The S&P Short Range Oscillator finally moved to slightly oversold at -0.53%.

Position: None

Weak close, at the day’s lows.

Position: None 

I have already spoken to three managements.

One more to go!

Position: None 

Bret Jensen

U.S. average gasoline prices climbed above $4 a gallon for the first time in a month as escalating tensions in the Middle East pushed up global fuel costs and renewed concerns about inflation.

phogan

From the WSJ I believe. IMO, we’ve had very few “emergencies” that required the release of stockpiles. All political bs.

“The U.S. Strategic Petroleum Reserve, the nation’s emergency stockpile of crude oil stored in underground salt caverns along the Gulf Coast, has fallen to its lowest level since 1983 following years of emergency drawdowns and limited replenishment. The reserve is intended to cushion the economy against major supply disruptions, including conflicts that threaten global energy markets. As tensions involving Iran and the Strait of Hormuz raise concerns over oil flows, policymakers are debating whether to release additional barrels to stabilize prices or prioritize rebuilding the reserve to strengthen long-term energy security.”

Position: None

Position: None

I made a mistake covering my Morgan Stanley (MS) short.

The hype surrounding the IPO market’s prospects, is, well, hype, in my view.

See More Tales From Nvidia (Issue #219) today. 

Position: None

In early June, 2026 I wrote in my Diary and was quoted in a Yahoo Finance interview that my view of SpaceX’s (SPCX) intrinsic value was about $70.

It is my view that few “talking heads” in the business media even bothered to read the IPO prospectus — and, that, even fewer, did a bona fide analysis (modeling) on the company.

We shorted the shares at $213 and I continue to remain short. (The shares are currently priced at about $123.)

From my Yahoo Finance interview of five weeks ago:  

SPCX IPO: Doug Kass Values SpaceX At A Discount Of Nearly 50% — ‘We Currently Plan To Short The Stock’

Position: Short SPCX (S)

Bond prices at the low of the day and yields at the high of the day.

Position: None

I covered my Apple (AAPL) ($325.40) short (-$8.50 today) for a small profit. 

I plan to reshort on strength.

Position: None

Here are today’s things:

* Added to GTBIF at $7.08, TRLV at $8.74, VRNO at $5.72 and MSOS at $4.39.

* Added small to PEP at $136.32 and PG at $148.73,

Position: Long MSOS (VL), GTBIF (S), TRLV (S), VRNO (S), PEP (S), PG (S) 

I added to PEP (PEP) and PG (PG) this morning.

Positions: PEP S PG S

*  The implication is increasingly clear: before hard consumption caps become commonplace, AI demand is already being redirected toward lower-cost models, making economics — not model capability alone — the next competitive battleground. 

AI IPOs… I wonder if they can happen under these circumstances?

SpaceX (SPCX) already a flop. Then, the dynamics in the sector are rapidly changing. Anthropic put up a huge Q in front of what was expected to be the IPO and that Q apparently had several one-time big boosts in it including revenue from tokenmaxxing that is now being stopped and a big subsidy from SpaceX that was revealed in their own S-1 if I remember correctly.

Now in addition to caps on token use, the Chinese and other Open Source models seem to be gaining traction again, at much lower prices.

At any rate, how can anyone have any confidence in any forecast that is produced for either Anthropic or even worse OpenAI? What sort of trajectory can Anthropic produce from its last Q that was aided by what are presumably either 1x or unsustainable events? The valuations these companies are demanding, the cash burn and continual funding they require, and all the commitments they have already made?

Since when do market share and pricing losers that hemorrhage cash command these types of valuations?

At any rate, there are so many moving pieces, how can anyone have any confidence in a forward financial forecast for any of these guys? How can someone even produce a forecast with any confidence? Can an underwriting bank really stand behind any of this with confidence?

Then can the market absorb all this liquidity? Big unlocks coming from SpaceX. They all will have unlocks and seemingly continual needs for equity issuance. Then the market overall, a lot of the big buyers of their own equity have obliterated their own balance sheet and cash flow with all the spending and future commitments and off balance sheet stuff. All of the sudden the equity supply/demand equation has flipped to the negative direction as well with all of the equity issuance that has occurred and is on the come, as well as the unlocks.

All my opinion, but it is going to be interesting.

The Caps Are Coming, The Caps Are Coming. 

“Tokenmaxxing” may be AI’s latest buzzword, but ETR’s latest AI Pulse Survey suggests enterprises are becoming just as focused on controlling consumption as expanding it. While AI usage continues to climb, hard consumption caps have emerged as one of the fastest-growing governance mechanisms, rising from 17% of organizations today to an expected 41% over the next 12 months. Demand isn’t slowing — it’s becoming managed. This week’s Open-Weight AI Models survey indicates over 30% of respondents all ready running them in production and nearly half piloting open-weight models, with cost savings the primary adoption driver, and 91% of non-users say demonstrated savings would increase their likelihood of adoption.  

