Ana Faris

I got asked what I thought about the space economy and promised a public reply. So here you go… The problem with the space economy is that there are really two completely different questions. The first is whether the space economy will become enormous. The second is whether space stocks will make investors rich. The first question is relatively easy. I think the answer is probably yes. Humanity has always expanded into new frontiers when technology made it possible and space will likely be no different. The second question is much harder. One of the most expensive mistakes investors make is assuming that because an industry changes the world, the companies inside it will create great shareholder returns, but history suggests otherwise. Railroads, airlines telco, internet transformed civilization. Yet many of the companies that built the underlying infrastructure generated mediocre returns for shareholders. The reason is simple, competition, capital intensity, and technological change destroy economics. An industry can be revolutionary while the stocks themselves are terrible investments. Space has many of the same characteristics. It is capital intensive, technologically complex, and requires enormous upfront investment. Those are not traits that automatically lead to great shareholder returns. In fact, I generally look for the opposite. I prefer businesses that are simple, predictable, asset light, and highly cash generative. I like businesses that can grow without constantly requiring large amounts of capital. Many space companies today do not fit that description. The way I think about it is that there are three parts. The first part is the infrastructure. Rockets, launch providers, satellites, and manufacturing all fall into this category. This is where most investors look first because it is exciting, visible, and promotable. It is also the part of the industry that tends to attract the most attention. That does not necessarily mean it will produce the best economics. The second part is the platform. These are the companies that control communications, navigation, logistics, data, and access (ie $VRSN). This part could become very attractive if network effects and scale advantages emerge over time. The third part is the applications. These are businesses that use space infrastructure to solve problems on Earth. Historically, this is where some of the largest fortunes are often made. During the Gold Rush many miners went broke chasing gold while others became wealthy selling picks, shovels, supplies, banking services, and transportation. The real winners were often not the people doing the digging. The difficult part with space is figuring out who the shovel sellers will be. That is far easier said than done. Most of the obvious candidates are still highly speculative and difficult to evaluate. Many space companies violate the filters that I normally look for. They are often capital intensive, free cash flow negative, difficult to predict, dependent on technological breakthroughs, and valued on possibilities that may not materialize for years. Because of that, I view most space stocks today as closer to speculation than investment. That does not mean fortunes will not be made. In fact, I suspect some of the largest fortunes of the next fifty years will come from the space economy. The challenge is not predicting that space will matter. The challenge is predicting where the economics will ultimately accrue. Investors often focus on what will change the world when they should be focused on who will get paid. The question is not whether space will be huge. The question is who will capture the value. 🌹

xAI charges $50B per gigawatt. Neoclouds charge $17-25B. Gavin Baker @GavinSBaker of Atreides Management told @johncoogan and @jordihays on @tbpn that Mars is not the SpaceX bull case. Altimeter's research shows xAI monetizes compute at $50B per gigawatt on the Google deal - 2-3x what any neocloud competitor charges. Baker stayed long through the IPO. His 12-month model doesn't track rocket launches. It tracks gigawatt additions. xAI also ordered roughly 20% of NVIDIA's Ruben production. Ruben is easier to deploy than Blackwell. Each new gigawatt at that pricing premium is a significant revenue event. Model gigawatts, not launch cadence. That's the trade. Full breakdown of Baker's near-term SpaceX case: podcastalpha.substack.com/p/gavin-baker-… Source: TBPN - youtube.com/watch?v=PW5n3Z…

I believe we are currently on the brink. We are entering a particularly risky period expected between the 2026 midterm election and the 2028 presidential election. At the same time, the monetary situation is becoming increasingly threatening. The U.S. government currently spends $7 trillion while only taking in approximately $5 trillion, resulting in 40% overspending. While the government has a significant amount of debt to finance, the demand for that debt is falling. This decline in demand is driven by standard supply and demand factors, as well as fears from debt holders regarding potential sanctions. #geopolitics @edels0n

Federal Reserve Chairman Kevin Warsh announces a new task force with five distinct focuses: -Fed communications -Fed balance sheet -Use and reliance on existing data sources -Productivity and jobs -Fed inflation frameworks

