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Warm-Up
- WORST DAY EVER for SILVER
- Cold Snap in Florida - Massive Critter Drop
- New Fed Chair named
- Pausing on space

Markets
- Bitcoin plunges - Crypto "winter"
- Deep dive into January economic results
- USD rises from multi-month low - EM still powered ahead
- ELON - PT Barnum move

Cold Snap
- On February 1, 2026, Florida faced a significant drop in temperatures, reaching a record low of 24°F (-4°C) in Orlando. This marked the lowest temperature recorded in February since 1923.
- Iguanas dropping from tress all over the streets
- Iguanas can survive temperatures down to the mid-40s Fahrenheit (around 7°C) by entering a "cold-stunned" state, where they appear dead but are just temporarily paralyzed and immobile; however, prolonged exposure to temperatures in the 30s and 40s, especially below freezing, can be lethal, particularly for smaller individuals, leading to tissue damage and organ failure.
- They get sluggish below 50°F (10°C) and fall from trees as they lose grip.
- The Florida Fish and Wildlife Conservation Commission (FWC) issued Executive Order 26-03 on Friday, allowing residents to collect and surrender cold-stunned green iguanas without a permit during an unprecedented cold weather event.

Right on Schedule
- Remember we talked about how the Nat Gas price was going to reverse, just as quickly as it spikeed?
- Nat gas down 25% today - down about 28% from recent high
- Still about 50% higher than it was before the spike.

THIS!
- Nvidia Corp. Chief Executive Officer Jensen Huang said the company’s proposed $100 billion investment in OpenAI  was “never a commitment” and that the company would consider any funding rounds “one at a time.”
- “It was never a commitment,” Huang told reporters in Taipei on Sunday. “They invited us to invest up to $100 billion and of course, we were, we were very happy and honored that they invited us, but we will invest one step at a time.”

Then
Oracle announced that it will do a fundraiser in the form of equity and debt - needs to fund more datacenter build-out.
- What happened to the OpenAI $300 Billion committment?
- Or is the money that NVDA "committed to OpenAi, that they must have committed to Orcle, not a committment
- GIGANTIC CIRCLE JERK

Fungus - -Interesting
- Did you know? Botrytis cinerea, a fungus causing grey mold, affects grapes by causing bunch rot, ruining fruit in high humidity.
- While it often destroys crops, specific dry, warm conditions can transform it into "noble rot," concentrating sugars and creating high-value dessert wines (e.g., Sauternes, Tokaji) with honeyed, raisin-like, and apricot flavors.

January Economic Review

Employment
— Job growth was nearly flat in December, with 50,000 new jobs added and earlier months revised lower.
— Unemployment dipped slightly to 4.4%, but it's still higher than it was a year ago.
— Long-term unemployment didn’t change and remains high, and the labor force participation rate slipped to 62.4%.
— Average hourly earnings rose 0.3% in December and are up 3.8% over the past year.
— Weekly jobless claims stayed close to last year’s levels, showing a labor market that is cooling but not weakening sharply.

FOMC / Interest Rates
— The Federal Reserve kept interest rates unchanged at 3.50%–3.75%.
— Most policymakers agreed the economy continues to grow at a solid pace, though job gains are slowing and inflation remains above target.
— Two committee members supported a small rate cut, but the majority preferred to wait.
- Fed Chair Powell: Clearly, a weakening labor market calls for cutting. A stronger labor market says that rates are in a good place. It isn't anyone's base case right now that the next move will be a rate hike.
- The economy has once again surprised us with its strength. Consumer spending numbers overall are good, and it looks like growth overall is on a solid footing.
- Upside risks to inflation and downside risks to employment have diminished, but hard to say they are fully in balance. We think our policy is in a good place.
- Overall, it's a stronger forecast since the Fed's last meeting. Haven't made any decisions about future meetings, but the economy is growing at a solid pace, the unemployment rate is broadly stable and inflation remains somewhat elevated, so we will be looking to our goal variables and letting the data light the way for us.
- Most of the overrun in goods prices is from tariffs. We think tariffs are likely to move through, and be a one-time price increase.
- Dissent: Miran and Waller (Miran is a admin shill and Waller wanted job as Fed Chair)

GDP & Federal Budget
— Economic growth remained strong in Q3 2025, with GDP rising at an annualized 4.4% driven by strong spending, higher exports, and reduced imports due to tariffs.
— Investment was mixed, with business spending increasing while housing activity declined.
— The federal deficit for December rose to $145 billion, though the fiscal year-to-date deficit is slightly smaller than last year.

Inflation & Consumer Spending
— Personal income and consumer spending rose moderately in October and November.
— Inflation, measured by the PCE index, increased 0.2% in both months and roughly 2.7% year-over-year.
— The Consumer Price Index rose 0.3% in December, with shelter, food, and energy all contributing.
— Producer prices also increased, though 2025 producer inflation slowed compared to 2024.

