Investing for Survival

Thursday morning setup: Futures are higher led by Tech as NVDA earnings boost the tape. As of 8:00am ET, S&P futures are 0.5% higher while Nasdaq futures jump 1.1% led by NVDA which is +7.4% in pre-market trading following an unprecedented forecast of 70% revenue growth in 2028, which is boosting Semis (+3%), incl MRVL +5.2% into their print tonight. NVDA helped the market climb a significant wall of worry and is not poised to resume it march higher. Memory is +3.6%, Software is +2.3%, Korea +2.1%, and Low/Unprofitable Tech +1.2% points to a broad-based Tech rally. Yet Only 2 of 7 Mag7 names are higher, NVDA and TSLA. Outside of Tech, most sectors are trading lower ex-Industrials / Utils which are benefiting from a reboot of the AI trade. Our Retail flows remain materially off their highs with behavior shifting from ETFs to single stocks; Mag7 / NVDA most bought, MRNA most sold with gold seeing strong inflows. Bond yields are +1-2bp with USD flat. Cmdtys are mostly lower dragged by Energy and Base Metals; Precious are mixed with gold flat and silver higher. Today’s macro data calendar includes July advance goods trade balance, weekly jobless claims and July inventories (8:30 a.m.) and August Kansas City Fed manufacturing activity (11 a.m.). Fed speaker slate includes Cleveland Fed’s Beth Hammack on CBNC at 10 a.m. and Fox Business at 1 p.m.

Fundamental

Headlines

The Economy

Weekly jobless claims totaled 203,000 versus estimates of 208,000.

International

July Chinese (YTD) YoY industrial profits rose 17.6% versus predictions of +16.0%.

The September German consumer confidence index came in at -26.6 versus consensus of -29.2.

Other

More detail on new home sales.

https://politicalcalculations.blogspot.com/2026/08/new-home-sales-and-prices-trending.html

More detail on yesterday’s statistical barrage.

https://bonddad.blogspot.com/2026/08/incomes-remain-recessionary-and.html

Iran

The latest (and probably equally unreliable) news.

https://www.bloomberg.com/news/articles/2026-08-26/iran-oman-agree-to-share-strait-of-hormuz-revenue-irgc-says?srnd=homepage-americas&sref=loFkkPMQ

Summary: Iran's military said it reached a revenue-sharing agreement with Oman on the Strait of Hormuz. The US is obstructing the process, causing progress to be delayed, according to the Islamic Revolutionary Guard Corps' spokesman Hossein Mohebbi. Iran has cautioned that a re-opening of the strait will take more than a deal with Oman.

But apparently the rate of passage through the Strait of Hormuz is increasing.

https://www.zerohedge.com/energy/kuwait-qatar-ramp-hormuz-oil-flows-oman-iran-talks-ease-supply-fears

Fiscal Policy

The sky doesn’t have to fall for the national debt to be a problem.

https://quoththeraven.substack.com/p/the-real-cost-of-40-trillion-in-debt?r=1ng8jx&utm_campaign=post-expanded-share&utm_medium=web

The Bessent bounce.

https://www.bloomberg.com/news/articles/2026-08-25/short-squeeze-in-us-swaps-options-shows-bessent-put-at-work?srnd=homepage-americas&sref=loFkkPMQ

Summary: Treasury Secretary Scott Bessent’s plan to expand bond buybacks has sparked debate about its effectiveness, but key market metrics show it’s having an impact. Since Bessent’s announcement, Treasuries have outperformed equivalent-maturity swaps, narrowing the 30-year spread between the two to the smallest since February. Benchmark US yields have drifted lower after initially see-sawing in the wake of the government’s plan to “at least double” its buybacks of longer-dated bonds.

