Risk off; $META 145B CapEx; $TSLA silence; 🇫🇷 5%; $SPCX unlock; 🛢️$112

No, not even 20 2002 first time above 5% Since 2002 on the French 10 year the big the big I'd say macro story this morning is really that the 112 print on the oil I'm sure on us we will get to what's going on in in In Saudi Arabia with a ramp goes headquarters and then any overnight Discussions and then rumors about a strike after the midterm elections on Iran and You know, it's it's also Right around the time for Israeli Prime Minister elections as well. So this all comes together In terms of a strike on Iran It makes sense from a calendar perspective pre-market this morning Tesla down 5% we'll talk about their earnings It really was about Cap X there was no discussion on the call About any merger as a matter of fact merger questions at the very outset of the Q&A on the Tesla call about merger Expectations between Tesla and SpaceX merger questions were explicitly disallowed by Questioners on the call IBM down around 6% They cleanly beat But the gross margin came in a little bit short Lamb research down 6% after hours fifth straight record quarter of revenue of 50% plus year over year it doesn't matter Today is not that day To go ahead and cheer your favorite tech chip data center stock on it's just not happening even meta Down 2% To start today this morning Intel down 5 and video down to and half SMC down 4 and a half Even SpaceX which had a great day yesterday if you were upset that you didn't get to buy the stock It's down 2.3% this morning and in the pre-market so you may get your opportunity to go ahead and buy a lot of you give me a sec Southwest Airlines Q3P fuel it's all about fuel fuel fuel Revenue was positive But the guidance For the full year Was cut eBay cutting a thousand jobs Stock is at record highs. That's good for eBay That's good for game stop Terms of the portfolio of eBay stock that they own but we'll make any short of purchase of eBay that much harder at this point uh Sock in Nadella's Pay package for Microsoft Was cut for the year Which I think is a prudent thing to do. It's something that you show your investors look We understand that there has been some missteps in the operation like Xbox Uh, and so we're not gonna pay our CEO a hundred million dollars Instead we will pay him $90 million dollars for the year We have tomorrow the apple iPhone duo gets into people's hands. There have already been Some very positive reviews all around How many times can you open and close the hinge 20 something thousand times and it doesn't break There's no crease in the screen Some people are very happy about it. The downside is is that they're currently no specific Orientation for apps on the iPhone duo so it's really just Your phone app But spread across a bigger screen and it doesn't necessarily come out all that good Before the open today we've got proctor and gamble blackstone comcast honeywell As those come out. I'll give a shout out on those After the close a lot less exciting. We've got decars bloom energy And some others all right. Let me pause right there a lot of you good morning. Let's go ahead and get us started Well, why don't we why don't we take a big picture look And then down. Let's go let's let's do that first Yesterday I had line hit At some point I forget except at some point exactly the with time it was in the afternoon It made the mark it made the markets all of a sudden to sell off It was that announcement that we were getting people that were non-essential people Personnel of the United States out of Saudi Arabia so To me that has to be in the background and I'll let a nasty discuss You know what he knows about about this and So so because of this you can't just look at the action that we saw after hours and there was a pump and dump Okay, to call it anything else That was a pump and dump on on meta now then used it change a few things they they went negative free cash flow For the quarter to the tune of 2.12 billion dollars, okay, but regardless the metrics were absolutely Stunningly good and you have a whole bunch of upgrades So I do think that the that the pump yesterday was a reaction to really what it was Unfricken believable stellar news for a company that is this big and then spent I think 36 billion in Capix in the quarter So I and news Has is the number one app on on you know and has been now for six weeks I the adoption has just been incredible in in Canada and the United States Over 10 million apps have been downloaded in six weeks So so there's no question that the stock price is that we saw Really assimilate a lot of the the outflows out of the sectors Such as hardware and semis and they are in a bear market when you look at ASMR best of breed and it's down 20% from its highs You better be awake That's like seeing and video or apple Against the S&P being down 20% that would be a hell of a drop So so there's something going on and Ella The lab research reported earnings they were absolutely Again, I don't even have to look at the earnings anymore because I'm more interested in what we know is