QQQNasdaqNeutralNasdaqAMZNAmazonBearishAmazonGOOGAlphabetBearishAlphabetGOOGLAlphabetBearishAlphabetMETABearish

Yesterday on

Big Tech turned the best businesses on the planet into a game of capex chicken. They went from cash machines with pristine balance sheets to "my capital spending is bigger than your capital spending," and none of them could slow down without losing the race to the others. That was my warning back in February, and they've been driving the car into the wall together ever since: Free cash flow has turned NEGATIVE at Amazon, Alphabet and Meta, and they're paying for the race with debt and new stock. The 4 biggest spenders still poured $202 BILLION into capex last quarter, more than double what they spent a year ago. Last week, the Mag 7 lost more than $1 TRILLION in a single session, and the Nasdaq had its worst day in 18 months. NONE of this should come as a surprise to you.

ORCLOracleBearishOracle

Yesterday on

The bond market told you to get out of Oracle 11 months ago. Last December, Oracle's stock had already given back its entire AI pop, and the cost of insuring its debt was climbing because it needed to borrow $38B for its data centers. That's when we shorted it at $189.97. Since then the stock is down 39%, and the cost of insuring Oracle's debt has more than doubled. In July, S&P cut Oracle to one notch above JUNK. Watch the CDS, the price of insuring a company's debt against default, because the bond market figures it out before the stock market does.

BTCBitcoinBearishBitcoin

Yesterday on

You didn't have to be clever this year. Back in March the plan was simple: Stay away from expensive US tech and stay away from US bonds, and let everyone else pay up for American exceptionalism. Since then the 10-year yield broke above its 2007 high. CoreWeave is down 57% and Oracle is down 39% from where we shorted them, and Tesla is down 26% from our $485 short. The speculative junk is getting wiped out too. American Bitcoin fell 93% before we closed our short. Valuation doesn't matter in the short run, right up until it's the only thing that matters...

NVDANVIDIABearishNVIDIA

2d ago on

From my friend Mr. X: As Anthropic apparently starts their road show, which I would call “We Work Part Deux.”  Remember, as I said before, We Work cut their valuation 3x, still couldn’t get it done, and then eventually ended up bankrupt.  And in my view, We Work and Adam Neumann had better governance and were a better deal, for a variety of reasons.  And that was before everything started coming undone and prior to policy heading in the wrong direction and prior to the head of the central bank of NVDA, who is also financing them, was caught canoodling with a Chinese spy.   This is why it does not work.  This is not .COM or railroads.  The $ are being spend on an incredibly dis-economic technology that will decay as opposed to sticking around.  This is rapidly depreciating immature broken software and compute that is the equivalent of UNIX, SPARC, and VAX or a Mainframe.    Then, the more they are spending, the less they are getting.  It is sort of like the impact of every incremental dollar of debt on GDP, very diminishing marginal returns.  There is no scaling.  If the underlying technology does the opposite of scaling, the business cannot scale.    Said simply, cost per unit is going way up (Anthropic’s S-1 tells you this too), revenue per unit is plummeting.  See this tweet and subtweet:  [https://t.co/so9bckPjEe]   More on Jensen the China lobbyist:  https://t.co/Ud2NHD6wg4 [https://t.co/Kr3PzWnl4U]   ICYMI re my last:  https://t.co/TMBitL1EQc   https://t.co/Fss7WgbNXj $NVDA @JG_Nuke @DougKass @edzitron @MacrostrategyP @GaryMarcus

QQQNasdaqBearishNasdaq

2d ago on

More than $10B poured into Nasdaq 100 and semiconductor ETFs in a single week, right into a falling tech market. If you're a bull, that's the LAST thing you want to see. Bottoms form when people finally give up, and this crowd is still buying every dip with both hands. Now add the calendar: it's November, and a fund manager who's behind for the year isn't going to stand up and take more risk, so every leg down invites MORE selling. And for the AI names, it gets worse… Their stock price is their cost of capital, and it's rising at the exact moment they need more money. Tech is in a bear market, and in a bear market you're either short or flat. We positioned for this early, and we're keeping our foot on the gas.