Changing of the Guard

- There is nothing worse than a brilliant image of a fuzzy concept.

- Ansel Adams

Just Like Satellite Image 

Just like weather forcasting from NOAA. It can tell you a hurricane is forming and it can also give you an idea as to where it will move to. The political landscape changed last Tuesday from Red to Blue. What does this mean? You do not want our true feeling. We, at Evolution feel that both of our two political parties are corrupt. They just follow their agenda. What they say and do is never the same. For example,

Fossil Fuel

is backed by the GOP (Guardians of Privilge). The Democrats will return to push wind power. They are both short-sighted. We need both along with other sources. The Republicans ran up debt for their supporters. Now, the Democrats will run up debt to win votes for the presidential election in two years. Neither party offers a vision. The responsibility of government is to protect and allow its citizens for the pursuit of happiness. Happiness for the GOP is allowing corporations to do whatever they like to grow and become richer. The GDP nevers includes the damage caused by industry to society and environment. The Democrats are no different. They may talk about the environment. They may talk about jobs. They may talk about the national debt, but talk is cheap. There never is a follow through with actions that make a difference. 

Meanwhile...

in the real world, debt is soaring and the Iran/US,Israel conflict is not resolved as well as the Ukraine/Russia war in Europe. The tariff trade wars continue. The news will be who is taking over what Congressional committee like Elizabeth Warren running the Senate Banking Committee. We need vision. We need living wage jobs. We need affordable housing, healthcare and transportation. We need clean water for citizens and supply for farmers. We need to stop spending recklessly and stop the debt spiral. We cannot see anything positive coming from either political parties as the leadership is still the same with the same old platform.

Related

The Treasury borrowed $839 billion just last week. When you spend a billion here and there, they soon become trillions. We are heading for $45 trillion, very soon. The world is no better, but the forces for a world recalculation will erupt with the next financial crisis. At present, the talk will turn to the Fed with their next meeting next month. In the duration, Anthropic is seeking their IPO. They want $1.5 trillion. This is a firm with a rogue AI that loses money hand over fist with many doubtors thinking that they need more than what they seek. Also, the present state of the VIX is alarming. It closed at 25.64 last Friday and the dollar remains strong even in the face of the big selloff. It closed at 102.27 last Friday. 

We look around for clues. The NASDAQ 100 fell hard last week. It is below its 50-day and 200-day moving average. This is a big sign. We see something at Disney. They are planning thousands of layoffs to cut costs. People are expendable to protect profits. That is their sad fantasy, but true. We have one more from the archives. This goes back to 1960. Scientists predicted the end of the world on Friday the 13th in 2026. The reason? Human population would overwhelm the earth. These types of predictions go back to Malthus in 1798 who said, "Food shortage would cause the doomsday." Sebastian worries about rogue AI.

Just when we are about to close this piece, news of Nvidia's CEO selling advanced chips to China behind closed doors by way of his Chinese girlfriend. Whether greed, foolish lust or heritage connections to China, this man cannot be trusted...Peace.

Crypto Theft, Debt = - Outlook

- What you risk reveals what you value.

- Jeanette Winterson

November and 😍

The negative shadow of September and October for the stock market has passed. The government still refers to the market has the reflection of our economy. We have told you repeatedly that this connection has been severed. Nevertheless, they control the narrative. We note one unusual bit of data. The inflation figures came in at 3.4% and lo, and behold, the GDP for the quarter came in at 3.4%?

Houston, we have a problem.

The recent revelations of debt by big tech has stunned some investors. They would love to shrug it off, but the numbers cannot be easily forgotten. Google says it spent over $500 billion on AI and data centers. They, like all their fellow hi-tech competitors, show few rewards. Amazon is the only one showing improvement, but improvement is not a profit. Their cap/ex for 2027 is $220 billion. It gets worse. Google says 2027 needs another $924 billion. We told you about Oracle. We told you about CoreWeave. We told you about Meta and its new issue offering. By the way, Nvidia and Advanced Micro each purchased $5 billion and the rest was gobbled up. We told you about the BS from Larry Fink, however no one was counting on the Binance news. 

The good gets thrown out with the bad.

When the news of the hack on Binance reached the media on 29 Oct. (does that date ring a bell?), the market fell like a house built on sand and flood waters rushing against it. Intel fell by 28% just on Friday. This is its worst day in 50 years! They were not alone. Gold was hit hard, but the selling was tied to the liquidity of the metal. The money was needed by investors to avoid margin calls. Have a doubt? Well, margin stock buying just hit a new all-time record at $1.5 trillion. All this buying has pushed the CAPE ratio to 41. This is an extremely dangerous level. The last time the ratio was this high was the dot.com bubble of 2000. 

