December 17, 2025
What You Need to Know Today:
The jobs data is pointing in the wrong direction
According to the best available but still very dirty data, the U.S. labor market lost jobs over October and November, and the unemployment rate ticked up to 4.6 percent, the highest level since 2021.
Somehow Oracle just missed this little $248 billion item last week
When last week Oracle (ORCL) published its earnings update on the costs of its artificial-intelligence data center buildout, it didn’t include $248 billion in lease-payments committed for AI data centers. That cost, Bloomberg’s Chris Bryant reported today, December 16, didn’t appear until the day after its earnings press release and analyst call in its comprehensive 10-Q earnings report that appeared on Thursday.
The jobs data is pointing in the wrong direction
According to the best available but still very dirty data, the U.S. labor market lost jobs over October and November, and the unemployment rate ticked up to 4.6 percent, the highest level since 2021.
Saturday Night Quarterback (on Sunday) says, For the week ahead expect…
I think that Oracle has, to a great degree, become a whipping boy for market worries about other names in the AI sector. If you’ve fallen behind in your own knowledge of aristocratic habits, Historically, a “whipping boy” was a child educated alongside a young prince who was physically punished in the prince’s place, on the theory that the prince himself could not be beaten. The role was meant to discipline the prince indirectly by making him witness someone else suffering for his misbehavior. Today the term is used figuratively for any person, group, or entity that becomes the habitual target of blame or criticism, even when others are more responsible. In finance and politics, for example, commentators sometimes call the Federal Reserve, “the market,” or a particular sector a “whipping boy” when they get blamed whenever something goes wrong. The prince(s) that can’’t be punished by stock investors in this case are OpenAI and Japan’s SoftBank. Oracle is a key player in the Stargate project that aims to rapidly invest $500 billion to build infrastructure. The other partners are OpenAI and SoftBank.
No action–insurance subsidies die in Senate and premiums will soar in January
The Senate blocked a bill Thursday to extend Affordable Care Act health insurance subsidies, all but ensuring they will expire at the end of the year. The Senate also blocked a Republican health care bill that Sens. Bill Cassidy (Louisiana) and Mike Crapo (Idaho) drafted as an alternative to the Democratic version
Initial claims for unemployment rose more than expected
Initial claims for unemployment rose more than expected last week. Initial claims increased by 44,000 to 236,000 in the week ended December. 6. The figure exceeded all but one estimate in Bloomberg’s survey of economists
Special Report: 3 Stock Market Bubbles: When will they burst? What to do now? Part 1, the AI bubble, Part 2, the debt market bubble, and Part 3, the cheap money bubble
This is a very difficult stock market. Even as stocks climb to new record highs. On the one hand, even investors who are all in, maybe even overweight to the long side, worry that this rally isn’t sustainable for much longer. By most historical standards valuations are off the charts. I get a steady stream of stories and posts asking whether XYZ stock has climbed to faro fast. Volatility on somedays can be downright scary with relatively minor events leading to big market moves. It’s simply very hard to stay on board this rally. On the other hand, it’s very hard to get off the train. I see lots of Wall Street analysts cutting recommendations from “buy” to “hold” on valuation fears, but I see almost no one saying “sell.” FOMO–fear of missing out–is just too strong. Which is totally understandable. The Standard & Poor’s 500 index was up 25.02% in 2024 and was up another 18.11% in 2025 to date through October 27. Market leaders have racked up even bigger gains. AI chip icon Nvidia (NVDA) was up 171% in 2024 and has gained another 39% in 2025 through October 27. It’s insanely difficult to walk away from those kinds of gains. So what’d you do?
Live Market Report (20 minute delay)
Somehow Oracle just missed this little $248 billion item last week
When last week Oracle (ORCL) published its earnings update on the costs of its artificial-intelligence data center buildout, it didn’t include $248 billion in lease-payments committed for AI data centers. That cost, Bloomberg’s Chris Bryant reported today, December 16, didn’t appear until the day after its earnings press release and analyst call in its comprehensive 10-Q earnings report that appeared on Thursday.
