Let AI Burn

Position: None

I have three research calls between 12:30 PM and 2 PM.

Radio silence.

Position: None  

Here are today’s things:

* I covered my SPY at $748.23 and QQQ at $716.51 shorts.

* I added to shorts in JPM at $340.44 and C at $145.01

* I added to MSOS at $4.49, GTBIF at $7.15  and TRLV at $8.71.

Position: Long MSOS (L), GTBIF (S) TRLV (S); Short JPM (M), C (M)

Another intraday low in TLT and high in bond yields.

Position: None

This estate sale (from late May) has saved millions of dollars:

Estate Sale

* I am the anti Boca Biff…

I am the executor of a large estate. The estate has been probated for about two months.

The estate has a very large and concentrated equity portfolio. (NVDA represents over 40% of the account, FTAI, EQIX, IIPR and a bunch of BDCs are the major components of the estate’s stock portfolio.)

I have patiently waited to liquidate the equities.

Yesterday afternoon I liquidated the entire stock portfolio. Not one share of equities remain. Given the elevated level of stock prices I wanted zero (nada, zilch) stock exposure.

Upon settlement I plan to put the proceeds into a money market fund on Monday morning.

This is called an Estate Sale.

Post Script: I recently spoke to Boca Biff for the first time in years. More on Boca Biff’s stock trading early next week.

Position: None

BY Doug Kass · May 29, 2026, 7:00 AM EDT

Position: None

Position: None.

Earlier I covered my QQQ (QQQ) short.

I just covered my SPY (SPY) short at $746.98

 Positions: None.

In response to some subscriber emails I am maintaining a small portion of my high-beta, high-tech short package – including (but not restricted to (SNDK), (MU), (CAT), (INTC), (AMD), (AMAT), (CRWV) etc.)

Positions: Short Package VS (including stocks mentioned above)

Chart from 9:38 a.m.

Positions: None.

In the premarket gaps/markups I shorted more C (C) $145.01 and JPM (JPM) $340.44 (both had price targets raised by UBS: C $150, JPM $384). 
Adding to GRNY (GRNY) and JOET (JOET) shorts

Buying MSOS (MSOS) more aggressively. And individual names.

Positions: Long MSOS L; Short GRNY M JOET S C M JPM M 

From Peter Boockvar:

Remember, awake, check Kospi/Cracks/US$, gold, shift continues/Rents/MSC and tungsten

Remember, awake, check Kospi, especially after Samsung reports earnings. Great Samsung earnings, well above expectations, were not great enough as investors question whether this is as good as it gets. The stock fell 8.6% in South Korea. SK Hynix, about to list in NY, was down 7.6%. Kioxia Holdings in Japan dropped 11.3% in sympathy, ASML is down 5% in Europe and Micron is lower by 5% too pre market. The Kospi itself closed down 4.9% but still up 82% ytd.

Samsung

While crude has notably fallen, even with continued strikes in Hormuz Strait and supply nowhere near where it was pre war (we remain long oil/gas stocks), product prices remain elevated and refiners are having an earnings party. My Bloomberg has data on the 321 Crack Spread going back to 1986 and yesterday’s close of $61.67 was a record high, exceeding the previous peak of $60.99 in June 2022. For those unfamiliar, the 321 crack spread is the margin at which a refiner turns three barrels of crude into two barrels of gasoline and one into distillate.

321 Crack Spread

I want to talk US dollar and gold again. We remain long gold, but a bit less so since January with almost no silver with intentions of buying it back at some point. Last month I pointed out the World Gold Council survey of central banks where more planned to diversify their dollar holdings and increase their holdings of gold. This was followed by last week’s release of another survey from the Official Monetary & Financial Institutions Forum. It said this of note:

“The dollar continues to dominate portfolios and is still viewed as unmatched for safety and liquidity. But central banks increasingly expect to reduce dollar allocations over both the short and long term, especially in emerging markets. For the first time since the GPI series (Global Public Investor) began recording reserve managers’ long-term intentions in 2023, more central banks plan to decrease their dollar holdings than increase over the next 10 years. The euro and renminbi remain the main alternatives, while interest in smaller developed and emerging market currencies is rising. This year, 29% of respondents plan to increase euro holdings in the long term, up from 22% last year. However, neither the euro nor the renminbi fully solves reserve managers’ problem: the former lacks a single, deep safe asset market, while the latter remains constrained by market structure and geopolitical concerns.”