Anyway,

Did you know there has been over 10 crypto hacks just in 2026 and we have two months to go? Bitcoin was sold as a safe vehicle that would not be diluted with excessive production. From the very beginning, we, at Evolution have been against this new form of money. It is just moving money from big banks to this new platform. They both deal in fake money. Only gold is real money, but critics come up with ways to deter your thinking like gold does not generate interest like banks offer and bitcoin has shown fabulous upside. Well, the charts reveal a different story. Bitcoin touched $112,000 last November and this November it closed at $77,693 on heavy volume. Support is at $62,500 amd the low is at $57,500. There are a lot of people under water. The first sign will be the 200-day moving average which is $73,100. All this leads to...

Latest

Bitcoin froze trading. The co-CEO, Yi He stated that trading will resume Sunday. Dear Reader, just recently private funds suffered a case of the runs. They limited withdrawals. Things have quieted down on the surface, but we suspect there is still a problem in private equity. 

We believe withdrawals in bitcoin will have the same results. They will be limited and the result will push the value down to test the lows. If pierced, the flood waters will cause a lot of problems to the market and our economy. The bullish outlook for November has a new shadow and of course, the election results...Peace.

Odds and Ends: October 2026

- The world does not need to know what you have, but who you are.

- St. Edith Stein

More AI Worries

Meta has spent so  much money on data centers and AI that its bottom line debt has surged to over $80 billion. So, now it is planning to offer a secondary stock offering. Dilution, my friend. They are not offering anything. They just want your money. We expect similar tactics from other big tech players.

Like this...

...The ultimate greedy man, Sam Altman says, "The world is going to have to suffer for the glories of AI."

Another Billionaire...

...Larry Fink, CEO of BlackRock says, "The US should use our retirement funds to fund the infrastructure of AI." Yeah, he wants our money to "bailout" his debt anxiety. It needs $10 trillion. Of course, his friends at the Fed might find a way. This gives us a reminder to you, "End the Fed!" 

Then, There Is...

...someone with a conscious. Christopher Whalen, an ex-New York Fed executive. He brings to light of the collapse of 777 Partners. This private equity firm went belly up and the worries of connected firms is being kept quiet - for now. The co-founder, Josh Wander pleaded guilty on 15 Oct. Dear Reader, this is a very big, red flag for private equity. The main reason Whalen said was no details of their investments and no price discovery. He also added that he sees food inflation picking up. Why, you ask? He says, "Farmers are not buying fertilizer because they cannot afford it due to their costs for deisel."

Nice Idea

In Japan and few other places, they have found a new idea for old golf courses or unused sport fields. They are turning them into clean energy by utilizing the land mass for solar parks. You know who could be the leader in America? Florida. They have old golf courses all over the state.

Another Good Idea

Battery Trains. Alstom is offering the idea and way to convert old, diesel and coal trains to battery operation. In some cases, it is a hybrid format, but it is cleaner and it will get cheaper with production and tech improvements.

Electric Ferry Boat?

Yes! China Zorrilla has made its first successful, commercial ferry operation beyween Brazil and Uruguay. Congrats! Clean power on the water and more to come. Yes. Australia is getting on board (ship humor) with its own hybrid-electric ferry which is under construction. Best of luck, Mate!

Related

Singapore keeps innovating. Now, they are adding their high-voltage direct current converter for wind power to be used on offshore oil rigs and the excess power will be sent to a local onshore community. Wow! Wel-done!

Sad Beat Goes On...

...in retail or due to failing retail. EBay is cutting 9% of its workforce and American Express is laying off 5% of its staff.

We Hear...from the Fed today. We expect more BS from their pulpit...Peace.

Market Inflexion Point

- If life were predictable it would cease to be life, and be without flavor.

- Eleanor Roosevelt

Market Dichotomy

The market had a rough week for the S&P 500. It fell 1.95% or 152 points. Nasdaq Composite fell harder at 4.48% or 1,226 points. The Industrials held firm and rose .67% or 347 points. All the major indexes are still above their moving averages, including the transports. So, what's the worry?

Cracks...

We told you about the fall from grace in Oracle (ORCL) which continues to fall under heavy volume. Now, the dam for AI has another crack with Core Weave (CRWV). It fell hard last week (25%) to close last Friday at $61.39. Just last June it was at $183. Ouch! 

Since the market has been kept alive with all the money flowing into data centers and AI, this is serious stuff. Invidia has invested heavily in Core Weave due to its work in cloud infrastructure that will utilize AI in a platform. The three co-founders, Michael Intrator, Brian Venturo and Branin McBee all sold a chunk of shares before the IPO and they along with other executives have been dropping shares all along. The PR says the three are still the biggest holders in the firm. Big deal! They owned all the shares from the beginning. Now, they are billionaires and maybe they seek the good life rather than work?

