Why I’m Eyeing Prices, Biotech and AI in Q3
As the second quarter skims some froth off the technology trade, let’s see why these three areas are key to watch in Q3.
Google In, Verizon Out, Nike Next?: 8 Key Items Shaping the Stock Market Monday
South Korea goes big on AI and chips, Comcast splits, Warsh on deck, and other headlines moving stocks this morning.
So Far, So Good
Last week we took a contrarian view on the Mag 7 by purchasing shares of Microsoft ($MSFT), Alphabet ($GOOGL) and Amazon ($AMZN).
So far that has worked out well as there is renewed interest in the hyperscalers and developing weakness in the previous leadership (memory and semis).
I expect that rotation to continue in the summer and I would consider adding to the above three stocks on lower prices.
Position: Long MSFT (VS), GOOGL (S), AMZN (S)
30 Signals Across the Portfolio’s 10 Themes and Strategies
Let’s scan through the headlines for the stories of the week that speak to our Pro Portfolio holdings.
Weekly Roundup: What We’re Watching as Markets Get Jiggy
We locked in massive gains on two positions and added to two beaten-down holdings.
Adding to Our Microsoft Position on Weakness
We’ll take advantage of the improved risk-to-reward tradeoff, and longer-term prospects.
VIDEO: Our Take on the Latest OpenAI IPO News
Let’s also follow up on our updated game plan for Palantir, and check in on Microsoft.
More Tales From Nvidia: ‘It’s Chinatown’ (Issue #209!)
‘Forget it, Jake. It’s Chinatown’
– Chinatown Forget it Jake, it’s Chinatown.
As more biz moves to China, the core problem is they all have no business model. To grow, they have to give it away. That requires infinite financing, which does not exist, even for money-making businesses. Nobody should really finance anything with these economics, which are price-to-profit, too expensive for anyone to use it (it becomes more expensive than human labor), price-to-grow, it loses $1 for every $1 of revenue. This is a pure commodity industry. Business is moving to lower-cost Chinese models for a reason. Some 98%-99% as good at 2% of the price. The low-cost player in a commodity industry wins. This industry is the definition of commodity. Highly undifferentiated, all about capital. Even Microsoft ($MSFT) is thinking of using the Chinese (Deepseek) now for Copilot. MSFT sees the writing on the wall. See tweet and subtweet. The first part about Anthropic begging the government for money comes from a credible source:
This was forwarded to me by Jim Chanos:
If you haven’t seen it yet, this graphic from Artificial Analysis (via JP Morgan) has gone viral overnight. It highlights the cost-benefits of the cheaper (primarily) Chinese open-source models for inference tasks. OpenAI may already be feeling this pressure. And if normal tech-deflation hits token prices…will hardware/AI infrastructure be next?
Position: MSFT VS
‘Soft Sale
I sold some MSFT ($MSFT) (+$16) $368.85
Position: Long MSFT VS