Telltales

Shownotes

In this episode of Telltales Podcast, Mike Nicoletti, Jason Wallace, and Hunt Lawrence explore the cash flow characteristics of companies across sectors like energy, technology, and healthcare. They also provide insights into US government finances, natural gas, and oil markets. Here’s a breakdown of the main topics discussed.

[00:32] Exhibit C: World Oil Supply and Demand The hosts discuss how macroeconomic factors and geopolitical changes in Lebanon have temporarily impacted oil prices, leading to a welcome strengthening in oil prices. (Exhibit C: Oil)

[01:04] Exhibit B: US Gas Demand and Supply The conversation shifts to natural gas pricing trends. The hosts explore how recent price increases in gas contracts for 2025 and 2026 signal better conditions in the natural gas market, despite short-term fluctuations. (Exhibit B: Natural Gas)

[02:00] Exhibit A: US Government Revenues and Expenses The hosts express concerns over the growing US deficit, despite rising revenues. They discuss how high interest payments and increased spending in social programs are causing fiscal challenges. (Exhibit A: US Gov. Finances)

[05:15] Amazon’s Risks and Uncertainties The team dives into Amazon’s business model, analyzing the risks in its AWS and third-party logistics business. They also assess the impact of AI competition and consumer spending trends on Amazon’s future. (Memo: Page 1, Amazon)

[16:12] Pharmacy Benefit Managers and Antitrust Scrutiny Jason discusses the FTC investigation into Pharmacy Benefit Managers (PBMs) and their use of rebates that push patients toward higher-cost drugs. The segment highlights how this affects drug pricing, particularly insulin. (Memo: Page 19, PBMs)

[18:21] Eli Lilly’s Market Position and GLP-1 Competition Eli Lilly’s success with its weight loss and diabetes drugs is under the spotlight, though government price negotiations may soon pressure its GLP-1 drug prices. The team also discusses future competition in this drug category. (Memo: Page 19, Lilly)

[20:11] Visa Antitrust Concerns Visa faces antitrust scrutiny. The team discusses potential impacts on their business models, ongoing lawsuits, and how these companies handle regulatory challenges. (Memo: Page 7, MA/V)

[22:53] Nuclear Power and Tech Support for Clean Energy The hosts explore the role of nuclear power in meeting clean energy goals, particularly with tech companies like Apple backing it as a clean source. Regulatory hurdles remain a major challenge in expanding nuclear energy infrastructure. (Memo: Page 1, Microsoft & Nuclear)

[24:55] Software Giants: Salesforce, Oracle, and AI GrowthSalesforce, ServiceNow, and Snowflake come under scrutiny for their ability to generate free cash flow. Oracle’s success in leveraging AI for database optimization is highlighted as a key growth area. (Memo: Page 2, CRM/NOW/ORCL)

Join us next week as we continue to evaluate top companies based on their cash flow characteristics. Stay tuned for more insights into the energy and technology sectors, and don't forget to download the latest Cash Flow Memo for detailed data.

AMZN 0.00%↑ GOOG 0.00%↑ MSFT 0.00%↑ ORCL 0.00%↑ MA 0.00%↑ V 0.00%↑ PYPL 0.00%↑ CRM 0.00%↑ NOW 0.00%↑ SNOW 0.00%↑ AVGO 0.00%↑ LLY 0.00%↑ NVO 0.00%↑

This podcast and the information herein are intended for informational purposes only. The views expressed herein are the author’s alone and do not constitute an offer to sell, or a recommendation to purchase, or a solicitation of an offer to buy, any security, nor a recommendation for any investment product or service. While certain information contained herein has been obtained from sources believed to be reliable, neither the author nor any of his employers or their affiliates have independently verified this information, and its accuracy and completeness cannot be guaranteed. Accordingly, no representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, timeliness or completeness of this information. The author and all employers and their affiliated persons assume no liability for this information and no obligation to update the information or analysis contained herein in the future.

This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit telltales.substack.com

In this episode, the Telltales team dives deep into the risks and uncertainties facing Google and its parent company Alphabet as AI technologies like ChatGPT threaten to disrupt its long-standing search business model. Jason shares his concerns that Google could become the next Kodak if it fails to adapt to the AI-powered future of search.

