Monday was a tough day, as a series of headlines weighed down on a market that was already fractured.  Dell Computer (DELL) led the market lower after Morgan Stanley (MS) downgraded its rating to "underweight" from "overweight,” and adjusted the target price to $110 from $144, citing a potential 50-300% spike in memory chip prices. The flip side is that Communication Services (XLC) enjoyed a solid session.

Dell’s misfortune is also taking out Hewlett Packard (HPE), and HP Inc. (HPQ) also took big haircuts.

The S&P 500 (S&P) finished the session below its 50-day moving average, which leaves it highly vulnerable. The next few days will be intense.

Private Equity Concerns

I hate using the analogy, but it looks like there are a few more cockroaches at Blue Owl Capital, Inc. (OWL).

Blue Owl shares are breaking down fast. What’s happening in private equity and credit is worrisome, in part, due to a lack of transparency. But considering all the bad press on Main Street, any major blow-ups would have deleterious consequences.

Access to your Credit

Access to credit was rejected at record levels for all sources, and in individual categories, such as refinancing.

Interestingly, applications for increased credit card limits surged, and rejections have tumbled – it looks like banks are going to keep you in the game if you already have a job. Just get ready to make payments forever.

I don’t understand the notion that financial conditions are easier – at least not on Main Street.

I’m not sure how the Federal Reserve is interpreting this, but there shouldn’t be a hawk in the room.

This is Not a Bubble

Bubble talk won’t die down, but this is not a bubble. I have been lucky enough to have lived through a few of them (I began my career on Wall Street in 1986).

However, fear merchants have allies in the political and media spheres, so the noise won’t quiet down.

Today’s Session

“We can look back at the internet. There was clearly a lot of excess investment, but none of us would question whether the internet was profound. I expect AI to be the same.

It is both rational and there are elements of irrationality through a moment like this. AI is the most profound technology humankind has worked on.

It will evolve and transition certain jobs, and people will need to adapt... the people who will do well are people who learn how to use these tools."

- Alphabet (GOOG/L) CEO, Sundar Pichai

The CEO of Alphabet is providing soundbites, that will be heard all day today, as the “bubble” debate intensifies.  

The overall market bias remains on the downside, with Nvidia (NVDA) set to post results tomorrow after the close.

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