This content is for informational and educational purposes only and does not constitute financial advice. Always do your own research. Not financial advice (NFA).
👀 Today’s Stories at a Glance
🎙️ Warsh finally picks a subject: 98 days as Fed chair, all of it answering questions. This afternoon he chooses what to talk about.
💸 PayPal’s $53 billion buyer walks: Stripe and Advent dropped their bid overnight and the shares fell about 12% before the US open.
🥇 Gold’s best month since 1999: Bullion is up nearly 14% in August as Treasury buybacks and a softer dollar revive the debasement trade.
🔌 Marvell beat and fell anyway: Record revenue and a raised full-year guide, and the shares still dropped about 8% on a thinner margin outlook.
🇯🇵 Tokyo hits the Bank’s number: The gauge the Bank of Japan watches most reached 2.0%, and September hike pricing sits just under 80%.
🇨🇦 Washington floats banning Canadian goods: The US trade representative raised outright bans, 11 days before Canada’s own counter-tariffs take effect.
₿ Bitcoin funds buy for 9 days: Spot bitcoin funds took $242 million on Thursday, a ninth straight day and more than $3 billion in August.
🛒 Shoppers still borrowing to buy: Affirm processed $14.1 billion of purchases last quarter, up 36%, and called it its most profitable ever.
🔍 The speech nobody has heard before: Today’s Deep Dive on the 1-point inflation gap, his own words, and what past Augusts in Wyoming did.
🧠 One Big Thing
The Fed sets the price of money, and this afternoon the man who runs it speaks on his own terms for the first time. Kevin Warsh has been chairman for 98 days. He has held 2 press conferences and sat in front of Congress, and all of that answered somebody else’s question about a decision he had already taken. He talks at 10:00am Eastern, which is 3:00pm here, 19 days before the Fed decides rates on 16 September. Roughly a third of the market expects a rise. That decision reaches you through your mortgage, your savings rate and the value of every bond fund you own.
⚖️ Fear & Greed
📉 The Number That Matters
65 months
US inflation has now run above the Fed’s 2% target for 65 straight months, going back to March 2021. That is the backdrop to every word Kevin Warsh says this afternoon.
⚔️ Winners vs Losers
Winners
ESTC 0.00%↑ : 18.19% Elastic N.V. surged after reporting quarterly revenue of $478.1 million and adjusted EPS of $0.70, both ahead of consensus, and lifting full year revenue guidance to $2.00 billion with adjusted EPS guidance raised to $3.33.
GAP 0.00%↑ : 16.67% Gap, Inc. jumped after second quarter adjusted EPS of $0.52 beat the $0.49 consensus on gross margin strength, prompting the retailer to raise full year adjusted EPS guidance to $2.35 to $2.45 and its operating margin outlook to 7.4% to 7.6%.
SOLS 0.00%↑ : 13.61% Solstice Advanced Materials rallied after mutually terminating its $14.5 billion cash and stock acquisition of Element Solutions with no break fee payable by either side, pairing the news with a new $500 million share repurchase programme and reaffirmed full year guidance.
AFRM 0.00%↑ : 13.43% Affirm Holdings climbed after quarterly revenue of $1.17 billion beat the $1.11 billion consensus on 33% year on year growth, with next quarter revenue guidance of roughly $1.21 billion also landing above expectations.
Losers
VISN 0.00%↑ : -41.57% Vistance Networks dropped because the stock began trading ex-dividend on a $5.00 per share special cash distribution funded by the sale of its Ruckus Networks business to Belden, a mechanical price adjustment rather than a fundamental move.
PYPL 0.00%↑ : -17.03% PayPal Holdings tumbled after the Stripe and Advent International consortium abandoned its $53 billion takeover approach, which had valued the payments group at $60.50 per share before the board rejected the bid as too low.
