The Week in Charts (7/1/26)
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The most important charts and themes in markets and investing…
1) The Hundred-Year Flood
“This is a hundred-year flood. I’ve never seen anything like it in any area in over 40 years.” -Tim Cook
What is the CEO of Apple referring to?
DRAM and NAND prices have spiked hundreds of percent in just the past year.
That means higher costs for data centers, smartphones, laptops, gaming consoles, and anything else that needs storage and memory.
AI was supposed to be a deflationary technological force, and it likely will be in the long run.
But in the here and now, due to demand outstripping supply, it is becoming highly inflationary.
Here are some of the price increases on popular products that consumers will have to bear:
-MacBook Pro: $1,699 -> $1,999
-Microsoft Surface Pro: $999 -> $1,599
-iPhone 18 Pro: $1,099 -> $1,299
-MacBook Air: $1,099 -> $1,299
-Sony PS5 Pro: $740 -> $900
-iPad Air: $599 -> $749
-Xbox Series X: $499 -> $649
-iPad Mini: $499 -> $599
-Nintendo Switch 2: $449 ->$499
-HomePod: $299 -> $349
-Apple TV: $129 -> $199
The cure for high prices is high prices – eventually.
Demand will eventually fall in response to these price increases.
And when that happens, memory prices should go down as a result.
But the questions is: what is the breaking point and how much more expensive will things get before the bust?
South Korea’s central bank is asking just that with the memory mania generating windfall profits for its two largest companies: Samsung and SK Hynix.
At Samsung, a memory chip worker with a base salary of $52k is expected to receive a total bonus of around $410k this year.
Not to be outdone, at SK Hynix employees are expected to receive bonuses of more than $454k.
This has led to a surge in luxury retail sales in South Korea, with jewelry up 146% year-over-year and watches up 85%.
The classic definition of demand-pull inflation is too much money chasing too few goods. And precisely what we’re seeing today.
2) The Most Dominant Investing Narrative
The most dominant investing narrative in the first half of 2026 was as follows:
-Buy the companies selling the shovels.
-Sell the companies paying for all the shovels.
And assume the spending never slows.
So enticing was this theme that we saw investors pour $25 billion into the memory ETF ($DRAM) in less than 3 months, the fastest ETF ever to hit that mark.
And Micron Technology ($MU), one the 3 largest holdings in that ETF (along with Samsung and SK Hynix), reported a 15x increase in quarterly profit to $28.2 billion That nearly matched Apple’s quarterly profit ($29.6 billion) and is expected to surge past Apple in the second quarter.
For years, Apple was the company with all the pricing power.
But even the strongest consumer brand has become a price taker with a critical input (memory) in short supply.
How long will this imbalance last?
That will be the key question for the 2nd half of 2026 and beyond. For now, the hyperscalers are issuing more debt, raising more equity, and burning free cash flow to fund the AI buildout.
But their share prices are starting to underperform as investors grow weary of the rising capital demands. If that continues, one would think a pullback in spending would be the result. And when that happens, the narrative changes instantly.
3) Everyone Is Expecting Good News
Nearly 60% of S&P 500 stocks now carry a Buy rating from Wall Street analysts, the highest level on record.
Why does this matter?
When everyone is expecting good news, there’s less room for positive surprises. That’s the setup entering Q2 earnings season.
4) A Deal Making Boom
US deal value over the last 4 quarters: $1.89 trillion, the highest level on record.
The last 2 major spikes: 2021 and 2000. Both occurred near market peaks.
Reminder: dealmaking tends to surge when confidence/optimism is high and discipline starts to fade.
5) Dangerous Investing Phrases
One of the most dangerous phrases in investing: “It can’t go down much more.”
Strategy ($MSTR) is now down over 80% from its high.
Painful? Yes. Unprecedented? No.
After the dot-com bust it fell 99.86%. If it were to match that, it mean another -99% decline from here.
Why is Strategy falling? Its Bitcoin purchases are underwater (average purchase price of $75k), with Bitcoin now in its longest (267 days) and deepest (-54%) drawdown since 2022.
6) Narratives Follow Prices
Five months ago:
“The Dollar is doomed. Gold and Silver are going to the moon.”
Five months later:
US Dollar: +7%
Gold: -26%
Silver: -50%
Narratives follow prices far more often than prices follow narratives. The market has a way of humbling consensus views/trades.
7) A Few Interesting Stats…
a) Nike is now down 75% from its peak in November 2021, the largest drawdown in company history.
b) Semiconductor stocks were up 237% over the last 14 months, surpassing the 234% surge during the peak of the dot-com bubble.
c) A record 33% of household wealth is now held by Americans that are 70 years of age and older.
And that’s it for this week. Thanks for reading! Have a happy 4th!
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Disclaimer: All information provided is for educational purposes only and does not constitute investment, legal or tax advice, or an offer to buy or sell any security. Read our full disclosures here.
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