橙子Joyce

Will the Federal Reserve raise rates as expected this week? Wall Street is debating: will it end the U.S. stock bull market?

After an unexpectedly strong U.S. CPI report came out last Friday, traders generally expect the Federal Reserve to begin raising rates at this week’s policy meeting—marking the first rate hike in more than three years.

Historically, previous rounds of rate hikes have offered a reference point for today’s market. Based on past experience (though history of course can’t guarantee the future), U.S. stocks may first weaken, then rebound.

Among the six tightening cycles since 1994, during the first four months after the rate-hike cycle began, the S&P 500’s average return was negative.

This suggests that once the “rate-hike shoe” drops, U.S. stocks may look lackluster through the beginning of next year.

As of the close last Friday, the benchmark U.S. equity index, the S&P 500, is up nearly 12% year to date. Strong corporate earnings and a fairly resilient economy have provided solid support for bulls in the stock market.

If you extend the time horizon, the S&P 500’s performance tends to improve gradually: in the 12 months after the start of a rate-hiking cycle, the index’s average return is close to 7%, with a median return of about 11%. (Using median-based statistics helps remove distortions from extreme outliers—for example, the index surged more than 40% after hikes began in March 1997.)

If the Federal Reserve implements a rate hike this Wednesday, it will be the first hike since July 2023—when the Fed raised rates to a range of 5.25% to 5.50%.

Currently, the federal funds rate in the U.S. is at 3.50% to 3.75%. According to the CME Group’s FedWatch tool, futures traders currently assign an 86% probability to a 25-basis-point hike this week.

One positive factor for the market is that mega-scale cloud service providers are still driving growth in excess returns through large-scale AI spending. The S&P 500 component stocks’ forecast for earnings growth in 2027 is expected to reach double digits. If the outlook for AI spending remains unchanged, it may be enough to offset any cooling in optimistic sentiment caused by the rate hikes.

Another bright spot for equities is that although inflation remains sticky, it appears to be slowing. The inflation rate has fallen from a May peak of 4.2%. This should allow the Federal Reserve to take a more gradual approach, and the data shows that the pace of rate hikes is crucial for stock performance—slower pacing gives investors more time to absorb policy changes!
$BZ
$CL
Energy

【For the First Time in Three Years, the Fed Raises Rates】The Federal Reserve raised rates by 25 basis points, lifting the benchmark rate to 3.75%-4.00%. This is the first rate hike since July 2023 and is in line with market expectations!

The Fed raised rates to drive inflation to fall “more timely,” signaling it will further tighten policy. On Wednesday, the U.S. Federal Reserve Board (the Fed) raised the target range for the key interest rate to 3.75%-4.00% and hinted that it would further increase borrowing costs in the coming months. Fed Chair Waller supported the rate-hike decision passed unanimously, which effectively acknowledges that the Trump administration so far has failed to control inflation. Waller said that among the many factors pushing up Treasury yields, it does not include the market losing confidence in the Fed’s ability to contain inflation; higher borrowing costs stem from strong economic performance and a surge in capital expenditures, which intensify competition for capital. The Fed’s quarterly projections show that policymakers expect one more rate hike this year and expect rates to remain unchanged in 2027. At the same time, policymakers also raised their near-term inflation expectations and their forecast for economic growth this year.

U.S. President Trump said that U.S. interest rates should be at 1% or lower and should be cut quickly. However, he said that even after the Fed’s decision to raise rates, he still has confidence in Waller.
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I remain firmly committed to buying the stocks of the industry’s leading companies: Nvidia, and SpaceX, and Tesla.

$SPCX.US
$NVDA.US
$TSLA.US

The U.S. military for the first time publicly confirmed that the country now has space-based “space control weapons” in orbit, and that the “Iron Dome” space-based interceptor project has advanced to the “flight-ready hardware” stage.

U.S. Air Force Secretary Troy M. (Troy Meinke) said on Monday: “The United States now has in-orbit space control weapons that can protect U.S. forces from attacks by hostile forces,” adding, “From a deterrence standpoint, this is important.” Meinke did not specify the type of the space-based weapon. Reports said this was the first time the U.S. acknowledged that it has “offensive capabilities” in space.

