Why The Nasdaq Just Hit Correction Territory
Summary
Ed Elson interviews Apollo’s Torsten Slok on the tech sell-off, driven by widening credit spreads and doubts over AI’s ROI. Later, Justin Wolfers analyzes Trump’s new Section 301 tariffs, arguing they lack economic rationale and act as inflationary supply shocks. The episode also covers the upcoming Fed rate decision amid rising uncertainty.
Topics discussed
Sponsors: VCX, Amazon Prime, and show intro
Market recap: S&P 500 rises, chip stocks fall
Semiconductor sector sell-off and Asian markets
Hyperscaler debt issuance and credit spreads
AI ROI concerns and credit default swap pricing
Market expectations vs. AI payoff reality
Amazon's negative free cash flow and timing
Race for AI ROI and data center financing costs
CEO responses and upcoming hyperscaler earnings
CapEx signals and diversifying away from AI
Value investing and non-AI sectors
Sponsors: Lisa mattresses, Odoo, LinkedIn
Trump's new tariff strategy and Section 301
Legal basis for tariffs and previous trade war lessons
Economic theory of trade vs. zero-sum politics
Tariffs as supply shocks and inflation risks
Fed policy response to supply-side inflation
Fed rate decision odds and market signals
Outro, credits, and final sponsors
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