[00:08:17] Google's AI Search Dilemma (Page 1) Jason warns that Google's model of 10 blue links for search, which has been around for over 20 years, is vulnerable to disruption from large language models and AI-powered search interfaces being developed by Microsoft, OpenAI, and other well-funded startups. The key question is whether these new AI search technologies will upend Google's dominance.

[00:14:59] The Future of Search & AI (Page 1) The hosts discuss the potential for AI search to be too computationally expensive, which could help Google maintain its low-cost advantage. However, Jason notes that hardware and software improvements are rapidly bringing down the cost of running AI inferences. Mike suggests that an AI orchestration layer running on devices could efficiently outsource queries to the most capable resources.

[00:27:15] Healthcare Updates (Page 15) Jason shares updates on Lantheus' prostate cancer treatment data, which showed improvement but didn't outperform Novartis' Pluvicto. He also mentions Vertex's excitement about their pain program and the pending release of Biontech's melanoma study data.

[00:29:49] Next Week Preview: Mag7 Risks Hunt teases that they will continue analyzing the potential weaknesses of another one of the "Magnificent 7" companies in next week's episode, but keeps the specific company a secret for now.

This podcast and the information herein are intended for informational purposes only. The views expressed herein are the author’s alone and do not constitute an offer to sell, or a recommendation to purchase, or a solicitation of an offer to buy, any security, nor a recommendation for any investment product or service. While certain information contained herein has been obtained from sources believed to be reliable, neither the author nor any of his employers or their affiliates have independently verified this information, and its accuracy and completeness cannot be guaranteed. Accordingly, no representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, timeliness or completeness of this information. The author and all employers and their affiliated persons assume no liability for this information and no obligation to update the information or analysis contained herein in the future.

This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit telltales.substack.com

In this episode, the Telltales team discusses the latest developments in the energy sector, Apple's lackluster iPhone 16 launch event, and exciting updates from biotech companies Vertex, BioNTech, and Harrow Health.

[00:01:05] Exhibit C: World Oil Supply/Demand Hunt notes that oil is in decline, with China's demand forecast to be flat. Surplus capacity remains at 4M barrels, mostly controlled by the Saudis and Abu Dhabi. He advises waiting or buying half positions in upstream oil companies.

[00:01:50] Exhibit B: US Gas Demand/Supply Natural gas production continues to rise despite curtailments by major producers. LNG projects are delayed and futures prices remain low. The Permian basin is the largest growth area.

[00:03:03] Exhibit A: US Government Revenues and Expenses The US deficit is projected to be around $1.6 trillion in 2024. Spending cuts will need to be addressed by the next administration.

[00:03:42] Energy Review (pages 9-12) Hunt goes through the energy pages, focusing on midstream and diversified oil & gas companies. He highlights Antero Resources and its midstream subsidiary as an interesting comparison.

[00:09:41] Is 30x Free Cash Flow = Value? (page 1) The hosts discuss whether 30 times free cash flow is a reasonable valuation for high-quality companies in the current interest rate environment. They note the importance of confidence in future growth at higher multiples.

[00:14:59] Apple iPhone 16 Launch - Underwhelming? (page 1) Jason and Mike debate the significance of Apple's underwhelming iPhone 16 launch. While new features were limited, Mike argues Apple is transitioning to a services-focused business model. Jason questions if Apple can compete as a software company against the likes of Google and Meta.

[00:23:58] Healthcare News Roundup (pages 15, 19, 20) Jason provides updates on Vertex, Harrow Health, and BioNTech from recent healthcare conferences. Vertex's CEO referred to their diabetes treatment as a potential cure. Harrow's subsidiary Melt Pharmaceuticals could have a $100M business at launch. BioNTech is set to announce data from its oncology programs.

The Telltales team covers a wide range of topics this week, providing valuable insights for investors interested in energy, technology, and healthcare. Tune in for the full discussion and analysis.

