Sold Out Through 2028

Hunt, Jason, and Mike walk the Cash Flow Memo through $90 oil that will not change oil-patch spending, a compute market sold out through 2028, and a healthcare desk that still found time for Eliquis.The Cashflow MemoKey Takeaways* Hunt’s $70-$90 oil range still holds at the top - crude is ~$90 and he does not see it running much higher - but Iran’s infeasible demands (US bases out, Hormuz cargo tolls, reparations, sanctions off) keep him closer to 90 than 80 for 6-12 months; ~20 ships/day still move (Iraqi crude allowed, Saudis can go Red Sea), producers still underwrite $70-75 so activity does not spike, and $90 oil maps to roughly $4.00-$4.20 US gasoline.* Industrial read-through is Caterpillar: data-center turbines plus reshoring and data-center construction more than offset lagging housing, and Hunt says tariffs, $90 oil, and the political noise are not changing what they hold or add; Mike wants more macro time on these calls now that Warsh is detoxifying Fed guidance.* Compute demand is still exponential: Jassy says AWS AI is sold out through 2026-27 and most of 2028, $200B of CapEx this year still will not close it, and recursive learning models by year-end are another multiple of inference per user - Hunt prefers Amazon, Google, and Microsoft as the compute owners and cannot make up his mind on Meta.* Supply cannot catch that demand in ’27-’28: New York’s >200 MW hold, Virginia saturation, and the Texas governor’s ERCOT audit all push off-grid; combined cycle is 3-4 years out, simple turbines (GE, Cat, Siemens) are sold out, SpaceX Memphis (~$30B, 2 GW, 1-1.5 year payout to Anthropic and Google, 4-5 GW ambition by end-’27) is the exception; Hunt would avoid CoreWeave even after it extended 2020 A100s through 2029 at a 25% price hike.* Chip and memory bottlenecks sit behind the power constraint - TSMC wafers plus packaging, Intel closer on packaging than lithography, memory prices hitting Apple - and Tesla/SpaceX’s Terafab is a first-principles end-run around ASML (particle-accelerator EUV vs tin-droplet lasers) that Huawei is already pursuing; healthcare: FDA closes the GRAS food-ingredient loophole, the childhood vaccine schedule goes 17 to 11 diseases (Japan’s MMR split was reversed after completion collapsed), Thermo Fisher is seeing early-stage equipment rebound, and the AZN-BMY rumor died even as Eliquis (one-third of BMY sales, largest Medicare Part D line) faces a 2028 patent cliff that Jason puts at ~$10B of Part D savings.Show Notes[00:00] Intro & Cash Flow Memo Download the memo at telltales.us; 30 minutes on energy, technology, and healthcare cash flows.[00:27] Iran, Hormuz, and $90 Oil Iran’s demands are not negotiable, so Hunt keeps oil closer to $90 than $80 for 6–12 months. About 20 ships a day still move; Iraqi crude is allowed through, and Saudi barrels can go Red Sea.[04:20] $70 Decisions and Caterpillar Producers still underwrite $70–75, so activity does not spike. Caterpillar is the industrial read-through: data-center turbines and reshoring more than offset weak housing.[07:47] AWS Sold Out Through 2028 Jassy says AWS AI demand is sold out through this year, next year, and most of 2028. $200B of CapEx will not close it, and recursive models by year-end add another multiple of inference per user.[10:37] The Grid Says Build Your Own Power New York’s hold, Virginia saturation, and the Texas governor’s ERCOT audit all push data centers off-grid. Combined cycle is years out; simple turbines are sold out. SpaceX Memphis (~$30B, 2 GW) is the exception.[14:45] A 2020 Chip Gets a 25% Hike CoreWeave extended Nvidia A100 rentals through 2029 at a 25% price increase. Hunt would still avoid the stock and own Amazon, Google, and Microsoft instead.[16:31] TSMC, Memory, and the Terafab TSMC wafers and packaging, plus a memory squeeze that hits Apple, sit behind the power constraint. Tesla and SpaceX are planning a Terafab that replaces ASML’s tin-droplet EUV with a particle accelerator.[22:15] Why It Won’t Run on Your Phone Frontier models need a rack of GPUs and have to run 24/7 even when the phone is offline. On-device AI will route requests, not replace the cloud.[24:11] Huawei and the China Supply Threat Locked out of the latest ASML tools, China is already on particle accelerators and e-beam. If the rest of the world stays chip-constrained, Huawei has a willing market.[26:12] Healthcare: FDA, Vaccines, and the Eliquis Cliff FDA closes the GRAS loophole; the childhood schedule goes 17→11 diseases. Thermo Fisher is seeing early-stage equipment rebound. The AZN–BMY rumor died; Eliquis is one-third of BMY and the largest Medicare Part D line, with a 2028 patent cliff Jason puts at ~$10B of savings.Subscribe for the weekly Cash Flow Memo walkthrough, download the memo at telltales.us, and join us next Wednesday.Cashtags$AAPL $AMZN $ASML $BMY $CAT $CRWV $GOOGL $INTC $META $MSFT $NVDA $SEI $TSLA $TSM This post and the information herein are intended for informational purposes only. The views expressed herein are the author’s alone and do not constitute an offer to sell, or a recommendation to purchase, or a solicitation of an offer to buy, any security, nor a recommendation for any investment product or service. While certain information contained herein has been obtained from sources believed to be reliable, neither the author nor any of his employers or their affiliates have independently verified this information, and its accuracy and completeness cannot be guaranteed. 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