Vanda Research: "Retail traders poured more money into SpaceX over the previous three trading sessions than they did for all of the “Magnificent Seven” stocks combined...Retail investors net bought $369.8 million worth of SpaceX stock in the first three days of trading. For perspective, retail traders bought $88.2 million worth of Nvidia stock over those same three days. Meanwhile, they net sold shares of Tesla and Apple." In my December report on "Price Discovery" (sageroadresearch.com/collections/re…), I dissected the "coordinated mob behavior" of the retail cohort. Here's a snippet: "Meanwhile, the internet has redefined how retail investors (and most investors) form convictions and express them. As FINRA detailed in a report released in December: “45% of retail investors receive financial advice from the internet and 24% reported getting their information from social media.” And according to a study by European researchers: “In 2023, almost 80% of American millennial and Gen Z investors relied on investment advice from social media outlets.” Meme stock behavior—the GameStop short-squeeze being the preeminent example—is often held up as evidence of “coordinated mob” behavior. It’s also evident in the individual stock buying of retail investors, which is concentrated in big, news-cycle dominant companies—in 2024, US markets saw roughly $265 billion in net new inflows from self-directed retail investors and slightly more than 25% of that went into just six tech stocks—AMD, Nvidia, Tesla, Apple, Amazon, and Palantir. It’s clear that this concentration of conviction also extends to ETF selection." Learn more about Sage Road Research here: sageroadresearch.com/collections/re…. Interested in subscribing? Message me. MarketWatch link: marketwatch.com/story/retail-i…

AQR factors vs Fama-French factors: The Quality and especially the Low-risk constructions yield a great boost in Sharpe. For the Momentum factors there's no big difference and Devil's Value underperforms bare value. But AQR's Momentum and Value factors are designed as a combo with higher anti-correlation, and viewed as a combo they have outperformed nicely.

Cursor CEO Michael Truell on the future of writing code: "Our goal with Cursor is to invent a new type of programming." "It looks like a world where you have a representation of the logic of your software that does look more like English." "You can imagine kind of an evolution of programming language towards pseudocode. You have written down the logic of the software, and you can edit that at a high level." "It won't be the impenetrable millions of lines of code, it'll instead be something that's much terser and easier to understand and easier to navigate." @mntruell with @lennysan on Lenny's Podcast

Nick Sleep on focusing on inputs, not outputs: “Our shares are cheap because investors prefer to chase the new booms surrounding Chinese urbanization… There are times when it is easy to feel good about investing, and there are times when it is much harder. The emotions usually go without outputs. It is in times like these that the hard psychological and analytical work is done, and the partnership is filled with future capital gains: this is our input. The output will come in time. Those with a rational disposition may not find it too hard to feel good today.” ___ This is one of the most important lessons in investing. You can control the inputs — the quality of the businesses you buy and the prices you pay. You cannot control the outputs — when the market decides to recognize that value. When short-term sentiment is poor and prices are depressed, the hard work is being done — buying quality businesses at attractive prices. In investing, you can control the inputs, but you can’t always control the timing of the output. Those focused on the inputs rather than near-term price action are often the ones who feel most comfortable when others feel anxious. If you become too focused on the output, short-term sentiment will begin to dictate your decisions rather than the fundamentals. Focus on what you can control. The rest will follow in time. ___ 📝 Nomad Investment Partnership Letters (June 2008)

10 years in the books. biremecapital.com/blog/fundament… Letter includes: -what we got right -what we got wrong -out shift away from net US equity exposure Also includes thoughts on Bollore and software stocks. Disclaimer below! FV performance is shown net of a 1% management fee and a 10% performance fee. Available for Qualified Clients only as SEC rules do not permit performance fees for nonqualified investors. Fee structures and returns vary between clients. FV inception was 6/14/2016. Advisory fees and other important disclosures are described in Part 2 of Bireme’s Form ADV. Reported performance is a dollar-weighted average of the securities in the Fundamental Value L/S Model Portfolio maintained at Interactive Brokers from inception through October 2023. From November 2023 onward, reported performance is a dollar-weighted average of the performance of all client accounts invested solely in the Fundamental Value L/S strategy with no client-directed customizations to the portfolio composition. Performance is shown net of a 1% management fee and 10% performance fee. Available for Qualified Clients only as SEC rules do not permit performance fees for nonqualified investors. Past performance is not indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that any specific investment will either be suitable or profitable for a client’s investment portfolio. The SPY ETF seeks to track the performance of the S&P 500 Index, and the performance described includes both fees and the reinvestment of dividends and other distributions. Registration does not constitute an endorsement of the firm, nor does it indicate that the advisor has attained a particular level of skill. See biremecapital.com/disclaimer for important disclosures.

EQUITY SUPPLY SHOCK For 25 years, buybacks and cash-financed M&A have reduced the stock of publicly traded US equity almost every year. That structural tailwind is about to reverse. SpaceX, Alphabet, Meta, OpenAI, Anthropic - five companies that could raise ~$400bn between them. More than twice the total equity issued across the whole market in most years. Net supply will flip from negative to strongly positive.

