To The Moon

My Investing Muse (10Feb2025)

Layoffs & Closure news

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END OF AN ERA: QUIKSILVER, BILLABONG & VOLCOM STORES TO CLOSE IN U.S. Icons of ’90s surf and skate culture, these brands once ruled malls and boardwalks. Now, over 100 stores will shut down as Liberated Brands files for bankruptcy, citing inflation, shifting consumer habits, and the decline of brick-and-mortar retail. Online shopping and fast fashion have reshaped the industry—leaving legacy brands struggling to keep up. Source: NBC News from X user Mario Nawfal

• Salesforce cuts 1,000 jobs as it joins Meta, Microsoft and Apple in AI pivot - Cityam

• Workday cuts nearly 2,000 employees Enterprise HR platform Workday is the latest tech company to announce layoffs in recent weeks. - Techcrunch

• Layoffs hit more than 7,100 workers tied to freight industry in US, Canada Amazon, Fila, Kohl’s, Del Monte Foods, Lytx, Lineage among companies with job cuts - FreightWaves

• Okta, SF tech company worth $16 billion, lays off staff after turning first profits - SF Gate

• Forever 21 considers bankruptcy filing if asset-sale plans fail - Business Times SG

The above are some snippets of news about layoffs, and closures in the past week.

The Demand on AI

Is AI hype a bubble or the next big thing? Magnificent 7 stocks are 30 TIMES higher than where they were 10 years ago, exceeding gains of other historical manias. The Nasdaq 100 rose 12x in 10 years before the 2000 Dot-Com Bubble popped. The Nikkei 225 rose 10x in a decade during the Japanese bubble of the 1980s. Furthermore, Gold saw a 15x increase in price in the 1970s before its peak. Lastly, Nifty Fifty stock prices rose 5x in the 1960s before the bull market ended in 1969. Will AI live up to the historically high expectations? - X user The Kobeissi Letter

This is not about more companies expressing interest or plans to introduce AI into their operations. It is also about investors seeking improved returns from AI investments.

As America, we now have two choices: win in AI, including win in open source AI. Or let China win in AI, all over the world. I believe it is critically important that we win. Kneecapping American AI, and American open source AI, to protect Big Proprietary AI is asking to lose. - X user Marc Andreessen

Some like Marc Andreessen (above) have encouraged America to invest and lead in open-source AI. Will there be a coordinated effort to push American companies to take the lead in open-sourced AI?

US Growth

US growth is not a miracle, it is fully debt-driven: It took a MASSIVE $2.2 trillion in public debt to create $570 billion in GDP growth in 2024 (before revisions). In other words, it took $3.9 of debt to generate $1 of economic growth. - X user Global Markets Investor

There are years of deficit spending but we need to wake up to the fact the growth is partially through government funding and not just American products and services. Given the amount of waste, are the returns inflated too? Can America drive their growth through products and services? Can America continue to lead with innovations and life-changing technologies? Can Europe and China challenge this?

With President Trump, the world looks with anticipation. If the government is driving the GDP growth, what has become of the market?

My final thoughts

The biggest risks point us to the biggest opportunities. Data privacy, data security and energy would be the next frontiers. Healthcare for the elderly would be the next growing sector. - Benson Kong

Global hedge funds dump everything but real estate stocks, says Goldman Sachs - Reuters

Let us consider exploring more options. There are concerns with insurance, banking, and real estate. The bonds are not taking the Fed’s lead as they continue to remain elevated. Can this be due to risk-reward?

Let us research before investing.

@TigerStars

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