Core Insights - The CEO of Affirm, Max Levchin, indicated that while there is no significant credit stress among federally employed borrowers due to the government shutdown, there are emerging changes in shopping habits among this group [1][2] - The ongoing federal funding lapse, which started on October 1, is the longest in U.S. history and has affected not only government employees but also programs like SNAP, which serves 42 million Americans [2] Group 1 - Affirm is observing a subtle decline in shopping interest among federal employees, with a noted change of a couple of basis points [1] - Approximately 670,000 federal employees have been furloughed, and around 730,000 are working without pay due to the shutdown [1] - The company is monitoring employment data for potential disruptions but currently reports no major disturbances in its operations [2] Group 2 - Affirm has the capability to adjust its credit standards if necessary, indicating a proactive approach to potential economic changes [2] - The impact of the federal funding lapse extends beyond government employees, affecting various sectors and programs [2]

Core Insights - U.S. small businesses are significantly impacted by President Trump's tariffs, struggling to cope with increased costs compared to larger retailers [1][3] - The complexity of supply chains for small businesses has escalated, with some reporting a tenfold increase in challenges [1] - Small businesses account for approximately 43% of U.S. GDP, highlighting their importance to the economy [2] Impact on Small Businesses - Small business owners report a decline in top line revenue year-over-year due to tariffs [2] - The current economic climate, exacerbated by tariffs, poses a threat to the livelihoods of small business owners [2] - Many small businesses lack the resources to stockpile inventory, making them more vulnerable to tariff impacts [2]

Core Viewpoint - Block shares experienced a 10% decline following disappointing third-quarter earnings that did not meet Wall Street expectations, indicating a slowdown in profit growth for the Square service [1] Financial Performance - Earnings per share were reported at 54 cents adjusted, compared to the expected 67 cents [4] - Revenue for the quarter was $6.11 billion, falling short of the anticipated $6.31 billion [4] - Year-to-date, Block shares have decreased by 24% [1] Segment Performance - Square's gross payment volume increased by 12% year-over-year, but gross profit growth for the point-of-sale service was only 9%, a decline from the previous quarter's 11% growth [1] - Cash App's gross profit growth was significantly stronger at $1.62 billion, reflecting a 24% increase year-over-year, supported by 58 million monthly transacting active users [3] - The growth in Cash App was driven by services such as Cash App Borrow, Cash App Card, and Buy Now Pay Later [3] Strategic Insights - The company attributed the slower growth in Square to a change in processing partners and lower-margin hardware sales [2] - The Chief Financial Officer noted that the company's product and go-to-market strategies are effectively gaining profitable market share in targeted verticals like food and beverage, particularly with larger sellers and outside the U.S. [2]

Core Insights - Archer Aviation's stock fell 12% following a share sale despite reporting a narrower-than-expected third-quarter loss [1] - The company reported a net loss of $129.9 million, which was better than the FactSet estimate of a $178.6 million loss [1] - Archer announced a $650 million stock offering for 81.25 million shares to finance its $126 million acquisition of Hawthorne Airport in Los Angeles, designated as a hub for air taxi operations [1] Company Summary - The stock offering will dilute the value for existing shareholders, with the weighted average of Archer shares outstanding increasing to approximately 660.9 million from 397.5 million a year ago [2] - Interest in electric aircraft manufacturers has surged recently as key players approach certification, highlighted by Beta Technologies going public on the NYSE [2]

Core Insights - The ongoing U.S. government shutdown has significantly impacted consumer sentiment, driving it to its lowest level in over three years, with a reading of 50.3 in November, reflecting a 6.2% decline from the previous month and approximately 30% from a year ago [2][3][4]. Consumer Sentiment - The University of Michigan's Index of Consumer Sentiment indicates a notable decline, with economists expecting a higher reading of 53.0, compared to the actual reading of 50.3 [3][4]. - The current conditions index fell to 52.3, marking an almost 11% drop from the previous month, while consumer expectations decreased to 49.0, down 2.6% [5]. Economic Concerns - Consumer worries about the government shutdown have overshadowed positive sentiment from record-high stock prices, with widespread declines in sentiment observed across various demographics, including age, income, and political affiliation [4]. - The survey highlighted that sentiment among individuals with significant stock holdings improved by 11%, indicating a disparity in consumer sentiment based on asset holdings [6]. Inflation Outlook - Inflation expectations remain relatively stable, with the one-year outlook slightly increasing to 4.7%, while the five-year outlook decreased by 0.3 percentage points to 3.6% [5].

A recent decision by the Securities and Exchange Commission to begin allowing fund companies to create ETF shares classes of traditional mutual funds is expected to lead to a flood of new ETFs on the market, but State Street's fund management arm, State Street Investment Management, has other ideas. The ETF giant, which manages roughly to $1.7 trillion in its SPDRs ETF family — including the oldest and most-widely traded S&P 500 exchange-traded fund, SPY, and the biggest gold ETF, GLD — sees the SEC greenli ...