Which keeps the pressure on Warsh.

https://www.nytimes.com/2026/08/26/business/kevin-warsh-federal-reserve-jackson.html?unlocked_article_code=1.8VA.S4VG.QUReXFW9drgy&smid=url-share

Inflation

Inflation remains elevated.

https://www.nytimes.com/2026/08/26/business/economy/inflation-pce.html?unlocked_article_code=1.8VA.c_0B.wWLuawG3OlyP&smid=url-share

Potential global food shock.

https://www.zerohedge.com/commodities/wheat-futs-surge-three-year-high-jpmorgan-hsbc-warn-global-food-shock-brewing

Tariffs

The metals’ lobby big steal.

https://www.wsj.com/opinion/u-s-canada-steel-aluminum-tariffs-8f7cabf1?st=KmN2ia&reflink=desktopwebshare_permalink

What the heck is ‘structural excess capacity’?

https://econbrowser.com/archives/2026/08/what-the-heck-is-structural-excess-capacity

The Financial System

Americans and their plastic.

https://wolfstreet.com/2026/08/25/credit-card-delinquencies-payment-volume-balances-debt-to-income-and-credit-limits-in-q2-2026-americans-and-their-plastic/

Investing

When Wall Street says Sell, see who is waiting to Buy.

https://quoththeraven.substack.com/p/when-wall-street-says-sell-check?r=1ng8jx&utm_campaign=post-expanded-share&utm_medium=web

The bull case.

https://www.ft.com/content/c96c25c1-b27c-4c08-a2ba-21821b39dd78?syn-25a6b1a6=1

Summary: But a rise in borrowing costs does not necessarily undermine equities if driven by an investment boom that is also lifting long-run productivity and earnings expectations. Indeed, equity markets are pricing future returns that reflect just that: stronger productivity, corporate earnings that can remain above historical norms and an economy capable of breaking out of its long-run growth trend. In effect, equity investors are making one of the biggest macroeconomic bets ever.

The case for TIPS.

https://www.wsj.com/finance/investing/are-inflation-fighting-bonds-on-sale-376ad05a?st=YZ1mth&reflink=desktopwebshare_permalink

News on Stocks in Our Portfolios

What I am reading today

While the focus of this article is on trading, the larger point is that true ‘learning’ isn’t easy.

https://traderfeed.blogspot.com/2026/08/what-is-best-way-to-learn-trading.html

CIA Director holds covert talks in Moscow.

https://www.zerohedge.com/geopolitical/us-air-force-c-17-makes-mysterious-visit-moscow

As a follow up.

https://www.zerohedge.com/energy/oil-extends-decline-rubio-rules-out-new-strikes-iran-oman-transit-deal-nears-finalization

Visit Investing for Survival’s website (http://investingforsurvival.com/home) to learn more about our Investment Strategy, Prices Disciplines and Subscriber Service.

Wednesday, August 26, 2026

The Morning Call---The off balance sheet time bomb

The Morning Call

8/26/26

The Market

Technical

Tuesday in the charts.

https://www.zerohedge.com/markets/bonds-stocks-bid-oil-skids-quiet-summer-tuesday-ahead-nvda?gift=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJuaWQiOiIxMTIyODA0Iiwic2VuZGVyVWlkIjoiUUhnc3BaZVVFS2E3RHhXM216eFlKbjhaWEFoMiIsImlhdCI6MTc4NzY4OTE3MiwiZXhwIjoxNzkwMjgxMTcyLCJhdWQiOiJ6aC1naWZ0In0.ckDilDmR5e02o7mmZGnddoWMQsK7uj8eauLgDQVK2pE

Tuesday in the technical stats.

https://www.barchart.com/stocks/momentum

https://www.barchart.com/stocks/market-performance

https://www.barchart.com/stocks/sectors/rankings

https://www.barchart.com/stocks/signals/new-recommendations

Credit is asking questions that equity has ignored.

https://www.zerohedge.com/markets/ai-story-not-dead-goldman-warns-range-outcomes-getting-wider?gift=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJuaWQiOiIxMTIyNzYwIiwic2VuZGVyVWlkIjoiUUhnc3BaZVVFS2E3RHhXM216eFlKbjhaWEFoMiIsImlhdCI6MTc4NzY4OTkyOSwiZXhwIjoxNzkwMjgxOTI5LCJhdWQiOiJ6aC1naWZ0In0.GKNlqxryveeDtkc6g39k7VzYHE2HJJteW-w3iWvUh1A