This podcast and the information herein are intended for informational purposes only. The views expressed herein are the author’s alone and do not constitute an offer to sell, or a recommendation to purchase, or a solicitation of an offer to buy, any security, nor a recommendation for any investment product or service. While certain information contained herein has been obtained from sources believed to be reliable, neither the author nor any of his employers or their affiliates have independently verified this information, and its accuracy and completeness cannot be guaranteed. Accordingly, no representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, timeliness or completeness of this information. The author and all employers and their affiliated persons assume no liability for this information and no obligation to update the information or analysis contained herein in the future.

This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit telltales.substack.com

In this episode, the Telltales team discusses the macro environment, including government finances and energy markets, and debates the investment merits of big tech stocks trading at 30-50x free cash flow. They also dive deep into NVIDIA's leading position in accelerated computing and the potential threats to its dominance.

[00:00] Oil & Gas (Exhibits B & C): Hunt opens the discussion by examining the current state of oil and natural gas markets, noting the influence of factors like China's demand and U.S. production.

[06:09] Exhibit A: US Gov't Revenues and ExpensesHunt analyzes the US government's financial situation, noting the challenges in raising additional revenue or cutting expenses meaningfully. He suggests that in the upcoming presidential debate, neither side will be able to make a strong case for fiscal improvement.

[09:20] Page 1: AAPL / AMZN / GOOG / MSFT / TSLA The team examines the high free cash flow multiples of the Magnificent 7 tech stocks and debates whether they represent good value in an environment of elevated interest rates, given their strong competitive positions and growth prospects.

[12:22] Page 3: NVDA/AMD/INTC/TSMC/ASML Mike and Jason do a deep dive on NVIDIA, discussing why its 15-20 year lead in AI accelerators will be hard for competitors to close, even as generative AI could potentially help them develop rival software platforms faster. However, they believe NVIDIA's ecosystem advantage will be difficult to overcome.

[20:30] Page 3: Nvidia's Competition The team considers potential threats to NVIDIA's dominance, including hyperscalers developing their own AI chips and AMD's efforts to catch up with its ROCm platform. However, they believe NVIDIA's software lead and incumbent position with developers give it a strong moat.

[23:26] Pages 15 & 19: Healthcare News Jason provides updates on Vertex's regulatory issues in the UK, Novartis divesting its radiopharmacy business in Europe while expanding in the US, and the market opportunity for Lantheus' Alzheimer's diagnostic imaging agent.

[25:35] Page 3: Nvidia Blackwell Delay The hosts discuss the implications of NVIDIA delaying its next-gen Blackwell chip by 2 months. They mostly see it as a minor issue and potentially a strategic move to optimize yields, especially since NVIDIA is still ahead of competitors.

This podcast and the information herein are intended for informational purposes only. The views expressed herein are the author’s alone and do not constitute an offer to sell, or a recommendation to purchase, or a solicitation of an offer to buy, any security, nor a recommendation for any investment product or service. While certain information contained herein has been obtained from sources believed to be reliable, neither the author nor any of his employers or their affiliates have independently verified this information, and its accuracy and completeness cannot be guaranteed. Accordingly, no representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, timeliness or completeness of this information. The author and all employers and their affiliated persons assume no liability for this information and no obligation to update the information or analysis contained herein in the future.

This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit telltales.substack.com

In this episode, the Telltales team discusses the latest developments in energy markets, semiconductor stocks, and biotech. Key topics include Intel's decline due to strategic missteps, NVIDIA's AI leadership and competitive risks, and updates on oil, natural gas, and the U.S. deficit.

[00:59] WORLD OIL SUPPLY / DEMAND (Exhibit C) Hunt notes 4 million barrels per day of spare production capacity, mostly from Saudi Arabia and UAE. If this supply came online, oil prices could drop significantly. Easing of tensions in Ukraine and Middle East could be bearish for oil.

[03:19] US GAS DEMAND / SUPPLY (Exhibit B) Natural gas prices are falling as storage levels rise much faster than normal, with the November contract trading in low $2 range. Weather will be a key factor, but persistently low prices could be a risk, especially for Haynesville producers.

[04:20] US GOV'T REVENUES AND EXPENSES (Exhibit A)The U.S. deficit remains a long-term challenge with no easy solutions.

