"Rates wee bit high" After the close update

The Wall Street Journal just found three trillion of debt that the AI giants have been keeping off their books. And if you're wondering if that is a good or bad thing, this is nearly double what the market thought it was. Let me give you a breakdown of what happened today. Crude spiked, yields rose, and every rate-sensitive name took a hit. A lot of people forget that today was the day that the ceasefire expired as if there really ever was one. Brent's up 2.6%, WTI's up 2.7 and higher crude means higher for longer rates. 30-year tapping levels we haven't seen since 2007. Rate pressure is full-on right now and this crushes utilities, it crushes home builders and real estate took a broad hit. Airlines dropped more than 2% on higher fuel costs. Planes don't fly on crude but distillate is going crazy. Heating oil, diesel, gasoline. We have a handful of positions on there, so our book is up big today. And semiconductors are holding firm and this is masking really how bad this hit to stocks is because on the surface, the tape looked pretty stable. The equal-weight S&P only dropped 90 basis points while cap weight falls half a point. Really nothing to speak of there if you strip out chips. The retail sector is getting smoked off more than a point and a half of weak sales data from last Friday. But let's get back to the Wall Street Journal story. Nine major tech companies now carry roughly three trillion of off-balance sheet AI exposure. So that is why you saw the hyperscalers get hit. And this is why Vol finally woke up. We told everyone VIX was way too cheap in the letter this morning and lo and behold, it moves 7% north. Keep in mind the one-year low in VIX was just last Friday. That didn't last long. We are insulated from any damage that you see in equities. This is something we've been talking to subscribers about for a very long time. If you want to see exactly what we are running right now and how we're hedging our book, just comment "LETTER" below and I'll send you the link. High interest rates take no prisoners and today was