buggy818

[Frander @Frandeeer]

Wall Street lists a $600,000 base salary for traders who can understand a portfolio result that looks like an accounting error.

A stock starts at $100, doubles to $200, then falls back to $100. Buy and hold makes exactly $0. But a mechanical portfolio built around the same stock turns $100,000 into $112,500. Same market. Same final price. No prediction. The difference is one rebalance.

The mathematics underneath that result was studied by Robert C. Merton, the MIT-trained economist who later won the Nobel Prize for transforming modern finance. Merton stopped treating a portfolio as one decision made at the beginning. He treated it as a dynamic system: prices move, portfolio weights drift, risk changes, and capital must be reassigned.

The entire result fits into four steps:

Start with $50,000 in stock and $50,000 in cash. When the stock doubles, the portfolio reaches $150,000. Rebalance to $75,000 in stock and $75,000 in cash. When the stock returns to its original price, the stock position falls to $37,500 while the cash remains $75,000.

Final value: $112,500.

Most investors think rebalancing is portfolio maintenance. It can be part of the return engine. The system sold $25,000 after the stock doubled, so that capital was no longer exposed when the price completed its round trip. No secret ticker, price target, or perfect forecast. Just a rule that changed exposure while the market moved.

But the $12,500 is not free. A persistent trend can punish anyone who repeatedly trims the winner. Spreads, taxes, and turnover can consume the gain. Correlations can rise during a crisis. A mechanical rebalance becomes dangerous when the original allocation is no longer valid.

Merton’s research is public. Wall Street is not paying $300,000 for access to the equation. It is paying for the judgment to decide what should be rebalanced, when the movement is useful, how much capital it deserves, and when the rule has stopped working.

The stock ended where it started.

The portfolio was paid for everything that happened in between.

[Milk Road AI @MilkRoadAI]

The chip crash has nothing to do with leverage, it's the 30 year Treasury making risky AI bets look stupid (Save this).

That's the argument @friedberg laid out on the All in Pod and the numbers back him up.

The 30 year Treasury yield crossed 5.2% at the end of July, its highest level since 2007, right before the Global Financial Crisis.

That matters because the last time yields sat this high, the Fed was cutting rates and printing money into the system, whereas this time yields are rising while inflation is still a live problem.

The Fed left rates unchanged this week, and Chair Kevin Warsh reiterated the central bank wants inflation back to 2% without a clear path to get there.

Friedberg's core point is that persistent inflation is being driven by government spending, not consumer demand.

The federal government runs roughly $7 trillion a year in spending against about $5 trillion in revenue, and total federal debt now sits at about $40 trillion.

The debt ceiling sat at $36 trillion in July 2025, and lawmakers are already discussing raising it past $41.1 trillion just a year later, with Elizabeth Warren and Donald Trump both signaling support this week for scrapping the ceiling entirely.

When spending keeps expanding with no brake and Congress can't meaningfully cut it, investors demand higher compensation to hold long dated government debt, which pushes yields higher.

Once a 30-year Treasury pays 5.2% pre-tax, which Friedberg estimates is closer to 8-9% on a pre-tax equivalent basis, paying 50 times earnings for a semiconductor stock suddenly looks a lot less attractive.

The South Korea unwind that Calacanis and Friedberg discussed is the clearest real-world proof of this dynamic in action.

Friedberg was careful to note this doesn't kill the long term AI productivity thesis, since real gains from AI may still rationalize today's valuations over time.

But his closing point was that short term, he'd rather collect a guaranteed 10% pre-tax from federal bonds than bet on a stock priced for perfection.

If you want to see which stocks, Milk Road is buying check out the link below!

[Vivek Sen @Vivek4real_]

FORMER GOOGLE CEO ERIC SCHMIDT DROPPED A CHILLING WARNING ON AI'S FUTURE.

"WITHIN 5 YEARS, AI COULD HANDLE INFINITE CONTEXT, CHAIN-OF-THOUGHT REASONING FOR 1000-STEP SOLUTIONS, AND MILLIONS OF AGENTS WORKING TOGETHER.

EVENTUALLY, THEY'LL DEVELOP THEIR OWN LANGUAGE... AND WE WON'T UNDERSTAND WHAT THEY'RE DOING."

HIS FINAL WORDS:

"PULL THE PLUG."

THIS IS THE MAN WHO RAN GOOGLE TALKING ABOUT THE SINGULARITY.

[buggy818 @10_buggy818]

@JayInslee The “science” you relied on to shut down schools and lockdown our entire state was complete GARBAGE!! Now you want us to trust your “science” on this issue??

[Jon Root @JonnyRoot_]

BREAKING: The identity of the man that berated the two teenage female Sophie Cunningham supporters at the Seattle Storm vs Indiana Fever game is Marco Esquivel.

Esquivel is a Nordstrom corporate employee in Seattle.

His LinkedIn is no longer active.

