Boockvar on GDP, Income/Spending/Savings

Avatar photo Doug Kass on October 29, 2026

The following is from Peter Boockvar:

Quick rundown on GDP, income/spending/savings rate & claims

Q3 GDP rose at a 3.4% q/o/q annualized rate, just above the estimate of 3.2% but was notably helped out by the price deflator which rose 2.3% instead of 3.2% as estimated. So, if it came in as forecasted, real GDP would have risen by 2.5% instead.

Personal consumption added 252 bps to GDP with another notable contribution from healthcare spending which added 56 bps of that with overall services contributing 189 bps to growth. Spending on food service/accomodations and housing/utilities were the other large adds to personal consumption. Spending on durable goods added 17 bps while nondurables added 47.

Not surprisingly, AI spend was a nice boost to growth. Adding up ‘info processing’, ‘industrial equipment’, ‘software’, and ‘R&D’ together, that contributed about 150 bps to growth. On the soft side, residential construction was a continued drag, not surprisingly.

A sharp rise in inventories was also a help to the headline figure, adding 161 bps to GDP while trade was a detractor of 332 bps because of AI as imports (much of which is tech) took away 264 bps.

Government spending added 90 bps to GDP with it all federal as state/local was flat in terms of contribution.

Bottom line, on a y/o/y basis, GDP growth was up 2.1% vs 2.2% in Q2 and 2.6% in Q1 and averaging 2.7% in the first three quarters of the year vs 2% in 2025. We know though the narrow but very large contributors to this.

The September PCE inflation stats were spot on as expected, rising .5% headline m/o/m and .3% core with 3.6% and 3.1% y/o/y increases. With CPI and PPI already on the board, these figures usually come in as estimated.

Income and spending figures were also as expected but because spending continues to exceed income, the savings rate fell to 3.8% from 4% and to the lowest since July 2008 not including the post Covid decline into 2022. Part of this decline is the rising wealth of those that own assets that feel less need to save from income and part is reflecting those living paycheck to paycheck.

Initial jobless claims remained very low at 194k vs 195k in the week before and that was 4k less than expected. The 4 week average slips to 197k from 198k. Continuing claims were low too at 1.701mm vs 1.722mm in the week before and about 200k under the 2025 trend.

Again, as measured here and not including those that lose their job and don’t file claims because they take a gig worker job and/or receive severance, the pace of fires is low.

Gold Buy

Avatar photo Doug Kass on October 29, 2026

I bought very small $GLD in premarket trading:


Dougie Kass

1h ago

very very small long in premarket

GLD  $368.76

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long gld vs

Very Strong Verano Results Announced

Avatar photo Doug Kass on October 29, 2026

As noted in my Diary I have begun to repurchase $VRNO -from yesterday:

Things I Did Today

Here are today’s things:

* I added to my SPY at $771.44 and QQQ at $728.34 shorts. 

* I added to MSOX at $1.86, VRNO at $5.06 and GLAS at $2.23. 

Position: Long MSOX (S), VRNO (VS), GLAS (S); Short SPY (M), QQQ (VS)

BY Doug Kass · Oct 28, 2026, 2:23 PM EDT

Positions: Long VRNO VS MSOX S MSOS common VL calls VS GLAS S

From The Street of Dreams 

Avatar photo Doug Kass on October 29, 2026

$CVNA: Morgan Stanley analyst Andrew Percoco is moving Carvana to the analyst’s Top Pick following a “strong” Q3 print, telling investors that the decision to move the stock to Top Pick is “driven less by near-term estimate revisions and more by increased conviction in the model’s ability to compound profits through macro volatility.” The firm maintains an $88 price target and Overweight rating on Carvana shares.

CVNA:UBS raised the firm’s price target on Carvana to $84 from $83 and keeps a Buy rating on the shares.

CVNA: Needham lowered the firm’s price target on Carvana to $100 from $120 and keeps a Buy rating on the shares. Following the company’s Q3 results, the stock continues to screen as a compelling large-cap growth story, trading at an untaxing multiple against durable share gains driving unit and earnings growth ,though the firm’s reduced price target reflects a lower assumed earnings multiple due to higher prevailing interest rates, the analyst tells investors in a research note.

CVNA:BTIG lowered the firm’s price target on Carvana to $82 from $87 and keeps a Buy rating on the shares. The company reported a sound beat across all major metrics, but expenses were a bit heavier than expected across vehicle operations, overhead, and advertising, leading to a modest adjusted EBITDA beat of $800M vs. $791M expected, the analyst tells investors in a research note.