📊 Market Snapshot
Cryptocurrencies:
Bitcoin (BTC): $79,711 (▼ 0.67%)
Ethereum (ETH): $2,507 (▼ 0.15%)
XRP: $1.43 (▼ 1.85%)
Equity Indices (Futures):
S&P 500: 7,742 (0.00%)
NASDAQ 100: 29,632 (▼ 0.21%)
FTSE 100: 10,806 (▲ 0.05%)
Commodities & Bonds:
10-Year US Treasury Yield: 4.69% (▲ 0.26%)
Oil (WTI): $83 (▼ 0.50%)
Gold: $4,598 (▼ 0.08%)
Silver: $70.20 (▲ 1.38%)
Data as of: UK: 12:34 pm BST / US: 7:34 am EDT / Asia (Tokyo): 8:34 pm JST
✅ 5 Things to Know
🎙️ Warsh speaks, and nobody knows how he sounds
The speech starts at 10:00am Eastern, which is 3:00pm here in the UK.
Kevin Warsh has run the Federal Reserve for 98 days. He has taken questions at 2 rate decisions and in front of Congress, and he has never once chosen the subject himself. He does that this afternoon, 19 days before a vote that roughly a third of the market thinks ends in a rate rise. Core inflation is 3.3% against a 2% target, and 3 of his own committee voted last month to raise. Options desks have priced the whole thing as a non-event.
Inside today’s Deep Dive:
The full point between what inflation is and what the bond market says it averages out at.
His 16-year argument about the Fed, in his own words.
What the last 8 of these speeches did to the S&P 500 and to the 2-year note.
The 4 things landing in the same minute he starts talking.
The Deep Dive runs in full at the foot of today’s edition.
💸 PayPal’s $53 billion buyer walked away
The number on the table was $60.50 a share. That was the offer Stripe and the private equity firm Advent made for PayPal in July, valuing the company at more than $53 billion and backed by roughly $50 billion of committed bank financing. PayPal’s board judged it too low, and the 2 sides spent 6 weeks negotiating. Bloomberg reported on Thursday night that the consortium has dropped the pursuit altogether. Advent, Stripe and PayPal all declined to comment. The shares fell about 12% in overnight trading, having closed Thursday at $61.47. Bloomberg
A takeover premium is the extra money a share carries because somebody has offered to buy the whole company.
When the buyer leaves, that money leaves with them.
PayPal shareholders are watching that happen in real time this morning. Bloomberg says the situation remains fluid and the pair could return with a revised offer, so the premium has not gone to zero. The combined business would have handled roughly $3.7 trillion of payments a year, which is the scale that made PayPal worth chasing in the first place. PayPal now has to make its own case again, without a bidder standing behind the price.
Sensei’s Insight: A deal that leaks for 6 weeks and then dies tells you the gap was on price, and price gaps close when one side gets desperate. Neither side here looks desperate. I am watching whether PayPal’s board says anything at all today.
🥇 Gold is having its best month since 1999
What does it look like when investors stop trusting a currency? It looks like this. Gold is on track to gain nearly 14% in August, its strongest month since 1999, and it was trading around $4,607 an ounce on Friday morning. The run followed the Treasury’s decision to at least double its buybacks of long-dated government debt, which pushed yields and the dollar down together. Exchange-traded funds backed by bullion added more than 28 tonnes last week, the most since January, and another 20 tonnes so far this week. Central banks have stepped up their buying too. Bloomberg
Traders call this the debasement trade, which means money moving into things that cannot be printed. It runs hardest when a government looks willing to live with its debt rather than fight it, and American government debt passed $40 trillion for the first time this month. Silver rose alongside it, up 1.8% to $70.50 an ounce. The risk on the other side is plain, because gold pays no income, so every rise in interest rates makes holding it more expensive. That is why the metal is sitting on this afternoon’s speech as heavily as any share price is.
Sensei’s Insight: Gold at these levels is a vote against the dollar rather than a vote on inflation, and those are different arguments. A gain of 14% in a month also attracts profit taking. I am watching whether the central bank buying keeps showing up.
