Market Briefing For Monday, Aug. 24, 2026

Are markets headed for a fall before the Fall? Well, parts already fell or are in a stabilization effort currently. So as to calamity: probably not, with caveats as you'd expect. In this case it's not necessarily rotation, rebalancing, or even the questionable 'credit-card-like' buybacks Treasury Secretary Bessent threw out amid a big of controversial related shuffling this past week (that was intent of buying long-term paper with short-term debt essentially).

Market bears can easily make a case for being nervous; we have regarding of course the mega-cap-techs (primarily hyper-scalers) for quite some time now. At the same time it is August; attendance is thinner, naysayers echo repeated worries on markets and stocks; and you have tentatively nervous technicals.

Where's the beef? On the plus side: Citadel finished their liquidation (extents desired) of their 'Situational Awareness' Fund bailout (considering the rumor they had fueled of a 'rate hike', they were not so innocent in the build-up to it); the President is going to flood the market with 'cheap beef', by waiving tariffs on hundreds of thousands of pounds of imported ground beef (easing some inflation concern); and perhaps Jackson Hole won't be the new week's spoiler.

I nevertheless suspected there are (Bessent was part of that) efforts to 'not tank' the broad market ahead of midterms; and certainly ahead of 'Jackson Hole' (Fed Summer getaway excuse for golf and trout fishing) coming right up in the new week. Let's see what happens; as besides stocks stabilized Friday into the August (monthly not weekly) Expiration.

Speaking of that certain stocks we are 'sort of' concentrated in like ONDS had a lot of Open Interest everywhere (huge volume volatility stock this Summer); especially 8 and 9 so obviously market makers, writers etc. closed between it; although that made 8 and 8.50 strikes 'in the money'; so might see additional assignment early in the new week; but perhaps not quite enough to move the needle much; although sooner or later we expect that, and in a favorable way.

Market X-ray: coin-toss to an extent as far as S&P near-term. Stocks up and rates firm is not a sustainable prospect; but everyone knows that; so for now you get a rally since it's very tough to fight this market with short-sales; and that's part of why.. despite big-cap skepticism... I've avoiding actively shorting or fighting a market; at least so far.

I realize the Administration (well Treasury) is trying to fight rates to put yields where they need them.. and that's understandable as we have this 'wartime' backdrop; regardless of whether analysts or the public wishes to acknowledge it.. at least it has happened relative to OIL's influence on pricing; not demand by consumers. And that's why we felt and feel the Fed shouldn't hike rates as the ramp has been due to geopolitics, not organic influences from consumers (so you don't punish the Country with higher rates when it's not excess public demand that pushed prices higher; and I think you all understand the picture).

Jackson Hole (Fed conclave) will be the new week's key topic; and I doubt Kevin Warsh (Fed Chairman) will want to get into a tit-for-tat monetary policy fight with Treasury Sec'y. Bessent. Is Warsh ceding the monetary role to the other character (Bessent)? That's hard to say; but again I think the Administration actions strongly affirm they wish the Treasury to have more to say about the Balance Sheet... and after all Treasury 'is' officially part of the Government; study history to see why the Fed is 'so' independent. Anyway Bessent's borrowing at the short-end to buyback the long-end; so that's what's afoot. Consolidation then perhaps higher with short-term (even hourly) swings may be dependent on what 'folks' say in Jackson Hole.

Bottom-line: ricochet moves in both directions are not necessarily preambles to what's coming next; but never know. The concentration in semiconductor or related mega-caps has been bothersome for some time; and valuations very stretched as I've contended.

Aside 'excess' CapEx for data-centers; what we do see benefiting Quantum Computing (like our D-Wave / QBTS) and photonics (focus on KOPN if their MicroLED optical interconnects really perform as they're contending).. will also mean the big hyper-scalers will have created more debt than justified. It's not something history hasn't seen before. We saw it in microwave and cellular at various times (and even in the not-too-distant future) with satellite delivery. So you could have a situation next year where the big-caps struggle but (and I hope it's not just self-serving to say) the new-era tickers do relatively better.

It's premature to define the AI debt deals ultimate impact as well; it is notable that Ken Griffin acknowledged that his Citadel finished unwinding leverage.. of the 'Situational Awareness' fund; and that was probably the most important least report story to explain both declines and advances in stocks this week.

So the shorts 'may' be in trouble 'if' we get through the weekend and Monday early chop .. and then if we do not get smug Fed counter-policy Jackson Hole attacks. Warsh is probably the ringmaster for next week's gathering; and likely he will sort of avoid rocking the boat, or dominating the 'center ring' if he can.