Crypto's bank and Nanya's chips: two distinct bull runs on a quiet macro day.

Transcript

Tom Crypto finally has a real bank and memory chips are going into a massive capex overdrive—buddy, this is the kind of momentum I live for.

Marie Look, I love the energy, but we need to talk about those regulatory clouds gathering in London too. Welcome to Investment Flash, the Weekend Edition for July eleventh, twenty twenty-six. I’m Marie, and I’m joined as always by Tom and Gerald.

Gerald Yeah look, it’s a quiet macro tape on the surface, but the micro stories are doing some heavy lifting. Honestly, seeing a billionaire activist take a massive bite out of Vodafone was enough to wake me up this morning.

Tom For real! But Gerald, before we get to the telcos, can we talk about Circle? The OCC gave them approval for a national trust bank. Circle shares jumped thirteen percent in the last session and they’re still eighty-four percent below their fifty-two-week high.

Marie Wait—wait a second, Tom. Let’s be precise. A national trust bank isn't the same thing as a full-blown commercial retail bank. It’s a huge milestone for crypto legitimacy, sure, but the compliance burden here is going to be massive.

Gerald Exactly. It’s the regulator’s way of saying, if you want to play in the big leagues, we’re going to be in your kitchen every single morning. Though, to be fair, the market clearly sees this as a 'buy the validation' moment for the whole ecosystem.

Tom It’s not just Circle, though. Bitcoin crossed sixty-four thousand dollars for the first time since June, and that’s dragging Strategy Inc and Coinbase up with it. Strategy Inc was up over five percent yesterday.

Marie No, but that’s exactly my point. These names are still so far off their highs—I mean, Strategy Inc is still down nearly eighty percent from its peak. This feels like a massive catch-up trade, not necessarily a new fundamental bull run.

Gerald The thing is, you also have Japan’s 'invest locally' plan potentially pushing more demand into Bitcoin and gold. It’s a weird convergence of regulatory wins and macro demand. Even if gold hasn't really caught the flyer yet, the crypto-exposed equities are loving it.

Tom Right—and I'm buying that momentum all day. Gerald, you’ve got to be happy with the Vodafone move, though. That sixteen percent stake from Xavier Niel? That’s a classic value play.

Gerald Yeah look, Niel’s Vega entity basically just walked in and became the largest shareholder by taking over that Emirati stake. The shares surged fourteen percent in London. It’s about time someone tried to unlock some value there.

Marie Honestly, activists entering a sleepy telco like Vodafone usually means one thing: brutal cost-cutting is coming. If you're long the London-listed shares or the ADR in New York, you're betting Niel can actually move the needle on those margins.

Gerald Alright, but the Financial Times actually broke the core of this a few days ago, so the real surprise was the sheer size of the stake. It’s a massive bet on European infrastructure recovery.

Tom No way, the real recovery story is in chips! Did you guys see Nanya Tech? They’re planning to quadruple their capital spending by twenty twenty-seven. Quadruple!

Gerald Tom—Tom, that’s the third time this month you’ve found a way to be bullish on memory chips. Twenty twenty-seven is a lifetime away in this market. By then, we’ll probably be trading stocks via telepathy.

Marie ha—fair enough.

Tom Oh come on! It’s about the signal. If Nanya is spending that kind of money, they’re seeing insane AI-driven demand for DRAM. It makes Micron look like a steal at a forward price-to-earnings ratio of just six point five.

Marie I’m going to push back here. While Nanya is dreaming of twenty twenty-seven, SK Hynix just had that massive Nasdaq listing and it’s putting a ton of pressure on the laggards like Intel. Intel was down ten percent this week.

Gerald Exactly.

Tom One hundred percent.

Marie That's the whole story right there. Intel's forward P-E is seventy! SEVENTY! While its peers are actually producing the chips people want. That’s a valuation trap if I’ve ever seen one.

Gerald It’s the same story with Delta Air Lines, in a way. They reported record revenue and beat profit estimates, but the stock still slipped nearly two percent because fuel costs are through the roof. Pricing power only gets you so far when your input costs are spiking.

Tom But isn't that a classic 'buy the dip' setup? If they’re hitting record revenue despite the fuel spike, imagine what happens when oil cools off. I’m looking at Delta as a quality catch-up trade.

