The Kansas City Fed conference in Jackson Hole, Wyoming, opens August 27 and will dominate financial headlines this week. Expect upbeat inflation data and Fed talking points as the 2‑year Treasury stays above the Fed Funds rate, easing pressure for another rate hike.
Bond Yields Rise, Housing Starts Slip
Bond vigilantes have pushed yields higher across Britain, France, Germany, Japan and the United States. The surge coincides with a 12.4% decline in July housing starts to a 1.24 million annual pace and a 30‑year Treasury yield at its highest level since 2007, while the iShares 20+ Year Treasury ETF (TLT) is down more than 6% year‑to‑date.
Earnings Season Fuels Investor Optimism
Nvidia reports earnings Wednesday, and Micron follows later, sparking optimism as the market anticipates strong results. The upcoming Jackson Hole gathering adds momentum, encouraging investors to look past recent volatility.
Billionaire Backing Drives Stock Picks
Jensen Huang of Nvidia, Sundar Pichai of Google and Alex Karp of Palantir illustrate how fundamentally strong companies rebound after solid sales and guidance. The author avoids Musk‑linked firms until they meet an eight‑factor fundamental model, noting that superior stocks recover quickly.
AI Order Backlogs Accelerate
AI developers demand ever more computing power, driving a $176 billion order backlog at GE Vernova that continues to expand. Data‑center construction and cloud services keep the boom relentless.
Short‑Seller Noise Distorts Reality
Citron founder Andrew Left received a 20‑year prison sentence for market manipulation, while Michael Burry remains a media favorite. Negative headlines sell, but fundamentals ultimately prevail.
Political Outlook Keeps Markets Calm
Trump’s agenda is unlikely to shift after the mid‑term elections, as most federal spending is already front‑loaded. Investors should ignore election‑driven noise and focus on the upcoming holiday‑driven positive news flow.
Keeping a disciplined focus on fundamentals lets investors ignore naysayers and ride high‑conviction stocks such as Nvidia, which the report deems unbeatable after tax considerations. Strong earnings and expected GDP growth support a bullish outlook for the coming weeks.
