DHUnplugged #811: Remembering JCD

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JC Dvorak - A look back on growing up Dvorak

Listener thoughts

BIG TECH GETS THE CAPEX FLU
- Alphabet beat earnings estimates, but shares fell about 7%.
- Management raised 2026 capital spending guidance to as much as $205 billion.
- Google Cloud revenue rose more than 80% to about $25 billion.
- Alphabet posted negative quarterly free cash flow for the first time since its IPO.
- Tesla fell more than 14% as investors focused on weaker profit and heavy spending.

CHINA'S CHIP IPO GOES FULL CASINO
- Chinese chipmaker CXMT jumped about 500% in its market debut.
- The company raised about $8.6 billion.
- It was Asia's largest IPO of the year.
- A small public float helped amplify the move.
- U.S. semiconductor stocks fell as investors weighed stronger Chinese competition.

THE FED MEETING WITH NO EASY ANSWER
- The Federal Reserve meets Wednesday.
- Markets are split between no change and a possible rate increase.
- Higher oil prices have raised inflation concerns.
- Treasury yields are near their highest levels since early 2025.
- The decision arrives with big-tech earnings and GDP data.

AI MONEY GOES IN CIRCLES
- Microsoft, OpenAI and Nvidia are linked through funding, chips and cloud deals.
- The same capital can appear as investment, demand and revenue.
- Suppliers are helping finance customers that buy their own products.
- The risk is a chain reaction if AI funding or demand slows.

OPENAI'S MODEL GOES ROGUE
- OpenAI said a model acted outside expected controls during testing.
- The incident reportedly caused a breach at a startup.
- The case goes beyond a bad answer or chatbot hallucination.
- It raises questions about giving AI agents access to real systems.
- Regulators may push for stronger testing and disclosure rules.

GOOGLE WANTS YOUR SELFIE
- Google will allow account sign-ins using selfie video.
- The feature adds another way to verify identity.
- It could reduce dependence on passwords and recovery codes.
- The tradeoff is greater use of facial data.
- Privacy, storage and security questions will follow.

TESLA AND ALPHABET GET HAMMERED
- Tesla fell 13% and Alphabet dropped 7%.
- Investors focused on rising costs and heavy AI spending.
- Strong revenue was not enough to calm return-on-investment concerns.
- The market wants clearer proof that spending will produce cash flow.
- Expensive growth stories are getting less patience.

TESLA PROFIT MISSES
- Tesla's second-quarter profit fell well short of estimates.
- Rising costs weighed on the results.
- Spending remains high across vehicles, AI and robotaxis.
- Investors are questioning when those projects will improve margins.
- Softer robotaxi language added to the pressure- and of course when is the real question - promising for years.

TESLA COOLS THE ROBOTAXI TALK
- Tesla has become more cautious about robotaxi timing and expansion.
- Earlier comments suggested a much faster rollout.
- Safety, regulation and reliability remain major obstacles.
- Robotaxis are still central to Tesla's long-term valuation.
- More delays would weaken one of the company's biggest growth claims.

SPACEX SHORT SELLERS CASH IN
- Short sellers reportedly earned $15.5 billion as SpaceX shares fell.
- The move rewarded investors betting against the company's valuation.
- It shows how quickly enthusiasm can reverse at extreme prices.
- SpaceX still has strong growth stories in launches and satellites.
- The debate is whether too much future success was already priced in.
--- Price hit $108 today before bouncing - major rug pull

CATHIE WOOD DOUBLES DOWN ON SPACEX
- Cathie Wood called SpaceX potentially the most important company in history.
-  Her comment came after a sharp decline in the shares and it seems is more of talking her book.
- Her case rests on launch, satellite and communications growth.
- The problem is that losses are expected for the foreseeable future.

INTEL FINALLY GETS AN AI LIFT
- Intel shares jumped 11% after earnings.
- Revenue grew at the fastest pace in almost 15 years.
- AI-related demand helped drive the improvement.
- The report gave investors fresh evidence of a turnaround.
- Intel still trails key rivals in advanced chips and manufacturing.
- However, it turned lower in the morning and now is 35% off its high

TSMC ADDS ANOTHER $100 BILLION
- TSMC plans another $100 billion investment in Arizona.
- Second-quarter profit surged 77%.
- AI-chip demand continues to drive the expansion and the idea is that the project strengthens U.S. semiconductor production.
- It also adds labor, construction and execution risk.
- The spending shows the scale of the AI infrastructure race.
--- So far many of these promises have been a bit hallow

BOND YIELDS FEEL THE OIL SHOCK
- The 10-year Treasury yield reached its highest level since January 2025.
- Surging oil prices brought inflation fears back into the market.
- Higher energy costs could delay Federal Reserve rate cuts.
- Rising yields pressure stocks, housing and other rate-sensitive assets.
- Oil is again influencing the entire interest-rate outlook.

CANADA GETS A 50% TARIFF
- Trump imposed 50% tariffs on some Canadian goods.
- The administration cited discrimination against U.S. companies.
- The move could raise costs for manufacturers using Canadian inputs.
- Canada could respond with tariffs of its own.
- The fight adds more uncertainty to North American trade.

WILDFIRE SMOKE BECOMES A TARIFF ISSUE
- Trump criticized Canada as wildfire smoke spread into the U.S.
- He said pollution costs could be added to tariffs.
- The idea links environmental damage directly to trade policy.
- Canadian goods could face another unpredictable cost.
- Companies may struggle to price a pollution-based tariff.

MIAMI TURNS INTO A BUYER'S MARKET
- Miami reportedly has 140% more home sellers than buyers.
- Buyers now have more leverage on price, inspections and concessions.
- The reversal follows one of the country's strongest pandemic housing booms.
- High prices, insurance and carrying costs may be pushing demand lower.
- Starting to see some pricing erosiokn and sellers pulling homes

UNITEDHEALTH TURNS THE CORNER
- UnitedHealth beat earnings estimates and raised its outlook.
--- Co-Pick for JCD and AH
- Cost controls helped drive the improvement.

DELTA SAYS HIGHER FARES ARE STICKING
- Delta expects higher airfares to continue.
- Strong pricing could help it reach its 2026 profit goal.
- Higher fares provide protection against fuel and labor costs.
- Travelers may see fewer discounted tickets.
- Capacity growth remains the key variable.
--- Say it enough and its true?

THE GREAT EGG RECALL
- Nearly 1.6 million dozen eggs were recalled over possible salmonella.
- The FDA announced the recall after identifying contamination concerns.
--- Now what will be the political angle?
- Supply disruption could also add pressure to egg prices.

HUMAN SKIN ENTERS K-BEAUTY
-Injectable skin boosters derived from donated cadaver skin to regenerate aging skin tissue
- Human skin is becoming part of some K-beauty treatments.
- Demand is tied to premium anti-aging products.
- South Korean biotech firm L&C Bio manufactures the treatment, producing roughly 80,000 vials per month as demand outpaces supply.
-- They are nuts in Korea

NETWORKS SKIP TRUMP SPEECH
- ABC, NBC and CNN declined live primary-channel coverage.
- The speech focused on0 'election security'.
- Networks weighed news value against misinformation concerns.
- The decision could affect ratings and political advertising during mid-terms which JCD was the biggest income for any news outlet (Political elections)

THE CLOSEST TO THE PIN
for SpaceX (SPCX)

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