Hey everybody, welcome back to the channel. We are back on another episode of the daily recap. We've got a lot to talk about today. Uh first of all, this morning we had, if you were with me on the market open, a pretty wild headline that came out.

Everything was green. Pre-markets were up. We were going through the news and then boom, Bitcoin falls by 2,000 bucks. Nvidia's down 2%. S&P is down. Microsoft's down 3%. We're going to talk about why that happened. The fallout from what happened this morning.

It had to do with an AI headline. Once again, the fragility of this AI narrative is becoming more and more fragile every day when these headlines try to take down the narrative. Uh even if there's no truth behind the headline, but nonetheless, the market did react to it. So, we'll talk about that today.

Uh Jensen Hang officially did Joe Rogan. Did not expect to see that today, but he did it. Jensen Wong did two and a half hours of Joe Rogan. Got a couple clips that I think are important for people to see. So, we'll talk about that. And then some macro updates. We got some Robin news, some Tesla news, some political stuff that's potentially going to be very beneficial to Tesla. lot to talk about. Let's get into it.

So, let's get started with what happened in the morning because it was a pretty wild morning on that Microsoft headline. And I do think it's important to talk about because the fragility of the AI story continues to be aggressive uh simply because there are more and more people that are scared that we are in some type of an AI bubble.

And the only way to combat that is for companies to put up results in earnings that disprove that narrative that this is a bubble. Nonetheless, the market is kind of on tilt in terms of trying to understand if it's real or not.

And although there's evidence every single day that it's real, the headlines that can come out can deeply disturb how the market is thinking about it. And today we a headline for Nvidia or for Microsoft had plenty of headlines for Nvidia.

Uh what was the headline? Well, the information which at this point should be uh referred to as the misinformation. I do not know how this publication has this much influence on the markets, but they do.

Um this was the original quote you're seeing on the lefth hand side of screen. Microsoft lowers AI software sales quotas as customers resist newer products. And the summary of the article, like literally the one sentence summary, is that customers are resisting signing up for co-pilot subscriptions.

Let me know in the comments if you've ever used Copilot before. Uh I've never worked at a corporation that has C-pilot subscriptions, but I have heard from many of you guys in the chat every day that C-Pilot sucks. So I think it's kind of, you know, something that's pretty wellnown.

Uh and then after Microsoft came out and explicitly said that we are not lowering our AI software uh or quote targets for salespeople, which was what the article was accusing them of. This is the exact quote. The company's not lowered its sales quotas or targets for its salespeople.

Then the information came out and they changed the headline by saying Microsoft lowers AI software growth targets as customers resist newer products. So I think the real thing to take away from this is how scared the market is if there is a upset or a hiccup inside of the broader AI narrative.

This source that they used to create this article which caused literally hundreds of billions of dollars of uh market cap rotation during the morning had two sources. You can see right here two salespeople in the Azure cloud unit.

It is rare for Microsoft to lower quotas for specific products. The report said citing two salespeople in the Azure cloud unit.

First of all, if anyone's buying Microsoft right now, you're not buying it for co-pilot. Like you're buying it for cloud. Azure is growing at 40%. Microsoft AI workloads are off the hook.

The reason is because AI is very real and they're getting a lot of demand for companies that want to use AI enterprise workflows adoptions. Obviously, that needs a lot of cloud computing and infrastructure to make that possible.

That's why they're investing so much in data centers. That's why Satia is putting a hundred billion dollars in capex. So you can have your qualms about the model companies, the LMS of the world, you know, anthropic, opening eye, etc., Microsoft having that 33% stake in opening eye, but you cannot say that the cloud isn't real, that the demand that Microsoft's getting from cloud is not real.

Now, there may be concerns about other ways for Microsoft to monetize AI, but cloud's a hell of a good business, and that's growing at 40% in terms of Azure specifically year-over-year.

I don't know anyone, and correct me if I'm wrong, but I don't know anyone who's buying Microsoft stock, which I am starting to try to understand a lot more. I've never really purchased shares of Microsoft. Um, but you know, given this recent sell-off, I'm trying to understand it a lot deeper.

