Two Bad News Emerging!

Added: 2026-04-30

[00:00:01]Ladies and gentlemen, breaking news. The oil prices has spiked up significantly and this could potentially set to derail the world economy even more. And there's also a risk of an AI bubble bursting and there are news coming out such as this and are they going to crash the stock market? Today I'll give you my flavor of it. So the headline news today is that Middle East oil prices has gone up pretty significantly and the AI boom is at high risk right now. And if both were to hit, I think that will be quite a disaster. So the WTI uh crude oil price has gone up to $103 a barrel and we haven't seen $100 for some time and it has gone back to 100. Now the brand crude at video recording time is about 114 1115 and all these are very high prices and the world could potentially see a stackflation because of such oil prices and we don't know whether this will go up even more. So on the Middle East side, Donald Trump has directed his officials to prepare for a long-term blockade of Iran. Now this is very important because this also signify that he has no intention at this juncture of going into allout war with Iran again.

[00:01:27]Now this is unfortunately also a slow burn situation. This is a no war no peace scenario and this is not something very good because uh dragging things for a long time will set prices to go up a lot because oil prices are climbing up and the US is right now preparing for a long-term blockade and this is certainly not a good option. So, Donald Trump has directed his officials to prepare for a long-term blockade of Iran and this is what I call a slow burn scenario. So, this is a no war no peace and this is unfortunately going to set the oil prices to go up gradually. Now, the thing about going up gradually is what I call a boy frog scenario. So, boy frog scenario means that you know people just get slowly accustomed to it. Now these are times where stock market my guess just get used to a gradually growing oil prices. May not be bad, may not be good, hard to say but certainly this is not a dis uh not a disastrous outcome like an allout war.

[00:02:40]Unfortunately it's not so good scenario where things get resolved. So certainly right now all out war is not envisioned.

[00:02:49]So this is a unfortunate no not good not bad scenario.

[00:02:55]So the question really is this is a game of chicken who will bling first. So the US right now demands nuclear surrendering. They want Iran to surrender all their nuclear and want the streets to open up. And right now they look at their offer they say throw in the dust bin. The Iranians okay wants of course all hostilities to stop in phase one phase two straits of horos also to be unblocked then they can talk about nuclear unfortunately um the Americans doesn't like this but to be frank both sides are suffering the Americans is most afraid of inflation because the inflation will set the American voters to be very upset and they will blame the Republicans and Donald Trump for it and they'll vote for a Democrat in the midterm elections. And if inflation doesn't need to wait until November, inflation is already here. On the side of the Iranians, they are suffering economically right now because of the loss of oil revenues and this is certainly something quite serious and besides all their shipments cannot come in because of the US blockade. So they they run out of some uh running low on some of these uh daily necessities and so on. So I think the truth is both side want to deal but who will capital first who will give in first. Talking about the Iranian oil revenues coming to a stop. The Iranian oil system is near a collapse right now. There are news that says that their oil capacity has right now hit near maximum. Well, just to take note, if you are in a oil production business, uh especially economy, your oil needs to keep on pumping and releasing. Well, unfortunately because of the blockade, they are pumping but they are not releasing out to the world because of the blockade. So, as a result, their storage capacity is hitting maximum. So Iranian uh C island is right now the main oil export terminal. The storage capacity is hitting the maximum really. So this is quite serious and by the way that is also true for some of the Middle Eastern country as well. Oil production is not something you just say okay turn off then turn on. In fact, I understand that there's a lot of damage to the system if you were to turn off and turning on is a very costly and painful process. So, right now, Iran tend to lose hundred over million dollars of revenue and this is a serious situation for Iran. Goods are spiking up in prices. They are facing inflation and shortage of goods as well. So right now the Iranian economy is facing severe situation and by the way so is the Americans as well in terms of inflation. So Donald Trump has came out and say that Iran has told him that it is in a state of collapse amidst all this peace talk uh stalemate.

[00:06:09]Now this one we got to double check whether it is true or not. Nobody will know because this is Donald Trump who is famous for houseology. So he says that Iran has told me it's a state of collapse and he want the US open the streets are almost as soon as possible while they try to figure out their leadership situation. Sign Donald Trump.

