Biggest news this week is Microsoft's Build developer conference. As expected, it was filled with AI. The thing I'm most excited about is the Surface laptop with a Qualcomm chip, NPU and Recall ability.
Below are the top 5 highlights from the conference according to Perplexity:
I was browsing my photo album over lunch today and came across this gem:
On that day, it was the single worst trading day since 1987. Now compare that to the stock market today:
If there was an argument to be made here, it’s that in the long run, most things are usually not as bad as it seems. And vice versa. The human mind and body are quite flexible and can tolerate quite a bit of stress. It helps to keep a long-term mindset to ensure one is mentally and physically healthy. Just like working out one day doesn’t make you an Olympic athlete, but sustained training over a long period of time, will get you darn close.
It’s also tough to bet against America 🇺🇸. As a junior corporate worker in 2008, I applied for the CFA scholarship, which would cover the cost of taking the Level 1 exam, and mentioned in the essay that I don’t believe recessions will last forever and now is the best time to improve one’s skills.
Short commentary this week because I'm returning from a trip to Dallas (amazing city, loved it). Regularly scheduled programming to resume this week. Always great to see a portfolio up while away on vacation :)
Tough week for Tesla shareholders. Elon decides to layoff the entire supercharger team of 500 staff, putting contractor partners in an awkward position of not knowing who is left at Tesla to contact. Is this a sign of a brilliant genius or the beginning of the end?
I still think the best days are ahead for Tesla shareholders. EV as an industry is facing incredible headwinds that are not unique to Tesla, so it makes sense for Elon to scale back investments in areas that are not directly tied to revenue. Supercharging makes up a small percentage of overall revenue. However, I strongly disagree with the "axe" approach of chopping the entire supercharger division.
With NACS becoming the industry standard in almost all cars sold in the U.S. and Canada starting 2025, it bodes well for Tesla that demand for supercharger network is just around the corner.
August 8 cannot come fast enough!
Tesla Robotaxi unveil on 8/8
— Elon Musk (@elonmusk) April 5, 2024
Whoa, what a week! Elon makes a surprise visit to China and he returns back to the U.S. with approval to operate FSD in China. I always believed that when it comes to AI, Tesla is miles ahead of anyone in real world application with all the video data they collect. If anyone is going to solve autonomous driving, my bet is on Tesla.
MSFT was pretty flat this week despite some news about investing in Malaysia's AI capabilities and some product announcements. They did well on their earnings overall.
Bitcoin seems to have hit a lull since the halving. My guess is probably profit taking from speculators. Interestingly, Huan Ventures has emerged from hibernation and is starting to make investments as noted in The Information. Read more.
Investors this week liked what they heard from Tesla and Microsoft. Both stocks are up post-earnings.
Sorry, short update today because I have some prior commitments.
Tesla had a bruising week: Cybertruck issues a recall notice to fix a potential issue with the accelerator sticking and investors are losing confidence that Tesla can continue is pace of growth as EV faces a pullback in demand. Seems Elon is spread thin running Twitter, SpaceX, Boring Company, xAI and Tesla.
On Friday, Nasdaq posted a 2% drop as tech started posting earnings. Netflix said it would stop releasing subscriber numbers which caused a panic among investors fearful that growth is stalling. Nvidia dropped 10% after Supermicro, one of its largest data center customers, and who itself saw its share price crater 25%, said it would not share prelim earnings spooking investors that ride is coming to an end.
Q1'24 earnings is turning out to be quite eventful. Another month of earnings left -- more (bloodshed?) to come!
The markets faced a challenging week, with inflation rising 3.5% in March -- higher than expected. This has led to questions around the Federal Reserve's plans for interest rates this year. Historically, the Fed lowers rates to stimulate the economy and maintain their dual mandate of full employment and 2% inflation. However, with inflation elevated and unemployment low, the path forward is less clear.
Investors were optimistic in the first quarter, driving the S&P 500 up nearly 10%. However, my outlook for the remainder of 2024 is more cautious. I foresee the S&P 500 ending the year roughly flat, around 5,100. Several factors contribute to this view:
These uncertainties are likely to translate to significant market volatility through the year.
In other news, Tesla recently announced a 50% reduction in the monthly cost of its Full Self-Driving (FSD) feature, lowering it to $99 per month. This strategic move should help boost FSD adoption and provide more real-world data to train Tesla's AI systems, which should improve future FSD capabilities. I view this as a positive long-term development for the company.
Overall, the market environment appears challenging in the near-term, but Tesla's FSD update provides a potential bright spot. I will continue to monitor these developments closely.
Supervised full self-driving now $99/month https://t.co/UoZ0MvirxW
— Elon Musk (@elonmusk) April 12, 2024
Pretty tough week for Tesla after it missed Q1'24 delivery estimates coming in 8.5% below YoY.
Tesla quarterly deliveries decline for the first time in nearly four years (More at Reuters: Here)
Now, Elon is trying to redirect attention to the Robotaxi strategy by tweeting that more details will be announced on Aug 8:
Not holding my breath for this one. "Fool me once..."
Tesla Robotaxi unveil on 8/8
— Elon Musk (@elonmusk) April 5, 2024
Not much in worldwide economic news this week except for the Baltimore bridge collapse which is partly slowing down global trade. S&P500 and Nasdaq are effectively flat from last week changing +0.4% and -0.3%, respectively.
Big mover this week was BTC -- up 11% WoW and 38% since purchase in late Feb 2024. Nice bounce which I attribute to news about the halving and investors leaning into a riskier trade (i.e., more greedy).
Let's see what next week brings! Have a great Easter weekend. Stock market is closed today (Good Friday).
Edit:
Given this is the quarter end, I wanted to share some highlights from NYT for posterity.
Even with the Fed contemplating cutting interest rates as many as three times this year, by as much as three-quarters of a percentage point in total, the returns on offer to investors remain well above those found elsewhere around the globe, helping keep money flowing into the United States.