[06:39] Energy Earnings Updates: 2024Q2 (Pages 9-12) Hunt reviews the latest results and outlook for Antero, EQT, Chesapeake, EOG, Magnolia, Permian Resources, Diamondback, Kinder Morgan, Enterprise, Energy Transfer, and the oil majors.

[13:44] Intel's Journey to Irrelevance (Page 4) The team discusses how Intel went from being the dominant chipmaker to facing an existential crisis due to missing mobile and AI trends. With $15B of annual cash burn and $48B of debt, major restructuring may be needed. Meanwhile, NVIDIA has grown from $5B to $110B+ in revenue.

[19:16] Nvidia's Risks (Page 4) While hyperscalers like Amazon and Google are developing their own AI chips for cost and performance reasons, they are likely to still rely heavily on NVIDIA GPUs. Energy availability is a potential risk. Mike & Jason published an article on Nvidia’s 5 risks which you can get from their website: www.topmarkcapital.com

[24:54] PFE / MRNA / LNTH / BNTX / VRTX (Page 15) Jason provides an update on the latest in biotech, including Novartis divesting its radiopharmacy unit, viewing Lantheus' network as a strategic asset. BioNTech also announced promising early results for an mRNA lung cancer vaccine.

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This podcast and the information herein are intended for informational purposes only. The views expressed herein are the author’s alone and do not constitute an offer to sell, or a recommendation to purchase, or a solicitation of an offer to buy, any security, nor a recommendation for any investment product or service. While certain information contained herein has been obtained from sources believed to be reliable, neither the author nor any of his employers or their affiliates have independently verified this information, and its accuracy and completeness cannot be guaranteed. Accordingly, no representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, timeliness or completeness of this information. The author and all employers and their affiliated persons assume no liability for this information and no obligation to update the information or analysis contained herein in the future.

This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit telltales.substack.com

Shownotes

In this episode, the Telltales Podcast team explores recent developments in healthcare, the importance of founder stories in investing, and potential economic risks on the horizon.

[00:00:54] World Oil Supply/Demand (Exhibit C) The Iranian response to recent events in Tehran has been delayed indefinitely, potentially impacting oil prices. The team discusses the ongoing situation between Hamas and Israel, as well as Saudi Arabia and UAE's role in the oil market surplus.

[02:29] US Gas Demand/Supply (Exhibit B) Concerns are raised about natural gas prices and consumption due to unseasonably warm weather in New York. The team suggests delaying discussion on energy companies to monitor price developments.

[03:12] US Government Revenues and Expenses (Exhibit A) The podcast highlights the growing deficit and potential risks associated with high government debt. They predict a possible financial event in the coming year that could impact the markets.

[03:45] Financial Institutions Overview (Page 13) Discussion of JP Morgan, Morgan Stanley, Goldman Sachs, and the addition of Interactive Brokers to their analysis. The team emphasizes the importance of overnight borrowing in the repo market and potential risks associated with it.

[06:59] Jobs Data Revision The team analyzes the recent significant downward revision of job gains by the Bureau of Labor Statistics, comparing it to similar revisions during the 2009 financial crisis.

[08:55] Telltales Founder Stories Gwendolyn and Holly share insights from their research on company founders, highlighting stories from NVIDIA, Vertex Pharmaceuticals, TSMC, and Interactive Brokers. The team emphasizes the importance of studying founders for investment decisions.

[13:31] Healthcare Sector Analysis (Page 19) In-depth discussion of recent developments in the GLP-1 drug market, focusing on Eli Lilly's recent study results and FDA decisions. The team explores the potential impact on healthcare spending and competition in the market.

[25:10] Vertex Pharmaceuticals and Diabetes Research (Page 15) The podcast concludes with a discussion of Vertex Pharmaceuticals' promising early-stage research on type 1 diabetes treatment and the company's unique approach to drug development.

Don't forget to subscribe to our email list at telltales.us for weekly updates on cashflow analysis across various sectors!

