedule. and h I can't find a good because I get all the Microsoft results. U Microsoft appreciation change extends. Let's see here. Let's see if I could just find it under the new.
There it is. There it is. See, look at this. Jan 30th, Meta, here's Meta and Microsoft did the same thing. Uh I don't want to waste too much time on it, but basically Microsoft, Google, Meta, Amazon added almost 10 billion to their profits in the past year, two years by extending the estimated working life of their service servers.
They're all doing it. Microsoft, Google, Meta, and Amazon. Meta extends server life again, saving it 2.9 billion. So this is known, right? Like people are aware of this, but but you might not be aware of this. like some people aware of this but accounting people are aware of this. Uh but but that's that's something fascinating to to pay attention to.
So uh then let's see some other comments here. Now they justify this by saying that they still see a lot of demand and that their spending is correlated to demand. Mind you, like these are the kind of analogies and and the investigation that we usually like to do just in the course member live streams uh in the mornings.
So, you're welcome to join those all of the time. And we we go deep into this kind of stuff just to the goal is to give you perspective. The goal is to teach you how to fish. You know, I I want you to be able to look at a stock, understand how to draw the trend lines, understand how to analyze the volume, understand how volatility is going to affect your your stock options, understand, you know, why, you know, on a big AI day like today, Tesla's not doing well.
Like, these are things we talk about even before the market open. I'm like, today's not a Tesla day. I literally said it this morning. I'm like, today's not a day for Tesla. Like, we'll be lucky if it just holds on to 318 today. So, nobody's going to care about Tesla today. uh and you know after an AI boom like what we just had with earnings yesterday.
Uh so you get all that at me.com and you could probably write it off on your taxes. A lot of people do that. Business expense for education. All right. AI. Okay. So we talked about the super intelligence. We talked about ads. We talked about the glasses revenue up expenses up longer useful life. So they touched on that.
That has to do with depreciation. They talked about their scale AI investments. Accelerated impressions growth price per ad up 9%. This I thought was very interesting. Actually increasing the cost of advertising at Meta right now. They say that's because businesses are able to get a greater AI uh benefit.
Maybe that's true for right now and conversions. So again, everything's good until you know you get higher layoffs. Biggest investment will be servers going forward. Okay, this is a big deal because Meta spent a lot of money on uh like data centers or larger buildings. Now they're spending more money on chips and servers.
Microsoft is doing the same, which means a lot of their future capex is going to be going into things that are going to depreciate faster. So, uh, the CEO at Microsoft allin, let it compound. We're focused on the revenue now. The cost will surely improve over time. This isish, but that's okay. Uh last year they spent about half of their capex money on servers and the other capex on more like infrastructure things.
Now they expect that to flip to a higher percentage of quote short lived assets going forward. Basically CPUs and GPUs which is great for Nvidia and AMD and Verive water cooling super micro computer for the racks. Like if you need a bunch of racks call up super micro computer. Yo I need a rack. Uh nice big rack.
Who doesn't like a big rack? Uh Microsoft talked a little bit about, you know, just this adoption even at like hospitals, doctors, Verizon for sales, Mercy Hospital had children born there. Uh well, it's a chain, but but anyway, weakness in the hiring sector scene on LinkedIn and their headcount didn't change either.
So, I think everything right now is really setting us up for this sort of continuation of this stock sort of like mooning basically uh until layoffs. The problem is once we start seeing layoffs, it's too late. People are going to deny it too. There will be a lot of denialism. And I think that's why there's some some reason to pay attention to what's going on with these job loss numbers uh in the challenger job cuts report because over time I think what what what you'll see is markets will start reacting to bad jobs data in time and margin compression of companies but people will just see it as an immediately a buy the dip because that's historically what's been great but once jobs really roll over we have major problems.
Good thing is we're not seeing that right now. And the good thing is JPAL is giving us good news. He's telling us basically, hey, no need to cut rates anytime soon. So, in other words, bullish for now based on Powell's heads up. We will know more. At 5:30 in the morning tomorrow, I'm going to be live.
So, make sure you are a member of the Alpha Report. We're going to be talking about it a lot uh in the alpha report and strategy for the day tomorrow. What to do, you know, what what I'm doing with buy sales. That's a big deal tomorrow. Uh and so, uh yeah, look forward look forward to seeing you there.
We'll see. And again, it's just a jobs report. So, you know, one report doesn't make a trend. Even if tomorrow's a really bad report, uh it doesn't make a trend. If tomorrow's a really gray report, technically it doesn't make a trend either, but it does kick the can down the road on on rate cuts a lot, but it's actually great for stocks.
So, if you want moon, if you want more Moon, uh you want a really good jobs report tomorrow. Okay. If I had to guess, like somebody put a gun to my head tomorrow. Uh Kevin's guess if Powell got the leak, which I think he did. Kevin's guess is 3.9% unemployment. You know, uh last was 4.1, estimate is 4.2.
That basically means no rate cuts this year and bullish for stocks. Check yourself before you rack yourself. Huh? All right. Well, that's that's one way to put it. Uh, anyh who. Yeah. All right. Go to me.com. Check it out. Use the coupon code. It expires tonight. No, sorry. Tomorrow's Friday. So, tomorrow nigh.
Comments 0