On Tuesday, Douglas Hiss, commander of the U.S. Space Force, further confirmed that soldiers of the space forces have been operating “in-orbit weapons capable of withstanding attacks in space.” Richard Palmer, director of the Space Command’s office for capabilities and resources integration, also said on Tuesday that the public disclosure of these capabilities is intended to deter adversaries while demonstrating that the United States is prepared to respond. Palmer said, “Our joint forces and our allies need space, and our economy needs space. The United States is ready to uphold this.”

On Monday, Meinke revealed that the “Iron Dome” space-based interceptor project “advanced from the initial contract stage to flight-ready hardware in less than a year.”

According to reports, in May last year, U.S. President Donald Trump issued a development plan for the “Iron Dome” missile defense system. Trump said that “Iron Dome” would be integrated with the United States’ existing missile defense capabilities, and once fully built, it could intercept missiles launched from other places in the world and even from space. The entire system is expected to cost about $175 billion (USD), and is planned to be “fully operational” within three years.

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$Space concept stocks
$SPCX.US

$LMT.US
$RTX.US

The Fed’s decision is about to be released, and the market is pricing a higher chance of a rate hike, up to 94%

Interest rate swaps linked to the Federal Reserve meeting show that the market expects the probability of this rate hike at about 94%, implying that roughly 23 basis points of tightening have already been priced in. If the hike happens as scheduled, the federal funds rate range will rise to 3.75%–4%. If the Fed keeps rates unchanged, it could become the biggest “dovish surprise” at a routine meeting since the Fed began formally publishing its policy decisions in 1994.

Hassett said that both he and U.S. President Donald Trump “respect whatever the Fed decides to do, no matter what it is.” In an interview on Tuesday, Hassett, director of the White House National Economic Council, outlined reasons why the Fed should not raise rates, but also said, “we” respect whatever decision the Fed will make. Last Sunday, Hassett made a similar remark, saying that both Trump and he believe there is no reason to hike rates, but he would support 100% any decision the Fed makes, and that Trump respects Powell and the Fed’s independence. It is important for the Fed to maintain the status quo ahead of the election.

Meanwhile, the market has started to reassess the AI-driven stock rally, while also absorbing the impact of rising oil prices and the possibility of a rate hike by the Fed this week.
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Only the stock prices of international large corporations are the real opportunities—we will patiently wait for prices to pull back!
$NVDA.US
$META.US

Landmark bill rejected, crypto market faces major negative pressure.

On September 15 in Eastern Time, the U.S. Senate voted to block the advancement of the “Clarity Act” (the Digital Asset Market Structure Clarity Act). This dealt a significant blow to the crypto industry’s efforts to establish a comprehensive market-structure framework. The final vote was 50 in favor and 49 against—far below the 60 votes required to overcome procedural obstacles.

Although the bill went through more than a year of negotiations, the two parties ultimately failed to bridge their differences on key provisions. A major reason cited by Democratic lawmakers is the bill’s ongoing controversy over conflict-of-interest provisions involving Trump’s cryptocurrency business interests. The bill would create a major loophole in nearly a century of securities laws—allowing non-crypto companies to put assets on-chain to evade investor protections, and enabling banks to use customer deposits for crypto lending, trading derivatives, operating nodes, and selling related software.

The bill aims to provide a clearer regulatory framework for banks, broker-dealers, and asset management institutions to participate in digital-asset trading and product development, and is widely seen as the most systematic attempt at crypto legislation in recent years.

The bill’s failure to pass further prolongs a regulatory vacuum in the crypto market, leaving the industry with greater uncertainty in areas such as compliance pathways, capital allocation, and institutionalization timelines.

The failure of this vote may mean the crypto industry will have to wait until next year for clearer rules.

The U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) are already moving forward with rulemaking in the digital-asset space. Even if Congress does not pass a clarity bill, those rules will still provide guidance for investment institutions.

The fundamentals of the crypto industry are stronger than ever. Billions of dollars of capital are moving on-chain; leading payment companies and financial institutions are adopting blockchain technology; and entrepreneurs around the world continue to develop new financial products—driving capital into the internet era. We will continue to work toward establishing clear regulatory rules that both protect consumers and provide room for innovation and building for entrepreneurs.

😁 It’s a wise move to invest regularly in BTC, ETH, BNB, and SOL!
$BTC

$BNB

Apple continues to expand iPhone’s satellite communication capabilities, while SpaceX is advancing direct-to-cell phone connectivity to low-Earth orbit satellites through Starlink.

