Big Story Rate Hike Odds Surged

SPEAKER_1 (0:00)

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Rob Black (0:12)

Friday, September 11th, 2026

I think the big story of the day has to be that the Fed rate hike odds surged to 90% on a monthly jump in core prices. There are some other things out there that are news as well. Space X just revealed an important timeline for launching data centers into space. It stocks up 1.1% on that news. They also signed another AI computing deal with $100 billion in run rate. CFO says the company is on track. NVIDIA CEO Jensen Wang just doubled down on his big 2030 prediction reiterating his expectation that the size of the AI market will reach $3 trillion to $4 trillion by 2030 during a talk at the Goldman Sachs Communicopia and Tech Conference. It was exactly a year ago that he made the initial prediction at the same event. His quote was, the semiconductor industry is going to just keep getting larger and larger, which is what we're seeing now with these two fundamental ideas that we have a new layer of computing with a new application and the end of Moore's Law.

He also went on to say, meanwhile, people are expecting these AI models to be smarter and smarter because they don't like wrong answers. Then the compounded result of that should result in a very large industry. NVIDIA's data center revenue, which includes hyperscalers and AI cloud, industrial and enterprise companies, came in at $89 billion versus the projected $85 billion in the most recent quarter, showing you they're struggling to meet demand. Every single day, the industry is struggling to meet compute demand at this point in time. Most CEOs of companies and data centers will say something along the lines of, every GPU we have could be sold to multiple different clients. It's a unique moment that continues to be a unique moment. Taking a look at some individual stocks out there today. Apple's had a good week adding another seven on today. Sitting at 334, all time high is in the low 340s. So their event, I would say, came off without a hinge, which is a play on the thought on the new foldable phone has a hinge in it. The hinge is incredibly complex and tough to make. I found that just a rabbit hole worth going down as far as looking into analysis of the company. I see Qualcomm's up 4.5% today, Meta's up 1%, NVIDIA is up fractionally, Microsoft up, just a big broad rally, if you will. Stocks are rallying even after that hotter than expected inflation report strengthened expectations that the Federal Reserve will raise interest rates next week. The S&P 500 is up 1%, the NASDAQ's up 1.1%, the Dow Jones Industrial Average is up 500 points. It sounds backwards. Hot inflation usually means higher interest rates, and higher interest rates usually pressure stocks, but markets don't always rally because the news is good. Sometimes they rally because the news is less uncertain. The August CPI rose 4.0% from the prior month in line with expectations, while Core CPI, which excludes food and energy increase 3.0%, slightly hotter than the economist expected. The rate hike next week may not be what investors want, but at least the Fed's next move is becoming clear. Wall Street hates uncertainty almost as much as it hates surprise earnings misses. A well-telegraphed rate hike could signal that the Fed is trying to get ahead of inflation now, rather than waiting and potentially having to deliver a much more aggressive series of rate increases later. In other words, investors may be viewing one predictable hike as better than the risk of several unexpected hikes down the road. Oracle's cloud infrastructure revenue jumped 121% year over year while the company reported more than $30 billion in new AI cloud contracts and maintained its capital spending plans. That has investors buying companies that supply the data center build out, including Dell, Hewlett Packard Enterprise. Super Micro, NetApp, the market's message today is not that inflation is suddenly harmless. It's that investors are balancing three things, a likely Fed hike now, falling oil prices, and continued spending on artificial intelligence. For now, the oil pullback of today and the AI optimism are outweighing the inflation concern, but with the Fed meeting next week, the market may be calm today because the outcome is much more clear and predictable next week. The inflation problem has not disappeared.

NVIDIA has become a core piece of the RoboTaxi stack as autonomous fleets move into commercial scale. Every major RoboTaxi program operating at scale today is already using NVIDIA across training, simulation, and in-vehicle compute. I am bullish on NVIDIA. I am bullish on GPUs because of cases like commercial fleets of RoboTaxis. I love the idea of a RoboTaxi. In my 50s now, I look at my ability to drive is less than it used to be. I don't like driving at night anymore.