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πŸ“‰ Trump Just Sent Stocks Flying

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BREAKING NEWS

πŸ’°The Government Just Wrote A $2B Quantum Check. Stocks Went Crazy.

The Trump administration just committed $2 billion to quantum computing, taking equity stakes in nine companies as part of the deal. Here is where the money went:

  • $IBM IBM gets $1 billion from the government and is matching it with $1 billion of its own to build America's first dedicated quantum chip factory.

  • $QBTS D-Wave Quantum, $RGTI Rigetti Computing, and $INFQ Infleqtion each receive around $100 million.

  • The stocks did not wait for the ink to dry. IBM jumped 12%. D-Wave surged 33%. Rigetti ripped 30%. Infleqtion added 31%.

So what is quantum computing and why does anyone care?

  • A regular computer thinks in ones and zeros. A quantum computer thinks in both at the same time. That one difference could let it solve problems in minutes that would take today's fastest computers millions of years.

  • Quantum computers still cannot beat regular computers on most everyday tasks. The technology works in labs. Getting it to work reliably in the real world is the part nobody has fully cracked yet.

  • IBM estimates quantum computing could generate up to $850 billion in economic value by 2040. The government is betting big on a technology that has been five years away from changing everything for over a decade. Not a bad bet. Just a long one.

The Munch Take: Two billion dollars from the government, stocks up 30% in a single afternoon, and a technology that could eventually break every encryption system on the planet. The companies getting funded today are not printing profits tomorrow. They are building the foundation of something that will matter enormously in ten years. Getting in early on the right ones is the whole game. Getting in early on the wrong ones is just expensive. My wife asked me which ones were the right ones. I told her that was the million dollar question. She said it sounded more like a two billion dollar question. She is, as always, correct.

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STOCK OF THE DAY

πŸ›’ Walmart Just Had Its Worst Day Since 2023

Walmart ($WMT) just delivered $177.75 billion in revenue, up 7.3% from last year and ahead of everything Wall Street expected. Online sales up 26%. Advertising up 37%. The quarter was genuinely good and everyone on the call knew it.

Then Walmart started talking about what comes next. Full-year profit forecast below expectations. Next quarter's outlook below, too. The stock dropped nearly 8% and had its worst single day since 2023. Same company. Same day. Two very different stories.

Here’s the catch.

Gas is expensive. Shoppers are tired. The Walmart CFO said fuel prices are hitting household budgets hard right now. Walmart knows this better than almost any company on earth because 90% of Americans shop there every single week. They see the consumer up close, in real time, with a full cart. When Walmart gets cautious, pay attention.

πŸ“ˆ The Bull Case:

  • E-commerce sales grew 26%, advertising revenue grew 37%, and Walmart+ added more new members than ever before. These parts of the business make more money per dollar than selling groceries. That matters a lot.

  • When people have less money, they shop at Walmart. Higher-income customers have been trading down to Walmart for two straight years. A struggling economy is actually good news for the world's biggest discount store.

  • Walmart has a subscription business now. Millions of people pay every month without thinking about it. That steady income does not disappear just because gas prices go up.

πŸ“‰ The Bear Case:

  • Walmart told investors it expects to earn less money this year than Wall Street thought. Then it said next quarter will also be lighter than expected. Two guidance misses in a row is not bad luck. It’s a trend.

  • Consumer confidence just hit a record low. Gas is expensive. Inflation is still sticky. A trade war is pushing prices higher. Even the world's biggest discount store has a ceiling.

  • Walmart is spending an extra $175 million just on fuel costs this quarter alone. That money has to come from somewhere, and it is coming straight out of profits.

The Munch Take: Walmart had a great quarter and the stock got crushed anyway. That is what happens when the future looks scary. The business is fine. The customer is the problem. Gas is expensive, confidence is in the gutter, and the world's biggest retailer just told everyone to calm down their expectations. My wife shops at Walmart every week without ever once looking at the stock price. Completely unbothered. Turns out ignoring the noise and just showing up every week is either the definition of brand loyalty or the greatest investment strategy I have ever seen. Probably both.

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πŸͺ Munchy Memes

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