The jobs data is pointing in the wrong direction
According to the best available but still very dirty data, the U.S. labor market lost jobs over October and November, and the unemployment rate ticked up to 4.6 percent, the highest level since 2021.
Saturday Night Quarterback (on Sunday) says, For the week ahead expect…
I think that Oracle has, to a great degree, become a whipping boy for market worries about other names in the AI sector. If you’ve fallen behind in your own knowledge of aristocratic habits, Historically, a “whipping boy” was a child educated alongside a young prince who was physically punished in the prince’s place, on the theory that the prince himself could not be beaten. The role was meant to discipline the prince indirectly by making him witness someone else suffering for his misbehavior. Today the term is used figuratively for any person, group, or entity that becomes the habitual target of blame or criticism, even when others are more responsible. In finance and politics, for example, commentators sometimes call the Federal Reserve, “the market,” or a particular sector a “whipping boy” when they get blamed whenever something goes wrong. The prince(s) that can’’t be punished by stock investors in this case are OpenAI and Japan’s SoftBank. Oracle is a key player in the Stargate project that aims to rapidly invest $500 billion to build infrastructure. The other partners are OpenAI and SoftBank.
No action–insurance subsidies die in Senate and premiums will soar in January
The Senate blocked a bill Thursday to extend Affordable Care Act health insurance subsidies, all but ensuring they will expire at the end of the year. The Senate also blocked a Republican health care bill that Sens. Bill Cassidy (Louisiana) and Mike Crapo (Idaho) drafted as an alternative to the Democratic version
Initial claims for unemployment rose more than expected
Initial claims for unemployment rose more than expected last week. Initial claims increased by 44,000 to 236,000 in the week ended December. 6. The figure exceeded all but one estimate in Bloomberg’s survey of economists
Fed cuts interest rates again at today’s meeting but reveals no consensus on 2026
The Federal Reserve lowered interest rates by a quarter of a percentage point today,Wednesday. But revealed a huge disagreement on the course for 2026. The decision cut interest rates for a third meeting in a row, moving rates to a new range of 3.5% to 3.75%. It marked the fourth straight vote that was not supported by all members of the 12-person Federal Open Market Committee. Voting for today’s 25 basis point cut were Jerome Powell, chair; John Williams, vice chair; Michael Barr; Michelle Bowman; Susan Collins; Lisa Cook; Philip Jefferson; Alberto Musalem; and Christopher Waller. Voting against this action were Stephen Miran, who preferred to lower the target range for the federal funds rate by 1/2 percentage point at this meeting; and Austan Goolsbee and Jeffrey Schmid, who preferred no change to the target range at this meeting. The new target Fed Funds rate of 3.5% to 3.75% is, of course, a nominal rate. With the Fed’s preferred inflation measure, the Personal Consumption Expenditures index, running at 28.% in September, the last monthly data, the current nominal target rate is barely above 0% at 0.7% to 0.95%. Yep, we’re back to the days of 1% interest rates.
The road to rare earth independence runs through Lynas and MP Materials
If the United States (and other technology economies such as Japan and Europe) are serious about reducing China’s dominance in the crucial minerals called rare earths (and I believe they are), then you need to realize as an investor that in the next five years all roads to that goal lead through Lynas Rare Earths (LYSDY) and MP Materials (MP). Both stocks are up hugely in 2025, but I think you need to own them. Buy half a position now and add on any dip, or dollar cost average over the next 12 months (with a bigger monthly buy on any dip) but own them. I have owned Lynas in my Jubak Picks Portfolio since October 18, 2022. The position is up 88% in that period as of the close on December 8. The ADR is up 78% in 2025 to date. On a dip I will add it to the long-term 50 Stocks Portfolio. MP Materials is up 298% in 2025 through December 8. Tomorrow, December 9, I will add MP Materials to my Volatility Portfolio. On a dip I will add it to the Jubak Picks Portfolio.