Core Viewpoint - MP Materials, backed by the Pentagon, warns investors to be cautious about other rare earth projects due to challenging economics in the industry [2][3] Company Insights - MP Materials is the only active rare earth miner in the U.S. and has established offtake agreements with major companies like Apple and General Motors, in addition to the Pentagon [4] - The CEO of MP Materials, James Litinsky, emphasizes the company's structural advantages due to its vertical integration and claims that it is "years and billions ahead of others" in the industry [4] - The company aims to normalize production within three years from the start of commissioning, contrasting with Australia's Lynas, which took about a decade [4] Industry Dynamics - The rare earth industry is described as a "structural oligopoly," with a few major players dominating the market [6] - The Trump administration is open to encouraging private capital investment in the industry through loans and grants, but higher prices are necessary to address the industry's structural challenges [7] - Rare earths are essential for various technologies, including weapons platforms, semiconductors, electric vehicles, and clean energy, with China currently dominating the global supply chain [8]

Labor Market Overview - The ongoing government shutdown has resulted in a lack of official labor market data, leading to reliance on alternative metrics to assess current conditions [1][2] - Various indicators suggest a weak but not collapsing labor market, with expectations of a decline of 60,000 jobs and an increase in the unemployment rate to 4.5% if the Bureau of Labor Statistics had released its report [2] Employment Trends - The labor market is characterized by low hiring and low firing, indicating high uncertainty among businesses [3] - The unemployment rate remains low at around 4.4%, with little change observed in layoffs and hiring rates [3] Small Business Employment - Larger firms continue to add workers, while smaller businesses are reducing their workforce, reflecting a trend of conservatism among small business owners [5][6] - ADP reported a loss of 34,000 jobs in October for businesses employing fewer than 250 people, indicating a steady erosion in employment for smaller firms [6] Job Creation and Layoffs - ADP reported that companies added only 42,000 jobs in October, which, while better than expected, still reflects weak hiring [7] - Challenger, Gray & Christmas reported 153,074 announced job cuts in October, the highest for that month in 22 years [7] - The Institute for Supply Management's employment indexes for services and manufacturing sectors indicate more companies are planning to hold or cut staffing levels, with readings below 50% signaling contraction [7] Wage Growth Disparities - Bank of America reported a year-over-year payroll growth of 0.5% in October, with significant disparities in wage growth: higher earners at 3.7%, middle earners at 2%, and lower income at only 1% [7] Job Openings and Small Business Indicators - Job search site Indeed reported a decline in job openings, reaching the lowest level since February 2021 [7] - Homebase indicated a further decline in small business employment, with a 2.9% drop in the "employees working" indicator from January levels [7]

Tesla CEO Elon Musk attends the Saudi-U.S. Investment Forum, in Riyadh, Saudi Arabia, May 13, 2025.Hamad I Mohammed | ReutersThis is CNBC's Morning Squawk newsletter. Subscribe here to receive future editions in your inbox.Here are five key things investors need to know to start the trading day:1. +$1 trillionThe richest man in the world is about to get a lot richer.Tesla shareholders approved CEO Elon Musk's nearly $1 trillion pay plan yesterday, with 75% voting in support of the proposal despite oppositio ...

Core Insights - Nvidia is the leading provider of artificial intelligence chips, achieving a market cap of $4.5 trillion, with Google as a significant client purchasing GPUs to meet AI compute demands [1][2] - Google is not only a buyer but also a developer of AI chips, recently announcing its most powerful chip, Ironwood, which is designed for heavy AI workloads and is over four times faster than its predecessor [2][3] - Google’s TPUs provide a competitive edge in the cloud market, with a notable increase in cloud revenue by 34% year-over-year to $15.15 billion, driven by strong demand for AI infrastructure [8][9] Company Developments - Google has developed its seventh generation of Tensor Processing Units (TPUs), which are application-specific integrated circuits crucial for AI tasks [3][4] - The company has been proactive in securing large contracts, including a significant deal with Anthropic valued in the tens of billions, expected to bring over a gigawatt of AI compute capacity online by 2026 [12][13] - Google’s cloud segment is experiencing substantial growth, with a backlog of $155 billion and a forecasted increase in capital expenditures to $93 billion for the year [8][21] Competitive Landscape - Google is ahead of competitors like Amazon and Microsoft in deploying custom AI chips at scale, with analysts noting that Google is the only major player to have deployed TPUs in large volumes [5][4] - While Nvidia remains a dominant player in AI chips, analysts suggest that growing familiarity with Google’s TPUs could drive further growth in Google Cloud [22][23] - The demand for TPUs is so high that analysts recommend Google consider selling these systems externally to customers, indicating a closing gap between TPUs and Nvidia’s offerings [23]