Retail is buying near RECORD levels:

On Monday, retail traders purchased +$3 BILLION of equities after the drop, the largest purchase since 2015.

Last week, retail traders bought +$8 BILLION of equities amid DeepSeek worries.

Has retail ever been this bullish?

(a thread) This comes after a record $448+ billion flowed into US stocks in 2024.

For the last 2 years, every dip has been a buying opportunity as big tech's dominance as grown.

As the trade war and AI disruption builds, retail is betting on the same outcome going forward.

This is insane:

In 2025, $9.2 TRILLION of US debt will either mature or need to be refinanced.

The US now holds $36.2 trillion worth of government debt, meaning 25.4% of the total is set to mature.

This is the REAL reason rates are rising. Let us explain.

(a thread) For some context, the US has added $23 TRILLION of debt since 2008, a 230% increase.

Since 2020, total US debt is up $13 trillion or $2.6 trillion PER YEAR for 5 straight years.

Much of this debt was refinanced last year and another major block of it is due in 2025.

The stock market is in a new era:

As trade wars start and stop, volatility is soaring and the S&P 500 is swinging $1+ trillion PER DAY.

Markets are in one of their greatest trading environments of all time.

Want to capitalize on it? Here's what we realized.

(a thread) First, it has become increasingly clear that President Trump's goal with tariffs is NOT to generate long-term revenue.

Rather, it's to use tariffs as a measure to obtain certain policy outcomes.

With Canada and Mexico, his goal is to secure the border as seen in today's deals.

The trade war is LIVE:

New tariffs from President Trump are set to impact $1.3 TRILLION worth of US trade.

The US stock market has lost over -$1.5 TRILLION of market cap with ~43% of all US imports soon subject to tariffs.

What does this mean? Let us explain.

(a thread) President Trump announced new tariffs of 25% on Canada, 25% on Mexico and 10% on China.

These build on already EXISTING tariffs on China, some of which are from the last Trump trade war.

On February 4th at 12:01 AM ET, these tariffs will go LIVE.

Here's what it means.

Did DeepSeek illegally buy Nvidia's chips?

Since DeepSeek was founded, Nvidia's sales to Singapore are up a WHOPPING +740%.

The US is now PROBING if DeepSeek bought Nvidia's GPUs through third parties in Singapore.

This will have MASSIVE implications.

(a thread) On Monday morning, when the market collapsed on DeepSeek worries, Elon Musk commented on the situation.

He says, DeepSeek “obviously” has ~50,000 Nvidia H100 chips that they can’t talk about due to US export controls.

These chips cost over $30,000 EACH.

Crazy week? We're just getting started.

Today is the first Fed meeting of 2025, large cap tech reports earnings, and Trump tariffs hit in 3 days.

Meanwhile, OpenAI has accused DeepSeek of illegally stealing their IP while Alibaba just launched an AI model better than BOTH of them.

Are you ready?

(a thread) As OpenAI and DeepSeek gear up for a massive legal battle, Alibaba has crushed them both.

They claim that their newly released AI model is BETTER than DeepSeek, ChatGPT, and Meta.

Tech stocks are beginning to retreat again and $BABA is rising sharply on the announcement.

Gold is telling us something:

Amid the DeepSeek volatility, gold quietly hit a record high this week, now up +35% in 12 months.

Today, gold prices are surging toward $2,800/oz with YTD gains nearly DOUBLING the S&P 500's return.

What is happening with gold?

(a thread) Gold prices have risen in a straight-line higher, even as volatility shook the S&P 500.

In fact, even as the US Dollar hit a new 52-week high and the 10-year note yield broke 4.80%, gold surged.

Historically speaking, gold should be down sharply.

The opposite is happening.

BREAKING: DeepSeek officially announces another open-source AI model, Janus-Pro-7B.

This model generates images and beats OpenAI's DALL-E 3 and Stable Diffusion across multiple benchmarks. The below image shows comparisons of Janus and Janus-Pro-7B.

Janus-Pro is a unified understanding and generation MLLM.

It decouples visual encoding for multimodal understanding and generation.

As seen below, image generation by Janus-Pro looks like a real picture.

DeepSeek is CRUSHING US stocks:

Nasdaq 100 futures are down -1,000 POINTS, set for their BIGGEST drop since Sept 2022.

Nvidia is set to erase $400+ BILLION of market cap today, the biggest 1-day loss in a stock in HISTORY.

What is happening? Let us explain.

(a thread) For some background, DeepSeek is a Chinese competitor to ChatGPT.

It was reportedly developed in UNDER 2 months.

In many categories, DeepSeek is actually outperforming ChatGPT.

DeepSeek is now a top performer in AIME, MATH-500, and GPQA benchmarks compared to ChatGPT.

The decline is accelerating:

Nasdaq 100 futures are now down -330 POINTS since the market opened just hours ago as DeepSeek takes #1 on the App Store.

This is how you know DeepSeek has become a major threat to US large cap tech.

The stock market does not lie.

(a thread) For some background, DeepSeek is a Chinese AI startup that appears to have spawned out of nowhere.

It competes with ChatGPT and cost less than $10 million to develop.

It was developed with chips that are considered to be FAR less advanced than those used by US AI companies.

Let us get this straight:

DeepSeek was built in UNDER 2 months for less than $10 million and it's now #1 on the App Store.

On top of this, it was built with outdated chips and small team of <200 people.

Meanwhile, the US is pouring $500 BILLION into AI.