The implication is increasingly clear: before hard consumption caps become commonplace, AI demand is already being redirected toward lower-cost models, making economics — not model capability alone — the next competitive battleground. 

Position: Short SPCX (S)

Cantor Fitzgerald initiates Trulieve (TRLV) with an Overweight (and a $15 price target).

Position: Long TRLV (S) 

Short-sellers, like the dodo bird, are a near-extinct species:

Position: None

On Thursday I covered my high-beta, high-tech short basket:

Covered My Short Basket!

I have just covered the balance of my high-beta, high-tech short basket for a large gain:

* AMAT $569.74 (-$11)

* AMD $504.44 (-$25)

* CAT $889.10 (-$25)

* CRWV $72.67 (-$5)

* INTC $97.78 (-$5)

* MU $850.75  (-$55)

* SNDK $1440.64 (-$175)

Position: None

BY Doug Kass · Jul 16, 2026, 12:14 PM EDT

Position: None

I will remind everyone that the apogee of any powered or fueled objects’ flight occurs AFTER the fuel runs out and the second derivative of direction (and speed) first turns negative.

Investors and traders need to avoid getting killed by the afterflight following the fuel exhaustion.

In other words, buying too early on the rollover can get expensive just as being too early in shorting on a turn up.

For emphasis, from Friday:

Our Arguments Are Starting to Play Out

We have argued that:

* With everyone on the same side of the bullish boat (in a market dominated by passive products and strategies) and with an increasingly casino-like backdrop of momentum-based buying (as a template see “The CNBC Panelist Said What?” (specifically, the poster child Jim Lebenthal’s “FOMO” buy of Micron at $1,200 recently), including the proliferation and popularity of leveraged ETFs and 0DTE options) — equities remain vulnerable to a market structure event.  

* At the very least, we anticipated a wild setting of dramatic rotation in sector form factors and that is what we have gotten in the last week. Stocks are moving in integers — in the sort of volatility market participants are not accustomed to. 

* Specifically, we expected the heady swing back into hyperscalers was likely to reverse. (Google’s (GOOGL) announcement of technical problems with Gemini served as a catalyst yesterday.) 

* We thought a correction in hyperscalers coupled with a large correction in the over-hyped leadership in memory and semis could contribute to a substantial fall in the Nasdaq. This is what we have been seeing in the last three trading session.

* We warned that the IPO market’s heady activity would backfire on investors. Yesterday SpaceX (SPCX) (one of our shorts) broke its IPO price. Standard Nuclear (STDN) and Csquare (CSQR) joined SpaceX by breaking below their IPO prices on Thursday. 

Again, this is a great environment for dispassionate and opportunistic traders but a lousy setting for the buy-and-hold crowd.

BY Doug Kass · Jul 17, 2026, 7:30 AM EDT

From last Monday:

I Remain Bearish as Investors Are Mispricing Risk

* Risks now dwarfs rewards…

Stated simply, my ursine market view continues to be influenced by:

 • The lack of fiscal discipline in Washington, D.C., which has resulted in ever increasing annual deficits and a burgeoning national debt load.

• Improvisational fiscal and foreign policy could lead to adverse economic and market outcomes.

• The domestic economy and 2026-07 S&P earnings growth are heavily reliant on AI capital spending. 

• We are skeptical whether the AI spend will translate into adequate returns on capital. 

• Persistently high inflation. 

• The likelihood that interest rates will be higher for longer.

• In today’s uneven K-shaped economy, many consumers are spent up and not pent up. 

 • An equity risk premium which has now morphed into an equity risk discount. 

 • Extended valuations in the 95%-tile (Cape Shiller Ratio, Buffett Indicator and other traditional metrics). 

• We are in a Bull Market in Complacency with institutional cash allocations near record lows and the buy the dip mentality (too) firmly entrenched. 

• Market structure risks are expanding materially. With the popularity of leveraged ETFs and ODTE options (zero days till expiration on indexes and, now even on INDIVIDUAL stocks) the markets have become gamified. Investor timeframes have been reduced as they behave more as gamblers in a casino than long term investors.   

BY Doug Kass · Jul 13, 2026, 11:45 AM EDT

Position: Long GOOGL (S), AMZN (S); Short SPCX (S)

The S&P Short Range Oscillator moved closer to neutral at 0.65% vs. 2.29%.

Position: None