The September job report was strong with unemployment rate at 3.5%, but this number is likely to go up as the Fed continues tightening until inflation cools down. Already, many companies, especially in the tech space, have announced layoffs and hiring freezes to tighten the belt. While consumer spending remained somewhat resilient as Bank of America ( BAC) reported a 1% growth in consumer deposits and 13% growth in credit card spending in 3Q22, the sentiment around higher interest rates and inflation is clearly negative for the overall ad market. Recently, WPP's GroupM and Zenith have adjusted their 2022 growth forecasts for the US ad market from +9.7%/+9.1% to +8.4%/+8%. Of course, staying invested in Google takes patience as the current economic conditions point to a rather difficult environment for the advertising market.
While Google is not immune to an economic recession (100% probability in 2023 per Bloomberg), the search giant should serve the Pelosis well when all the macro headwinds are said and done. The deep-in-the-money calls were purchased on when Google's stock was trading at roughly ~$140 a share. Nevertheless, the Pelosis sticked to their bet on Google ( NASDAQ: GOOG) by exercising 200 call options at a strike price of $100, for a total of $2 million. AMD's ( AMD) Q3 revenue will come in ~$1 billion below expectations due to weak PC sales ( here). Nvidia has seen its Gaming revenue fallen off a cliff due to softening demand as GPU mining is virtually dead ( here). Micron is seeing supply outpacing demand in a deteriorating environment with "extremely aggressive pricing" ( analysis here).
According to, House Speaker Nancy Pelosi's husband Paul Pelosi recently took heavy losses totaling almost $1 million from call options on Micron ( MU ), Nvidia ( NVDA ) and Disney ( DIS ).įor a quick review of the semiconductor space, corporate earnings have been awful and estimates have been cut at the quickest pace since 2008. 2022 hasn't been a friendly year for the Pelosis.
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