The industry scale is expanding accordingly. As of the end of June this year, 123 satellite direct-to-mobile collaborations between satellite operators and mobile carriers have been publicly disclosed worldwide, with 23 already launched. Starlink alone involves 99 partnerships.

While direct-to-satellite connectivity on phones is still in the technical validation stage, the main question is who will connect first and who will get calls through first. As more players enter the scene, another issue begins to emerge: if, in the future, carriers in different countries all want to increase satellite coverage, does every carrier behind the scenes need to build its own independent satellite network?

SpaceX currently represents a highly vertically integrated approach: it controls rockets, satellites, and the network itself, then partners with carriers in various countries.

It is trying to spin off parts of the infrastructure in satellite communications so that multiple carriers can share them.

Which model is lower-cost and more efficient is still unclear. But the fact that these two paths are emerging at the same time already indicates that direct-to-phone satellite connectivity is shifting from a simple technological race to a more complex industrial contest.

More than 200 years ago, in The Wealth of Nations, the discussion focused on why pin-making needs division of labor.

Today’s question is about satellites.
When a market becomes large enough, which capabilities should still remain in the hands of a single company, and which infrastructure is better suited to be used jointly by many?
Steady and continuous investing $SPCX.US
$SPCX

Elon Musk just threw another heavyweight bomb. When replying to a user on X, the head of SpaceX (SPCX.US) said clearly: “I am highly confident that SpaceX will deploy an NVIDIA (NVDA.US) VR NLV72 AI computer in space next year.”

Musk’s VR NLV72 refers to NVIDIA’s Vera Rubin NVL72, which this year has entered full-scale production. This rack-level AI supercomputer integrates 72 Rubin GPUs and 36 Vera CPUs. Its single-rack inference computing power reaches 3.6 EFLOPS, while its training computing power is 2.5 EFLOPS. The core Rubin GPU is based on TSMC (TSM.US) 3nm process technology, integrates 336 billion transistors, and comes with 288GB of HBM4 memory, delivering 22TB/s bandwidth. Per-card inference performance is 5x that of the previous-generation Blackwell. The total memory plus VRAM capacity of the entire cabinet is as high as 74.7TB—roughly equivalent to the total memory of 4,500 mainstream smartphones. NVIDIA’s own claim is that, compared with the GB200 NVL72, the inference cost per million tokens is only one-tenth.

Not just putting a chip in space

Sending a device like this to orbit is on a completely different scale from prior experiments that “ran a GPU in orbit.”

SpaceX’s roadmap is more specific than the outside world imagines. According to CFO Bret Johnsen’s remarks at a Goldman Sachs conference, the company will launch its first batch of Starmind AI1 satellites in the fourth quarter of 2027, and will significantly expand deployments in 2028. In essence, these satellites are “racks in space”—repurposing the Starlink V3 satellite platform, removing the communications phased-array antenna, swapping in a computing payload and a larger solar array, and adding a 110-square-meter deployable liquid-cooling heat dissipation unit. The first-generation AI1 satellite will have an approximately 20-meter deployment height, a 70-meter wingspan, a 210-kilowatt solar cell array, an average compute power of 120 kilowatts, and a peak power of 250 kilowatts.

Production is also moving forward. SpaceX’s AI satellite factory in Bastrop, Texas aims to achieve large-scale production by the end of 2027, with a long-term plan to deploy about 1 million AI satellites.

At the chip level, SpaceX is already NVIDIA’s “die-hard” customer. In an earnings call, Musk said bluntly: “We think the Vera Rubin architecture is the best architecture, the best AI computer, so we only choose NVIDIA.” Johnsen added that the partnership with NVIDIA helps SpaceX secure scarce production capacity allocations for GPUs amid current supply constraints.
I continue to invest in SPCX and GOOGL
$SPCXB

$BTC

Is a high interest rate the “terminator” for the U.S. stock market? Or are earnings the real factor?

This round of rate hikes is still some distance away from truly suppressing valuations. The key factor determining the valuation ceiling is not the interest rate level itself, but the earnings growth rate.