Wednesday morning setup: Stock futures are flat and Treasuries slipped while oil stumbled heading into today's PCE report and NVDA earnings. As of 8:00am ET, S&P Futures are unchanged and Nasdaq futures drop 0.2% as NVDA and MRVL both rise 0.2% with Semis flat, Memory down 80bp, Korea down 46bp, Software down 1.3%, but Unprofitable Tech +83bp which point to continued de-risking into NVDA / MRVL where expectations are positive, but a stronger print may mean more for the ecosystem than for the individual stocks. Elsewhere, both Cyclicals and Defensives are mixed with Healthcare standing out to the upside and Energy to the downside. Bond yields are +1-3bp as the curve bear flattens, giving back some of yesterday’s gains. Confirming out report from Monday about Bessent's plan, JPM reports this morning that "There is chatter of CTAs accelerating buying as 10Y yield approaches / breaches 4.60%." USD is higher, crude is lower on US / Iran deal optimism, but WTI may have support at $80/bbl until a deal is announced. Base Metals are stronger, precious metals are weaker, and Ags are mixed but net higher. Today’s macro data focus is on PCE where consensus expects a headline PCE +0.1% MoM / +3.6% YoY and Core PCE +0.3% MoM / +3.3% YoY. Nvidia reports earnings after the close.

Fundamental

Headlines

The Economy

Weekly mortgage applications declined 1.0% while purchase applications were down 2.0%.

Month to date retail chain store sales rose 9.1% versus +7.6% in the prior week.

The June Case Shiller home price index was up 0.4%, in line.

https://bonddad.blogspot.com/2026/08/yoy-repeat-home-sales-prices-continue.html

Q2 GDP (2^nd est) grew 1.5%, in line.

July personal income was up 0.4% versus predictions of +0.3%; July personal spending was up 0.2%, in line; July real personal spending was up 0.0% versus +0.2%.

July durable goods orders increased 1.1% versus consensus of +0.7%; ex transportation, they were up 0.4% versus +0.5%.

July PCE was up 0.2% versus projections of +0.1%; core PCE was up 0.2%, in line.

July new home sales fell 10.5% versus estimates of -1.3% while building permits were down 2.6% versus +5.0%.

https://mishtalk.com/economics/new-home-sales-decline-10-5-percent-housing-remains-stagnant/

The August consumer confidence index came in at 89.4 versus expectations of 90.2.

The August Richmond Fed manufacturing index was 4 versus forecasts of 7.

International

Other

Iran

Overnight news.

https://www.zerohedge.com/energy/oil-dumps-iran-oman-push-reopen-hormuz-satellite-image-show-gulf-producers-ramping

China’s ties with Iran are not as strong as many think.

https://www.bloomberg.com/news/articles/2026-08-25/how-china-is-caught-in-trump-bessent-s-push-for-economic-d-day-for-iran?srnd=homepage-americas&sref=loFkkPMQ

Summary: The relationship between China and Iran is far more lopsided and less strategic than commonly assumed. Beijing’s investment in Iran has fallen dramatically short of headline agreements, its military ties are limited and its broader Middle East strategy depends on balancing relations with Iran’s regional rivals. China is Iran’s dominant trade partner, but the relationship is asymmetric. China absorbs roughly a third of Iran’s trade, while the Islamic Republic accounts for less than 1% of commerce for the world’s second-largest economy, according to the Center for Strategic and International Studies. China’s official data show its foreign direct investment stock in Iran totaled $4.5 billion by the end of 2024, compared with $9.5 billion in the UAE. The American Enterprise Institute’s China Global Investment Tracker, which monitors transactions of at least $100 million since 2005, puts cumulative Chinese investment in Iran at about $4.7 billion, concentrated primarily in energy and metals. By contrast, it places Chinese investment in Saudi Arabia at about $16 billion across energy, technology, metals and entertainment. “Chinese companies have a very limited footprint in Iran relative to other countries in the region,” said Esfandyar Batmanghelidj, chief executive of the Bourse & Bazaar Foundation, a London think tank. “Major Chinese firms have steered clear of Iran due to secondary sanctions risks.”

