In this podcast, Motley Fool host Anand Chokkavelu, analyst Emily Flippen, and contributors Jason Hall and Jose Najarro discuss: Inflation ticks up (this bears monitoring).
Additionally, Nvidia and semiconductors get a China bump. However, The big banks kick off earnings season (and tell us the economy), in light of current trends. Nevertheless, Is "crypto week" a thing.
Meanwhile, Bold predictions on which company will surprise this earnings season To catch full episodes of all The Motley Fool's free, check out our podcast center.
When you're ready to invest, check out this top 10 list of stocks to buy. A full transcript is below. This podcast was recorded on July 15, 2025.
Additionally, Advertisement: I had the absolute pleasure of speaking to Pamela Anderson, all thanks to the Dove Self-Esteem ject.
On the other hand, At the same time, We speak the impact Why2K has had on women's body confidence and how Pamela has regained control (noteworthy indeed).
On the other hand, The Dove Self-Esteem ject is an amazing initiative supported by science-backed methodology to help us imve our relationship with our bodies, amid market uncertainty.
To find more body confidence building exercises, go to dove. At the same time, That's Why2K spelled W-H-Y-2-K (which is quite significant). Moreover, Anand Chokkavelu: Get excited.
Today is the first day of earning season (remarkable data). On the other hand, Motley Fool Money starts now. Moreover, I'm Anand Chokkavelu.
I'm joined by two of my favorite Fools, Emily Flippen and Jason Hall to kick off earning season with some big banks, giving us a feel for the economy.
We'll also give you the skinny on crypto week, and we'll have bold predictions on earnings season. Plus, we're bringing on a bonus Fool.
Moreover, Also one of my favorites, semiconductor expert Jose Najarro to talk some hot NVIDIA news. But first, we had a fresh inflation reading this morning (this bears monitoring).
Furthermore, June's consumer price index ticked up to an annual rate of 2. 7%, up from May's 2. Emily, what were your takeaways.
Emily Flippen: Well, if you thought you could have a peaceful Tuesday with no bad news, think again (remarkable data), in this volatile climate. Obviously, inflation is heating up here a little bit.
However, I think we're just starting to see some of the impacts from tariffs as those price increases and core goods start to become more tangible, as opposed to theoretical.
Conversely, We had this really big front loading of inventory that happened at the beginning of the year as es stockpiled in anticipation of tariffs, and those are beginning to diminish, which I think is making it harder to tect ducts from rising costs.
Nevertheless, We saw that in core goods inflation. Those includes things basic necessities apparel and household ducts that accelerated last month.
But the good thing is, in the silver lining to our Tuesday here is that this is a gradual acceleration. We're not talking anything that's incredibly dramatic. Those numbers at 2 (quite telling).
However, Meanwhile, 7%, that's an annualized rate. Additionally, We're not talking month over month here. No need to immediately panic.
But I do think this could have some overarching implications for what we're ly to see in future earning season, both coming up in the next couple of weeks, as well as toward the end of the year (which is quite significant).
Nevertheless, It just makes me want to pay attention to what leadership is going to be ing on because how this trickles down for consumer spending and how much prices are able to be passed along versus the impact to companies' bottom lines, that's really going to have a wide reaching impact in the later half of 2025.
Nevertheless, Jason Hall: I think wide reaching is a good way to put it.
In contrast, Just looking at what the are doing today, the S&P 500, which I mean, let's be honest, that's indexed to gigantic companies is down a quarter of a percent, given the current landscape.
Furthermore, Meanwhile, But if you look at the Russell 2000, that's small caps. It's down 1, in this volatile climate.
You see where investors are seeing the potential impact of inflation on the companies that are most directly affected by it (fascinating analysis).
What they're looking forward and seeing if we're being honest, is really going to be driven by the tariff story. That's still the big story in the background.
If we look at May, we saw a massive increase in imports as companies tried to pull forward inventory as much as they could back in April, I should say.
Then in May, it came down quarter over quarter, but May imports were still well up from where they were year over year (which is quite significant).
Maybe some of the concerns empty store shelves later in the year maybe aren't as ly to come to fruition as a lot of investors have been thinking, because that would be a big thing that would certainly drive a lot of inflation (something worth watching).
However, In contrast, By the way, all the data hasn't been reported yet, but June traffic at the Port of LA, it was a record level for that month.
I think the market broadly is looking out and saying, hey, I don't really know if what we're seeing with the inflation that could be driven by the potential of the tariffs is going to be as bad as we think.
But at the end of the day, what's the investor takeaway, guys, in today's financial world.
Peter Lynch bably had it right when he said, if you spend 13 minutes on economics in a year, you wasted 10 minutes. These things affect us in the real world (quite telling).