🔌 Marvell beat, raised, and fell 8% anyway
The street wanted about $2.71 billion. Marvell delivered $2.739 billion, a company record, up 37% on the year. Adjusted earnings came in at 94 cents a share, data centre revenue rose 46% to $2.17 billion, and management lifted the full-year target to $12 billion. That is a beat and a raise on every headline line. The shares fell close to 8% in extended trading anyway, after closing the regular session at $241.45, and they were lower again before Friday’s open. Invezz
The margin guide explains it. Marvell told investors to expect third-quarter adjusted gross margin of 57.5% to 58.5%, down from 58.9% in the quarter just reported. The company designs custom chips for a small group of cloud giants, chiefly Google and Amazon, and that work earns less per dollar than its off-the-shelf optical hardware. Faster growth in the custom business therefore drags the average down. Nvidia set this week’s bar by guiding a full year ahead, so a solid quarter from a supplier priced for acceleration was never going to clear it.
Sensei’s Insight: This is the AI trade getting picky, which is healthier than it feels on the day. Marvell is growing faster and earning less on each dollar of that growth. I am watching whether the margin range holds through the January quarter.
🇯🇵 Tokyo inflation reaches the Bank’s own target
Japan published its first inflation reading for August overnight, and the number the Bank of Japan cares about most finally got there. Tokyo core-core inflation, which strips out both fresh food and fuel, rose to 2.0% from 1.8% in July. Core inflation came in at 1.8% against a 1.7% forecast. The yen strengthened to around 159.30 against the dollar on the print. Market pricing for a Japanese rate rise in September now sits just under 80%, up from roughly 65% on 7 August. FXStreet
Japanese interest rates matter well beyond Japan. For 3 decades investors have borrowed cheaply in yen and bought higher-yielding assets everywhere else, which is why a rising Japanese policy rate pulls that money home and lifts long-dated yields around the world. Japan’s own 10-year government bond yield reached a 3-decade high near 3% earlier this month. Middle East energy costs are still working through Japanese prices with a lag, and wholesale inflation there ran at 7.2% in July. The Bank next meets in September, days after the Fed decides.
Sensei’s Insight: Japan raising rates is the quiet risk to everything else, because cheap yen has quietly funded a lot of positions around the world. The hike itself is close to priced in. The unwind that can follow it is not.
Stories You Might Have Missed
🇨🇦 Washington floats bans on Canadian goods
The US trade representative, Jamieson Greer, told the Canadian Broadcasting Corporation on Thursday that Washington ought to consider banning some Canadian goods outright. He pointed to Canadian caps on the type of American cars that can be imported and to provincial procurement rules that shut out US suppliers. American duties of 50% already apply to about $20 billion of Canadian imports, roughly 5% of the total, and Prime Minister Mark Carney has said a similar value of American goods will face Canadian duties of 15% to 50% from 8 September. A tariff makes a good expensive. A ban makes it unavailable. Bloomberg
₿ Bitcoin funds bought for a ninth straight day
Spot bitcoin funds took in $242 million on Thursday, a ninth consecutive day of net inflows and the longest run since April. August inflows now sit above $3 billion, the strongest month of 2026 and roughly double what April managed. Bitcoin traded back above $80,000 on Thursday before easing to around $79,300 on Friday morning, down 1.2% on the day. Strategy, the company that holds bitcoin on its balance sheet as a treasury asset, closed about 12% higher at $137.40 on Thursday’s move. The steady buyer through this rally has been the funds rather than the traders. CoinDesk
🛒 Affirm processed $14.1 billion of purchases
Affirm, the buy now, pay later lender, reported fiscal fourth-quarter revenue of $1.17 billion against $1.11 billion expected, on volume through its platform of $14.1 billion, up 36% on the year. Active customers grew 21% to 27.8 million and the average customer made 7.0 transactions, up 20%. Management called it the most profitable quarter in the company’s history. Guidance for the current quarter came in above consensus at $1.19 billion to $1.22 billion. The American shopper who looked finished in the July retail sales data is still spending, and is increasingly borrowing to do it. Stocktwits