Wall Street took a beating Monday as tariffs went from political posturing to actual policy. The S&P 500 slid 2%—its worst day of the year—while the Nasdaq tumbled 2.7%, led by a brutal selloff in momentum stocks. Nvidia (-8.69%) and Super Micro Computer (-13%) were among the hardest hit, while tariff-sensitive stocks erased their post-election gains.

For months, markets doubted that trade barriers would actually materialize—but with 25% tariffs on Mexico and Canada now official and Chinese levies doubling to 20%, investors were forced to reprice the risks.

As if that wasn’t enough, OPEC+ added to the chaos by announcing an increase in supply, sending crude oil down 2.1%, while gold (+1.6%) and silver (+2.2%) surged as investors sought safety.

⚡ Closing Bell:

• Dow Jones: ⬇️ -1.7% › 43,084 › Broad-based losses across sectors.
• S&P 500: ⬇️ -2.0% › 5,837.1 › Worst one-day loss of 2025.
• Nasdaq 100: ⬇️ -2.7% › 18,338.2 › Nvidia and AI stocks got crushed.
• Russell 2000: ⬇️ -2.8% › 2,182.5 › Small caps took the hardest hit.

Macro Moves:
➝ 10-Year Yield: ⬇️ -0.05 bps › 4.2%
➝ 2-Year Yield: ⬇️ -0.04 bps › 4.0%

❗ Looking Ahead: Monday’s selloff was brutal, but the real test is just beginning. Will tech stocks find a floor? Nvidia, Dell, and Super Micro got crushed—now we’ll see if dip buyers show up or if the AI trade is losing steam.

Meanwhile, tariffs are officially here—markets largely dismissed them before, but now that they’re in effect, investors will be watching for supply chain disruptions and ripple effects.

The jobs report later this week will be another market-moving moment. A weak print could fuel rate-cut hopes, but a strong one? That might keep the Fed in wait-and-see mode.

And with geopolitical risks still lurking—from ongoing tariff tensions to economic concerns in China—markets aren’t out of the woods yet.

Volatility isn’t going anywhere.

#TRUTH:
❗❗❗ “Out of chaos comes order.” ~ Friedrich Nietzsche

Sky High:

Warren Buffett built Berkshire Hathaway (BRK.B) into a powerhouse by buying undervalued stocks and sitting on a mountain of cash.

Now? The stock itself is looking pricey—Berkshire just hit its highest forward price-to-book ratio since 2008.

With 30% of its assets in cash and short-term Treasuries, investors aren’t just betting on Buffett’s next move—they’re finding comfort in Berkshire’s fortress balance sheet amid market uncertainty. But while they seem eager to pay a premium for safety, one thing Berkshire isn’t doing with all that cash? Buying back its own stock.

The company has gone two straight quarters without repurchasing a single share, outpacing even JPMorgan’s Jamie Dimon in the stock buyback avoidance department.

❗Bottom line: Berkshire is as rich as ever—but now, so is its stock.

Poof! $500B Gone in 24 Hours:

The $500 billion wipeout is complete. Crypto markets have now erased all the gains from the U.S. Crypto Reserve announcement—and then some. Total market cap is now $100 billion lower than before the news even broke.

Bitcoin (BTC) is barely hanging on above pre-announcement levels, while Ether (ETH) has actually fallen below them. Meanwhile, the ETH/BTC ratio just hit a five-year low at 0.025.

Solana (SOL), Ripple (XRP), and Cardano (ADA) held on to some gains but have surrendered a sizable chunk of their Sunday pump. Meanwhile, volatility remains high, and options skew still favors downside protection into March, according to QCP Capital.

It’s not just crypto feeling the pain. Crypto stocks gave up early gains, with Core Scientific (CORZ) and Bitdeer (BTDR) turning red, while Semler Scientific (SMLR) sank 7.3% after a DOJ fraud investigation surfaced.

❗The Sunday sugar rush is officially over—now, the real test begins.

Goldman’s Take:

Goldman Sachs is ringing the alarm on Nvidia and the Magnificent 7, warning that Nasdaq 100 rallies are for selling, not chasing.

