Patrick Boyle

“And it it's the the valuation they're talking about, to be clear, they're talking about a 125 times sales. So that's not earnings, that's sales. And we don't even really know what the earnings are of SpaceX. There was, you know, the Reuters published that they had EBITDA of, $8,000,000,000. But EBITDA is not earnings. It's earnings before, essentially, the cost of building satellites and building rockets, you know, which for SpaceX, you have to imagine is a significant cost.”

“Like, the, you know, the the idea that so firstly, Nasdaq had to change all of their rules to allow this inclusion because normally a company needs to be you know, there's a list of rules as to how they weigh, you know, a low float company going into an index, how long it's been public, because the idea is it needs to be seasoned in the market and sort of find a valuation with real buyers and sellers. So normally, you would expect it to take about a year, at least, to even consider adding it. Fifteen days is unheard of, and then getting rid of the the caps for the the float on it. You know, Reuters reported that this is because Elon Musk negotiated with Nasdaq and said, you know, we we can list this thing on the NYSE, we can list it on the Nasdaq, we can list it wherever we want.”

“There's a company I can't think of their name now, but they they launched one NVIDIA chip into space in a little satellite, to run an AI program where I think it was meant to, you know, learn the works of Shakespeare or something like that. It constantly had to be shut down because it overheats, because it's very difficult. You know, everyone says, well, space is cold, but it's also a vacuum, and you need air blowing over something or water or whatever to cool it, via convection. If it has to cool radiatively, you need these massive, massive cooling fins on it. And so the next version of this tiny, you know, Shakespeare satellite is going to have the second largest cooling array in space behind the International Space Station.”

“And they have, at the moment, around 10,000,000 paying customers, I believe. You know, there's some analysts out there, and they said that that, that they would reach 1,200,000,000 customers. Now, that's quite an amazing number when you look at the population of the planet who are like, there's 1,000,000,000 people on the planet who earn $35 a day, which comes to a bit under $12,000 a year. They will not be paying for, you know, $150 a month Internet access.”

“So the big drivers of the emerging markets for the last better part of last two, three years now have been the submission of your place, specifically in Taiwan, TSMC being the big one, and South Korea, the memory companies, SK Hynix and and Samsung. And in one stat that's pretty mind blowing is that if you look at it on a year to date basis, those three semiconductor companies, TSMC, Samsung, SK Hynix, are driving almost 70% of the entire index's earnings growth. So this has basically become a one way bet on the CapEx build out that you're seeing.”

“Our view is that The Straits are still very much closed. Oil Brent oil is close to a $110 per barrel. And if you look at the refined products of gasoline, diesel, jet fuel, they're closer to $200 per barrel. And you're already seeing an economic slowdown across most Asian countries, and that our view is that the next leg will be in Europe. So so we're actually think the markets are being very complacent about the risk of an oil shock or a higher for longer oil environment.”

“In the old agreement, for example, Microsoft had to pay a percentage of their cloud revenue to OpenAI because of this exclusive OpenAI offering that they got to sell to their customers. Well now, they don't have to pay revenue share to OpenAI. And while it's no longer exclusive, they still get to sell OpenAI's products to all of their customers. In other words, Microsoft's cloud revenue just went up. At the same time, Microsoft still has significant control over OpenAI.”

“Today's number, ninety. That's how many seconds Russell Brand spent trying to find his favorite bible quote live on Piers Morgan before he finally gave up. The former comedian was on the show to discuss his new book, How to Become a Christian in Seven Days. Sources say step one is to be accused of sex crimes.”

“Now we're talking about a 125 times sales. And, you know, it's worth noting as well that that SpaceX is. It it is an exciting company. It is growing, but it's not grow you know, analysts expect it to grow 25% next year. That's not good enough. Like, Google went public, I forget how long ago, but it they were growing at 240% a year, and they went public at 10 times sales once again. And so the the price the it's not really the the question isn't whether it's a good or a bad company. A bad company can be a good investment if you get in at a low enough price, and an amazing company can be a terrible investment if you overpay for the stock.”

“Well, the the thing that's quite questionable about the way this IPO is being done is just the way that it is being forced into the Nasdaq 100 index almost instantly. I think there's gonna be a fifteen day delay. And also the waiting that it'll be given is much higher than you would expect for a company with a very low float. So in a funny way, the company goes public at a very high valuation. People will probably buy in. Firstly, there's a lot of people are just very excited about Elon Musk and his companies. They'll they'll put money in, but then the, the expectation is that the indexes will be buying fifteen days later. You know, at the current valuation they're talking about, it would have a four and a half percent weight in the in the Nasdaq 100.”

“Well, the real question is there's there's an awful lot of stuff in there that you would consider sort of lottery tickets. Right? Like, where it's stuff that it seems a little bit unlikely, this whole data centers in space thing. It's been tried. There's a company, I can't think of their name now, but they they launched one NVIDIA chip into space in a little satellite, to run an AI program where I think it was meant to, you know, learn the works of Shakespeare constantly had to be shut down because it overheats, because it's very difficult. You know, everyone says, well, space is cold, but it's also a vacuum, and you need air blowing over something or water or whatever to cool it, via convection. If it has to cool radiatively, you need these massive massive cooling fins on it.”

“What's interesting with the the current composition of the emerging market index is that it's really not a reflection on the underlying emerging market economies. It's basically become a bet on the AI CapEx build out you're seeing. So the big drivers of the emerging markets for the last better part of last two, three years now have been the semiconductor plays, specifically in Taiwan, TSMC being the big one, and South Korea, the memory companies SK Hynix and and Samsung. And in one stat that's pretty mind blowing is that if you look at it on a year to date basis, those three semiconductor companies, TSMC, Samsung, SK Hynix, are driving almost 70% of the entire index's earnings growth. Wow. So this has basically become a one way bet on the CapEx build out that you're seeing.”

“Ten years ago, these economies were in a funk. Morgan Stanley called had a term called a fragile five for a lot of these countries. But as these cycles go, they've turned around, and growth is finally coming back up for a long time. So I I I would say you do have to look at it from a country by country basis, because, again, the index is so misleading given how lopsided it is on AI. If the AI topic story slows down or, god forget, turns negative ever, then the index will be in a world of pain. However, outside of that, there's a lot of attractive bottom up stories.”

“Our view is that the straits are still very much closed. Oil Brent oil is close to a $110 per barrel. And if you look at the refined products of gasoline, diesel, jet fuel, they're closer to $200 per barrel. And you're already seeing an economic slowdown across most Asian countries, and that our view is that the next leg will be in Europe. So so we actually think the markets are being very complacent about the risk of an oil shock or a higher for longer oil environment.”

“Microsoft and OpenAI have had a contractual relationship for many years, but recently that situation became contentious. Part of the agreement was that in exchange for its compute, Microsoft would be the only cloud provider that could sell OpenAI's products. In other words, the relationship between Microsoft and OpenAI has long been exclusive. But now they're changing that. OpenAI will be allowed to partner with other companies, which means they can now sell ChatGPT through other platforms such as say AWS which is Amazon's cloud unit which effectively means that the relationship with Microsoft is now an open relationship.”