Pre Market Thoughts - 3 Aug 26 US yields lower from the highs set in the prior week. JPY has also strengthened following Bessent's cheeky picture. The problem with macro is that interpretation is difficult. While one could spin JPY appreciation as bearish for risk assets, you can also call Bessent's slow guidance down of the JPY as an easy unwinding of carry trade, helping to cap yields in the US. Which narrative will prevail? Its hard to say at this point. However, the AI buildout will spark a rise in yields. This is simply because debt has to be utilised to add into the mix. Before people paint this as bearish for semis, the cashflows accruing to semis actually make this the strongest industry to withstand higher yields. Good luck asking an overly leveraged property investor. Those will buckle before a memory maker trading at 4x PE and flush with cash. Going into the Asian session, KOSPI closed 5% lower in sympathy with the weakness in the US close on friday. $0660 was down about 10% whereas $285A was relatively unchanged. This is as i note, $285A is going to engage in share buybacks. Who is left to buy you ask? well. The companies themselves. Over the weekend, 2 pieces of additional news. First of all, Qwen 3.8 is going to be released as an open model. Going by benchmarks this is at near frontier capabilities. BABA is up 4.4% in pre market. Secondly, Moonshot is also looking to IPO soon. As of this point, BABA is up 32% since i called the "Burry Bottom" - If even Burry is selling, this has to be distressed. lmao. just kidding. not kidding. The calendar this week is also much lighter than the previous week. Post the hyperscaler earning season, we are coming into one of the best market reactions. MSFT, GOOG and AMZN have all rebounded. This sets up very well for continued capex growth. The next buyer of memory will be the companies themselves via buybacks. To note, i want to highlight MSFT - which has provided the first real validation to the market on capex, Azure has increased to 43% cc with about 45% growth guidance for Q27, M365 seats have also exceeded 30MM paid and operating leverage is holding despite elevated AI spending. I have said multiple times before that i think the next rally will not be led by memory. instead it is neocloud summer. What we will start to see will be neoclouds that are transforming into hyperscalers. The increased capabilities of Open Source models are a direct beneficiary for the neocloud trade. In other news, Oil has gone down again on another TACO. Will it go back up? Or is this the end? Only Trump knows. For my readers, i only have 1 ask. if you have operated or ran a data center before in SEA, could you please let me pick your brains? I would like to get more insight onto the operational aspects of running one. Thank you and good luck!(degentrading)