[00:06:30]Well, my take is that you know whether you can believe him or not is another thing. Well, I'll wait for the Iranian to respond to this statement.

[00:06:40]Well, so much about oil actually a site also have some issues. So the world has broke out in the new news on AI and this is going to be quite serious as well because all of them might have a pressure on the world economy and the stock market. So the bigger risk is actually AI because AI is driving the world stock prices going higher and higher and higher and despite the oil crisis in Middle East. So right now there is a news that says that open AI sales have not met their targets and as a result US stocks are falling. So this is actually in my opinion the bigger risk than the oil crisis. So, Wall Street Journal actually reported that Open AI, which is Chat GPT's company, has missed critical internal revenues and a user growth targets and this could trigger what I call a confidence uh crisis in the AI uh infrastructure development. Now just to take note if open AI which is chat GVT grows rapidly then you will need a lot of server a lot of data center a lot of chips a lot of semiconductors and so on. So the AI boom is driving a lot of infrastructure boom uh as well as semiconductor boom. Well because open AI missed their targets in one day AMD, Broadcom, Oracle all these start being hit uh quite badly in their stock prices. So if the industry leader is hit then the entire capeex uh could be at risk. Now how this come about is because the CFO of open AAI warned that the company may struggle to meet public reporting standards and this is a big issue because it seems misaligned with the founder and CEO which is Sam Offman.

[00:08:44]Now this is something that is quite serious because they expect there to be 1 billion weekly active user for Chat GBT by last year. okay by end of last year and that never happened and their revenue projection also missed. So right now this is a serious problem. Now just to say this, if open AI with chat GBT miss their targets then maybe they have not enough money to pay for all the infrastructure that they have committed to build which is $300 billion in in Oracle, $600 billion in many computing power and a lot of capeex that they promised to. So this is something quite serious. Now just to be clear if you take a step back who says that chat GBT is the industry standard right now I hardly use chat GBT now I only use clo which is a far more superior AI than chat GBT occasionally I use open AI which is chatgvt to talk to clot because clot is a bit sophisticated maybe uncle me takes a long time to learn so I asked chat Gutty to learn basic things to teach me how to use the more sophisticated thing otherwise I hardly use chat GBT now and I'm not the only one the whole industry is uh going and migrating into agentic AI already which is essentially entropic that is uh clot now Gemini is also very good run by Google and Gemini has a lot more free usage so open AI is no longer the market leader in terms terms of the level of innovation and so on. So I think that right now the world is having a a migration towards more sophisticated and more useful AI and this will set uh open AI which is chat in trouble. So frankly speaking it is not AI that's coming down but it's just shifting around and I think that's okay. So I would just say this for those people who are global index funds investors like myself.

[00:10:59]Chill. I don't think that this is an issue in the mid to long run because this is basically a company missing his target because of competition. So the rest of the industry is growing. It's just not that company growing. So I think that it's just substitution and it doesn't reflect an industry slowing down. So I think that this is actually okay. Well things could happen still in future but at at least what I can see right now the AI boom is still happening. It's just not chat GV that's leading it uh by a lot. So the final verdict is this is just competition and rotation. It's not collapsing. So I wouldn't be too worried about this one.

[00:11:46]Of course, the market will react uh sensationally to some of this news, but I don't think it's worth a worry. But I think the oil prices is probably more worrying because it's just going up and up and up. In conclusion, this is not a industry collapsing, but it's just competition and rotation of the winners.

[00:12:11]So I would be too worried about this AI issue but I'm more worried about the oil price issue because at some point of time if the oil prices keep going higher and higher higher it will bite okay it has to bite the economy and therefore by by association it has to bite the stock market as well. We don't know whether this would happen in a catastrophic outcome because they might just suddenly come to an agreement and all will be peace from there. So things are policydriven, things are negotiationdriven. So don't miss any of these. Remember, hit subscribe as I bring to you more in my live stream.

[00:12:48]Bye-bye.