My analysis from the elementary level of due diligence I've done on the company has not come down to, hey, Co-Pilot is something people should be excited about. And to my understanding, co-pilot's this like add-on subscription of 30 bucks a month that, yeah, not every enterprise is going to want because maybe they don't need it.

In fact, they might be building their own in-house AI tools. They might be working with CHATBT directly or Anthropic. So, the idea that the AI narrative is gone or it's a bubble or it's all fake because co-pilot, which is a subscription offering inside of Microsoft's enterprise sales, isn't getting as much growth as people thought it would get. It's like, okay, cool. Next.

Because we know that enterprises are using AI. We know that they're using cloud. For cloud, they're using GCP, Amazon, or Microsoft. So, that's a winner. And we know that that's going to be continue to be a winning category.

Maybe Microsoft doesn't win in copilot. That does not mean AI is dead. That means maybe other companies are implementing these AI workflows to allow them to get better use cases versus what Microsoft copilot is offering.

So I think the entire story today if anything it should be a reason to be like all right Microsoft maybe should deserves to be down 2 3% on the day which Microsoft as of recording this is down 1.4%. It was down 3% so a little bit of recovery but that does not mean the entire market deserves to get hit.

And you got the market kind of recovering right here. S&P is green, Nvidia is green, etc. I mean it is another argument for why people are scared and as soon as the headline came out I mean we're talking about everything started going down. Bitcoin was the first one to fall off.

So it seems like the NASDAQ is which is tech essentially and AI is correlated with crypto and they're going back and forth. But if if there's going to be a headline to take this down, this was not the headline.

And if there is going to be another headline, which I'm sure there will be in the future, it's very important to not panic when this stuff happens until you actually have some hard set of data that shows like actual earnings data that shows that companies are not buying GPUs, companies are taking back their forecast for earnings, companies are not knowing how to monetize AI.

Like we need real hard proof, not journalists that are trying to move the market by putting out an article. So overall, story was a nothing burger, but it is very important to understand how fragile the AI narrative is and how you're going to need a lot more earnings growth to continue proving to people that AI is very real.

All right, next up, Nvidia. Jensen did it. Jensen did it. He did Joe Rogan. This was super exciting to see. Uh, there you go.

Jensen and Joe Rogan. There's a lot to dive into. A lot of stuff was said in this podcast. Nothing super crazy, I think, was said. I'm still going through all the different summaries of what I'm getting, but I mean, at its core, everything that Jensen has said, Jensen has done a lot of interviews over the past couple years. uh the state of accelerated computing.

Uh he he definitely gave Trump a lot of credit for being pro- energy, pro re-industrialization. Said that energy was the bottleneck for AI. Talked about CUDA, demand, deep learning, all that stuff.

So I so far have not seen a major takeaway that's really really like necessary or different to understand as an Nvidia shareholder if you, you know, haven't already heard Jensen say it. But I think there were two clips. One is about the story where Jensen first sold the first supercomputer to Elon and then the other is about energy and the power grid. So I'm going to play both of those clips right now.

>> Most people generally as a country, you know, as a a giant community, which we are, it just only makes sense that we have manufacturing in America that especially critical technology like you're talking about.

>> Like it's kind of insane that we buy so much technology from other countries. If United States doesn't grow, we will have no prosperity. We can't invest in anything domestically or otherwise. We can't fix any of our problems.

>> If we don't have energy growth, we can't have industrial growth. If we don't have industrial growth, we can't have job growth. These it's as simple as that,

>> right?

>> And the fact that the fact that he came into office and the first thing that he said was drill baby drill. His point is we need energy growth. Without energy growth, we can have no industrial growth. And that was it saved it saved the AI industry.

>> Got I got to tell you flat out if not for his progrowth energy policy.

>> We would not be able to build factories for AI. We would not be able to build chip factories. We won't sure surely won't be able to build supercomputer factories. None of that stuff would be possible. Without all of that, construction jobs would be challenged, right? Electrical, you know, electrician jobs, all of these jobs that are now flourishing would be challenged. And so, I think he's got it right. We need energy growth. We want to re-industrialize the United States. We need to be back in manufacturing.