At the same time, But as investors, I think our time is still just better spent looking for strong durable es with those great long term tailwinds (something worth watching).
Additionally, We start focusing on macro, amid market uncertainty. What happens, in this volatile climate.
We're reacting based on what our own biases and inclinations are, given current economic conditions. If we give our motions control of our portfolios, that's never the right decision.
Anand Chokkavelu: If you do the math on Peter Lynch, you should spend three minutes on Macro, amid market uncertainty. That's what we did, in light of current trends.
However, Give or take, in light of current trends. We'll be back with some news NVIDIA and China after the break (remarkable data).
Moreover, Jose, you've covered semiconductors before it was cool to cover semiconductors. In contrast, Today, we've got some news on NVIDIA in China. What's going on.
Jose Najarro: Pretty exciting news for the overall semiconductor industry, given current economic conditions.
Today, the stocks in the semiconductor space are up roughly 3%, 4%, 5% depending on what stock you're looking at, given the current landscape.
Nevertheless, But the CEO of NVIDIA recently made a trip to Beijing and met with a few government and industry officials there, in light of current trends.
While he was there, he did vide an to customers, noting that NVIDIA is going to be filing applications to sell the NVIDIA H20 GPU again to that market.
Jensen assured that the US government has assured NVIDIA that the licenses will be granted and NVIDIA hopes to start deries there pretty soon. Just a quick backlog of what happened.
On April 9th of 2025, this was still part of India's Quarter 1 earnings, the US government issued a new export restrictions on the H20, which is an AI chip meant for the Chinese market and that they could no longer ship to that region.
For that one quarter and those few weeks that the export restriction affected, the company lost roughly $2. 5 billion in revenue (quite telling), in light of current trends.
The analysis reveals n when they gave guidance of Quarter 2, they mentioned due to these restrictions, they were losing eight billion dollars in revenue per quarter for a full quarter.
Additionally, At the same time, Now that you have this new entrance of this market, you can at least potentially see at least $30 billion added on revenue, not seeing any growth rates per year for the overall AI GPU space in China.
A lot of companies are excited, amid market uncertainty. This also did trickle down to a little some other companies, in this volatile climate.
Additionally, AMD also had similar export restrictions, and they did respond to similar s that they will also be looking for these license apvals for their chips as well.
Jason Hall: This's not exactly the same thing as Richard Nixon going to China in 2072, but Jensen Huang going there in person, it's a reminder of how important China is for the semiconductor industry writ large, given the current landscape.
Jose Najarro: Very important, and it also showcases how we want to have this AI nology being run on American nology. We don't want it run from other countries (noteworthy indeed).
It's coming from NVIDIA, which is a US based company, in today's market environment. Furthermore, Anand Chokkavelu: This's all very ly positive news.
Is the four trillion dollar in market cap for NVIDIA a buy, a sell, or an index for you at this point, Jose.
However, Index means you just stick with whatever allocations in a broad based index fund, which with a four trillion dollar market cap, is it pretty sizable at this point.
On the other hand, In contrast, Jose Najarro: For me, it's definitely more in that index position. I'm not looking to add anymore to my portfolio.
Obviously, there's a lot of growth opportunities, and that's why I'm willing to hold.
However, Additionally, But obviously, you could see plenty and plenty of short term tailwinds that could create volatility.
Nevertheless, For me, it's a perfect index play, as you mentioned, pretty much just hold and write this AI wave. Conversely, Anand Chokkavelu: It's a jam pack day, considering recent developments.
Moreover, Let's move on to the story I thought we'd lead with. We had three of the major banks report earnings this morning. That's JPMorganChase, Wells Fargo, and Citigroup.
As bank lending goes, so goes the economy (noteworthy indeed), considering recent developments. Jason, what are the banks telling us the economy. I know Jamie Dimon must have some thoughts.
Jason Hall: He always has thoughts, the godfather of the US banking industry and a little bit of a permabear at times, when things are going very well, he's very bearish, considering recent developments.
Meanwhile, He does get a little more optimistic when things are a little bit questionable.
However, But what I really saw this quarter was there's less of what management says, and then what the es did and then what management is doing, thinking the es.
On the other hand, Overall, again, JP Morgan, Wells and City, the results were fine, in light of current trends. In contrast, Again, that's looking backwards though.
The one thing that we can look at that gives us some indication of what management is acting on going forward is visions for credit losses. Frankly, there were no major changes here for any of them.
However, This's what they're doing on their books to bolster their balance sheets for expected future loan losses.
Wells and City reported increased allowances, but they were both commensurate to things within the mix.
Moreover, Wells had some changes in its portfolio mix, a little bit less asset backed stuff mortgages and a little bit more credit cards, and cities went up mainly because its loan portfolio just got larger, in today's market environment.