Monetary Policy

Warsh’s Jackson Hole opportunity.

https://www.bloomberg.com/news/articles/2026-08-25/jackson-hole-offers-warsh-high-profile-slot-to-rebut-his-critics?srnd=homepage-americas

Summary: Kevin Warsh’s first major speech as chairman of the Federal Reserve is a test of his communications style, which has been criticized for not being forthright with his views on the economy. Warsh faces pressure from Wall Street to provide more transparency and communication on the Fed's policy moves, after a shaky press conference last month triggered a bond market rebuke. Warsh’s defenders argue that the market reaction to his July press conference was overdone, and that he is aiming to rein in explicit guidance on where policy is headed as part of a communications overhaul.

Fiscal Policy

Let the bond market speak.

https://www.wsj.com/opinion/let-the-bond-market-speak-81529d74?st=zM5wPC&reflink=desktopwebshare_permalink

The real $40 trillion debt crisis.

https://www.realclearmarkets.com/articles/2026/08/25/the_40_trillion_debt_isnt_the_crisis_the_40_trillion_debt_is_the_crisis_1201373.html

The Treasury raises the stakes in the battle to control interest rates.

https://www.capitalspectator.com/treasury-raises-the-stakes-in-a-battle-to-cap-long%e2%80%91term-yields/

The off balance sheet time bomb.

https://www.zerohedge.com/markets/balance-sheet-time-bomb-inside-ai-hits-31-trillion-13tn-three-months?gift=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJuaWQiOiIxMTIyODMyIiwic2VuZGVyVWlkIjoiUUhnc3BaZVVFS2E3RHhXM216eFlKbjhaWEFoMiIsImlhdCI6MTc4Nzc0OTQ2MywiZXhwIjoxNzkwMzQxNDYzLCJhdWQiOiJ6aC1naWZ0In0.1LHc8eo8pajlPkjK0Lu6MWcaa2WuTTsBdt8uaj2YL5k

Investing

This is how overvalued the stock market really is.

https://www.marketwatch.com/story/heres-how-overvalued-the-stock-market-really-is-f26540c5?st=Ao6GMQ

Have we really learned the lessons of the great financial crisis?

https://bondvigilantes.com/blog/2026/08/have-we-really-learnt-the-lessons-of-the-gfc/

The danger in the S&P 500 ETF.

https://smeadcap.com/missives/the-long-and-winding-stock-market-road/?utm_campaign=Missives&utm_medium=email&_hsmi=434015080&utm_content=434014384&utm_source=hs_email

The five levels of wealth.

https://dariusforoux.com/the-5-levels-of-wealth/

Sabotaging your returns.

https://www.advisorperspectives.com/commentaries/2026/08/25/investor-psychology-sabotaging-returns-chapter

News on Stocks in Our Portfolios

What I am reading today

Visit Investing for Survival’s website (http://investingforsurvival.com/home) to learn more about our Investment Strategy, Prices Disciplines and Subscriber Service.

Tuesday, August 25, 2026

The Morning Call---The bond market will break Warsh

The Morning Call

8/25/26

The Market

Technical

Monday in the charts.

https://www.zerohedge.com/markets/bonds-bullion-bitcoin-bid-amid-bessent-double-whammy-tech-wreck-continues?gift=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJuaWQiOiIxMTIyNjcwIiwic2VuZGVyVWlkIjoiUUhnc3BaZVVFS2E3RHhXM216eFlKbjhaWEFoMiIsImlhdCI6MTc4NzYwNDAyMiwiZXhwIjoxNzkwMTk2MDIyLCJhdWQiOiJ6aC1naWZ0In0.NT8Munfz6KVNdcD0d7EgneLCDmo5eAtiP8N5q9m7nI8

Monday in the technical stats.

https://www.barchart.com/stocks/momentum

https://www.barchart.com/stocks/market-performance

https://www.barchart.com/stocks/sectors/rankings

https://www.barchart.com/stocks/signals/new-recommendations

Some good news for the stock market.

https://www.marketwatch.com/story/heres-some-surprisingly-good-news-for-the-stock-market-this-midterm-election-year-d492d3a4?st=5HgFmC

And some bad news.