This podcast and the information herein are intended for informational purposes only. The views expressed herein are the author’s alone and do not constitute an offer to sell, or a recommendation to purchase, or a solicitation of an offer to buy, any security, nor a recommendation for any investment product or service. While certain information contained herein has been obtained from sources believed to be reliable, neither the author nor any of his employers or their affiliates have independently verified this information, and its accuracy and completeness cannot be guaranteed. Accordingly, no representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, timeliness or completeness of this information. The author and all employers and their affiliated persons assume no liability for this information and no obligation to update the information or analysis contained herein in the future.

This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit telltales.substack.com

SHOWNOTES

In this episode, we dive into the latest developments in technology, pharmaceuticals, and global markets, exploring the strategies of industry leaders and emerging trends.

[00:01:18] World Oil Supply and Demand (Exhibit C) Oil consumption forecasts have been reduced due to slowdowns in China's economy, particularly in construction and infrastructure. The oil price remains stable due to geopolitical tensions involving Iran and Israel. Saudi Arabia and the UAE may increase oil supply to the market.

[03:16] US Gas Demand and Supply (Exhibit B) Natural gas prices hit unprecedented lows in August due to surplus supply. Expectations are for prices to rise to the $3 range as we enter the November contract trading period.

[04:04] US Government Revenues and Expenses (Exhibit A) The Treasury Department projects a $1.9 trillion deficit for fiscal 2024. Interest rates are discussed, with expectations that they will not return to post-2008 levels due to ongoing debt issuance needs.

[09:39] Vertex Pharmaceuticals (Page 15) The story of Vertex's founder, his mission to combat disease, and the company's journey from its inception to becoming a leader in cystic fibrosis treatment is explored. The importance of interdisciplinary collaboration and technological innovation in drug discovery is highlighted.

[15:03] TSMC and BYD (Page 3) The similarities between TSMC and BYD are discussed, including their ability to leverage government support and their focus on cutting-edge technology and talent acquisition. The potential threat BYD poses to Tesla is briefly mentioned.

[17:42] Retail Businesses (Page 8) Home Depot's results indicate a weak consumer market. The impact of interest rates on the home improvement sector is discussed.

[18:31] Harrow Earnings Update (Page 20) Harrow reported strong earnings, exceeding sales expectations. The company's five-year plan and potential for continued growth in the ophthalmic pharmaceutical market are discussed.

[20:34] Lantheus Earnings Recap (Page 15) Lantheus reported good results but also increased expenses, particularly in R&D and sales staff, in preparation for new drug launches.

[21:50] Hyperscale Capex (Pages 1, 2, 3, 4) The continued high capital expenditure of large tech companies, particularly in AI and data centers, is discussed. The potential impact on Nvidia's future sales and profitability is explored.

[27:10] Google's Antitrust Ruling (Page 1) The recent antitrust ruling against Google is discussed, including potential remedies and the impact on Google's agreement with Apple for default search engine status.

[29:49] Google Pixel 9 Phone and Gemini Launch (Page 1) Google's announcement of their new Pixel phones and the Gemini AI product is covered, comparing it to Apple's upcoming offerings and discussing potential pricing strategies for AI features.

In conclusion, this episode provides a comprehensive look at key developments across multiple industries, offering insights into market trends, technological advancements, and regulatory challenges facing major companies.

$TSM $BYDDY $TSLA $VRTX $HD $LOW $HROW $LNTH $NVDA $MSFT $GOOGL $AAPL $META $AMZN $ORCL

This podcast and the information herein are intended for informational purposes only. The views expressed herein are the author’s alone and do not constitute an offer to sell, or a recommendation to purchase, or a solicitation of an offer to buy, any security, nor a recommendation for any investment product or service. While certain information contained herein has been obtained from sources believed to be reliable, neither the author nor any of his employers or their affiliates have independently verified this information, and its accuracy and completeness cannot be guaranteed. Accordingly, no representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, timeliness or completeness of this information. The author and all employers and their affiliated persons assume no liability for this information and no obligation to update the information or analysis contained herein in the future.

This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit telltales.substack.com

Shownotes

In this episode of the Telltales Podcast, hosts Mike Nicoletti, Jason Wallace, and Hunt Lawrence explore recent market events, discuss key companies across various sectors, and analyze their cash flow characteristics.

