Asset Prices Rise, Inflation & Tariff Questions Linger
Weekly Investment Update | By Brian Schreiner
Stocks and bonds were higher last week and commodities were down. Both gold and bitcoin moved strongly higher; gold was up 3% and bitcoin was up 4%.
Unemployment Rate Near 4-Year High
The July jobs report released last Friday extended a recent run of weak labor market data. The unemployment rate rose to 4.3%, near a 4-year high. Moreover, June’s job figure was adjusted downward to show a loss of 13,000 jobs—the first monthly decline since 2020. The weaker-than-expected employment data has increased speculation that the Federal Reserve will cut interest rates at its meeting next week.
Gold & Bitcoin Shine
The price of gold set a fresh record high this morning of $3,680 per ounce—up more than 36% year to date. Friday morning’s release of weaker-than-expected jobs data seemed to push the price of both gold and bitcoin stongly higher, which may be an indication that investors see a cut in interest rates as a risk to higher inflation.
Tariff Uncertainty Continues
The US Court of Appeals for the Federal Circuit rejected specific tariffs enacted under the International Emergency Economic Powers Act (IEPA). The administration is appealing the 7-4 decision to the Supreme Court, with a final ruling unlikely before December. Uncertainty remains, as alternative existing legislation could potentially be used to implement similar tariffs regardless of the Supreme Court's decision.
Google Wins Antitrust Case
Google secured a decisive victory in its federal antitrust case. The judge ruled that Google will not be required to sell its Chrome browser and can continue its multi-billion dollar agreement with Apple to be the default search engine on Apple products. Market analysis suggests the judge viewed the case as outdated ("stale") given the rapid emergence of new AI-driven competition in the search market. The resolution, which was better than anticipated, removed a significant overhang from both Google and Apple, and both stocks traded higher following the news.
AI Capital Expenditure & Overinvestment Risk
A primary risk consideration for the technology sector is the massive scale of capital expenditure currently being deployed for AI. Large technology companies including Meta, Google, Amazon and Microsoft are spending a combined total of over $300 billion in 2025 on AI-related infrastructure.
The central question remains what the ultimate return on investment (ROI) for this spending will be. It’s impossible to ignore the parallels to the dot-com bubble of 1999–2001, where massive overinvestment preceded a painful market correction. If returns from the massive capital expenditures prove disappointing, the market could face a similar reckoning as companies will be forced to restructure.
This Week’s Inflation Reports: Wednesday & Thursday
Two inflation reports are scheduled to be released this week. On Wednesday, the Bureau of Labor Statistics will release the latest Producer Price Index (PPI) and the Consumer Price Index (CPI) report scheduled to be released on Thursday. The new CPI report will provide one of the last major data points for the U.S. Federal Reserve as it considers cutting its key interest rate by either 25 or 50 basis points at a meeting ending September 17. The most recent report released in August showed that inflation remains sticky at a 2.7% annual rate in July. α
Interesting things I came across this week…
Anatomy of the Private Equity Bubble (Monetary Matters)
Private Credit Returns Dwindle (Bloomberg)
Cracks in Private Credit Market Widen (The IRA)
Egypt's Labyrinth May Excede Pyramids' Grandeur (UnchartedX)
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