More broadly, Wall Street strategists have also not treated the Fed’s possible return to rate hikes as a signal ending the bull market. As long as economic growth and corporate earnings remain resilient, market pullbacks caused by moderate hikes may be only short-term volatility.

The threshold where valuations truly come under pressure is 5%-6%

The first tier is a super-growth environment where earnings growth exceeds 20%. In such a case, the valuation multiple can be supported as high as about 24x, corresponding to a 10-year U.S. Treasury yield of roughly 6%. The second tier is a above-trend growth environment with earnings growth of 10%-20%, where the valuation multiple is about 20x, corresponding to a yield of around 5%. Overall, the lower the earnings growth rate, the lower the interest-rate level the market can tolerate.

Currently, the S&P 500 trades at about 22x 2026 EPS, implying adjusted 2026 earnings growth of roughly 28%. For 2027, the valuation is about 18x, implying earnings growth of about 21% (excluding one-off investment gains/losses). This means that as long as earnings growth can be maintained at 15% or above, there is still room for further valuation re-rating in 2027.

There’s another yardstick for whether valuations are expensive. A two-stage dividend discount model shows that the implied equity risk premium is currently about 7.2%, which is around the 69th percentile historically; the long-term PEG is about 2x. In other words, as long as companies can deliver average annual earnings growth of 13%-15%, today’s valuation level still has fundamental support.

The 30 AI leaders currently trade at about 30x forward valuations. That compares with roughly 19x for the other 470 constituents in the S&P 500 and about 14.3x for MSCI ACWI peers. This valuation premium mainly comes from stronger visibility into earnings, lower leverage levels, and more stable shareholder returns.

Productivity is another buffer. If productivity stays in the 1.5%-2.5% range, the current yield can still support roughly a 20x valuation multiple. If AI further drives productivity above 2.5%, the valuation support would be even stronger.

In the short term, these two forces are enough to partially offset the pressure from rising financing costs: first, improved profitability in the financial sector; second, companies still hold about $2.4 trillion, and these funds can earn higher interest income. From a market-cap style perspective, large-cap stocks have stronger ability to absorb pressure.
$GOOG.US

The U.S. Department of the Treasury has, in sequence, authorized transactions involving Venezuelan gold and broader mineral-related deals under OFAC, allowing dealings with the state-owned gold mining company Minerven, and permitting negotiations for investment contracts and the provision of mining-related services. More recent licenses have also expanded coverage further to include coal and others.

Commodity trader Trafigura has reached an agreement with Minerven to purchase roughly 650–1,000 kilograms of gold bars (ingots) and ship them to the United States for refining.

Through a new mining law, Venezuela allows foreign capital to participate in the extraction of “strategic minerals,” including gold, for terms of up to 30 years. U.S. Interior Secretary Doug Burgum led dozens of executives from U.S. companies on a visit to Venezuela to promote opportunities in gold, bauxite, nickel, iron ore, rare earths, and other sectors.

The U.S. is also considering further measures (including a possible executive order on critical minerals), with the goal of ensuring that U.S. firms can not only obtain oil, but also secure supplies of minerals important to national security. The White House said the two countries are benefiting from a “reset in relations” and new Western investment in critical industries.

Venezuela’s resources are not fictional: official data in 2018 listed about 644 metric tons of gold, about 14.68 billion tons of iron ore, about 320 million tons of bauxite, and about 408,000 tons of nickel. Institutions such as CSIS estimate gold resources at roughly on the order of 75 million ounces. But years of nationalization, sanctions, illegal mining, and armed control mean actual output remains far below potential.

The policy direction is already clear—after oil, the U.S. is continuing to “lock in” Venezuelan resources, with gold being the first to take shape because it can be monetized quickly and is relatively easier to transport. Real-scale mine investment (exploration, infrastructure, and formal production) will still take longer, because gaps remain in areas like security, electricity, roads, and the credibility of contracts. In the near term, what is more likely is trade, refining, service contracts, and the restarting of a few older projects—not the immediate emergence of a batch of world-class new mines.
What to watch is not the slogans, but three things: whether armed groups are being pushed out of mining areas, whether gold traceability and due diligence can be verified, and where the money from new contracts ultimately flows. These three matters determine whether this is “a move toward normalization and reform,” or just the old model with a new set of buyers.​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​
$XAU
$BTC
Sustained investment in XAU gold and BTC bitcoin