[00:00:00] Introduction and Recent News (Exhibit C)

Hunt discusses the recent antitrust judgment against Google and its potential impact on Apple. The hosts briefly touch on oil and gas market conditions.

[03:21] Natural Gas Market Update (Exhibit B)

Hunt provides an overview of the current weak state of the natural gas market, with prices at historic lows and ample storage.

[03:52] U.S. Government Finances (Exhibit A)

The hosts discuss the challenges facing the U.S. government's fiscal situation, including rising interest expenses and the need for spending cuts.

[05:22] Healthcare Companies Update (Page 15)

The team reviews recent developments for Lantheus and Vertex Pharmaceuticals, noting positive outlooks for both companies.

[07:23] Industrial and Manufacturing Sector (Page 14)

Hunt analyzes the performance of Caterpillar, Deere, Generac, TransDigm, and Fastenal, highlighting their business models and cash flow characteristics.

[10:36] Financial Institutions Overview (Page 13)

The hosts discuss JPMorgan Chase, Morgan Stanley, and Goldman Sachs, examining their valuations and dividend policies.

[12:13] Japanese Yen Carry Trade Explanation

Hunt and the team provide a detailed explanation of the recent market dislocation caused by the unwinding of the yen carry trade.

[17:31] Semiconductor Industry Deep Dive (Page 3)

The hosts discuss NVIDIA's recent challenges and the overall state of the semiconductor industry, including Intel's struggles to remain competitive.

[27:04] Tech Giants and Antitrust Concerns (Page 1)

The episode concludes with a brief discussion of the recent antitrust judgment against Google and its potential implications for other tech giants.

Don't forget to subscribe to our email list at telltales.us to receive our weekly cash flow memo, covering 80 companies, U.S. government finances, and the energy sector!

This podcast and the information herein are intended for informational purposes only. The views expressed herein are the author’s alone and do not constitute an offer to sell, or a recommendation to purchase, or a solicitation of an offer to buy, any security, nor a recommendation for any investment product or service. While certain information contained herein has been obtained from sources believed to be reliable, neither the author nor any of his employers or their affiliates have independently verified this information, and its accuracy and completeness cannot be guaranteed. Accordingly, no representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, timeliness or completeness of this information. The author and all employers and their affiliated persons assume no liability for this information and no obligation to update the information or analysis contained herein in the future.

This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit telltales.substack.com

Shownotes

00:00:00 - Introduction

00:00:56 - Market Update: Oil and Natural Gas

• Oil pricing weakening; 4.4 million barrels of excess production capacity not being produced

• Saudi Arabia and UAE may increase production in fall, causing near-month prices to drop

• Natural gas trading very low due to oversupply; prices expected to improve in winter

00:03:10 - U.S. Political Landscape and Budget

• Discussion of Vice President Harris

• Speculation on expiring Trump tax cuts and their impact on income tax revenue

00:04:20 - Company Analysis: Retail and Transportation

• 5 Below facing challenges with CEO departure

• Uber's future uncertain with AI and Robotaxi developments

• FedEx and UPS competing against Amazon's logistics

• Nike struggling but maintains strong balance sheet

• Costco performing well but expensive at 50x free cashflow

00:11:39 - Restaurant and Beverage Stocks

• McDonald's and Starbucks struggling with same-store sales growth

• Chipotle rebounding strongly after E. coli issues

• Detailed discussion on Celsius Holdings' growth challenges and market position

00:15:03 - Healthcare Sector Update

• Vertex Pharmaceuticals' VX548 non-opioid pain treatment submission accepted by FDA

• PDUFA date set for January 30, 2025

• Discussion on effectiveness compared to opioids and market potential

00:16:20 - Tech Sector: Microsoft Earnings and AI Developments

• Microsoft's earnings meet expectations but fall short of some predictions

• AI Copilot sales lower than expected due to capacity constraints

• Plans for increased capital expenditure to support AI infrastructure

00:20:39 - AI in Finance: JPMorgan's Language Model

• JPMorgan developing its own AI language model for internal use

• Discussion on potential use of NVIDIA servers and open-source models like Meta's Llama

