Good morning! All is well in the world again after Nvidia crushed earnings and jumped 5% after-hours. Salesforce also beat expectations and raised its forecast, thanks to AI tailwinds.

Meanwhile, a federal court ruled Trump’s reciprocal tariffs illegal. Elon Musk reportedly tried to block Sam Altman’s chip deal in the Middle East, and the Pentagon just axed Musk’s “what did you do last week?” email mandate.

Plus: Hailey Bieber scored a unicorn exit, selling her skincare brand Rhode for $1 billion. Telegram is partnering with xAI, 1 in 4 Americans are functionally unemployed, and Buffett’s advice to young earners.

Invest in Pacaso’s luxury vacation home empire–backed by Zillow’s co-founders, SoftBank, and Maveron–before the valuation changes after May 29. Learn more here.

SQUEEZ OF THE DAY

TACO Trade

Wall Street has a new acronym for “buying the dip” in the Trump era: the TACO trade: Trump Always Chickens Out.

Coined by the Financial Times, the TACO trade captures a pattern we’ve seen on repeat:
Trump threatens tariffs → markets drop → backlash ensues → Trump walks it back → markets bounce.

It happened with the 90-day tariff pause in April, again during the China ceasefire, and just this week with the EU U-turn. See chart below:

When asked about the TACO trade on live TV yesterday, Trump had a bit of a meltdown, telling the reporter: “Don’t ever say what you said,” and defended it as a “negotiation” tactic, but failed to explain why markets shouldn’t keep betting on his U-turns.

Now all eyes are on the calendar. The 90-day pause ends exactly six weeks from today. Will Trump double down or chicken out once again? If market pricing is any indicator, investors are betting on the latter.

Takeaway: If you’ve been riding the TACO trade, congrats, you just made generational wealth. Just hope the next reporter doesn’t provoke him into actually following through, and collapsing the global economy.

HEADLINES

Top Reads

• Nvidia beats on earnings and revenue as data center sales jump 73% (CNBC)

• Nvidia earnings topped forecasts by 10% over past 2 years (YF)

• Trump administration axes Biden-era barrier for crypto in 401(k) plans (CNBC)

• Court says Trump doesn't have the authority to set tariffs (Axios)

• Pentagon sunsets Elon Musk's "what did you do last week" email mandate (Axios)

• Elon Musk tried to block Sam Altman's big Middle East deal (WSJ)

• Elon Musk says he is leaving Trump administration (BBC)

• Cantor Fitzgerald to acquire UBS hedge fund unit, expanding alternative assets (YF) 

• Salesforce turns in strong results and optimistic forecast (CNBC)

• Tesla investors demand Musk work 40-hour week at EV maker as ‘crisis’ builds (CNBC)

• KKR is fighting private equity's battle for the UK stock market (BB)

• NYC pension's private equity sale might be largest ever of its kind (Axios)

• Asia's $7.5 trillion bet on US assets is suddenly unraveling (BB)

• Nearly a quarter of the U.S. is ‘functionally unemployed’ (FC)

• Telegram CEO announces $300M partnership with Elon Musk’s xAI and Grok (CNBC)

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CAPITAL PULSE

Markets Rundown

Market Update

• Stocks closed lower Wednesday as investors awaited NVIDIA’s earnings after the bell and digested FOMC meeting minutes, which acknowledged rising risks to both inflation and employment targets.

• All 11 S&P 500 sectors declined, though technology and communication services fared better than defensives like utilities and energy.

• Bond yields rose, with the 10-year Treasury yield at 4.48%, reflecting ongoing uncertainty around Fed policy direction.

• Markets now turn to Friday’s PCE inflation report, with the Fed’s preferred gauge expected to show modest price gains.

Economic Data Highlights

• FOMC Minutes (May): Policymakers cited growing risks to both inflation and employment goals, offering little new guidance on rate direction.

• PCE Inflation (Apr, expected Friday): Forecast at +0.15% MoM, +2.2% YoY headline; +0.1% MoM, +2.5% YoY core

• 10-year Treasury yield: Rose to 4.48%, up 3 bps on the day

Reported Earnings

• NVIDIA (NVDA): Posted strong results driven by continued AI demand; guidance came in above expectations.

• Salesforce (CRM): Delivered mixed results with slightly softer forward guidance, but solid cloud momentum.

• Macy’s (M): Reported Q1 results and lowered full-year guidance, citing tariff impacts and a more cautious retail environment.

Earnings Today

• Best Buy (BBY) – Reporting May 29 (Before Market Open): Focus on electronics demand and margin trends.

• Costco (COST) – Reporting May 29 (After Market Close): Investors looking for trends in membership renewal and traffic growth.

• Marvell Technology (MRVL) – Reporting May 29 (After Market Close): Key focus on AI chip segment and enterprise networking demand.

Movers & Shakers

• (+) Joby Aviation ($JOBY) +29% after announcing a $250M Toyota investment.

• (+) Abercrombie & Fitch ($ANF) +15% because the retailer says tariffs won’t hurt sales.

• (–) GameStop ($GME) -11% after the retailer announced a $512 million Bitcoin purchase.

Private Dealmaking

• Acrisure bought the payroll business of Global Payments for $1.1 billion

• e.l.f. Beauty acquired Rhode for $1 billion

• Neuralink, Elon Musk’s brain-implant startup, raised $600 million

• H.I.G. Capital bought Rentokil Initial for $464 million

• GRIN Therapeutics, a neurodevelopmental disorders biotech, raised $140 million

• Salvia BioElectronics, a migraine heralded developer, raised $60 million

For more PE, VC & M&A deals, subscribe to our Buysiders newsletter.

BOOK OF THE DAY

Empire of AI

A longtime AI insider, Karen Hao takes us deep inside OpenAI—the company at the center of the global AI arms race—to reveal how idealism gave way to a breakneck pursuit of power and profit.

Drawing on exclusive access and on-the-ground reporting from Silicon Valley to the Global South, Hao exposes the hidden costs of AI’s rise: the staggering resources, the exploited workers, and the environmental toll.

Empire of AI is a riveting, behind-the-scenes account of the people, drama, and consequences shaping the future—told by someone who witnessed it all from the cockpit.

“Our lives are about to be remade by artificial intelligence—or to be more accurate, by a few companies run by a few very self-confident people.”

DAILY VISUAL

Data Center Construction Contributing One Percentage Point to GDP Growth

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DAILY ACUMEN

Legends Series: Richard Dennis

Richard Dennis turned $1,600 into $200 million using rules anyone could follow—if they had the discipline.

Known as the “Prince of the Pit,” Dennis believed trading wasn’t art—it was science.

In the 1980s, he conducted a now-legendary experiment: training a group of novices, dubbed the “Turtles,” to trade commodities using a strict trend-following system.

The result? Many became millionaires.

Dennis’ lesson was clear: you don’t need to predict—you need to react.

When prices broke out, you bought.

When trends reversed, you got out. No emotion. No story. Just price.

In 2025, markets are volatile and macro signals are murky.

But momentum is alive—S&P sectors are rotating, rates are shifting, and volatility is returning.

Dennis’ rulebook would thrive here.

His message: Build a system. Follow it. Don’t deviate. The edge isn’t in brilliance—it’s in consistency.

ENLIGHTENMENT

Short Squeez Picks

• Where does consciousness reside in the brain?

• Breaking the cycle of proving yourself

• 11 benefits of being single

• Why Warren Buffett tells young people not to worry about their salary

• Why a billionaire loves stoic philosophy

MEME-A-PALOOZA

Memes of the Day

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