Related

The SMH or the semi ETF also fell hard. It held at support which is 540. This is an inflexion point. If the price is pierced, look out below. If it holds and regains, then all is well. However, this is not what the charts are saying. The recent trendline is straight down. This leads to two other points within the market. The first is the next Fed meeting. It is not until Oct 27/28. During this time period will investors answer the other question? Will they buy the dip?

They may take comfort in viewing the charts of Visa and Mastercard. They are rocketing upward and defy the aspect of a struggling consumer under heavy inflation. Of course, consumers may be playing the same game in the late 1970s. When inflation rose rapidily during that period, consumers used multipe credit cards. They maxed out one and transfered to a new card that offers a bonus for opening and transferring accounts. However, a day of reckoning will happen and with the holiday season approaching, this is not good...Peace.

Where Is the Connection?

- All knowledge degenerates into probability.

- David Hume

Economy and Wall St.

We have suggested many times in the misguided belief that the strength of the economy is reflected by price and value from the stock market. The government likes to use a rising market as the true barometer of our economy. This correlation ended many years ago. I will offer you a scorecard of recent data in relationship to the stock market. You be your own judge.

King Dollar: It continues to deny gravity. It closed last Friday at 102.2. It has been in a rising price channel since the end of September. At the same time, the US deficits climbed over $40 trillion and this year's yearly budget has surpassed $two trillion. In addition, bonds rates are rising. The 10-year bond rose over 5% and as of last Friday, sits at 5.24%. When you consider that the Federal Reserve might add another quarter point increase, bonds will rise, our debt will rise and although this act will strengthen the dollar, this is only a temporary solution. Why, you ask? Because for every action there is a reaction. You can clearly see the reaction in housing. Interest rates climbed to roughly between 7.38% to 7.57% for mortgages. To qualify for a mortgage, buyers need a clean sheet with income of over $96,000 per year. We are making home buying unaffordable for over two-thirds of our citizens. In a consumer society, our biggest purchase is off the table.

Related

Musk has stated that he seeks a $40 billion dollar loan to buy Invidia's chips for his AI data center. His firm is not alone. All the big players are jumping on the AI band wagon. However, there are two problems stemming fom this action. First, all these "players" are seeking financing. This puts them into competition with the Federal government who needs to finance their excessive debt. Demand will raise rates even higher. This puts a burden on every loan seeking entity. 

The second problem is more for big tech than the federal government. Application! Oracle was one of the first tech members to see the "future" in AI. They spent and borrowed to lead the way. ORCLs stock price was over $300 last October and as of last Friday, it closed at $141.40. OUCH! The company did the usual to keep their stock price up. They implemented cost cutting, especially with jobs. They laid off the people that they need to apply the AI platform. They are not alone. We will see more and more of this playbook by big tech as spending and debt crush earnings. They will attempt to sell the "hope" of AI. 

The federal government leads the way in selling "hope." It starts with the dollar. Inflation is in direct conflict with hope. The recent oil and diesel prices pave the way for more inflation. The BRICS are in direct conflict with the dollar. Together, they are eroding confidence in the government. Hope is a fragile spirit. 

Now, back to the market and interest rates. When bond rates are high, they look better than the risk of the stock market. When investors realize that the market has been in an uptrend since 2022, they may make a judgement call on the further growth of the market as compared to the safety of bonds? If money begins to leave the market, the big boys will begin to feel pain. This money will probably enter the bond market, however, gold will attract a nice piece of it. It will not take too big of an investment in new money to push gold back to $5,000. 

Speaking of Metals

We are in a deficit for silver and copper. The two are needed for AI. President Trump did well to push chip making in America as well as critical minerals, but "working" a deal with Russia for diesel is so very wrong. Anyway, these things take a lot of time and sometimes, they never materialize.

Bulls Counter

They will remind you that the banks are doing extremely well. All the money entering AI and data centers will lead to new riches down the road (hope). They counter Oracle with Apple and Meta. The two are in a rising price channel. The seasonal pullback of Sept./Oct. is almost over and the market held at support. November and December are two big ups for the market. Inflationary acts will reach a limit and the war with Iran should end soon. Plans are in progress to build a new pipeline to end the Hormuz Straight. The future looks bright.

We say, "Only God knows the future." ...Peace.

Malaise or Truth?

- It's not what you look at that matters, it is what you see.