“Gold has become the clearest beneficiary of this uncertainty. It leads short-term buying intentions and has moved to the centre of reserve strategies as a hedge against geopolitical risk and concerns about the international monetary system. In 2026, 82% of central banks hold physical gold, up from 71% last year. A net 30% plan to increase their gold allocation over the next one to two years, while 61% expect the price to settle between $5,000 and $6,000 per ounce by June 2027. Only 28% say the current price is discouraging further purchases. The motivation behind gold purchases is increasingly strategic rather than purely financial. Protection against geopolitical risk is cited by 51% of respondents, up 11% from 2024.” I bolded to emphasize.

“Over the next 10 years, do you anticipate increasing, decreasing or maintaining your exposure to the following currencies? Share of respondents, %”

https://www.omfif.org/2026/06/central-banks-are-riding-the-wave-of-persistent-volatility

China reported its June reserve data and they keep buying gold. They now hold (that they report) 75.44 million troy ounces, or about 2,350 tons, as they continue to reduce their holdings of US Treasuries.

China Gold Holdings

As an equity owner of an apartment REIT, CPT, and a close watcher of everything macro, I’ve been arguing that in the latter part of 2026, the slowdown in rental growth, mostly seen in Sunbelt states, was going to start to reverse with a resumption of higher prices in 2027 because of a sharp drop in new construction and with still strong absorption rates. This was from the June Apartment List National Rent Report out last week and which measures NEW leases only, not renewals:

“The national median rent increased by .4% in June, and now stands at $1,385. This marks the 5th straight monthly increase, with the market now in the midst of the busy summer moving season.” New rent prices are still down 1.2% y/o/y but “has now ticked up for two straight months, after bottoming out in April at the lowest level that we’ve seen in our estimates going back to 2017.” New rents are off 4% from the peak seen in 2022.

The vacancy rate held at 7.2% with 7.3% being the high in this cycle seen in February. Surpassing Austin, San Antonio is now the weakest market in the country while San Francisco remains the strongest with coastal markets overall doing better than sunbelt.

Apartment List said, “we now appear to have hit an inflection point, signaling that the rental market may finally be stabilizing as construction slows and the recent influx of new units gets absorbed.”

And, “The construction boom peaked in 2024, when we saw over 600 thousand new multifamily units hit the market, the most new supply in a single year since 1986. Since then, deliveries of new apartments have slowed considerably, albeit while remaining fairly robust by historic standards. Despite being on the downslope of the construction boom for nearly two years, the market had been struggling to absorb the swell of new inventory. That may finally be changing, as we see multifamily occupancy also hitting an inflection point in tandem with rent growth.”

Rents/shelter are the biggest component of CPI (second to healthcare in PCE) and this is a must watch as the quarters unfold.

I forgot to mention yesterday the important comments from the MSC Industrial earnings call from last week. As they are a major distributor of a variety of products that feed into the industrial and manufacturing sector, it’s a go to for me.

“The growth of our installed base is showing the benefits of an improving macro environment that should result in higher sales across existing locations, an effect which we commonly refer to as the coiled spring. We started to see early signs of this in the third quarter, with daily sales trends on a per unit basis showing volume improvement.”

“we are seeing further signs of an industrial recovery taking shape with positive IP readings across most of our top manufacturing end markets and five consecutive months of MBI readings above 50.”

I’ll add, as I believe some of this is due to inventory stocking in response to concerns over supplies and price increases with Strait issues, we’ll see in coming quarters how sustainable.

They raised prices by 7.2% y/o/y by the way. “Tungsten is still the largest driver of our inflation, and I think we’re not done.” Tungsten prices are up 500%.

And some more on the macro that they are seeing, “we are starting to see changes in behavior. So, the most notable that we haven’t sized yet, but we’re watching closely, is summer shutdown patterns are changing significantly. So, whereas we would have had pre-planned shutdowns, particularly in automotive, those are being canceled, or they’re not being announced as they would have been. So it’s still spotty, but it’s real.”

The price of Tungsten per dry metric ton

Positions: None.

