To The Moon

Macro Landscape: A Valuation Balancing Act

• $S&P 500(.SPX)$ remains near 20x forward earnings, reflecting investor belief that downside risks (growth, policy, tariffs) are roughly balanced by anticipated Fed or fiscal responses.

• Institutional investors are thinking in game-theoretic terms, not just about macro data, but about how their peers will react to it.

• This explains continued support for US equities, despite rising concerns around policy volatility and earnings headwinds.

Data Focus: Precious Metals, Earnings, and Sentiment

1. Gold/Silver ratio hits 102x. A level historically only seen during war or global crisis (1991, 2020).

   Implies geopolitical anxiety is still high.

   Silver may have upside if tensions ease, as it’s more economically sensitive than gold.

Gold

1. Earnings revisions turning lower, but still non-recessionary in pace and tone.

   Cuts to Q2 and 2025 S&P 500 EPS estimates are accelerating but within normal ranges.

   This controlled downgrade process aligns with market resilience in large-cap valuations.

Disruption Watch : Echoes of the 1990s Tech Bull Run

• The $NASDAQ(.IXIC)$ is +73% since Dec 2022, tracking eerily close to the mid-1990s bull market (68% gain over same duration post-1995).

• The pattern of occasional policy-driven pullbacks, like in 1997, suggests short-term volatility doesn’t negate the long-term trend tied to disruptive tech (AI).

• Long-term investors should view temporary dislocations as opportunities, especially with AI hardware/software ecosystems gaining traction.

Policy Risks: Tariffs and Regulatory Shocks

Tariffs

• Trump’s new round of tariff threats includes:

  100% tariffs on foreign-made movies

  Upcoming tariffs on pharmaceuticals (within 2 weeks).

• Healthcare names sold off hard :

  SPDR S&P Biotech ETF -6.6%, worst day since May 2022.

  The appointment of Dr. Vinay Prasad to lead the FDA’s vaccine division spooked investors due to his highly public skepticism of the pharma sector…

• Meanwhile, trade-sensitive names across Tech and Semis also felt pressure :

  $Advanced Micro Devices(AMD)$ warned $1.5B hit from export controls.

  $SUPER MICRO COMPUTER INC(SMCI)$ cited delayed AI server orders due to GPU transitions + tariff fears.

  $NVIDIA(NVDA)$ $5.5B charge tied to China sales ban underscores the stakes of further escalation.

Looking Ahead: Fed Day + Market Reactions

• Fed decision today is widely expected to leave rates unchanged.

• How Chair Powell frames trade-related inflation vs. slowing growth.

  A dovish tone acknowledging downside risks could calm markets.

  A neutral/hawkish message would prolong the recent pullback.

Powell

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This summary is for informational purposes only and does not constitute financial advice. Investors should conduct their own research before making investment decisions.