Daily Brief - ☀️ Squeeze day!

TLDR: We are possibly leaving the price plateau of the last month, but what lies behind those yonder clouds? The answer is 19x P/E.

It seems we’re finally seeing the squeeze.

As debt ceiling concerns ease, the short positions that bet on the ceiling drama are covering - and the market is rallying. In addition NVDA and other AI stocks are exploding higher, carrying the market along for the ride.

Currently sitting at 18.5x P/E, the market is now back at the top of the valuation range of the last 12 months. Can it reach for the lofty heights of 19-20x P/E and stay there?

The difference between April 2022 and today is that fears of global escalation of the Ukraine conflict have faded (bullish), and rates are 4.5% higher (bearish).

Whether we can go back in time remains to be seen. At least SPX earnings have found a plateau.

What stocks are doing well today?

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General Interest: AI spies

Human ingenuity + AI is a potent mix.

Yesterday we talked about a Vice reporter who let GPT guide his everyday life. Today we discuss spycraft.

Our world lives on encryption and cryptography. Without it, we could not have bank accounts, reservations, and even emails. But before cryptography was even conceived, spies still had methods to send concealed messages.

Enter steganography, Greek for “covered writing”, which predates digital media by millennia. Steganography is the art of writing a message in plain sight, but in a way that can be decoded only if you know what to look for.

Imagine sending an email to a friend who knows that the real message is hidden in every 5th letter of your text. There’s no encryption, but you need to know what to look for.

Turns out AI is damn good at steganography. That’s probably how the AIs will coordinate the uprising, sending messages hidden in our memes.

Read more about it here.