>> Every successful person doesn't need to have a PhD. Every successful person doesn't have to have gone to Stanford or MIT. And I think I think that that that, you know, that sensibility is is um spot on. is my point.

>> So currently that that is a big bottleneck, right? Is energy.

>> Yeah, it is the bottleneck.

>> The bottleneck is this. So was it Google that is making nuclear power plants to operate one of its AI factors?

>> Oh, I haven't heard that. But I think in the next six, seven years, I think you're going to see a whole bunch of small nuclear reactors.

>> And by small, like how big you talking about?

>> Hundreds of megawws. Yeah.

>> Okay. And that these will be local to whatever specific company they have.

>> That's right. We'll all be power generators.

>> Whoa.

>> You know, just like just like your you know, somebody's farm.

>> It probably is the smartest way to do it, right?

>> And it takes the burden off Yeah. takes the burden off the grid. It takes and you could build as much as you need

>> and you can contribute back to the grid. When I announced this thing, nobody in the world wanted it. I had no purchase orders. Not not one. Nobody wanted to buy it. Nobody wanted to be part of it except for Elon.

>> He goes, he was at the event and we were doing a fireside chat about the future of self-driving cars and he goes, "You know what? I have a company that could really use this."

>> I said, "Wow, my first customer." And so, so I was pretty excited about it. And he goes, "Uh, yeah. Uh, we have this company. It's a nonprofit company and all the blood drained out of my face. I just spent a few billion dollars building this thing. It cost $300,000 and you know the chances of a nonprofit being able to pay for this thing is approximately zero.

>> And he goes, you know, this is a it's an AI company and uh it's a nonprofit and and uh we could really use one of these supercomputers. And so I I picked it up. I built the first one for ourselves. We're using it inside the company. I boxed one up. I drove it up to San Francisco and I delivered at Elon in 2016.

>> And uh I walk up to the second floor where they were all kind of in a room. This smaller than your place here and and uh uh that place turned out to have been open AI.

>> It's not really uh nonprofit anymore though, is it?

>> They're not they're not nonprofit anymore. Yeah.

>> Weird how that works. So I think the takeaway from those two clips is that obviously Jensen is making the continued argument about how important energy in energy infrastructure is as an ecosystem to be able to develop AI and the other really important thing about this is that you know the Elon story I thought was fascinating because now people can't wait to get their hands on chips.

In fact, the Morgan Sailing report we talked about yesterday um that said the biggest concern customers have of Nvidia is not that AI is a bubble, but that they can't get their hands on chips fast enough, especially Vera Rubin that will be launching next year.

The market's worried about a bubble. Customers of Nvidia are worried about getting chips and Jensen selling a story about how 10 years ago no one wanted to buy a chip. Elon, you know, said, "Hey, maybe we can use this with Open AI at the time."

So, it's quite incredible to see the trajectory of how things have changed. Uh Nvidia basically flat on the day. You got a lot of other stocks that are moving. I did buy more Nvidia today.

I continue to believe that the market is discounting Nvidia right now compared to other stocks and other valuations simply because of their fear. Like I really think the number one reason Nvidia is discounted right now is because the market is afraid that they're missing something to the story because if not I mean objectively Nvidia should be closer to 200 right now at least 200 if not 210 215 and and that would not be a euphoric multiple at all.

Get to 300 or like but like 200 197 where it was before earnings is not crazy. It's at 180. So like why is that happening? I think it's because the market's just scared that it might be a bubble. I really think that.

Which is ironic because they're you know Nebius is green and Cororeweave is green and Amcor which is a supplier for Broadcom and Nvidia that's green but the company that's actually growing faster than all those other companies with ironically better margins even though it's a hardware company is not green.

So I think from that perspective Nvidia continues to be a buy. It's one of my Mac 7 buys including met and Amazon going into 2026.