00:24:58 - Future of Search and AI

• Speculation on how search might evolve in the next 2-3 years

• Potential shift towards chat interfaces and cited references

• Challenges with data sources and closed social networks

00:29:06 - Apple's AI Strategy and Future of Mobile

• Apple's delayed AI capabilities for iPhone 16 Pro

• Potential impact on Apple's business model, particularly Google revenue sharing

• Discussion on conflicts between app developers and AI assistants

00:31:42 - Conclusion and Next Week's Topics

FIVE 0.00%↑ UBER 0.00%↑ UNH 0.00%↑ FCX 0.00%↑ ALB 0.00%↑ CF 0.00%↑ NEE 0.00%↑ FDX 0.00%↑ UPS 0.00%↑ NKE 0.00%↑ COST 0.00%↑ MCD 0.00%↑ SBUX 0.00%↑ CMG 0.00%↑ CELH 0.00%↑ VRTX 0.00%↑ MSFT 0.00%↑ JPM 0.00%↑ NVDA 0.00%↑ META 0.00%↑ GOOGL 0.00%↑ AAPL 0.00%↑

This podcast and the information herein are intended for informational purposes only. The views expressed herein are the author’s alone and do not constitute an offer to sell, or a recommendation to purchase, or a solicitation of an offer to buy, any security, nor a recommendation for any investment product or service. While certain information contained herein has been obtained from sources believed to be reliable, neither the author nor any of his employers or their affiliates have independently verified this information, and its accuracy and completeness cannot be guaranteed. Accordingly, no representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, timeliness or completeness of this information. The author and all employers and their affiliated persons assume no liability for this information and no obligation to update the information or analysis contained herein in the future.

This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit telltales.substack.com

Shownotes

00:00 - Introduction

00:46 - Oil Market Update

Discussion of 2025 oil supply and demand projections

Estimated 104.5 million barrels per day of supply and demand

Breakdown of crude oil vs other liquids in production figures

Saudi Arabia and UAE holding back 3.5 million barrels of surplus production

Caution advised on investing in oil producers currently

03:00 - Natural Gas Market

Current low prices for natural gas

Storage levels 500 BCF above 5-year average

Potential for price improvement later in the year

Advice to wait before investing in natural gas producers

05:00 - U.S. Government Cash Flow Statement

Analysis of CBO forecasts and estimates

Current deficit running at about $1.5 trillion in full employment economy

Challenges in reducing spending or increasing revenue

Discussion of potential impacts on corporate taxes, tariffs, and individual taxes

Concerns about long-term deficit sustainability

10:44 - Healthcare Sector Update

Projection of 8% increase in medical costs for next year

Government actions against Pharmacy Benefit Managers (PBMs)

UnitedHealth Group earnings growth driven by PBM business (OptumRx)

12:25 - CrowdStrike Software Issue Explanation

Detailed breakdown of the cybersecurity software update that caused widespread crashes

Impact on various industries including airlines and banks

Technical explanation of the bug and its effects

Discussion of potential fallout for CrowdStrike and cybersecurity industry

19:48 - Tesla Analysis

Review of Tesla's recent financial results

Discussion of Tesla's various business segments: automotive, autopilot/robotaxi, humanoid robots

Valuation considerations for Tesla stock

Upcoming robotaxi event on October 10th

Analysis of Tesla's automotive business value and potential

Consideration of geopolitical factors affecting factory locations

29:40 - NVIDIA and Tech Spending

Brief discussion on NVIDIA's chip sales and margins

Google/Alphabet's continued heavy CapEx program

Implications for NVIDIA's future sales and market reaction

31:26 - Closing Remarks

This podcast and the information herein are intended for informational purposes only. The views expressed herein are the author’s alone and do not constitute an offer to sell, or a recommendation to purchase, or a solicitation of an offer to buy, any security, nor a recommendation for any investment product or service. While certain information contained herein has been obtained from sources believed to be reliable, neither the author nor any of his employers or their affiliates have independently verified this information, and its accuracy and completeness cannot be guaranteed. Accordingly, no representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, timeliness or completeness of this information. The author and all employers and their affiliated persons assume no liability for this information and no obligation to update the information or analysis contained herein in the future.

This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit telltales.substack.com