Nvidia is the leading vendor to the artificial intelligence hyperscalers. It has capitalized on its technological lead in graphics processing hardware. Its GPUs have become the dominant brute-force engine for AI training in the cloud. Nvidia’s growth and profit margins have

Apple has been late to the AI party and in my firm's view represents another asset bubble in the IT sector at risk of unwinding. Other than the Apple Watch and Airpods, the company has not successfully introduced many new products to the market in recent years. Its virtual

In my career, I have experienced firsthand how capex cycles can drive booms and busts. Unsustainable capital expenditure trends in the broad technology and communications sectors are an economic warning signal today. The chart below shows how the capex cycle drove the boom and

The four leading capex spenders today, Amazon, Microsoft, Alphabet, and Meta have been dubbed the hyperscalers for their massive data centers and cloud computing businesses that can scale up and down based on customer demand including demand for AI training and inference

Tech hyperscaling is not a new phenomenon. For comparison to today’s hyperscalers, we want to look at the four leading capex spending companies during the late 1990s Internet boom. Our Bloomberg research confirms those to have been AT&T, SBC Communications, Worldcom, and Qwest.

Nvidia is the leading vendor to today’s hyperscalers, but who were the high-end equipment dealers of Y2K that could be considered its analogs? Based on our Bloomberg research, Cisco Systems, Sun Microsystems, and Lucent Technologies were three of the top vendors at the time.

While understanding the capex cycle can be helpful for warning when it could be late in the game for a particular sector or industry, it can also be useful for identifying when it might be early. “Bull markets are born on pessimism, grow on skepticism, mature on optimism, and

There is an interesting divergence among different measures of long-term inflation expectations: 1. According to the recent University of Michigan Consumer Survey data, the average US consumer believes that inflation will be 6.1% over the next five to ten years. 2. The

Commodity equity bull markets can sometimes begin simultaneously with large-cap growth and technology stock busts. This happened before in the Nifty Fifty bust in 1973-74 and in the early 2000s. The chart below from Bank of America shows how an equity bull market in energy,

We believe the Great Rotation is still to come. August showed some new signs of life on that front as megacap tech stocks came under significant pressure early in the month and then mining stocks outperformed the Magnificent 7 Index for the full month. We don’t know for sure

Venture capital is likely in the typical "return to normal" phase.

Meanwhile: The Baltic Dry Index is inflecting higher again, much like it did during the initial wave of inflation following the COVID-19 lockdowns. For those who may not know, this index reflects the average cost of transporting dry bulk goods, including coal, iron ore, and

It’s fascinating to see the recent declines in equity markets alongside the weakening of the US dollar against other fiat currencies — an exceptionally unusual combination, to say the least. This behavior reminds me of the fragility in Treasury markets during the COVID

The Australian dollar has just had its first candle above a significant resistance level, likely signaling the start of a new upward trend. To be clear, this isn't the kind of movement you typically see in a deflationary environment.

The 2 vs. 10-year yield spread turning positive this week is likely one of the most critical macro events we are experiencing. Historically, these "un-inversions" tend to happen abruptly, and the current situation has been no different. These types of macro setups occur only

If precious metals companies were a sector, they would have the highest cash flow margins in the S&P 500 index today.

This is the annual gold production of the world's second-largest precious metals miner.   The lowest level in more than 20 years, according to its most recent report.   From this perspective, today’s environment closely resembles the 1970s.   Back then, major miners shifted

Investors are currently holding one of the lowest long positions in WTI contracts in the last ten years. I’m comfortable taking a contrarian stance on this. The possibility of inflation resurfacing remains one of the most overlooked views in the market today.

What an important week for gold miners, now positioned in what I believe to be an incredibly compelling technical setup.

Metal prices have been notably outperforming oil in the last three years.   This creates an ideal macro environment for mining companies, especially those engaged in open-pit projects, which heavily rely on energy prices to enhance their profitability.   Mining companies are