Housing
— Existing home sales rose in December, but the number of homes for sale is still low.
— Prices dipped a bit from November but remain higher than they were a year ago.
— New-home sales in October were steady compared with the prior month but much higher than last year.
— New-home prices fell compared to 2024, though they are still high relative to long-term norms.

Manufacturing
— Industrial production rose 0.4% in December and was up 2.0% for the year.
— Manufacturing output increased, while mining activity declined and utility output jumped.
— Durable goods orders grew sharply in November, driven by a big increase in transportation equipment, pointing to strong demand in key industries.

Imports & Exports
— Import and export prices rose slightly through November 2025.
— The goods trade deficit widened in November because exports fell while imports increased.
— For the year so far, both exports and imports are running above 2024 levels, though the overall trade deficit remains larger.

Consumer Confidence
— Consumer confidence fell sharply in January after improving in December.
— Both views of current conditions and expectations for the future weakened, with expectations dropping well below the level that often signals recession risk.

Earnings

— Roughly one-third of S&P 500 companies have reported Q4 earnings, and overall results are strong.
— 75% of companies have beaten EPS estimates, though this is slightly below long-term averages. Revenue beats remain solid at 65%.
— Companies are reporting earnings 9.1% above estimates, which is well above the 5-and 10-year surprise averages.
— The S&P 500 is on track for 11.9% year-over-year earnings growth, marking the 5th straight quarter of double-digit earnings growth.
— Eight of eleven sectors are showing positive year-over-year earnings growth, led by Information Technology, Industrials, and Communication Services.
— The Health Care sector shows the largest earnings declines among lagging categories.
— The forward 12-month P/E ratio sits at ~22.2, elevated relative to 5-and 10-year averages, signaling continued optimism despite tariff and cost concerns.
— FactSet also notes the S&P 500 is reporting a record-high net profit margin of 13.2%, the highest since 2009.

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S3XY No More
- Tesla is ending production of the Model S sedan and Model X crossover by the end of Q2 2026 to focus on autonomous technology and humanoid robots (Optimus).
- Do we have any idea with the TAM for either of these are?
- Huge assumptions that Robotaxi will be a bug part of the global transportation. But, what if it isn't?
- Unproven being built, taking out the proven - investors were not too happy about this...Stock was down after earnings showed continued sluggish EV sales and BIG Capex for Robotaxi refit, robots and chip manufacturing.

But...
- Friday - not to allow TESLA stock to move down tooo much.
- With SpaceEx looking for an IPO in June - valuations have moved from $800B to 1.5T supposedly.
- Now there is discussion of merging in xAI and possibly Tesla
- Tesla shares dropped after earnings

FED CHAIR PICK
- Drumroll: Kevin Warsh
- Seems like a good pick from the aspect of experience and ability
- Deficit reducer?
- More hawkish than market expected?
- Announce Friday after several leaks in the morning

And then...
- Silver futures plummeted 31.4% to settle at $78.53, marking its worst day since March 1980.
-It was down 35% during the day - the worst daily plunge ever on record.
- It was the worst decline since the March 1980 Hunt Brothers crash.
- The sharp moves down were initially triggered by reports of Warsh’s nomination.
- However, they gained steam in afternoon U.S. trading as investors who piled into the metals raced to book profits.- USD Spiked higher - Gold was down 10%
- GOLD saw a drop of 10% to the close - 12% intraday - this was also a record
- Bitcoin is down 25% from its recent level 2 weeks ago
- ALL BEING BLAMED ON THE FED CHAIR PICK
-- QUESTION - Will Trump back-peddle this OR talk to supporters in congress or tell them not to confirm him if markets continue to act squirrely?

Fed Statement and Rates
- Fed out with statement - no change on rates
- Changes: Inflation up, employment steady, economy strong
- Does not bode for much in the way of cuts - probably on hold though end of Powell term

Apple Earnings
- Apple reported blowout first-quarter earnings on Thursday, and predicted growth of as much as 16% in the current quarter, matching the period that just ended.
- Sales could be even better, Apple said, if the company just secure enough chips to meet its customers’ iPhone demands.
- The company reported $42.1 billion in net income, or $2.84 per share, versus $36.33 billion, or $2.40 per share, in the year-ago period.
- Apple saw particularly strong results in China, including Taiwan and Hong Kong. Sales in the region surged 38% during the quarter to $25.53 billion.
- “The constraints that we have are driven by the availability of the advanced nodes that our SoCs are produced on, and at this time, we’re seeing less flexibility in supply chain than normal,” Apple CEO Tim Cook said.
- Stock up slightly - no great moves....

Blue Origin
- Blue Origin will pause tourist flights to space for “no less than two years” to prioritize development of its moon lander and other lunar technologies.
- The decision reflects Blue Origin’s commitment to the nation’s goal of returning to the Moon and establishing a permanent, sustained lunar presence.
- The pause in tourist flights grounds the company’s reusable New Shepard rocket, which has sent more than 90 people to the edge of space and back to experience brief periods of weightlessness.
- Datacenters on the Moon? (sounds like a Pink Floyd album)

 

 

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