gonna be a negative reaction to any news It seems on semis and every bounce seems to be uh A reason to sell these hardware names and and I see chip makers as a canary in the Homeign for essentially The problems that we see where everybody saying oh we can't build the there's a capacity constraint Well, you can't build a reaction on the result is still going to be the same You're not going to see the the type of growth Uh In the future that you thought until those capacity issues are are corrected in the same way that we have refining capacity issues in in gas Um regardless of how much oil there is in the system so so getting back I do believe that that the reaction yesterday with meta had a lot to do also with the fact that there's some profit taking after a huge move Upwards I would have I would have done that too. I was just mostly in the rivets is and that's a long term core holding I always buy when it dips So so that's it about meta. I'll let David the koski talk about the other areas of tech and one thing Yesterday I forgot to make one major point and the saving factor of this market a gentleman today asked me In the morning about you know About some something terrible about the markets, but I keep looking at industrials and financials and health care And they gave back a ton of what they of what people thought in a rotation Out of tech what have held and it didn't and that to me seems like an entry point that seems from a probable Probability standpoint a much better entry point on the non tech side from this point on because of the fact that it is oversold Thank you David Thank you a lot of you Before I get to the ends let me just throw a couple of other pieces Into the meta mix for the discussion Um It seems if you're gonna knock the the company and knock the stock And need to give a reason for Uh the the fall um It is the cap expending um and the cfo On the call You know talked about the compute intensity necessary for mues people are very happy and excited about the uptick In mues uh download uh it's a short period of time there's not a lot of data yet But seems to be doing well by the way I use mues. I I enjoy it um The she did echo what we heard yesterday Um out of sex about um The compute cost efficiency Um will be greater than 10 act 10 x Uh within a year But that being said uh the the the cost of getting to the promised land is not going to be cheap And for a company of this size Nevertheless, it's still a big spend There's two other things need to be uh talked about first of all Um the company We lost in court in new mexico Uh to the tune of 25 billion dollars um For i don't know let's call it it's it's inappropriate um Um effect on Uh Children and so forth and then the other thing is Uh vis-a-vis where the company is headquartered and where it is incorporated It will stay in california Uh the company has agreed to um to compensate Mark Zuckerberg if there is a Wealth tax 5% on net worth above a billion um in California that that computes Uh to for him Uh potentially a 12 billion dollar Uh cost that he will have to pay and that will now be shouldered Uh by the company and by the way just to go back for a second allodio Right the company Now going to be uh free cash flow negative The buybacks have been suspended for four straight quarters and And the company is issuing class c dividend stock To existing shareholders So that it can if and when necessary issue additional stock For purchase to raise money Without deluding Zuckerberg's control of the company So all this is really important i don't think any of this is Particularly bad. This is what the company needs to do. I don't think it can Not do all these things that being said it is taking what is a Um A fortress of a company Um and making it a little bit more um potentially sensitive to other things uh a little bit yeah a little bit more sensitive um to to other factors that are out there Let me get today in nicosky and then to denis good morning dev Hey good morning um as i alluded to and have been alluding to on the AI front You know everything that sells that you know the supply chain for AI needed I mean has been correcting for several months you know when it comes to the the data center builders I mean i don't think there's a stock that's down less than 50 percent All of the power suppliers from cat to commens to you know Everything in that entire area has been decimated so this shouldn't come as a surprise what we're seeing You know every sector outside of tech Has outperformed since october second, you know I mentioned i put a Piece out on that day where you know all the other sectors were oversold so that was kind of the pivot for me Um, you know whether staples whether health care health care is you know by far the number one spot I'm expecting to see a big internal rotation today. I'm seeing a lot of the staples names Up considerably you want rates down, but rates are going to come in the form of a market correction here um i did a A space with Cantro for about two hours last night. I posted it on my timeline um if anyone has time