Above is the Nvidia headquarters in Santa Clara, California. It's home to a business worth US$ 3,000,000,000,000.

That's bigger than the GDP of both Italy and Canada. Below is the monthly chart of Nvidia and CIsco going back to the Internet /  dot com bubble. Cisco dropped 90% as the bubble popped.

Back in 2007/8/9 it was the banks that were too big to fail but they're way too well capitalised to do so now, and also the risk has been passed to countless trading apps and fintechs. So the risk isn't so concentrated.

But in the US stock markets that concentrated risk is pretty much the only thing keeping the markets afloat.

Nvidia, other chip stocks, Apple, Microsoft, Meta, Google and a few more.

The public, pension funds, hedge funds, US politicians, trendfollowing algorithms, and my dog are long and buying more.

Be careful when everyone is in the same trade.

NVIDIA Monthly

CISCO Monthly

Breaking

Hartnett: Gold Just Surpassed The Euro As The World's 2nd Largest Reserve Asset[Zerohedge]

In Focus
China

China Manufacturing PMI August 2024

 A slow week of data from China but the slow sinking of the economy continues as the manufacturing PMI ticked lower. 

China new home prices rise more slowly in August, survey shows[Reuters]

Japan

A reprieve for a Japan as typhoon ShanShan batters the country. There was another typhoon a few weeks ago.

Economic statistics were mixed this week.

I can't feeling that typhoon Carry Trade will be back battering the Japanese economy soon.

Japan Core CPI YoY

Japan Unemployment Rate July 2024

US Economy

Headline statistics are still holding up but the anecdotal evidence is of a rapidly slowing US economy.

Record credit card defaults and plunging pending home sales support the narrative from Dollar General, Walmart and the like. CPI wasn't lower which may change Powell's mind on a cut in September. Markets have priced in a 50bp cut and it would take a black swan event to have a cut higher than that.

Markets may be over optimistic here.

US Durable Goods Orders July 2024

US House Price Index June 2024

US GDP Q2 2024

US Pending Home Sales July 2024

US Core PCE Index July 2024

Dollar General warns poorer US consumers are running out of money[FT]

Allstate Approved to Raise Home Insurance Rates by 34% in Wildfire-Prone California[Bloomberg]

RV Downturn Turns Apocalyptic With Largest Dealership Offering 55% Discounts[Zerohedge]

In The Background