Nvidia Is Selling the Future, Jack Ma Is Imitating Bezos, and Meta Is Making a Deal

The highlight of the stock market this week was the quarterly earnings report from the world's most valuable company—Nvidia—and it made Wall Street nervous.

Expectations were high ahead of the earnings report. Judging by the options market, traders were pricing in a stock movement of about 5.4% the following day—which for Nvidia translates to a market cap of ±$280 billion. However, investors were concerned not so much with the quarterly figures as with the outlook for the future.

The numbers were strong. Quarterly sales doubled year-over-year, exceeding Wall Street’s expectations. But investors, accustomed to Nvidia’s record-breaking performance, reacted coolly to the report. The stock price rose only after CFO Colette Kress promised 70% revenue growth in the next fiscal year—compared to a consensus estimate of 45%.

This week, concerns surrounding AI were evident even beyond the stock market. The SEC issued subpoenas to the largest Wall Street banks—Goldman Sachs, JPMorgan, Citigroup, and Bank of America—regarding their lending to the hedge fund Situational Awareness. Its 24-year-old manager, Leopold Aschenbrenner, who has earned the nickname “AI Nostradamus” in the market, had been ramping up his bets on AI assets using borrowed funds and suffered heavy losses in July due to a sell-off in the sector. Meanwhile, Microsoft co-founder Bill Gates proposed reserving a portion of jobs for people to prevent AI from pushing them out of the labor market.

While the market waited for Nvidia, the debate over how the U.S. manages its national debt flared up with renewed intensity. Stanley Druckenmiller—a legendary investor who worked side by side with George Soros for more than a decade—in an article titled “Let the Bond Market Speak,” called the U.S. Treasury’s plan to increase its purchases of long-term government bonds a mistake. In his view, by buying back its own debt to keep Treasury yields in check, the government is manipulating prices under the guise of supporting liquidity—rather than letting the market itself determine the fair value of its borrowing. This, Druckenmiller warns, undermines confidence in the government debt market.

Good news: S&P has upgraded the country’s credit rating—for the first time in 10 years. This has sparked a debate over whether Kazakhstan’s stock market might also take a step forward and transition from “frontier” to “emerging” status. The MSCI Kazakhstan Index includes only three stocks—Kaspi.kz, Kazatomprom, and Halyk Bank— explains Ramazan Dosov, chief analyst at the Association of Financial Professionals of Kazakhstan, in his column. And the problem is not that Kazakhstani issuers are not large enough, but that too small a share of their stock is traded on the exchange: for example, KazMunayGas, which accounts for nearly half of the KASE’s total market capitalization, has only 12.2% of its shares in free float.

Don't miss it this weekend. Sunday marks Warren Buffett's 96th birthday. At Berkshire Hathaway, his three closest executives were known as the “Three Ts.” Two have already left: Todd Combs now manages Jamie Dimon’s money at JPMorgan, and Tracy Britt-Kuhl has launched her own fund. On August 30, we’ll explain how the “Oracle of Omaha’s” school became a talent pipeline for the entire market.

This article was AI-translated and verified by a human editor