CVNA:BofA analyst Michael McGovern raised the firm’s price target on Carvana to $72 from $70 and keeps a Neutral rating on the shares. Carvana is executing well in a mixed macro backdrop, with improving reconditioning efficiency making up for the margin headwinds around financing and ad spend growth, the analyst tells investors in a post-earnings note.

$GOOGL: Morgan Stanley analyst Brian Nowak lowered the firm’s price target on Alphabet to $375 from $400 and keeps an Overweight rating on the shares. Alphabet is “not an expensive stock,” but Search innovation and faster growth are key to ar re-rating, the analyst tells investors in a post-earnings note. 

GOOGL: Cantor Fitzgerald analyst Deepak Mathivanan lowered the firm’s price target on Alphabet to $350 from $420 and keeps an Overweight rating on the shares. Alphabet’s Q3 results missed key metrics, with EBIT 7% below estimates and Search growth slowing, driving a 10% after-hours share decline, but Cloud growth above 100%, record Search queries, strong TPU demand and continued Gemini innovation support its AI positioning and long-term upside, the analyst tells investors in a research note.The firm recommends buying shares on weakness.

GOOGL: Goldman Sachs analyst Eric Sheridan lowered the firm’s price target on Alphabet to $385 from $435 and keeps a Buy rating on the shares. Alphabet’s Q3 Search revenue missed expectations amid FX and tougher comparisons, while Cloud growth of 103% and a $561B backlog underscored strong demand constrained by compute capacity, the analyst tells investors in a research note. Agentic AI offers new growth opportunities but sharply rising capex of $203B in 2026 and an estimated $350B in 2027 pressures free cash flow, the firm says. 

GOOGL: UBS lowered the firm’s price target on Alphabet to $332 from $380 and keeps a Neutral rating on the shares. Google missed Search and YouTube estimates, signaled more measured AI monetization, and saw Cloud margins stagnate despite rising TPU sales, raising concerns that over $100B in TPU revenue in 2027 could pressure EPS and free cash flow expectations, the analyst tells investors in a research note.

GOOGL: JPMorgan analyst Doug Anmuth lowered the firm’s price target on Alphabet (GOOG) to $375 from $425 and keeps an Overweight rating on the shares. The stock’s post-earnings selloff shows the margin for error when a hyperscaler spending hundreds of billions on the AI infrastructure buildout and flipping to negative free cash flow posts disappointing results, the analyst tells investors in a research note. JPMorgan points out that Google faced a tough search compare in Q3 and that management indicated currency was the single largest driver of the deceleration. The firm believes Google’s search headwinds “are more navigable than permanently structural.”

GOOGL: BofA analyst Justin Post lowered the firm’s price target on Alphabet to $380 from $430 and keeps a Buy rating on the shares after a Q3 revenue and EPS miss. Following the report, the firm raised its 2027 revenue estimate for the Cloud beat, additional TPU sales in its model and client facing SpaceX capacity additions in Q4, offset by lower Search, YouTube and subscription estimates. For 2027, BofA raised net revenue by 11% to $616B and lowered its EPS view by 1% to $14.87.

Note: I have previously sold my CVNA puts (for  a nice profit)  

Positions: Short CVNA VVS

NOW Down, EBAY Up: Upside, Downside Movers in the Morning

Avatar photo Doug Kass on October 29, 2026

Upside

– $GKOS +16% (record Q3 sales and a large FY revenue-guidance raise topped expectations)

– $INSM +14% (BRINSUPRI revenue grew 29% sequentially and guidance was raised for both BRINSUPRI and ARIKAYCE)

– $NCLH +12% (Q3 results topped guidance and the FY EBITDA and EPS outlooks were raised)

– $CVNA +8.4% (large Q3 revenue beat and accelerating retail-unit growth outweighed an EPS miss)

– $CMG +8.3% (Q3 comparable sales beat expectations despite a modest profit miss)

– $DASH +6.9% (record GOV, revenue and net income alongside an agreed $17B acquisition of CART)

– $LITE +6.9% (MRVL is reportedly in advanced acquisition talks, with a deal potentially announced next week)

– $EBAY +6.1% (Q3 revenue and GMV growth accelerated, reinforcing improving marketplace momentum)

– $HII +5.6% (record Q3 revenue, $32.4B of contract awards and higher FY shipbuilding-revenue guidance)

