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πŸ“‰ Meet The New Most Powerful Man In Finance

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BREAKING NEWS

🏦 Jerome Powell Is Out. Meet The New Most Powerful Man In Finance.

Kevin Warsh was sworn in as Fed Chair at the White House on Friday by Supreme Court Justice Clarence Thomas. The first time a Fed Chair has been sworn in at the White House since Alan Greenspan in 1987. That detail alone tells you how politically loaded this moment already is.

Trump told the room he wants Warsh completely independent. Then later that same day said rates will come down very quickly. Both things happened on the same Friday.

Here’s why every investor should care:

  • The Fed controls interest rates. Interest rates control your mortgage, your credit card, business loans, and the stock market. One Fed decision can move markets within minutes.

  • Warsh's first rate decision comes next month. Trump wants cuts. Inflation says not yet. Warsh is stuck in the middle from day one.

  • Jerome Powell is not fully gone. His governor term runs until 2028. Warsh will be running meetings with his predecessor sitting at the same table voting on every decision.

What traders should watch: The June Fed meeting is the first real test. Any signal from Warsh on the direction of rates will move markets immediately. Watch his language carefully. Watch inflation data between now and then. And watch whether he pushes back on Trump or plays along. That answer will define the next two years.

The Munch Take: The most powerful economic job in the world just changed hands in the middle of a war, rising inflation, and a market that cannot decide what it wants. Trump wants rate cuts. Inflation wants hikes. The market wants certainty. Nobody is getting exactly what they want. My wife asked me what the Fed Chair actually does. I said he controls the price of money. She said that sounds like too much responsibility for one person. She’s not wrong.

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STOCK OF THE DAY

β˜•οΈ Starbucks Just Fired Its AI. Turns Out It Couldn't Count Coffee.

$SBUX Starbucks is pulling its AI inventory system across all of North America after the tool miscounted and mislabeled store inventory. A company spending billions on a tech-forward turnaround just discovered that the robots could not keep track of the oat milk. Somewhere a spreadsheet is feeling vindicated.

To be fair to Starbucks, the bigger story here is actually encouraging. CEO Brian Niccol's "Back to Starbucks" plan delivered its first real results in Q2 2026, with global comparable store sales up 6.2% and US customer traffic hitting a three-year high. The turnaround is working. The AI inventory system just was not part of it.

πŸ“ˆ The Bull Case:

  • Starbucks delivered revenue and profit growth in the same quarter for the first time in over two years. US comparable transactions rose 4.3% year over year. After several quarters of customers walking away, they are walking back in.

  • Brian Niccol fixed Chipotle. Faster service, better staffing, cleaner stores, and a reimagined loyalty programme are already showing up in the numbers. The operational playbook is working.

  • The stock jumped 9% after the last earnings report and has had its best month in over a year. Analyst consensus sits at 16 buys against 4 sells. The market is starting to believe the recovery is real.

πŸ“‰ The Bear Case:

  • The coffee is expensive. A standard order regularly clears $8 to $10. At some point consumers stop justifying it and walk past the green sign to the independent shop down the street or brew a cup at home.

  • North America operating margins actually contracted during the turnaround quarter due to labour investments and tariff pressures. Growing revenue while shrinking margins is not a sustainable combination.

  • China comparable store sales grew just 0.5% under the new joint venture structure with Boyu Capital. China was supposed to be the growth engine. Right now it’s barely running.

The Munch Take: Starbucks fired its AI inventory system for confusing oat milk with regular milk. We’ve all been there. Regardless, the turnaround is real and the market is getting optimistic. But the coffee is still overpriced and not great. Even though my wife spends more at Starbucks every month than I spend on market data subscriptions, I’m not touching it. She either has incredible brand loyalty or the most expensive habit I’ve ever funded.

πŸͺ Munchy Memes

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