https://talkmarkets.com/article/jpmorgan-warns-of-a-downturn-ahead-and-ai-stocks-may-be-to-blame-1787590300

Gold screaming ‘overbought’.

https://www.zerohedge.com/the-market-ear/gold-screaming-overbought-jpm-says-dont-rule-out-5000?gift=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJuaWQiOiIxMTIyNzUwIiwic2VuZGVyVWlkIjoiUUhnc3BaZVVFS2E3RHhXM216eFlKbjhaWEFoMiIsImlhdCI6MTc4NzY2MjQwNSwiZXhwIjoxNzkwMjU0NDA1LCJhdWQiOiJ6aC1naWZ0In0.3BGybAxNuTArB6erSNNF_GR8_S-cyOddDQkU9FQr3HY

Tuesday morning setup: Global stocks rose as chipmakers rebounded, with falling bond yields adding support to rise sentiment after Brent crude slid below $90 a barrel, down more than 3% after a New York times reports that "evacuated foreign service officers could begin heading back to their posts as early as this week... suggesting Washington does not anticipate a renewal of full-scale conflict with Iran." Oil is also lower on positive signals from Pakistan’s army chief, and Al-Arabiya reporting that he carried an offer to lift sanctions under the MOU. As of 8:00am ET, S&P 500 futures climbed 0.4%, while those for the Nasdaq 100 advanced 0.9% and leading the charge in a reversal of yesterday’s cash performance. In premarket trading, semis lead with Memory, Mag7, Software, and Low/Unprofitable Tech all higher too. This is occurring with bond yields down 1-2bp. Nvidia was poised to break its longest losing streak since 2022. Semis are up 2% and Memory +3.5%, reversing all of yesterday's drop. NVDA is also leading Mag7 higher with 5 / 7 higher ex-AAPL, MSFT. The AI theme is boosting other sectors as Cyclicals ex-Energy lead Defensives. Monday saw the second-lowest tape volume of the year despite the update from Bessent and renewed noise around debasement trades. Gold snapped a four-day run of gains, while the dollar held steady. The yield on 10-year Treasuries declined four basis points. In a WSJ Op-ed, Stan Druckenmiller gives his view on the likelihood that Bessent - his former junior trader at Soros - is making with intervention. In commodities all 3 complexes are lower with Base Metals the bright spot; gold is outperforming broader Precious on the move lower. Today’s macro data focus is on Housing Data, regional Fed activity indicators, weekly ADP, and Consumer Confidence.

Fundamental

Headlines

The Economy

International

Q2 final German GDP grew 0.3% versus forecasts of +0.2%; the August business climate index was 88.8 versus 87.2; the August current conditions index was 88.5 versus 87.0.

The June Japanese leading economic indicators were reported at 116.5 versus projections of 116.4.

Other

The latest Q3 nowcast.

https://www.capitalspectator.com/q3-growth-still-firm-but-fresh-headwinds-cloud-the-outlook/

Iran

Trackers can’t verify the amount of oil the US says is moving through the Strait of Hormuz.

https://www.wsj.com/business/energy-oil/u-s-says-oil-is-pouring-through-hormuz-trackers-cant-find-it-306faebd?st=JYixxv&reflink=desktopwebshare_permalink

US sanctions dozens of Chinese firms.

https://www.zerohedge.com/geopolitical/bessent-drops-iran-sanctions-hammer-dozens-chinese-firms-spares-big-banks-beijing

Iran’s economy is on the ropes.

https://www.zerohedge.com/economics/irans-economy-ropes-amid-hyperinflation-and-widespread-gas-shortages-trump-blockade-bites

Monetary Policy

The bond market will break Warsh.

https://quoththeraven.substack.com/p/bonds-will-break-warsh-at-jackson?r=1ng8jx&utm_campaign=post-expanded-share&utm_medium=web

Time for Fed accountability.

https://www.realclearmarkets.com/articles/2026/08/24/the_fed_must_be_held_tight_to_a_market-price_stability_rule_1201526.html

Fiscal Policy

Bessent plans, markets laugh.

https://www.realclearmarkets.com/blog/2026/08/22/man_plans_markets_laugh_1201898.html

