Amazon is seeing huge demand for increased computing capacity. New capacity may not solve the memory chip pricing crisis.

In Amazon's infancy, Jeff Bezos remained solely focused on growing the business rather than the young company's volatile stock price. He found inspiration, however, in the same source of wisdom as Warren Buffett.

Amazon is increasing its capital expenditures to $220 billion, citing rising memory costs as a contributing factor. As a positive sign for Micron Technology and other memory and storage stocks, Amazon's capacity to build AI infrastructure can't keep up with demand.

Amazon is upgrading its Indiana data center campus to support its AGI team's frontier model effort. Amazon continues to invest in its own frontier models despite last month's AGI job cuts.

Amazon is no longer just a retailer. AWS and advertising now generate much of the company's profits, making the business higher quality than I once believed.

Each of the major cloud providers reported strong double-digit cloud growth, driven by robust demand for AI. The hyperscalers are also increasing their capex spending to meet the unprecedented demand.

Vertiv (NYSE:VRT | VRT Price Prediction) and Astera Labs (NASDAQ:ALAB) both reported into the same tailwind: Amazon and Microsoft pouring roughly $100B to $105B combined per quarter into AI capex.

Amazon's leading cloud and e-commerce businesses have strong growth ahead. Apple has one of the best business models on the planet.

Amazon and Alphabet are remarkably comparable.

Last month in this forum I alluded to “canaries” in the coalmine (see here) , referring to the high implied volatility on options of stocks like Micron (MU) and SpaceX (SPCX). One working hypothesis was that assisted by leverage (both direct and via ETFs that provide this leverage) the market is currently amplifying “bi-modality”, which basically means a schizophrenic pricing of return outcomes that differ significantly from each other- akin to the outcomes of a coin flip.