Saturday Night Quarterback says, For the week ahead expect…
Speculation about future rate cuts and who will replace Jerome Powell as Federal Reserve chair rather than the actual rate cut itself at the December 10 meeting will generate the most interest among investors and traders.
ACA insurance subsidies likely to go down to defeat in vote next week
There’s good news–the Senate is set to vote next week on extending Affordable Care Act health insurance subsidies for three years. This would be the vote that Democrats who voted to reopen the government were promised by Republicans. And there’s bad news–the plan is all but certain to fail in that vote.
U.S. Treasury debt breaks $30 trillion
In November U.S. government debt in Treasuries topped $30 trillion for the first time. Ever. The size of the debt has more than doubled since 2018.
Add January 30 to your calendar–will there be another shutdown?
The stopgap spending bill passed by Congress in mid‑November 2025 ended the record shutdown and extended fiscal year 2025 funding levels for most federal agencies. But only through January 30, 2026.
They probably won’t change the name back to Facebook, though
Meta Platforms (META) is expected to cut resources from the virtual reality initiative Mark Zuckerberg once framed as the future of the company. (And his reason for changing the company’s name from Facebook.) Zuckerberg is considering potential budget cuts as high as 30% for the company’s Metaverse group next year. (The group includes the virtual worlds product Meta Horizon Worlds and its Quest virtual reality unit.) Cuts of that size would most likely result in firings as early as January.
More signs of a coming AI debt crisis? Is Morgan Stanley looking for an exit?
Sources say (Yes, I urge caution interpreting anything that begins “sources say.” You have to pay attention, but….) that Morgan Stanley, one of the big players in financing the artificial-intelligence infrastructure build out, is considering offloading some of its data-center exposure via a significant risk transfer (SRT). The bank is said to have held preliminary talks with potential investors about an SRT tied to a portfolio of loans to businesses involved in AI infrastructure. What exactly might that mean? It could mean that the bank has looked at its portfolio and concluded it’s too heavy on AI debt. It could mean that Morgan Stanley has decided that the risks in AI debt are sufficiently high and that the potential return is too low. For investors the possible move should trigger memories of the sub-prime mortgage crisis and the subsequent global financial crisis. that crisis was foreshadowed to lenders packaging and then selling off debt that they had decided as too risky. And one of the reasons that crisis was so damaging is that no one could be certain where that off-loaded risk had been off-loaded to.
Can an AI start up–even OpenAI–compete with a profitable Big Tech like Google?
CEO Sam Altman has declared a “code red” at OpenAI to improve ChatGPT as the company faces intense competition from rivals, such as Alphabet (GOOG) with much deeper pockets.
To my mind the question of whether any AI startup can “win” against Big Tech competitors such as Google, Microsoft (MSFT) and Amazon (AMZN) is as important to investors as the questions raised by short sellers about depreciation accounting and potential debt bombs.
According to a report by tech news site the Information, the CEO of the San Francisco-based startup told staff in an internal memo: “We are at a critical time for ChatGPT.”
OpenAI has been rattled by the success of Google’s latest AI model, Gemini 3, and is devoting more internal resources to improving ChatGPT.
It’s the only jobs data we have–and it’s bad
I normally don’t pay much attention to the ADP Research private payrolls report. It doesn’t track the official jobs number from the Bureau of Labor Statistics, which is what the Federal Reserve watches, very well. This time around, in addition, economists also cautioned against reading too much into the report released on Wednesday, arguing the monthly estimate has diverged from the government’s private payrolls count produced by the Labor Department’s Bureau of Labor Statistics. But since the BLS isn’t producing its next report–for November–until December 16 thanks to the government shutdown, the ADP report is the data we have. And it’s ugly. Jobs from private sector employers posted their biggest drop in more than two and a half years in November as small businesses shed jobs. Some economists said combining employment measures from the National Federation of Independent Business, the Conference Board, and regional Federal Reserve surveys confirmed labor market softness, but not the size of the drop shown by the ADP data.
