Trump’s Economic Gamble

Good morning, Markets are playing tug-of-war between war and peace, Trump is rolling the economic dice, Google just dropped $32B on cybersecurity, and Nvidia wants robots to think like us. Meanwhile, Gaza burns, and the world watches.

Just another day on this spinning rock.

WORLD
Gaza burns again

Israeli airstrikes in Gaza have killed at least 404 people, including many children— according to Palestinian health officials, marking one of the deadliest days since the war began. The violence reignited after ceasefire talks collapsed, with both Israel and Hamas blaming each other for the breakdown.

Israel accused Hamas of rejecting proposals for a ceasefire extension, prompting renewed military action. Hamas, which still holds 59 Israeli hostages, warned that Israel's actions jeopardize mediation efforts. The strikes targeted homes and refugee camps, forcing thousands to flee.

International mediators, including Egypt and Qatar, condemned the escalation, while the EU urged Israel to halt attacks and called for Hamas to release hostages. Meanwhile, the U.S. backed Israel, blaming Hamas for the renewed violence. Amid the chaos, hospitals are overwhelmed, and aid remains blocked. Bodies are piling up, and many of the dead are reported to be children. Hamas officials, including the head of its government, were among those killed in Israeli strikes.

With no resolution in sight, both sides remain at an impasse—Israel demands hostages first, while Hamas insists on a full withdrawal. The war, which began with Hamas' October 7 attack on Israel, has now claimed over 48,577 Palestinian lives, according to Gaza’s health ministry.

ECONOMY
The recession gamble

Is a recession worth the risk? President Trump and his advisers seem to think so, but economists aren’t convinced.

Recessions are typically something presidents try to avoid—both in policy and rhetoric. Yet, Trump’s administration is openly acknowledging the possibility, even framing it as a necessary step toward long-term economic gains. Officials like Commerce Secretary Howard Lutnick and Treasury Secretary Scott Bessent argue that a period of economic pain could serve as a “detox” from excessive government spending, while Trump himself calls it a “transition” toward a stronger economy.

But is this economic strategy truly in America’s best interest? Trump’s supporters claim his policies will revive U.S. manufacturing, cut dependence on foreign imports, and ultimately bring prosperity. However, many economists warn that the reality could be much harsher, with rising prices, falling confidence, and stock market volatility already surfacing under Trump’s leadership.

Take tariffs, for instance—Trump’s key tool for “re-industrializing” America. While tariffs are meant to curb reliance on imports, they also raise costs for U.S. manufacturers, making production more expensive and potentially hurting the very industries they aim to protect. Critics argue that simply slapping tariffs on goods won’t undo decades of economic shifts like the “China shock” that devastated U.S. manufacturing in the 2000s. Meanwhile, economists also point out that government deficits—ballooning under Trump’s watch—could make any downturn even more painful.

The biggest question remains: Who bears the cost? Lower-income Americans, who voted for Trump hoping for economic relief, may be hit hardest by rising prices, job losses, and safety net cuts. While Trump’s team insists that short-term sacrifices will yield long-term rewards, history suggests that the fallout of a recession lingers far beyond the initial downturn.

ENERGY
Oil prices sway between war and peace

Oil prices slipped as Ukraine peace talks balanced out Middle East tensions, but uncertainties remain. When two of the world's biggest oil players—Russia and the U.S. discuss de-escalation, the markets react. But does this signal stability, or is it just a temporary pause in volatility?

On Tuesday, oil prices dipped nearly 1% as Presidents Trump and Putin explored solutions to Ukraine’s ongoing war, possibly easing Russian energy sanctions. However, market watchers remain cautious, pointing to trade tariffs and geopolitical flashpoints in the Middle East.

Brent crude fell 0.7% to $70.56 per barrel, while WTI dropped 1.0% to $66.90. Even if Russian oil exports increase, they won’t match previous highs anytime soon. Russia’s output was 9.2 million barrels per day (bpd) in 2024, significantly lower than 10.6 million bpd in 2016. Meanwhile, global recession fears persist, with the OECD warning that Trump’s tariffs could slow economic growth and energy demand across North America.

With OPEC+ boosting output, Iranian production is holding steady at 3.3 million bpd, and tensions in the Red Sea are escalating, so oil markets remain at the crossroads of diplomacy and disruption. The next big test? U.S. oil inventory data set for release this week, which could hint at whether supply pressures will ease or intensify.

AI & TECHNOLOGY
Nvidia’s AI genius that thinks plans, and moves like us!

The age of generalist robotics is here—Nvidia just made sure of it.

What if robots could think and act like humans? Nvidia’s latest AI model aims to bridge that gap.Groot N1, unveiled at GTC 2025, combines synthetic and real-world learning with a dual-system architecture to mimic human cognition.

While companies like X1 and Figure push for mass-produced humanoids, Nvidia’s open-source approach could redefine how these robots learn and operate. With simulation frameworks and training data blueprints, Groot N1 may be the missing link between concept and reality—but will it deliver where past attempts have failed?

WHAT NEXT?
Google’s $32B Wiz bet

Google has just sealed the biggest acquisition in its history, snapping up cloud security firm Wiz for a staggering $32 billion. This isn’t just another tech buyout—it’s a strategic leap that could reshape Google’s cloud ambitions and cybersecurity dominance.

Wiz, with its booming $700 million annual revenue, will operate independently, much like Microsoft’s LinkedIn deal. The acquisition not only strengthens Google Cloud’s security arsenal but also sends shockwaves across the enterprise tech world. The deal wasn’t an easy one. A year ago, Wiz walked away from a $23 billion offer over autonomy and antitrust concerns. Now, with regulatory winds shifting and AI-driven security risks escalating, the timing seems perfect for Google to make its move.

As Google Cloud plays catch-up to AWS and Azure, Wiz’s cutting-edge security solutions might be the ace up its sleeve. But with regulatory hurdles ahead and an AI-powered future to secure, will this gamble pay off?