The AI trade has been bouncing between “we’re so back” and “it’s so over”—and Goldman is firmly in the latter camp. Their reasoning?

• Good news isn’t good enough → When stocks stop rallying on strong earnings, it’s a red flag.
• The Magnificent 7’s earnings growth isn’t as magnificent anymore → The premium they commanded is fading.
• Hedge funds are bailing → AI-linked trades are being unwound at a record pace.
• Valuation reset incoming → Investors are reassessing just how much they’re willing to pay.

Goldman Sachs is calling time on the AI trade. Investors are no longer chasing 2025 growth—they’re already bracing for 2026, using Nasdaq 100 rallies to exit, not buy. Nvidia’s $320 billion wipeout was a wake-up call, signaling that after a decade of unstoppable gains, big tech’s momentum may finally be running out of fuel. Hedge funds are dumping the Magnificent 7 at their fastest pace since 2021, and after years of relentless multiple expansion, a major reset could be coming. The AI boom isn’t dead, but the easy money era is fading fast.

Go Big or Rent?

Everyone wants to be an AI company, but not everyone is willing to spend like one. Big Tech is splitting into two camps—those pouring billions into AI infrastructure, and those keeping it lean by renting computing power instead.

Amazon, Meta, Alphabet, and Microsoft are all-in on capex, collectively spending over $315 billion this year, betting that bigger models and more compute power will secure future dominance. Meta alone is committing up to $65 billion, with Mark Zuckerberg calling heavy infrastructure spending a “strategic advantage.” Amazon’s Andy Jassy is even more aggressive, pushing over $100 billion into AI, believing it’s the biggest business opportunity since the internet.

Then there’s Apple and Salesforce, playing a different game. Instead of splurging on their own AI infrastructure, they’re renting cloud power and hedging with partnerships. Apple has turned to OpenAI, Baidu, and Alibaba to fuel its AI efforts, while Salesforce dismisses massive AI spending as “excessive” and a “race to the bottom.” CEO Marc Benioff is happy leveraging others’ billions instead of burning his own.

So far, neither approach guarantees success. Apple, despite its cost-conscious AI strategy, is struggling to build a functional AI assistant. Meanwhile, Alphabet is spending billions but still chasing true AI breakthroughs.

The big question: Does winning in AI require deep pockets, or just smart partnerships?

Escapes:

Saturnia Hot Springs in Tuscany, Italy

Highlights of the Day:

① Tariffs Become Reality ❌
➝ Trade war fears turned into policy moves, with the US officially slapping 25% tariffs on Mexico and Canada and doubling levies on China to 20%. Tariff-sensitive stocks tumbled, wiping out their post-election gains.

② Tech Meltdown ❌
➝ Nvidia (NVDA) -8.69% › A chorus of bearish takes from Goldman Sachs sent the stock to new 2025 lows.
➝ Super Micro (SMCI) -13.00% & Dell (DELL) -7.01% › Reports linking their servers to a fraud case in Singapore added to the AI-driven rout.
➝ Intel (INTC) -4.05% › Popped on chipmaker rumors, but quickly erased all gains.

③ Safe Havens Shine ✅
➝ Gold (+1.6%) & Silver (+2.2%) › Investors rushed to metals as risk-off sentiment took hold.
➝ Verizon (VZ) +1.79% › Gained on its 5G deal with Lockheed Martin and Nokia.

④ Biggest Implosion: Sunnova Energy ❌
➝ Sunnova (NOVA) -64.25% › Issued a “going concern” warning, losing two-thirds of its value in a day.

⑤ Other Notable Movers
➝ Allegro MicroSystems (ALGM) +14% › ON Semiconductor is rumored to be eyeing an acquisition.
➝ Kroger (KR) -2.96% › CEO resigned abruptly over a personal conduct violation—investors didn’t like it.

Commodities Check : ✔️

• Oil : ⬇️ -2.1% › $68.28 per barrel
• Gold: ⬆️ +1.6% › $2,892.7 per troy ounce
• Silver: ⬆️ +2.2% › $32.20 per troy ounce

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The stinger

Disclaimer

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