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Warm Up
- Politics Goes off the rails - Biden out (Failed)
- Huge Failure of tech - Crowdstrike getting skewered (Down ~ 30% since incident)
- Dangerous market - running on emotions

Market Update
- DJIA - FAILED - worst week in ages - massive losses as UNH fails to keep up (accounted for 500+ points of that big rally in July)
- Market broadened out finally - then the mega-caps started to come in and market was crushed -
- Tesla Earnings are out - other tech names too

Need a new CTP

Market Emotions
- Now that we  are in the throws of the election cycle - dangerous market
- Running on emotion - and you can see that we levels (round like futures markets @ES - 5,600 and @NQ 20,000 levels as battle lines)
- People will think that one or other candidate is good or bad and will invest accordingly (usually without facts)
- Biden dropping  out has interesting impact - Now we have one candidate that we really do not know actual policy and track record. Also unknown VP ...

Crowdstrike Glitch
- Anything on your end a problem?
- Some minor trading issues with Schwab for a minute on Friday
- Airlines - still seem to be having issues
- Bigger issues when relying on single company?
- Friday and over weekend MSFT said that they restored a majority of services
- Hackers are already taking advantage of situation and Crowdstike out with warnings  (some firms  may get phished into beleiving that there is a fix and it is actually a hack)

Delta Offers Apologies+
- CEO Ed Bastian offered Freq flyer miles to travelers that were stuck due to Crowdstrike "glitch"
- 800 flights were cancelled Sunday (22% of flights)
- The airline was offering flight attendants extra pay to pick up shifts
- WHO IS GOING TO PAY FOR THIS? (Crowdstike and passengers)

Tech - Wiz Walks
- $23 billion - they say NO THANKS
- Wiz - 4 year old start up that makes security tools to protect data centers
- May valuation was $12 billion
- Company wants to go the IPO route

Election
- Sooooo - thoughts on the Biden dropout? (Via letter and Social Media - is that weird?)
- Trump Trade fade?
- Vance tough on anything  foreign? (USA First)
- Anyone else aside from Harris?

Bank Earnings
- Looking back - not much to be upset about - so that is good
- Rate expectations are for September (Dec more likely)
- Yield curve has steepened (good for profit margin of banks)
- Fed continues to be dovish
- Trump expectations of reduced regulations?

More Earnings
- Google/Alphabet - Alphabet prelim Q2 $1.89 vs $1.84 FactSet Consensus; revs $84.74 bln vs $84.22 bln FactSet Consensus
--- Margin 32% vs 29& a year ago (Stock initially up then tuend lower on lower advert revenue  and other AI comments)
- Tesla Earnings - Tesla prelim Q2 $0.52 vs $0.61 FactSet Consensus; revs $25.5 bln vs $24.38 bln FactSet Consensus
-- Tesla prelim: GAAP gross margin of 18.0%, down 23 bps yr/yr
---- Tesla prelim: reiterates that in 2024, its vehicle growth rate may be notably lower than growth rate achieved in 2023 (Stock down 5%)
- Visa: Reports Q3 (Jun) earnings of $2.42 per share, excluding non-recurring items, in-line with the FactSet Consensus of $2.42; revenues rose 9.6% year/year to $8.9 bln vs the $8.92 bln FactSet Consensus. (Stock down 10%)

Warren
- Berkshire Hathaway trimmed its gigantic Bank of America holding for the first time in four and a half years following the bank's strong 2024 run.
- It marked the first time since the fourth quarter of 2019 that the Omaha-based conglomerate has reduced the stake
- In fairness, the stake became too large - and required extra reporting - this way they can keep their transactions a bit more quiet.
- Bank of America remains Berkshire's second largest equity position after Apple, holding 999 million shares with a market value of almost $43 billion.
- Berkshire is still Bank of America's largest shareholder with a 10.8% stake.

Homebuilders
- Continue to see interest
- DR Horton (Biggest out there crushes earnings expectations)
- Still goes vertical - ALL TIME HIGH
- Still a big divergence with NEW Home and EXISTING Home sales
- AMAZING  in higher interest rate environment - but pricing better that existing and more interest

Meanwhile - Rates
- Yields bumped off the lower bound of the recent range (10Yr Yield)
- 4.27% - even though rate cut for September is supposedly near 100% probability
- Perhaps it is more about the state of US debt than the Fed?

NVDA
- Preparing updated version of AI chip for China
- Blackwell
- Nvidia will work with Inspur, one of its major distributor partners in China, on the launch and distribution of the chip which is tentatively named the "B20", two of the sources said. Shipments of the "B20" are planned to start in the second quarter of 2025
- The sources declined to be identified as Nvidia has yet to make a public announcement.
- China accounted for around 17% of Nvidia's revenue in the year to end-January in the wake of U.S. sanctions, sliding from 26% two years earlier.
-- Of course news is out after chips correct due to Biden
---- So we put governor on the chip? Can't they just figure out what

Micky Dees DEFLATION
- McDonald’s will extend its $5 value meal beyond its initial four-week window in most of its U.S. markets as the fast-food giant says the offer is driving traffic back to restaurants.
- McDonald’s is extending the promotion as rivals such as Burger King and Starbucks offer deals to entice diners and boost traffic.
- The deal: It includes a McChicken or McDouble, four-piece chicken nuggets, fries and a drink.

China- Eco Slump
- China surprised markets by cutting major short and long-term interest rates on Monday, its first such broad move since August last year, signalling intent to boost growth in the world's second-largest economy just days after a Communist Party leadership meeting.
- The cuts to the central bank's key short-term policy rate, its market operations rates and benchmark bank lending rates came after China reported weaker-than-expected second-quarter economic data last week and its top leaders met for a plenum that occurs roughly every five years.
- Market was not impressed
- Trying to get ahead of Trump wrecking ball?

Tricky
- General Motors BEATS revenue expectations ny a wide margin (~$2Billion)
- Stock up nicely pre-marketss
- Company takes a victory lap
- BUT - General Motors discloses it recorded charges before noncontrolling interest of $122 million
- Stock down 6% on the day
- Lesson - Headlines are often misleading - do not invest on headlines

UPDATE
- CrowdStrike software update contributed to Google's M&A talks with Wiz falling apart, according to Bloomberg

UH OH
- Car loan delinquency rates are soaring
- According to Cox Automotive, the volume of repossessed vehicles at Manheim auctions, the largest wholesale marketplace, is up 23% year over year through the first half of 2024.
- They are also up 14% compared with the same period in 2019, according to the data.
- Credit card delinquency on the rise as well
- Consumers are struggling - markets do not care...

Do we want to talk about the Trump vs. Harris Trade?

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