Costco sues to get refund of Trump tariffs
Costco Wholesale (COST) has sued seeking a full refund on the duties it has paid as a result of President Donald Trump’s global tariffs imposed this year. Costco filed the lawsuit at the U.S. Court of International Trade on Friday, saying the administration’s tariffs imposed under the International Emergency Economic Powers Act (IEEPA) are unlawful. It comes as the Supreme Court is considering whether Trump has legal authority to impose tariffs on a vast range of goods from nearly all countries.
Another short seller, Jim Chanos, is flagging the risks in AI debt
I take everything from both extreme speculative bulls and extreme negative bears with a grain–or more–of salt. Members of each camp talk their own positions and certainly aren’t above cherry-picking facts to buttress their own views.
But I do take shorts like Jim Chanos very seriously. In his long career on the short side of the market Chanos has proven himself to be a well-informed analyst of company weaknesses and corner-cutting. So I think it’s very important to listen when he has joined his voice to those pointing to serious accounting problems at AI companies and the possibility that those accounting problems could lead some of the huge amount of debt that AI companies have issued this year to blow up. Chanos and other short sellers like Michael Burry have focused on the use of asset backed debt to pay for the huge build out in AI data centers. The problem, these shorts say, is that many of these new AI companies–particularly in the part of AI called “neoclouds–have used assets in the form of Nvidia (NVDA) chips to secure large loans to buy more AI chips to scale up their operations. But, and this is the crux of the shortsellers’ case, they are using unrealistically long schedules to depreciate the value of these assets–5 or 6 years when the life of these technology assets is more like 2 to 3 years.
Insurance companies are “dIscouraging” older adults from signing up for Medicare Advantage plans
Major health insurers are taking drastic steps to discourage older adults from signing up for their Medicare plans, according to STAT.
Health insurance sticker shock
I’d be amazed if I was the only American who spent part of the family and friends Thanksgiving holiday talking about the coming spike in the cost of health insurance under the Affordable Care Act (aka Obamacare) if Congress doesn’t extend the enhanced Affordable Care Act premium tax credits (aka the “enhanced subsidies”) that expire at the end of 2025. The Senate is committed to holding a vote on something in the first two weeks of December. Even if an extension passes in the Senate, I think there’s almost no chance of it passing in the House of Representatives or getting President Donald Trump’s signature. The most likely outcome is no extension and higher rates come January 1.
Saturday Night Quarterback says, For the week ahead expect…
Buy on the Dip” is Back, baby! What other conclusion would you expect investors and traders to draw from the last month? Especially since the longer term record of this market has conditioned them to buy whenever the market dips by 5%.
So far, this rally has traced out the perfect “Buy on the Dip.” The S&P 500 hit an intraday high of 6,920.34 in October 2025, with a record closing high of 6,890.89 on October 28.The index recorded its maximum drop from the late‑October high on November 20, when it closed at 6,538.76, 5.11% below the October 28 record closing high of 6,890.89. From the close on November 20–the day after odds of a Fed rate cut bottomed–to the close on November 26, the S&P 500 gained 273.85 points, rising from 6,538.76 to 6,812.61. That’s an increase of about 4.19% over that period. If you had blindly followed the formula and bought when the dip reached 5%, you would now be looking at a gain of 4.2% in a week.
What’s not to like about that?
Jim’s Stock Alerts
COLDAmericold Realty Trust, Inc.
WMTWalmart Inc.
NVDANVIDIA Corporation
CMICummins Inc.
PAASPan American Silver Corp.
TBFProShares Short 20+ Year Treasury ETF
IGOViShares International Treasury Bond ETF
FXYInvesco CurrencyShares Japanese Yen Trust
UUPInvesco DB US Dollar Index Bullish Fund
BABATencent Holdings Limited
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