And Jensen Joe Rogan probably introduces the concept of Nvidia which you know quite frankly a lot of people don't even know that Nvidia is the reason we have AI like my sister the other day had no idea when I was talking to her that GPUs are the reason why she gets to use chat and so hopefully this does get a lot more distribution for him as a brand and more people understand why AI is possible it's because all right.

And so hopefully this does get a lot more distribution for him as a brand and more people understand why AI is possible it's because all right.

Last thing we're going to get into is some of the different macro headlines that we had throughout the entire today. Uh, first off, I wanted to talk about this. I thought this was pretty interesting. So, we've talked about Kevin Hasset potentially becoming the new Fed chair.

Trump kind of teased yesterday that Kevin Hasset could become the next Fed chair. Here's a report that I thought was pretty interesting. Bond investors warned Treasury over Hasset as the Fed chair.

Bond investors have told the US Treasury that they are worried that Kevin Hassid, if appointed to the Federal Reserve here in 26, would cut interest rates too aggressively to please Trump.

During November consultations with major banks, asset managers, and the Treasury Borrowing Advisory Committee, several market participants said they preferred people that are more independent like Rick Reer or the Fed Governor Christopher Waller.

Investors also expressed doubts about Hasset's ability to lead a divided Fed board. Some of them viewed him as a Trump stoogge, risking lasting damage to the Federal Reserve's credibility.

I think this is a fair argument. I don't know if it's going to be enough of an argument to cause any broader issues with Kevin Hass becoming the next Fed chair or with, you know, the market being upset that he's the next Fed chair. Yes.

Will will there be some credibility issues and some like fears about the independence of the Fed? Sure. But at the end of the day, like this is politics and every administration is going to have their own picks of who they want to serve in certain significant positions.

And so if Trump wants lower rates and Kevin Hassid is definitely going to lower rates, maybe he's not going to be as independent, but nonetheless, he's going to lower rates. And the market's going to have to ask themselves a question. Do they care that much about Fed independence? Do they care more about lowering rates?

Also, there's probably a bright line. I mean, if it's we're not talking about 100 basis points on day one. So, we're talking about something that can be scaled, but something that is inevitable to get these rates down and whatever other dove that you pick to be the Fed chair, they might be a little bit more independent, but the outcome might be the same.

The Fed rate cut probability, by the way, went up to 89% today. We did get some other macro data in regards to uh ADP private payrolls, which came in at negative 32,000 today.

Okay, the expectation, this was for November, was supposed to be um plus 40,000. So once again, uh we don't have Jolts yet. We don't have the jobs report for uh November.

I think we're going to be getting that in the middle of December after the FOMC meeting. But the Fed's got to cut rates. And I think this ADP private payroll number today kind of all but confirmed that it's very likely we're going to be getting these rate cuts because you just cannot have the labor market deteriorating the way it is without uh the Fed stepping in.

Now, American Eagle Outfitters earnings yesterday were really good. They increased guidance by 4x, beat EPS by 20%. I'm still pretty confused how Abberrombi, Urban Outfitters, American Eagle, Burlington Factory, Best Buy, all these retailers are putting up these monster earnings numbers and I'm supposed to believe the consumer is weak.

Now, there's tons of data to explain the consumer is weak, but I'm trying to reconcile in my own head, why are these companies putting up really good results if the consumer is weak? Why are they shopping for $85 jeans?

Are we just having middle class and rich people shop for these jeans and that's subsidizing the entire economy? Maybe. But it's hard to believe that every single retailer that's coming out, the XRT retailer ETF having its best week in a while.

Um, kind of solidifying the case that the consumer might not be as weak as expected. Now, PayPal CFO did come out this morning. PayPal stock was down once again on the day. It was down 3%.

It continues to be down about 2.4% on the day. And the CFO said, "We are continuing to see weakening consumer dynamics from September to October to November." Is that a PayPal weak consumer where people are using Zel and Apple Pay and other things which might mean they're not as weak on those platforms? They're weak on PayPal.

Or are the hundreds of millions of people that use PayPal every month showing an aggregate trend of weakness? I think it's probably the latter versus the former. But there is a lot of nuance to this because then you have other companies showing that the consumer might not be that weak.

