☕ Hot CPI, Nvidia update & time to buy TSMC?
Nov 10, 2026Howdy! 👋
All three indices are down in the early going on a “hotter than expected” inflation.
Right.
- You and I have seen this movie so many times we’ve memorized the lines.
- We know how it ends for smart investors.
BE SMART!
Here’s my playbook.
1 – SOSDD: Inflation’s “hot” markets “not”
Inflation ran hotter than expected this morning and futures dropped immediately.
Like that’s a surprise.
To a point we have discussed many, many times… today’s market action has nothing to do with inflation itself.
The markets dropped because big traders are asking WWWD… as in What Will Warsh Do?
The bet is that this latest data makes him more inclined to raise rates than lower ‘em. In fact, futures now reflect an 84% probability of him doing just that.
I say great.
Chaos creates opportunity.
People want to make this all kinds of complex.
It’s not.
The solution is to buy companies making “must have” products and services the world can’t live without and which are growing at rates that dramatically exceed the rate of inflation.
Don’t believe me?
I get it… Wall Street has a vested interest in promulgating the argument.
One of my mentors, the late Dr. Mark Mobius, laid this out very clearly in his 2020 book, The Inflation Myth and the Wonderful World of Deflation.
I consider it mandatory reading for smart investors.
Btw, Dr. Mobius sat for an exclusive interview with the One Bar Ahead® Family and you can find that in the March 2021 issue if you haven’t read it or would like to re-read it in light of today’s shenanigans.
Keith’s Investing Tip: Rates are for traders. Companies selling must-have products at prices that beat inflation are where you want to spend your time, energy and – I submit – money.
2 – Jensen update: the White House weighs in
Yesterday I asked whether Jensen Huang will still be Nvidia’s CEO by the end of the week. (Read)
Today the answer looks like a big asterisk.
US President Donald Trump says he spoke with Huang on Monday and asked him point-blank whether he knew the woman was a spy.
Jensen’s response?
According to Trump: “He said, ‘I had no idea that she was a spy,’ and I really believe him.” (Read) Then, in the same breath: “I know the FBI is looking into it in terms of something else.”
That’s the asterisk and a big one at that.
Meanwhile:
- Nvidia’s board says it has “confidence in Jensen.” A committee of independent directors is investigating, with help from outside counsel.
- House China hawks want Huang at a closed-door briefing on Nov 18.
- The first shareholder class action hit federal court Monday, and more law firms are lining up.
- Beijing calls the whole thing “groundless speculation” but seems to me that’s an insult to those who are actually groundless speculators.
None of this, however, answers the question that I think matters most.
What did he know, when and how?
As I noted Monday during a TV interview with Stuart Varney, there’s a bigger issue.
If Huang knowingly allowed or created conditions allowing the sales of restricted chips to Chinese “ghost companies” then HE is the national security problem.
Can you imagine if the US were to bring charges against Huang under the Economic Espionage Act or Conspiracy & Fraud Charges related to the same??!!!
Impossible you say?
In late October, an Nvidia spokesperson said Huang’s interactions with Ms. Huang were “not unusual or unexpected” and part of his job.
Ten days later, the board is investigating him.
That’s quite a shift.
Meanwhile, no word on Alice Huang’s whereabouts.
Imagine that. 🙄
Keith’s Investing Tip: If a worst-case headline knocks you off course, then you own too much. What’s happening is less about the company and AI than it is about position sizing.
And if you have no idea what that term means – position sizing – now’s a great time to learn. I’ll be here if that’s helpful.
3 – Anthropic’s IPO: the price came down. The risks haven’t.
Anthropic set its IPO terms this morning. It’s offering 825 million shares at $70 to $78 apiece, valuing the company at roughly $1 trillion to $1.4 trillion… a big step down from the roughly $2 trillion investors were bandying about only a month ago. (Read)
Not that this is unexpected.
I’ve been warning repeatedly that the company isn’t all that, especially lately.
Here’s where I think it stinks and why investors ought to be VERY leery.
NONE of the dangers highlighted in the company’s S-1 have gone away…
… models that could slip out of control
… models that may not respond to the people running them, taking harmful actions nobody asked for
… technology the company itself admits could pose “catastrophic or existential risks to humanity”
Oh, and one last little gem.
The filing also says that, given the potential scale of a catastrophic AI incident, no single insurer, and possibly not the insurance industry as a whole, may have enough capacity to cover it.
Translation?
Anything resembling safety commitments may come at shareholders’ expense (while early insiders and the investment bankers will ride off into the sunset with their saddlebags full of your money) 🤦
Once again, Wall Street has privatized big profits but socialized risk which, imho, begs the questions where the regulators who are ostensibly charged with protecting the investing public are in all this but I digress.
But, but, but…
Nvidia, Microsoft and Google are all buying blocks of shares.
Yeah, they have to because they are Anthropic’s chip and cloud suppliers which means that a big chunk of that money flows right back to them as orders.
This is like Wall Street paying to fund specific “associations” and “educational undertakings” that are thinly veiled guises intended to promote more trading which, you guessed it, generates billions in fees for them.
Or, if you prefer, like a Vegas casino comping your room and the buffet because it knows exactly where you’ll be spending the rest of the weekend… the house almost always gets its money back.
Individual investors like us are just that… individuals.
There’s an old saying, if you look around the room and you can’t spot the patsy… it’s you.
Keith’s Investing Tip: IPOs are one of the most rigged games of all. If you’re tempted, let Anthropic report at least one quarter as a public company before you buy. That’s when you find out what the numbers look like once they have to stand on their own. Waiting rarely costs you the opportunity but very often saves you a bundle.
4 – TSMC: AI demand doesn’t do drama
While everybody’s glued to the Nvidia soap opera, TSMC quietly dropped another monster number.
October sales hit a record NT$586.9 billion, or roughly $17.9 billion. That’s up 59.7% from a year ago and 14.7% from September. (Read)
One month in, TSMC has already booked about a third of what it expects for the whole quarter.
No surprises here, imho.
Follow the money.
68% of TSMC’s revenue now comes from high-performance computing, which is code for AI. A year ago it was 57%.
Time to buy?
I prefer other names because I think they have considerably more profit potential but that’s beside the point.
My hat is off to everyone who owns TSMC! 😃
5 – Polymarket’s revenue nearly doubled since June. Guess why.
Polymarket says its annualized revenue has topped $1.8 billion, up from “north of $1 billion” in June. (Read)
Wanna know why?
Forget the whole gambling or not gambling thing.
Wall Street’s firms, quant shops and major market makers have ALL integrated platforms like Polymarket into sophisticated institutional trading strategies.
There are four primary avenues:
- Cross market arbitrage and divergence hunting
- Direct event driven hedging and targeted risk transfer (from their books to retail investors)
- Quantitative market making to dominate the order flow and capture the spread while remaining entirely delta-neutral
- Pure-play prediction markets designed to systematically pick off mispriced contracts from retail participants (who typically have no idea they are the fodder).
Can you invest?
Not directly.
Polymarket is private as is its primary US rival, Kalshi.
However, there is an ETF to consider if you want in on the action… the Tema Trading and Prediction Markets ETF (DICE) which offers indirect exposure to both via SPVs (specialized investment vehicles).
It’s down about ~16% since debuting this fall, FYI.
Keith’s Investing Tip: Every investment has risk, but not all risks are worth the investment. Always know who’s taking the other side of any bet… and that’s as true in the markets as it is in casinos.
Bottom Line
Investing is not a game of rushed decisions.
- Have a plan
- Execute
- Adjust
- Repeat
As always, let’s MAKE it a great day — you got this!
I promise.
Keith 😀