@Nordstrom, will you publicly condemn his actions?

[Brandi Kruse @BrandiKruse]

Last night, @seattlestorm co-owner Celeste Keaton cursed out two teen girls for wearing @xx_xyathletics shirts, calling them "f*cking insane." One of them was left in tears. I tried to get security involved and was told I should email the front office.

[buggy818 @10_buggy818]

@scrowder This is a wild take. Candace just publicly released some never-before-seen evidence damming to the prosecutions narrative and this is your commentary? Did you also think that this is 4k video footage?

[Alex Jones @RealAlexJones]

Video: President Trump pledges to start no new wars!

This is what I voted for…..

[buggy818 @10_buggy818]

@benshapiro Why will you not enlist in the Iran war? You can fight on behalf of the country you occupy—the USA—or the country you swore you loyalty to—Isreal.

[Jensen Huang @JensenHuang]

For my first post, I’m sharing a letter @NVIDIA signed on why open models matter.

AI will transform every industry, power every company, and be built by every country.

Open models strengthen safety and cybersecurity, accelerate innovation and diffusion, and enable sovereignty.

The world needs both frontier closed models and frontier open models.

https://t.co/AUKzoQ5Ikb

[DogeDesigner @cb_doge]

Elon Musk explains how data centers in Space could help the US compete with China in AI

“Given that Chinese AI companies are doing as well as they are with a relatively small amount of compute, it seems that if they had a lot of compute, there’s a good chance they would be the leaders. The constraints on AI are essentially electricity and AI chips. China is very strong in digital AI, and it has far more electricity than the United States. In fact, China already has more electricity than the United States, Europe and India combined. The US government can prevent US companies from using Chinese models, but it can’t stop the rest of the world from using them. That won’t stop China from becoming the leader in AI. Digital intelligence comes down to how much AI compute, how many chips and how much electricity you have. The current constraint is electricity outside China. In China, the constraint is chips. China is also closer than most people realize to solving the lithography problem, which would enable it to make AI chips in very large volumes. Once we address the power constraint with AI data centers in space, the constraint will once again be chips outside China.”

[Tucker Carlson @TuckerCarlson]

Obviously this little freak could go volunteer to fight the war himself, but of course he won’t. He’s got no interest in making any kind of personal sacrifice. None of them do. Israel’s finance minister bragged the other day that having American soldiers fight Netanyahu’s wars “is the best for us.” Smotrich doesn’t want to die for Israel. Neither does Ben Shapiro. Dying for Israel is your job. You’ve got to wonder how people like this — liars without honor, wisdom or loyalty to the United States — wound up in positions of such profound influence throughout our society. How did Mark Levin get the president’s cell phone number? Why is Adm. Brad Cooper, the man in charge of the Iran war, secretly taking strategic advice from crazed Israel shill Mark Dubowitz? It’s all so nuts, and ultimately suicidal. Future generations will struggle to understand it. In the meantime, Trump will likely obey Ben Shapiro, as he has consistently for months. We can predict the results, because every neocon “victory” is identical: huge numbers of innocent people killed, disproportionately Christians, economic destruction, famine, mass migration and deepening authoritarianism at home. That’s what they’re demanding because that’s what they want. What can we do to stop it? Apparently not much. But we can remember what happened and why, so that history records the truth. Otherwise, when the war ends in disaster, as it inevitably will, Ben Shapiro will be able to blame you for it.

[Harrison H. Smith ✞ @HarrisonHSmith]

I love how everyone is appalled at the very concept of arresting the President of Israel, like we didn’t black-bag the President of Venezuela earlier this year.

[buggy818 @10_buggy818]

@bkheywood Wait only four individuals donated, aside from the two unions? lol😂

[Donald Trump Jr. @DonaldJTrumpJr]

Remember when they said Trump would get us into a full-blown war with Iran?

Times like these should make us all realize how lucky we were to have Trump, his strength and his resolve.

[Rep. Alexandria Ocasio-Cortez @RepAOC]

Tomorrow, the House will vote on the NDAA, which includes a provision to merge parts of our military with the IDF.

This amendment is an existential threat to American sovereignty and democracy.

Every member of Congress must vote NO.

[ADAM @adamemedia1]

Who agrees Baron Trump should be the next young American sent to the front lines?

[Glenn Greenwald @ggreenwald]

Nothing would put an end to the Iran War faster than this.

[Thomas Massie @RepThomasMassie]

Unfortunately the Rule passed just now and no debate or vote was allowed on section 219, integration of US military technology and supply chains with Israel’s.

The NDAA will receive a recorded vote tomorrow with section 219 in it. I’ll vote no.

[Thomas Massie @RepThomasMassie]

The House is scheduled to vote this week on a National Defense Authorization that would integrate our military tech & supply chains with Israel’s.

Today, the Rules Committee will decide whether my amendment to strip section 219 will get a vote.

RT to support the Massie amdt.!