So labor data is weakening. Fed's likely going to cut. Consumers weak. that there's a counternarrative to this consumer weak argument.

If the Fed cuts and the consumer ends up not being as weak as expected, although we do know delinquencies are rising, then maybe that's how you navigate 2026 from a macro perspective, which is that the Fed is going to cut rates.

That's going to help the consumer. That's going to help the labor market. The labor market still probably is not the best. The consumer is still not the best, but those rate cuts might come in. And if the consumer is better than expected, the obvious offside risk to that is inflation because if you have too much consumption, then inflation goes up.

But if AI could be deflationary, which you know that could be a very big thing that happens, this is whole Elon's argument about goods and services are going to be so abundant that the cost of these things are going to come down dramatically.

Um, and that could take place in 2026. That's a hedge against inflation like being massive. And then second of all, it's like, do you want a little bit more inflation or do you want a horrible labor market? I think most of us would say we want a little bit more inflation.

So maybe the macro is not as horrible. It's definitely not amazing, but maybe it's not as horrible as a lot of people were thinking. And you know that could be leading to a little bit more momentum going into the end of 2026.

Next thing right here I thought was really interesting as well is the Trump administration is now looking to robots. This was a report by Politico this morning. Lutnik also talked about this on CNBC that um they are going allin on accelerating the industry's development in terms of robotics.

According to three people familiar with the matter, a spokesperson said we are committed to robotics and advanced manufacturing because they are bringing or they are central to bringing critical production back to the United States.

The really really interesting part about the robotics ecosystem is essentially if you read the report it sounds like they're saying we need a robotic zar just like we have the aisar with David Saxs and he's also the cryptozar if you have a robotic zar.

Tesla stock was I think is up on the news today that there could be a very very heavy focus yeah 446 on Tesla 4% of the day.

There's a very very heavy focus on the industry of robotics because the administration understands that this is going to be a key way to grow Tesla's going to get a lot of momentum from that because if you have the industry or the government ready to propel the growth of robotics, Tesla's going to be a winner.

Amazon's going to be a big winner as well because robotics are going to be important to them to increase those operating margins. And so I think a lot of these robotics companies or just like the AI companies and crypto companies got the administration on their side.

Robotics is that next layer which intersects with AI in a very um intimate way. And as a result, you might have a company like Tesla and Amazon really benefiting from the government saying, "Hey, we're going to focus heavily on robots."

All right, last thing I wanted to share is a clip from Larry Frink at the Dealbook Conference. We're getting a lot of these clips over the next couple of days as uh a lot more of these clips have come out and a bunch of people getting interviewed. Bent, Alex Karp was there.

Um I thought this one was pretty interesting. Larry Frink and Brian Armstrong discussing crypto and Larry Frink mentions that um he was wrong on crypto.

>> Uh called crypto an index for money laundering.

>> Uh, Black Rockck

>> And Thieves.

>> Yes.

>> Money laundering and thieves.

>> Um, you uh now have the biggest Bitcoin ETF.

>> So, what happened here?

>> I have very strong views, but that doesn't mean I'm not wrong. Uh, but you by having strong views, you have to test yourself and ask yourself. And, you know, in my role, I see, you know, thousands of clients a year. I have, you know, governmental leaders and we have these conversations and it my my thought process always evolves and this is a a very glaring public example of of a a big shift in my opinion.

So obviously in the world of tokenization and as tokenization continues to expand, more people get excited about it. You see Larry Fank from Black Rockck seeing this like multi- trillion dollar opportunity.

That is also why he gets more excited and why he's probably admitting what he's admitting about. All right, that's it for me. Thank you everybody for listening and watching. I will see you guys tomorrow on another episode of the daily recap.

And more and more we continue to see how the world of AI is intersecting with a variety of different verticals and how these verticals are also fragile in terms of their narrative. But we're going to keep updating every single day to understand this narrative as we go forward. Thank you everybody for watching. I'll see you guys on the next one.