Volatility Pulse - Sector Whiplash
TARIFF WHIPLASH
90% of Tariffs Fell on Americans
NY Fed finds nearly 90% of tariff costs fell on US firms and consumers through November 2025. The rest of the world barely noticed.
Source: The Idea Farm / Liberty Street Economics · Feb 22
AI BOOM TO AI DOOM
The $690 Billion Bet
Mag 7 combined 2026 AI capex approaching $690B — nearly 100% of operating cash flow vs 10-year average of 40%. Amazon's $200B alone means negative free cash flow for the year. $690 Bil is greater than the GDP of Sweden, Ireland or Norway.
Source: Evercore / Fortune · Feb 22
STICKER SHOCK
NVDA > GDP of Japan
NVIDIA's $4.5T market cap now exceeds the GDP of Japan, Germany, India and the UK.
Source: Disruption Banking · Feb 22
AI BOOM TO AI DOOM
AI Imports Hit $400B
US AI-related imports now over $400B annualized, up 142% in a year. Data center computer imports alone approach $300B/yr.
Source: @JosephPolitano via Daily Chartbook #858 · Feb 20
The AI Metal Nobody Talks About
AI data centers use 3x more copper than traditional facilities. S&P Global's Daniel Yergin warns of a 10 million metric ton shortfall by 2040 without massive supply expansion.
Source: The Idea Farm / S&P Global · Feb 22
THE GREAT ROTATION
Energy's Best Start in 25 Years
Energy is the S&P 500's top sector YTD at +23% — best start to a year in a quarter century. Yet portfolio allocation remains below 3%.
Source: Larry Adam, Raymond James via Daily Chartbook #859 · Feb 21
Value Is the New Momentum
Net 43% of fund managers expect value to outperform growth in the next 12 months — the most since April 2025. The rotation conviction is building.
Source: BofA via Daily Chartbook #858 · Feb 20
Global Breakout
MSCI country indexes more than 2% above their 1-year peak jumped to the highest since 2004. The global rally is the broadest in two decades.
Source: Bloomberg via Daily Chartbook #858 · Feb 20
Money Fleeing America
US share of global equity flows just hit the lowest since 2020. Meanwhile, cumulative 4-week international equity flows are the largest on record.
Source: BofA via Daily Chartbook #859 · Feb 21
VOLATILITY CORNER
Tax Refunds + Tariff Relief = XRT Upside
XRT (retail) upside calls may look cheap with the combined tailwind of lower tariffs + $106B in OBBBA retroactive tax refunds hitting March/April.
Source: Piper Sandler · Feb 22
Claude Code Crushes Cybersecurity
Anthropic's Claude Code announcement tanked cybersecurity stocks — PANW, CRWD, OKTA, TENB all hit hard. Call spreads on some of these names may be interesting for a rebound.
Source: Piper Sandler · Feb 20
SMART MONEY VS DUMB MONEY
Everyone Hates the Dollar
BofA's dollar positioning aggregate is the most bearish since they started collecting data in 2012. When everyone knows the dollar is going down, it usually doesn't.
Source: BofA via Daily Chartbook #858 · Feb 20
Just Because...
Cotton Candy Was Invented by a Dentist
A dentist invented the single greatest threat to teeth in carnival history. Dr. William Morrison looked at a world full of cavities and thought, 'You know what people need? Spun sugar on a stick.' He sold nearly 69,000 boxes at the 1904 World's Fair. Job security is job security.
— Vinay Tolia, Marine Layer Advisors
