📀📈 Intel at Dot Com Bubble Level Highs

Happy Wednesday all,

This week’s stories highlight the growing overlap between politics, policy, and markets. Intel’s $24 billion rally has pushed the chipmaker’s valuation to dot-com levels as Washington considers converting CHIPS Act grants into an equity stake. S&P reaffirmed America’s AA+ credit rating on expectations that tariff revenue will help offset rising fiscal pressures, even as critics warn of contradictions ahead. And new disclosures reveal President Trump has been on a $104 million bond-buying spree, raising fresh questions about precedent and financial transparency.

Here’s what you need to know.

Enjoy this week’s Hump Days!

- Humphrey & Rickie

👀 Eye-Catching Headlines

Trump eyes U.S. government stakes in other chip makers that received CHIPS Act funds (CNBC)

Homeowners Are Doing Small Projects but Deferring Big Ones, Home Depot Says (WSJ)

Tariff revenue expected to offset tax bill impact, S&P says in US credit rating hold (CNBC)

How Pop Mart Sold the ‘Happy Vibe’ of Owning a Labubu (WSJ)

Trump expands 50% steel and aluminum tariffs to include 407 additional product types (CNBC)

Chipotle and Shake Shack Help Solve an Economic Puzzle (BBG)

Demand for Rental Housing Drives Unexpected Jump in Building (WSJ)

The Weekly Brief

Intel’s $24 Billion Rally Sends Valuation to Dot-Com Levels

• Following a difficult period, Intel's stock surged 28% this month, largely fueled by reports of two significant potential investments: a planned $2 billion stake from Japan's SoftBank and discussions for the U.S. government to acquire a roughly 10% stake in the company.

  • The sharp increase in share price has pushed Intel's valuation to its highest point since the dot-com era, trading at 53 times its projected profits.

• The potential U.S. government investment would not be new funding but rather a conversion of grants already allocated to Intel under the CHIPS and Science Act into a non-voting equity stake.

• The move by the Trump administration, combined with SoftBank's investment, has largely been seen as a vote of confidence in new CEO Lip-Bu Tan's ability to turn around the chipmaker, which has fallen behind rivals like TSMC and Nvidia.

S&P Affirms U.S. Credit Rating as Tariff Revenue Expected to Plug Fiscal Leaks

• S&P Global Ratings affirmed its AA+ credit rating and stable outlook for the United States this week, a grade it has maintained since 2011.

  • The agency's decision was based on the expectation that revenue from President Donald Trump's tariffs would largely offset the negative fiscal impact of recent tax cuts and spending increases.

• S&P projects that while government debt will continue to rise, the fiscal deficit will stabilize and not persistently deteriorate over the next few years. This contrasts with a recent move by Moody's, which stripped the U.S. of its last top credit rating due to concerns over the deficit.

  • Critics point out a central contradiction: if tariffs successfully encourage a shift to American-made products, the volume of imports and the resulting tariff revenue will decline.

Trump Goes on $104 Million Bond-Buying Spree While in Office

• According to a recent White House financial disclosure, President Donald Trump actively purchased hundreds of bonds, totaling at least $103.7 million, since his inauguration this year.

• The 690 transactions, made through early August, include municipal bonds as well as corporate debt from major U.S. companies such as Qualcomm, T-Mobile, and Meta.

  • The report indicates that the president made numerous purchases and reported no sales during this period.

• Breaking with the precedent set by his predecessors since 1978, Trump has neither divested his assets nor placed them in a blind trust. Instead, his business empire, with a net worth estimated at $6.4 billion, remains under the management of his sons.

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