Marie Not so fast. You have to look at the UK’s latest move on the cloud providers. They’re designating Microsoft, Google, Amazon, and Oracle as 'critical third parties.' That is a massive regulatory overhang.

Gerald Yeah look, I saw that in the FT this morning. It basically means the Bank of England and the Financial Conduct Authority get to look under the hood of their cloud operations to ensure financial stability. It’s more compliance, more cost, and more friction.

Marie Right, and that’s the problem—Microsoft is already underperforming this year, down about eighteen percent. Adding a layer of British oversight to their global cloud business isn't going to help that price-to-earnings multiple expand.

Tom Wait—wait a second, let’s pivot to something more fun. Did you guys see the Needham note on Reddit? This is the coolest thesis I’ve heard in weeks.

Gerald Is this the one about human intelligence being the new 'rare earth' mineral?

Tom Yes! Needham is saying that as the internet gets flooded with garbage AI-generated content, actual human conversations on Reddit become more valuable for training models. It’s a bet on human data as a scarce resource.

Marie I mean… he's not wrong. But Reddit is down nearly twenty percent year to date. It’s a high-risk contrarian play, Tom. You’re basically betting that Silicon Valley’s appetite for data outweighs the fact that the company is still finding its feet as a public entity.

Gerald It’s certainly more creative than the usual 'buy chips' mantra. Though speaking of Silicon Valley drama, Apple suing OpenAI for allegedly stealing trade secrets? That is a spicy breakup.

Marie Oh, that's brutal. Apple calling it 'the tip of the iceberg' suggests this is going to be a long, drawn-out legal battle. It really makes you wonder about the stability of those AI partnerships everyone was so bullish on last month.

Tom pff, okay, but look at Meta. They’re up six percent because they’re planning to build their OWN AI chips. They aren't waiting for the lawsuits; they’re just verticalizing the whole stack. That’s why the valuation at an eighteen P-E still looks so good.

Gerald Alright, alright—Tom’s back to the chips. But we should mention the macro risks we aren't seeing on the front page. Those maritime tensions in the South China Sea? That’s a real tail risk for the China and Japan ETFs.

Marie Exactly.

Tom Totally.

Gerald That's it. If things escalate between China and the Philippines, the sentiment on Asian equities is going to sour fast. The Japan ETF is up sixteen percent this year, but it’s very sensitive to regional stability.

Marie And before we wrap, we have to mention the Apollo bid for EasyJet. Seven point six billion dollars! It sent the shares to a four-year high. Gerald, your 'boring' European value plays are actually having a moment.

Gerald Yeah look, it’s nice to be right once in a while. But deal completion risk is real. Apollo is a tough negotiator. I’d be careful chasing it here after a fourteen percent jump in a single session.

Tom Gerald, you were spot on yesterday about the Nasdaq volatility hedge, too. With the VIX being so quiet despite all this cloud regulation and geopolitical noise, that hedge is looking like a genius move right now.

Gerald hah—yeah, yeah. Even a broken clock, right?

Marie Alright, let’s bring it all together. Our view today is that we’re seeing a massive widening of dispersion. You’ve got clear winners in crypto and memory, but the mega-cap cloud names are starting to feel the weight of regulation.

Tom Right, and the fact that the S&P 500 ETF is just one percent off its all-time high while all this sector-level chaos is happening? That tells me you want to be in the specific stories like Circle or Meta, rather than just buying the whole index.

Gerald The thing is, we’re all flying blind into next week’s consumer price index print. If that inflation data comes in hot, all these nice micro narratives—Nanya’s capex, Apollo’s bid—they all get swamped by the macro reality of 'higher for longer'.

Marie Exactly. The reflexivity risk is high. If you're not hedged, you're just gambling on the micro. And as always, none of this is investment advice—we’re just three people looking at charts and headlines.

Tom A quick reminder for the weekend—if you’re enjoying the show, hit follow on Spotify or check out investmentflash.com for the full digest with all the sources and charts we mentioned today.

Gerald Good call, Tom. It’s been a busy week, but there’s plenty more to watch as the London markets open up on Monday.

Marie Definitely. We’ll be watching those UK cloud regulations closely. Enjoy the rest of your weekend, everyone.

Tom Catch you later, buddy!

Gerald See you soon.

Marie We're back for tomorrow's Weekend Edition at ten a.m. London time. See you then.