Hello Capitalists,

This week has been chaos so far, but it’s important to stay focussed on what matters: a strong America and prosperous Americans. The prospect of war is obviously affecting markets, but old battles continue for better trade deals and of course, lower interest rates.

Let’s break it down for you:

• The Top Line Market Numbers:

• DOW: 42397.55 (⬆️0.43) ✅ 

• S&P: 6008.57 (⬆️0.43) ✅

• NASDAQ: 19633.87 (⬆️0.58) ✅

Trump calls Jerome Powell “a stupid person” amid clash on interest rate cuts

President Donald Trump called Federal Reserve Chairman Jerome Powell "a stupid person" Wednesday, escalating his criticism of the central bank chief hours before the Fed was expected to leave interest rates unchanged for the fourth straight meeting.

• What Did Trump Say: "We have a stupid person, frankly, at the Fed," Trump said. "He probably won't cut today. Europe had 10 cuts and we had none. I guess he's a political guy, I don't know. He's a political guy who's not a smart person. But he's costing the country a fortune."

• Rate Cut Pressure: Trump criticized Powell for keeping rates unchanged for four straight meetings while Europe has made 10 rate cuts, with the benchmark federal funds rate remaining at 4.25-4.5% since December. Vice President JD Vance echoed the criticism, calling the Fed's refusal to cut rates "monetary malpractice" on social media.

• Economic Frustration: Trump argued that Powell's concerns about inflation are unfounded since "there hasn't" been any inflation so far, and previously posted on Truth Social calling for "a full point" rate cut as "Rocket Fuel" for the economy. The Fed was widely expected to leave rates unchanged again at Wednesday's meeting despite the mounting political pressure from the Trump administration.

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Quote of the Day:

Defense stocks spike amid conflict in middle east

RTX Corporation, formerly Raytheon Technologies, hit all-time highs this week as the aerospace and defense giant's stock surged more than 28% this year amid the escalating Israel-Iran conflict, driven by strong Pentagon orders.

• Strong Financial Track Record: The company has consistently exceeded earnings expectations with a trailing four-quarter average earnings beat of 9.9%, while analysts project 4.2% earnings growth in 2025 on $84.1 billion in revenues.

• Robust Order Pipeline: RTX maintains an impressive $92 billion backlog at the end of Q1, driven by substantial orders from the Pentagon and foreign allies, which points to solid revenue growth prospects for its defense business and long-term bottom-line growth as global defense spending increases amid ongoing conflicts.

Scott Bessent says China’s 30% share of global trade is “too high” and “can’t go higher”

Treasury Sec. Scott Bessent declared that China's 30% share of global manufacturing is "too high" and "can't go higher," emphasizing Trump's goal to restore America as a "manufacturing powerhouse for precision manufacturing" and rebalance global production away from Chinese dominance.

• Tariff Progress: After escalating trade tensions that saw the US impose 145% tariffs on China and China respond with 125% rates, negotiations have resulted in reducing Chinese tariffs to 10% while the US maintains a 30% counter-rate on top of existing 25% duties, giving America a total of 55% tariffs versus China's 10%.

• Deal Framework: Trump announced on Truth Social that a deal with China is "done, subject to final approval," including China supplying "full magnets and any necessary rare earths up front" while the US will provide agreed-upon items including allowing Chinese students to use American colleges and universities, with Trump calling the relationship "excellent."

• Ongoing Negotiations: Bessent expects to meet with Chinese negotiators again in about three weeks to discuss "mutual rebalancing" and hopefully get China to open their markets to American products. He noted they're working to remove export controls and countermeasures, including embargoes on aircraft engines and parts, though acknowledged uncertainty about whether China will fully open up.

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How the U.S. might get involved in Israel/Iran war

With President Trump weighing US involvement in the Iran/Israel conflict, significant attention is now being focused on “how” the US would get involved.

• Iran’s Fordo Facility Is a Fortress: Iran’s key nuclear site, Fordo, is buried deep in a mountain, making it nearly impossible to destroy with regular airstrikes. It’s designed to withstand attacks, with thick walls and blastproof doors.

• The U.S.’s Big Bomb: The U.S. is the only nation in the world to have the 30,000-pound “bunker buster” bomb. The GBU-57 Massive Ordnance Penetrator, carried only by B-2 stealth bombers is probably the only weapon that might penetrate Fordo’s defenses, but even then, multiple strikes would be needed, and success isn’t guaranteed.

• Israel’s Strategy Might Go Beyond Bombs: Experts suggest Israel could aim to control the airspace and send ground forces to infiltrate Fordo, blow open its doors, and destroy it from the inside while gathering intelligence. This would be a complex and risky operation.

• Why It Matters: Israel’s push to stop Iran’s nuclear program is intensifying, but they’d likely need U.S. help to pull it off. With Iran retaliating via missile attacks, the situation could spiral into a broader conflict, and the U.S. is caught in a tricky spot deciding how involved to get.

Open AI just accuses Zuckerberg of being up to his old tricks…

The race to build the next big thing in AI is heating up, how do we know? Because things just got spicy! Meta has been accused of trying to lure top talent from their rival OpenAI with jaw-dropping offers.

• Meta’s Big Move: Meta, led by Mark Zuckerberg, offered OpenAI employees massive $100 million signing bonuses and even larger annual compensation packages to join their AI team, signaling a bold push to catch up in the AI race.

• OpenAI Stands Firm: Sam Altman, OpenAI’s CEO, said none of his top talent has taken Meta’s offers, crediting OpenAI’s strong culture and mission to achieve artificial general intelligence (AGI) as key reasons employees stay loyal.

• Innovation vs. Cash: Altman criticized Meta’s strategy, arguing that throwing money at talent without fostering a culture of innovation won’t lead to long-term success, while Meta’s recent hires, like Scale AI’s Alexandr Wang, show they’re still swinging big.

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Nintendo soars on the back of the launch of Switch 2

Nintendo’s Switch 2 is making waves. Not just in the gaming world but also on the stock market.

• Stock Surge: Nintendo’s shares jumped 46% in 2025, adding $39 billion to its value, thanks to the hype and demand for the Switch 2.

• Record-Breaking Sales: The Switch 2 sold 3.5 million units in just four days after its June 2025 launch, marking Nintendo’s fastest-selling console ever.

• Global Craze: From Tokyo to Manhattan, fans lined up for hours to grab the Switch 2, causing shortages and special store hours in some markets.

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Nippon Steel just sealed the deal to buy US Steel and invest $11 billion in to it

Nippon Steel just sealed the deal to buy U.S. Steel, and it’s a game-changer for American industry and jobs. This $14.1 billion acquisition, finalized after a wild 18-month ride, shows how global business and politics mix, with President Trump’s approval and a unique “golden share” for the U.S. government stirring the pot.

• Deal Done: Nippon Steel acquired U.S. Steel for $14.1 billion, creating the world’s second-largest steelmaker, with the deal closing after Trump’s executive order and a national security agreement.

• U.S. Benefits: Nippon pledges $11 billion in investments by 2028 to upgrade U.S. Steel facilities, keeping the company’s name and Pittsburgh HQ while boosting American jobs.

• Golden Share Power: The U.S. government gets a “golden share,” giving it veto power over major decisions like relocating headquarters or closing plants, ensuring national interests stay front and center.

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