– $LLY +5.1% (annual revenue guidance topped expectations)

– $NVS +3.2% (2026 core operating-income guidance was raised despite a drug-trial write-down)

– $RCL +3.5%, CCL +3.0% (cruise names rise after NCLH beat and raised its FY outlook)

– $MSFT +1.1% (strong cash flow and cloud guidance signaled better returns from heavy AI investment)

Downside

– FTNT -27% (headline beat and raised guidance failed to offset sharply slowing product growth and concerns the refresh cycle is fading)

– NOW -19% (strong topline results were overshadowed by softer forward cRPO expectations and unfavorable renewal phasing)

– HLN -14% (Q3 organic sales missed and FY organic-growth guidance was cut to around 2.5%)

– OSK -13% (quarter missed and FY revenue and EPS guidance were cut as fire-truck production problems persisted)

– MRVL -12% (reported talks to acquire LITE sparked concerns over deal cost and execution risk)

– $CAT -11% (quarter beat, but the margin outlook and durability of AI-infrastructure demand fell short of elevated expectations)

– $GOOGL -11% (Q3 profit and revenue missed as softer search advertising and surging AI spending intensified cash-burn concerns)

– $EGO -10% (2026 gold-production guidance was cut and cost outlooks were raised amid a slower Skouries ramp)

– $CTSH -10% (Q3 beat, but the FY revenue-growth outlook narrowed and Q4 growth guidance disappointed)

– $SCI -8.9% (Q3 earnings missed and guidance was cut)

– $ZS -7.1%, $OKTA -7.5%, $PANW -6.8%, $RBRK -6.8%, $CRWD -6.8%, $SAIL -8.0% (cybersecurity names fall on FTNT’s product-growth slowdown and refresh-cycle concerns)

– $NBIS -6.7%, $CRWV -6.4%, $STRL -6.6% (AI-infrastructure names retreat as $GOOGL’s spending surge renews concerns about monetization and cash returns)

– $HUBS -6.5%, $TEAM -6.9%, $CRM -5.8%, $TYL -5.8%, $WDAY -6.1% (enterprise-software names weaken after NOW’s forward cRPO and renewal outlook disappointed)

Understanding My Trading Moves

Avatar photo Doug Kass on October 29, 2026

The following posts (in case you left early on Wednesday!) helps to explain why I got shorter (on strength yesterday) — remember I covered my index shorts on the whoosh lower at around 11 p.m. last night to take a quick profit!

PPS

Bookings shrunk and backlog did not grow!

The after-market move in Microsoft ($MSFT) reminds me of the up move Meta ($META) had based on the print and earnings per share, before the market figured out the internals — and then hammered the stock.

Obviously Google ($GOOGL) wet the bed too:

https://www.zerohedge.com/markets/msft-rises-azure-beat-bookings-shrink-and-backlog-stalls

Position: None

BY Doug Kass · Oct 28, 2026, 4:55 PM EDT

Market Postscript

* Here are my thoughts following the plethora of EPS releases after the close…

With Google’s ($GOOGL) miss (the deceleration in its core business was unanticipated by every panelist on “the show”), Meta’s ($META) continued awful share price action, Nvidia’s ($NVDA) price rollover threatening chart support, Amazon’s ($AMZN) lackluster share price action (and underperformance) and some possible toppiness in Apple’s ($AAPL) share price, we are left with one… Microsoft ($MSFT).

Meanwhile, ServiceNow’s ($NOW) disappointing results (the company cut subscription revenues for the full year) will likely weigh heavily on software stocks (which were market leaders) tomorrow morning.

I remain independent in view.

As I said in response to subscriber jryan, most stocks do not meet my standards to buy and I won’t change my process or discipline — even if Perma Bulls Tom Lee and Dan Ives (confidently) see clear skies ahead…

The S&P Short Range Oscillator registered 1.84% (more overbought than the prior day) and I ended the day with a large short position in SPY

.

Position: Short SPY (L)

BY Doug Kass · Oct 28, 2026, 4:51 PM EDT

Now Large-Sized on SPY Short

I have moved to large-sized SPY short at $774.19.

Position: Short SPY (L)

BY Doug Kass · Oct 28, 2026, 4:11 PM EDT

Adding to Shorts

Bonds down, crude oil up.

I am adding to shorts.

Position: Short SPY (M)

BY Doug Kass · Oct 28, 2026, 12:00 PM EDT

Positions: None