Hi Again,
Look at our “newsletter scorecard”; our portfolio went up by 15.73% in May 2026! In April 2026, it went up by 7.25%. The market (S&P500) went up 10.5% in April 2026 and by 5.1% in May 2026. Despite geopolitics, why is the market going up? Simple; corporate revenues are skyrocketing. After about 50 years, the US manufacturing sector is booming. “Reshoring” is working! Many retail stores like Best Buy, Kohls, Dollar Tree announced great revenue figures, and their stock prices rose by 15%. Dell Q1 revenue grew by 757% (year to year)! Their stock went up by 30%. 75% car loan borrowers pay more than $1,000 per month. Manufacturing Managers Index (PMI) went up to the highest level in 3 years to 54.
Due to high inflation and a robust economy, none of the economists expect the Federal Reserve to lower rates. We got a new Fed Chair on 5/22/26 but he must convince others on the Board if he wants to lower rates. Expect him to get bullied very soon! In fact, economists expect the interest rates to go up by 1% within the next 12 months. Investors and traders are selling government and corporate bonds.
Bradley Thomas Gerstner is an American entrepreneur, investor, venture capitalist, hedge fund manager, and podcaster. He is the founder, chairman, and CEO of Altimeter Capital. Gerstner appeared on the 2022 Forbes Midas List after his firm's successful investments in Snowflake and Grab. On 5/28/26, Brad made the following comments:
• Snowflake was up 38% in 3 hours!
• “More tokens they have, more money they can make”. In AI, a token is the basic unit of data that a model reads, processes, and generates. Instead of processing raw letters or whole sentences, AI breaks text down into these smaller "building blocks". A token can be an entire word, a part of a word (like a syllable), or even a punctuation mark.
• Elon Musk is the best creator of AI tokens-turning electrons in to AI tokens.
• “Let your winners run”-when stocks go up in a hyperbolic manner, let them ride!
Anthropic AI sells to enterprises while Open AI focuses on selling directly to consumers. Anthropic is beating Open AI and going up 33% quarter to quarter- best record in corporate history. Some are getting in to the upcoming Anthropic IPO through Zoom as they own a big share of their portfolio. Within the past 3 months, Zoom Communications (ZM) went up from $70 to $110. Per CNBC interview with Sam Altman, CEO, Open AI, 20% of all US Corp expenses are going to building data centers in 2026.
Is this “fever’ coming to an end? Day after day, Wall Street experts tell us that this euphoria is different from 1999/2000. But one thing remains the same- “Irrational exuberance” (As stated by Alan Greenspan in 1996). On 6/3/26, Broadcom (AVGO) announced that their gross profit margin will fall by 75%! Jeffrey Edward Gundlach is a billionaire investor, philanthropist, and the CEO of DoubleLine Capital, a mutual fund company he co-founded. He's known as the "Bond King" and a leading bond expert. On 6/5/26, Jeffrey stated that studying international markets going back to 1800, when concentration goes up to 40%, all markets crash. This is known as a “bubble top”. In 2026 major US companies are spending $800 billion and in 2027 it will go up to $1.2 Trillion. At this time, concentration of tech stocks come to 38.6%. Famous Wall Street saying, “staircase up, elevator down”.
Beware!
Have a great month!
Fernando