Everyone talks about revenue because it’s the easiest number to model and the easiest number to get excited about. Far fewer people spend time thinking about the economics required to produce that revenue. Going from $500m to $21b in a few years is no doubt remarkable. The more important questions are how much capital must be deployed, what returns that capital will earn, how much depreciation will eventually flow through the income statement, and how much of the value created ultimately accrues to shareholders. We have been in an extraordinary bull market where AI and infrastructure stocks have risen at breathtaking rates. Rapid price appreciation has a way of making investors increasingly optimistic, sometimes extrapolating today’s conditions far into the future. Eventually, excitement gives way to economics. When the dust settles, what will matter is not how much revenue was generated, but whether the business earned attractive returns on capital after accounting for dilution, depreciation, competition, and ongoing reinvestment requirements. A business can grow revenue 40x and still be a mediocre investment if the underlying economics are poor. Revenue tells you how big a business became. Economics determine whether shareholders actually benefited. 🌹

Ackman’s core thesis for 2026 is exploiting market distraction. While capital rotates heavily into the 'AI race,' semiconductor manufacturers, and new IPOs like $SPCX, Pershing Square is taking concentrated, heavy positions in what the market currently dismisses as 'old tech'. Ackman argued the market is ignoring $MSFT and $AMZN's near-infinite runway in cloud computing. He views $AMZN as one of the most dominant companies in history because it maintains its moat not by pushing prices up, but by aggressively driving down delivery times and costs. He views $META not as a legacy social network, but as an immediate beneficiary of AI. AI has significantly optimized Meta's ad delivery, simultaneously increasing advertiser ROI and user engagement.

Atreides Management's @gavinsbaker says the bottleneck trade is nearing its end. "That was the game for the last year. The next game is what has enduring franchise value on the other side of these bottlenecks, whenever that is."

$SPCX ACQUIRES CURSOR FOR $60B. Months ago, Jensen Huang $NVDA said: "My favorite enterprise AI service is Cursor. Cursor is an AI coder. Every one of our engineers is now assisted by Cursor, and our productivity has gone up incredibly." Elon is playing to win.

.@elonmusk made Warren Buffett’s entire net worth in one day. Peter Thiel predicted why Buffett’s logic was flawed 13 years ago: “He’s become the richest man in America by avoiding technology.” “Would you rather invest in a spaceship company going to Mars or a Mars candy bar?” “And when people live on Mars, they’ll still be eating Mars candy bars. Spaceship companies will come and go, so you should only invest in candy bars.”

Baseten CEO @tuhinone tells Altimeter's @apoorv03 that one of Baseten's cloud providers has already indicated their B200 prices ($/GPU hour) are set to double when existing contracts expire and are up for renewal later this year. "If you go out right now saying you want a thousand GPUs, truly.. people are talking about Q2 of next year. So 12 months out, maybe 15 months out. We have a cluster.. in one of these clouds.. of B200s.. Our unit price right now is $2.63 an hour.. that's up for renewal in October. They came to us already in May and said $5.10 is the new price.. So double."

Scott Bessent asked his mentor Stan Druckenmiller about strategy behind 30 years without a single losing year - now Bessent is Trump's US Treasury and Druckenmiller warns the next financial crash is coming for the United States together with George Soros they crush the British and Japan economy now - one Trump tweet - Druckenmiller went from 93% invested to completely flat in one day "US debt has gone from 65% to 105% of GDP " - Druckenmiller calls this a ticking bomb the man who never lost a year in 30 years says the next crash will be worse than 2008 - and his student now controls the US Treasury in this video you will learn the exact strategy behind 30 years of 30% returns bookmark & watch today ↓

SUMMARY OF FED DECISION (6/17/2026): 1. Fed leaves rates unchanged for the 4th straight meeting 2. 9 out of 18 officials expect at least one rate hike this year 3. Fed lowers its median 2026 US GDP projection from 2.4% to 2.2% 4. Fed now sees PCE inflation not returning to its 2% target until 2028 5. Fed says inflation "remains elevated" relative to their goal 6. Today's Fed decision was reached in a unanimous 12-0 vote The Fed appears to be bracing for more inflation.

Very hawkish dot plot. Nine out of 18 officials have at least one hike this year (and six of those 9 have *multiple hikes*). Only one person has a cut this year, and one participant (presumably Warsh) didn't submit an SEP The statement gets a complete writethru from top to bottom, much shorter

Kevin Warsh just ended his first ever FOMC meeting as Fed chair. His message to markets: "I can't give you any guidance on what we're going to do next." Here is what he said: 1. Inflation is still way above the Fed's 2% target and prices are too high for most people 2. "We will fix five years of misses on inflation", he is directly saying the previous Fed failed 3. The Fed will no longer tell you in advance what it plans to do with interest rates 4. He watches stock market prices more than anything else when making decisions 5. Interest rates are hurting the housing market but are not slowing down financial markets 6. All 19 members at the table agreed not to raise rates today 7. The 2% inflation target is not changing 8. He refused to say whether bond yields rising after today's decision concerns him 9. He refused to say whether he has spoken to Trump since becoming Fed chair Under Powell, the Fed always told markets what was coming next. Under Warsh, that is gone.