Bessent’s real plan?

https://www.zerohedge.com/markets/bessents-real-plan-trigger-massive-treasury-ctas-short-squeeze?gift=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJuaWQiOiIxMTIyNzA1Iiwic2VuZGVyVWlkIjoiUUhnc3BaZVVFS2E3RHhXM216eFlKbjhaWEFoMiIsImlhdCI6MTc4NzY2MTU5MSwiZXhwIjoxNzkwMjUzNTkxLCJhdWQiOiJ6aC1naWZ0In0.DTDkoozKs3CTaTRukP_Pm5-lDlEFh0jSz_7Sk2FSTI4

There is no easy fix for Bessent.

https://www.bloomberg.com/news/articles/2026-08-23/bessent-has-no-easy-fix-for-what-s-really-driving-bond-yields-up?srnd=homepage-americas&sref=loFkkPMQ

Summary: Treasury Secretary Scott Bessent announced a plan to buy back long-term US debt, which he called a "Treasury twist", in an effort to influence Treasury yields. The plan had a brief impact on yields, but they quickly returned to near their highest levels since Bessent took office, suggesting that his efforts to get borrowing costs down are running into forces beyond his control. Bessent’s vision of yield-curve control extends beyond Treasuries and includes influencing rates for companies investing in artificial intelligence, but some market participants doubt his ability to shape yields and believe that a more effective approach would be through Fed quantitative easing.

The perils of an interventionalist Treasury and passive Fed.

https://www.bloomberg.com/opinion/articles/2026-08-24/fiscal-reform-not-treasury-intervention-is-needed-to-fix-us-debt?srnd=homepage-americas&sref=loFkkPMQ

Summary: US Treasury Secretary Scott Bessent has been intervening in financial markets to reduce upward pressure on long-dated US Treasury bond yields. Bessent's efforts include directing US intervention in the foreign-exchange market to support the yen and committing to increase the size of its buybacks of long-dated government securities. The interventions are seen as having limited impact and potentially creating more problems, such as making policy less predictable and increasing risk premia, and the underlying issue of the nation's fiscal problems needs to be addressed.

Some perspective on the federal debt.

https://scottgrannis.blogspot.com/2026/08/key-facts-about-federal-debt-you-might.html

Counterpoint.

https://wolfstreet.com/2026/08/23/the-bond-market-is-finally-functioning-again-after-14-years-of-financial-repression/

A debt crisis?

https://talkmarkets.com/article/weekly-market-pulse-a-debt-crisis-1787561212

A brief history of interest payments and the national debt (politically annotated).

https://bonddad.blogspot.com/2026/08/a-deeper-look-at-history-and-sources-of.html

Spooked by AI.

https://www.wsj.com/finance/investing/we-went-to-wall-streets-exclusive-wilderness-camp-everyone-was-spooked-by-ai-e16dbe10?st=7Bbvbi&reflink=desktopwebshare_permalink

Tariffs

Unprecedented self-harm.

https://econbrowser.com/archives/2026/08/paper-diaper-tiger-trump-vows-to-double-tariffs-on-canadian-autos-escalating-fight

China

China shock 2.0.

https://www.apollo.com/wealth/insights-news/insights/daily-spark/china-shock-2-point-0-is-here

The Financial System

A ‘democratized’ financial crisis is still a crisis.

https://giftarticle.ft.com/giftarticle/actions/redeem/347989ef-5ae6-4f2a-9c9e-f73a8ab69169

Investing

Is the stock market rigged?

https://www.carsongroup.com/insights/blog/is-the-stock-market-rigged/

News (but not a Buy recommendation) on Stocks in Our Portfolios

What I am reading today

Visit Investing for Survival’s website (http://investingforsurvival.com/home) to learn more about our Investment Strategy, Prices Disciplines and Subscriber Service.

Thursday, August 27, 2026

The Morning Call---The sky doesn't have to fall for the $40 trillion debt to be a problem

Wednesday, August 26, 2026

The Morning Call---The off balance sheet time bomb

Tuesday, August 25, 2026

The Morning Call---The bond market will break Warsh

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