No Relief Coming At The Pump
Despite all the rhetoric in recent days intended to create more product supply, it's all marginal in the face of an oil market that if anything looks like it's getting tighter.
@bobeunlimited.bsky.socialBob Elliott
@bobeunlimited.bsky.social
CIO @ Unlimited | Fmr Bridgewater IC | Described as one of the few "sane" voices on #fintwit (or is it #finsky?) | Comments are not investment advice
@bobeunlimited.bsky.social@bobeunlimited.bsky.socialRemember the $600bln question Sequoia raised 2yrs ago? It's now the $3tln question.
And while the tab has grown, actual revenue has only increased a little over 100bln, highlighting just how far the forward need has outgrown the actual reality.
@bobeunlimited.bsky.socialI hear all the time that the semis & hyperscalers see plenty of AI-related demand ahead, with no connection to who will pay to meet those lofty expectations. In short, it would require all non-tech companies to bet their entire free cashflow on AI by 2030. Good luck.
@bobeunlimited.bsky.socialThe AI boom is increasingly shifting from parabolic to linear growth. Most investors are totally unprepared for that shift. This week, free on the blog app.
@bobeunlimited.bsky.socialAnyone who has been in the VC world for more than a minute knows well that ARR is not close to the same as actual revenue.
@bobeunlimited.bsky.socialThe market is one big bet on AI based on hope for parabolic growth. That's a troubling situation when spending growth is looking increasingly linear.
On CNBC Overtime with Melissa Lee yesterday to close out the week:
youtu.be/aRwlDuI2jLQ?...
@bobeunlimited.bsky.socialAnother great MacroTalk this week covering:
- The telling market response to the OpenAI News
- How the Fed tightening cycle may be more than planned
- What the bending LLM revenue S-curve means for macro
Check it out!
youtu.be/x6vUWPpPF4I?...
@bobeunlimited.bsky.socialSwinging by CNBC Overtime at 440pm ET today to no doubt piss off some AI manics with some troubling facts we learned this week. Check it out!
@bobeunlimited.bsky.socialCompanies that are doing well just before an IPO don't: - Refuse to disclose their actual revenue - "Leak" overstated numbers to the press - Repeatedly push back the listing date - Raise huge "bridge" financing rounds - Claim existential risk to get gov monopoly protection
@bobeunlimited.bsky.socialThe OpenAI & Anthropic S-Curve Problem
News of lower OpenAI revenue (and hastily ‘leaked’ end-’26 guidance), even as they picked up significant share clearly shows a transition from parabolic to linear industry revenue growth ahead.
@bobeunlimited.bsky.socialfeel like I should get one for 5k.
@bobeunlimited.bsky.socialFinanced by first new car with them... A Saturn 2000. what a beauty.
@bobeunlimited.bsky.socialAt current growth rates, it'll take until 2045 for OpenAI+Anthropic *together* to reach 1tln in ARR.
@bobeunlimited.bsky.socialMany nasty replies to my piece yesterday on flatlining model revenue b/c they were highly confident OpenAI ARR surged to 70bln based based on an unsourced leak. Lots mocking the use of Tickerplus as an estimate. Turns it was... 50bln. smh
@bobeunlimited.bsky.socialCongrats to our friends at Brookwood for the launch of $GMAC - the Simplify Brookwood Global Macro ETF which is focused on bringing investors diversifying macro exposures in a tax aware way.
@bobeunlimited.bsky.socialCrack spreads still near highs.
@bobeunlimited.bsky.socialSpot oil prices still above 120 bucks / bbl.
@bobeunlimited.bsky.socialOne Big Bet
US stocks have held up in the face of surging bond yields, corporate spreads, and higher oil prices. The AI mania is the only thing left supporting the market.
@bobeunlimited.bsky.socialThe last thing an advisor needs is to explain to a client that they are facing a retroactive tax clawback in some product when the admin has already made it clear that it's in the cards for the most abusive versions of these products.
@bobeunlimited.bsky.socialRecent rise in advisors asking me how to think about the various tax avoidance strategies that they are getting bombarded with every day. My answer is pretty simple - if it sounds too good to be true, it probably is.