How is the Nasdaq not in trouble here? As of November 2024, it is estimated that OpenAI has roughly 4,500 employees.

DeepSeek was able to build something nearly as advanced as OpenAI, which has 22 TIMES more employees.

How is this possible?

Follow us @KobeissiLetter for real time analysis as this develops.

Lower rates AND lower inflation?

President Trump just "demanded" that rates are CUT and said lower oil prices would fix inflation.

We spent hours researching this and it would take a MASSIVE drop in oil prices to get 2% inflation.

Is it possible? Here's the math.

(a thread) This week, President Trump claimed to have a solution to the Fed's 3+ year battle against inflation.

He demanded the OPEC lower oil prices and the world drop interest rates.

President Trump has also insisted that the US produces more crude oil throughout his campaign.

Has a new era begun?

Investors are currently PILING into US stocks at rates rarely ever seen before.

Retail investors ALONE bought $7.8 billion worth of US equities over the last WEEK, the most since November 2023.

Investors have never been so optimistic.

(a thread) The S&P 500 has risen ~5% over the last 7 days and hit an all-time high for the first time this year.

This comes after back-to-back annual losses in the "Santa Claus" rally for the 3rd time in history.

Recent buying is +2.3 standard deviations above the last 12-month average.

Crypto investors just made history:

Exactly 16 years ago, Bitcoin was launched as the first digital currency in the world.

Today, President Trump officially signed the first pro-crypto Executive Orders in US history.

What does it all mean? Let us explain.

(a thread) Just hours ago, the below Executive Order was signed by President Trump.

This includes a variety pro-crypto measures all aimed as "strengthening American leadership in digital financial technology."

The long awaited national crypto reserve was a part of this Executive Order.

The Fed's worst nightmare just got worse:

ALL 3 major metrics of inflation in the US are rising and rate HIKES recently became more likely.

Meanwhile, President Trump just said that he will "DEMAND that interest rates drop immediately."

What will the Fed do now?

(a thread) It is clear that inflation is HOT, even with the unexpected drop in Core CPI, to 3.2%.

1-month annualized core PCE inflation is at 3.5%+ and and core CPI is 120 basis points above the Fed's target.

1-month, 3-month, and 6-month annualized core PCE inflation are rising.

Tariffs are coming:

President Trump is set to place tariffs on China, Mexico and Canada by as soon as February 1st.

Estimates show that Trump's tariffs could generate up to $3.3 TRILLION in revenue over the next 10 years.

What does this mean for markets?

(a thread) President Trump said that 25% tariffs on Canada and Mexico and 10% tariffs on China are likely by Feb 1st.

Trump has considered tariffs of 60%+ on some Chinese products.

A universal 20% tariff would generate ~$300 BILLION per year, per the Tax Foundation.

Who pays for this?

It's day ONE of the stock market under Trump:

Tariffs are coming, rate cuts are priced-out, and 200+ Executive Orders were signed on Jan 20th.

As an investor, you must evolve your investment strategy with changes in market dynamics.

Here's what we are watching.

(a thread) President Trump has signed 200+ Executive Orders already.

This is more than the total signed by Joe Biden in his entire term and nearly as much as Trump's entire previous term.

It's also ~4x the annual average of previous presidents.

A lot of change is coming.

The US debt ceiling crisis is back:

On Friday, US Treasury Secretary Yellen announced that the US will hit the debt limit on Tuesday, January 21st.

Yellen has advised the US Treasury to start “extraordinary measures."

What does this mean? Let us explain.

(a thread) For some background, the US debt crisis is not new.

Since 2020, total US debt has gone from $23.2 trillion to $36.2 trillion.

That's a $13 TRILLION increase in 5 years, or a 57% increase since the pandemic.

Last year, the US added $1 trillion in debt in just 105 DAYS.

What just happened?

Melania Trump, the First Lady of the US, just launched her own memecoin, $MELANIA.

Less than 48 hours ago, Donald Trump launched $TRUMP which just erased $7.5 BILLION in market cap in 10 MINUTES.

Wondering what happened? Let us explain.

(a thread) At 4:13 PM ET, Melania Trump made the below post launching her memecoin.

Just minutes later, Donald Trump reposted the post himself, while at his Victory Rally.

All of a sudden, buyer demand collapsed in Donald Trump's memecoin, $TRUMP, and supply surged.

WOW.

Donald Trump’s memecoin, $TRUMP, DOUBLED overnight and is currently trading up more than +28,000% in 36 HOURS.

The coin is now up more than the S&P 500 has returned since 1971, or 54 YEARS of returns.

Why did it double overnight? Let us explain.

(a thread) The coin is officially trading above $75 for the first time in history.

This puts the total market cap at $15 BILLION with over $2 billion in volume in 24 hours.

Between 12:00 AM ET and 6:00 AM ET prices doubled in $TRUMP.

What happened during the overnight session?

What just happened?

At 9:44 PM ET on a casual Friday night, president-elect Trump launched the biggest memecoin in history, $TRUMP.

Since then, the coin is up 9,500% with $2.2 BILLION of volume traded in under 12 hours.

What does this all mean? Let us explain.

(a thread) The initial launch of the coin was so hard to believe, it came with skepticism.

Traders figured Donald Trump's account was hacked.

However, no statement on a hack surfaced so the coin kept rising.

At 12:45 AM ET, $TRUMP broke above $10.00 and the rally accelerated rapidly.