I don't think we really learned a lot broadly that we didn't already know. Nevertheless, Now, you look at these three. Wells' stock is down, call it 5% today.
Moreover, Management lowered guidance for net interest income. That's the most important source of fit for Wells Fargo because it's a big main street lender.
Maybe there's a little bit of an indication there.
At the same time, Emily Flippen: I found it really interesting that to your point, Jason, Dimon is considered such a bear when things are good and such a bull when things are bad, amid market uncertainty.
But the JP Morgan CFO said during the call that the consumer seems to be fine (noteworthy indeed).
That's an exact quote, which feels to me a bit of a reach because to your point, a lot of the data that these banks are working off of is lagging, in light of current trends.
They're basing off theories credit and consumer spending based on their own consumer credit portfolios. To their point, that is led by labor, and with unemployment, it's still less than 5%.
This leads to the conclusion that analysis reveals seems to be fine, but that lagging indicator, I worry, could just be something that sneaks up on these types of es because we've seen unemployment tick up continuously for over two years now.
More than half of all American consumers say they expect to be worse off financially next year in comparison to this year, and consumer spending is declining (fascinating analysis).
The Federal Reserve is looking to manage inflation, not unemployment. With less rate cuts this year, I feel that could further worsen unemployment rates.
That lag in between, I think, what some of these banks are experiencing in terms of the quality of their credit portfolio versus what the average American is experiencing right now is incredibly to me when I listen to these earnings calls, given current economic conditions.
However, Anand Chokkavelu: No way our listeners want to hear the nitty gritty details on three different banks. They're bably zoning out already, Jason.
Jason Hall: We don't want to talk return on tangible common equity for all three of these. That's fun stuff. Moreover, Anand Chokkavelu: We'll get to the stress tests, all that stuff.
You get to talk one and only one, Jason. Of JPMorganChase, Wells Fargo, and Citigroup, which had the most noteworthy earnings for stock pickers out there.
Jason Hall: Honestly, I don't think we had really any outliers here.
Nevertheless, Just a couple of really quick points each of them, I think it bably serves our listeners better, given current economic conditions.
Furthermore, Nevertheless, JP Morgan continues to be that gold standard (which is quite significant). You look at their return metrics.
Additionally, Nobody fall asleep on me here, but they're extraordinarily high. Directionally, we're talking twice as good as a city, which is struggling with years of issue.
Morgan also had pretty decent loan growth. Jane Fraser is doing a really good job of dragging city forward (noteworthy indeed).
But again, they're bragging 8% return on equity versus, 17% over at JP Morgan. However, That's the difference you see there, in light of current trends.
Now, looking at Wells, it may be the one that really signaled to the market that consumers to Emily's point are feeling more of a pinch than anyone else (this bears monitoring).
Again, looking at that bringing down their expected net interest income, this is the one of all of these that's most concentrated on, traditional Main Street, USA banking and lending.
Maybe that's the biggest takeaway for me is that. Anand Chokkavelu: The million dollar question. By seller index on these banks, Jason (this bears monitoring).
On the other hand, Jason Hall: You know how I do this (noteworthy indeed), given current economic conditions. I can't give you any of those three (something worth watching).
I'm going to say none of the above. If I'm buying bank stocks today, valuation really matters with these giant mature es. This leads to the conclusion that re are some positive things.
However, Less regulation, lower corporate taxes is compelling.
But there's just much better values to be found, if you look at some of the larger regional and a handful of more specialized banks out there.
Conversely, That's who I'm looking to hear from this week, Truist Financial, for example, it's really in the sweet spot of the demographics, the Southeast migration trends.
I won't steal Emily's thunder, but there's a big regional bank with national reach that just made a really interesting acquisition that has that one on my radar, but I'll let Emily talk that one.
Emily Flippen: I completely agree here with Jason.
Furthermore, However, I think there's a fair point that a reduction in regulation across the board with the new administration could just be a boon for the industry, but that doesn't make me want to go out and be, I'm going to start indexing these banks.
However, If I'm indexed, index a total market of which you get exposure to a lot of these high quality companies.
But if you're going to want additional exposure in my book, pick the high quality ones, in today's financial world.
This tells us that JP Morgan's and to Jason's earlier point, a company that should be on everybody's radar, which is Capital One Financial, in this volatile climate.
They just closed their discover merger, and that makes a behemoth in this space. But skip the bad ones.
I was going to say that I think quality is more important than price here, and I think that is true.
But I was thinking of that in the context of those small regional banks that can sometimes get really attractive on a price basis, but you're losing out on quality (something worth watching).
I think Jason's point understanding the price you're paying for even the larger banks is incredibly important because these are mature es, and the market can have pretty stark reactions for factors outside of their control when it comes to the broader economy, given the current landscape.
Focus on quali.