- Henry David Thoreau

Sept./Oct. Pullback

In the stock market, the Fall retracement in stocks is almost a given. If you look at the close last Friday, you may not believe the theory. However, if you look at the chart, the Industrials fell 2,000 points from its high in September and ended down for the month. The S&P 500 also fell for the month, although just 14 points; it bounced up hard entering October. The two leading indexes had steady volume. 

Nasdaq tells a different story. It was up all month and continues rising into October. The small cap, Russell went the other way. It was down from the beginning of September and fell all month, but the volume was very low. No conviction.  

The Transports had a rough month. It too was down all month and like the small cap index, it had low volume. Together, the indexes show some malaise, but the Bulls remain in charge.

Indicators

The Fed has another meeting at the end of the month (27th Oct.). There is another Wall St. aphorism, "Buy the rumor, sell the news." The rumor on interest rates changes on a daily calendar. We pay little attention to heresy. Facts speak to us as well as the charts. The big announcement from the G-7 about diesel and oil is news, but you have to understand the big picture. The group will offer the market (world) 100 million barrels of both diesel and oil. However, this is to be spread out over four months and diesel will not enter the market for probably another 20-days. So, how did this effect the market? Brent rose to $102 on Friday. US crude, initially fell, but recovered to close at $91. The two oil commodities are in a rising price channel line.

For perspective, consider this point. The world consumes over 100 million barrels of oil on a daily basis and around 30 million barrels of diesel. The news makes headlines, but it will make no difference to rising price and more inflation.

Market Disconnect

We have stated many times in past pieces that the stock market no longer reflects the US economy. The latest stats on our economy says it grew at 2.2% in the 2cd quarter. This is deceiving. The formula uses price to determine value. Inflation causes prises to rise and thus, it appears that the economy is growing. What should be included is the misery index. However, this index of inflation and employment has been massaged. We do not believe the inflation numbers from the BLS. Unemployment rose one notch to 4.2%. 

Back to the disconnect: A report on jobs last Friday was a big failure. The market expected 90,000, but it received only 29,000. This is a big miss. So, what does the market do? It rose and the dollar for the week strengthened to close at 101.9. This is not logical. We already knew the market is not logical and now, we see this as another proof there is no connection between Wall St and Main St...Peace.

 

Odds and Ends: September 2026

- Fishing largely consists of not catching fish.

- Robert Hughes

No Colors in the Desert

As the seasons change from summer to fall, most of us get to see the beauty in His design except for those in desert regions like New Mexico. The economic weather in that state is jumping into winter. We told you in past pieces that Oracle (ORCL) was laying off 152,000 in cost cutting due to expenses in data centers. Their flagship facility in New Mexico has all kinds of trouble with a capital "T." Oracle wanted to construct a 17 mile gas pipeline to provide energy, but the state has rejected permission to build it. Their contract with the state says that the state gets paid no matter what. Oracle has stopped payments. Oracle has invested billions into this project and the outlook could cause contagion? We also told you in past pieces that one of the biggest problems in building these data complexes is being able to get transformers, switches and other electrical msterials. We believe Oracle's problems will not be the only greedy tech to have construction problems.

Want to Bet on It?

Well, it got cheaper in North Carolina as the BS from lobbyists to that state claimed, "It's not gambling, it is a derivative call." So, if you want a "derivative" on Oracle's ability to finish their New Mexico data center, the tax in N.C. is just 6% as opposed to the normal 23% in betting platforms. This leads us to the question, "How high can BS go?" Answer: As tall as the CEO of Polymarket.

We Invented It...

...but China did it. China's solar energy surpassed coal. Why not us? Spain did it. Spain's solar energy accounts for 60% of their energy source. If Spain can do it, why not us?

This Is What We Did

The SEC passed regulations to allow data centers to sell stock issues without any details. Buyer beware!

We Also Did...

...nothing as far as safety for our future with AI. President Trump said that he got AI developers to sign an accord to "self-regulate" AI. This translates to no safeguards and no regulations. The influencers got everything that they wanted for greedy big tech. This puts our future at risk.

Good News

Fusion Energy has relicated the power of a star (Sci-Fi stuff). In 2022 at the Livermore National Labortaory, scientists proved it could be done. Pacific Fusion in South San Francisco is leading the charge that has 50 horses in the race to produce commercial, clean energy source.

Wastewater Scan

As the weather changes, the flu virus awakens. Two US schools, Sanford and Emory are developing a program that checks wastewater. It can find infectious diseases in their scan and give local regions a heads up on the health of its citizens. Good work.

Indoor Activities

The colder weather finds us inside our homes. We use to love to go to concerts, but the price for tickets is outrageous. You and I asked, "Why?" Now, we know. Live Nation had a monopoly and they were ripping us all off. Glad, they caught that fish...Peace.