Upside:

-CRNX +99% (to be acquired by Vertex at $85/shr in cash, valuing it at $10.0B)

-PDYN +6.5% (executes AFRL HANGTIME contract for SwarmOS multi-domain autonomy)

-FISV +4.9% (JPMorgan, BOFA, and other banks held preliminary talks for acquisition of Fiserv’s network)

-NET +3.3% (Scotia Howard Weil Raised NET to Sector Outperform from Sector Perform, price target: $300)

-MGTX +3.0% (enters up to $400M royalty and equity financing with Oberland Capital)

-SHEL +2.6% (to divest Shell Downstream South Africa tto ADNOC Distribution at implied EV of $1B; reports Q2 upstream production)

-PLUG +2.2% (to supply GenEco PEM electrolyzers for 50 MW Hunter Valley Hydrogen Hub in Australia)

Downside:

-RIVN -11% (Q2 revenue guidance; files to offer of up to 75M shares)

-WDC -6.0% (sector weakness)

-AMD -3.9% (sector weakness)

-INTC -3.5% (sector weakness)

-ON -3.4% (to divest two chipmaking plants to reduce costs)

-AVGO -2.3% (hearing Erste Group Cuts AVGO to Hold from Buy)

Positions: None.

Positions: None.

Positions: None.

Treasury Autions

11 a.m. : Treasury Announces a 4, 8 and 17 Week Bill Auction; 
11:30 a.m.: Treasury hosts a $52B 52 and a$90B 6 Week Bill Auction; 
1 p.m.: Treasury hosts a $58B 3-Year Note Auction

Fed Speaker:

7:00 a.m.: Fed Vice Chair for Supervision Bowman (Voter) delivers opening remarks at the Financial Stability BoardVirtual Outreach Event, Virtual

Economic Calendar

Positions: None.

Key Takeaways

· Extreme Bubbles In Valuations and Earnings: The data are haunting. The CAPE multiple of the S&P 500 today now classifies as a 2.9x sigma event — closing in on the bubble high of 3.3x back in December 1999. Lest you take solace, it is way higher than the 1.8x SD event ahead of the 1929 crash. The thing is, EPS growth is now so out of line with historical norms, let alone nominal GDP trends, that it has now reached a 4.6 sigma event — compared to 0.9x at the peak in early 2000. Under a more normal profit stream, the CAPE multiple would be a 4.6 SD event (see page 10 of the Financial Times for more).

· Signs of Consumer Strain are Hard to Ignore: What the bond market clearly didn’t see was the page B3 article in today’s Wall Street Journal titled Walmart Cuts Prices, Draws Praise From the President. The retail giant, with annual revenue topping $700 billion, is cutting prices on thousands of goods. Now watch its competitors forced to follow suit. On the very same page, we see Pawnshop Chain’s Demand Rises With Living Costs — second-hand and consignment stores are in a huge bull market, and just like the shift in the labor market towards multiple-job-holders, a vivid sign of consumer financial strain. Great environment for the Fed to be contemplating a rate hike, don’t you think?

· Affordability Crisis Leads to Family Reunification: This is not an official data point per se, but probably should be. See Movin’ In: Kids in 20s Are Living Back Home on the front page of today’s Wall Street Journal. The affordability crisis on full display. Almost half of U.S. adults under the age of 30 have moved back home — up +12 percentage points from the pre-COVID level in 2019. The reason? Fully 55% of young adults who moved back home said it was out of “financial necessity.” Rents have come down, but are too high at a time when many recent college graduates are saddled with massive volumes of student debt ($1.7 trillion), which no longer receives government support (hence a 10%+ delinquency rate).

Position: None

I just covered my QQQ short rental from yesterday at $714.61 for a near $8 gain.

I remain short SPY.

From Monday:

Things I Did Today

Here are today’s things:

* Re-shorted indices — SPY at $748.84 and QQQ at $722.33. 

BY Doug Kass · Jul 6, 2026, 12:48 PM EDT

Position: Short SPY (S)

Position: None

As night follows day, the memory and chip sector’s overnight action dictates the NYSE opening…

Position: None

The S&P Short Range Oscillator remains overbought at 3.20% vs. 3.37%.

Position: Short SPY (S), QQQ (VS)