Good morning,

Nvidia earnings land today, and Wall Street’s acting like it’s the Super Bowl, the Met Gala, and Judgment Day all rolled into one.

With $4.4 trillion in market cap riding shotgun, the AI king’s numbers could make or break a stock market that’s largely been clinging to AI hype.

Meanwhile, Trump is threatening legal war with Fed governor Lisa Cook and exploring ways to gain more power over the 12 regional Fed banks.

Economists warn this could backfire in a big way.

Elsewhere, Biden’s EV tax credit is about to expire, but there’s last-minute wiggle room for buyers rushing to lock in savings, which could unexpectedly pull forward demand and earnings for automakers.

And American companies are dusting off their 2018 playbooks to front-load Chinese imports ahead of Trump’s next tariff announcement.

It’s shaping up to be a high-stakes, high-volatility, high-drama day.

Quote of the day 

Five things to know before opening bell

🔥 Trump vs. the Fed 

The Trump administration is looking for ways to have more sway over regional Fed banks, according to people familiar with the matter, as first reported by Bloomberg. President Trump has already moved to oust Governor Lisa Cook and says he’s prepared for a legal fight.

🚗 EV buyers get wiggle room

Biden’s $7,500 EV tax credit (or $4,000 for used vehicles) will expire on September 30, but the IRS just changed the rulebook. Buyers can now qualify based on the contract signing date, not the delivery date. That gives shoppers more flexibility, especially if the car needs to be shipped or hasn’t been built yet. 

💾 Nvidia earnings front and center today

Nvidia reports earnings after the bell and the stakes couldn’t be higher. With a $4.4 trillion market cap and nearly 8% weight in the S&P 500, today’s Q2 results could make or break the AI rally. Analysts expect a bigger post-earnings move than any other quarter this past year. The S&P 500 is projected to swing about 0.9% in response. “There is one chip in the world fueling the AI Revolution, and that is Nvidia,” said Wedbush tech analyst Dan Ives.

😬 Consumer confidence slips again

The Conference Board’s consumer confidence index dropped from 98.7 in July to 97.4 in August. Although relatively mild, the dip isn’t encouraging. The “present situation” gauge — which tracks perceptions of current jobs and business conditions — fell 1.6 points. Expectations for labor and income over the next six months dropped 1.2 points. The data reinforces early warning sings showing up in credit card delinquency and retail foot traffic.

🧯 Treasuries aren’t buying the rate-cut hype

Stocks rallied after Powell’s remarks last week, but the bond market isn’t celebrating. 30-year Treasury yields climbed again yesterday as inflation fears creep back in. “If the Fed cuts to make it cheaper for the government to borrow, they’re essentially giving up the ability to raise rates again. And that’s how you get spiraling out-of-control inflation," warned Jim Bianco of Bianco Research.

Trump’s shadow looms larger over the Fed

Citing alleged mortgage fraud, President Trump fired Fed governor Lisa Cook, reviving concerns about political interference at the central bank.

For her part, Cook responded with a public rebuke. “President Trump purported to fire me ‘for cause’ when no cause exists under the law. I will not resign,” she said.

Speaking at a Cabinet meeting Tuesday, Trump said he’d abide by any court decision but brushed off Cook’s challenge.

“Oh sure, always,” he said. “She seems to have had an infraction, and she can’t have an infraction, especially that infraction, because she’s in charge of, if you think about it, mortgages.”

⚖️ Independence in question

Trump’s persistent browbeating of Fed Chair Jerome Powell has already raised red flags about the Fed’s independence.

His campaign against Cook is now drawing even more scrutiny, especially as the White House eyes greater control over the regional Fed banks.

“If it’s just 25 [basis points] to get Trump off their back, that’s not credible monetary policy,” warned market strategist Jim Bianco warned

Bianco added that while this particular incident may not influence next month’s FOMC decision, Trump’s power to appoint additional Fed governors could reshape the Board’s composition. 

“He could potentially veto the reappointment of regional Fed presidents,” Bianco said, turning the institution into a rubber stamp for his policy agenda.

Deutsche Bank’s Jim Reid shares Bianco's concern.

“With Stephen Miran nominated for the seat recently vacated by Governor Kugler — and with Governors Waller and Bowman dissenting in favor of a rate cut at the July meeting — this increases the prospects of a dovish majority on the Board,” he said.

📉 Market reaction

So far, stocks have shrugged off the Fed drama, while gold has crept toward near-record highs.

But it may be only a matter of time before Trump’s war of words turns into direct action — and that could shake up both the Fed and the broader market.

“We think the episode will add to growing global investor unease over Trump’s efforts to influence the independent central bank,” said UBS global head of equities Ulrike Hoffmann-Burchardi.

📦 Corporate America dusts off 2018 playbooks

From factories to freight to retailers, businesses across the supply chain are scrambling to adapt to rising costs from Trump’s ever-shifting trade policy with China. 

Nearly five months after his initial Liberation Day tariff announcements, we’re finally seeing hard data on how companies are responding... and it looks a lot like 2018.

🔁 History repeating, just louder

Back in Trump’s first term, the mere threat of tariffs on Chinese goods triggered a rush of front-loading, with U.S. importers racing to stockpile inventory ahead of new duties. 

That same playbook is now back in full force.

According to ImportGenius, three distinct waves of front-loading have already hit in 2025, the most dramatic coming between June and July, when a brief tariff truce prompted a 49% surge in Chinese imports. 

That’s more than double the sharpest spike seen during the 2018 rush, which topped out at 22%.

🤔 Will it work this time?

Short-term... maybe. Companies are clearly pulling every lever to soften the blow... and for now, those strategies have helped shield consumers from the worst of the recent price hikes.

“Many businesses have been creative and savvy in using different means to buffer the initial shock,” said Gregory Daco, chief economist at EY-Parthenon.

But longer-term, import volumes from China have already started to slump, and analysts say the trend may be just getting started.

“The difference in exports from China to the U.S. between July and August of this year is a 40% drop,” warned ImportGenius analyst Lynn Hughes. 

“Yes, the month isn’t over yet, but realistically, we still only have a week. Considering the amount of demand already pulled forward at the beginning of the year and the steady decline, I feel we could be about to start seeing imports drop below 600,000 containers for several months.”

🚨 One more wrinkle

The bigger problem is that nobody know what will happen next. 

Just this week, Trump floated the idea of slapping a 200% tariff on Chinese imports if Beijing restricts U.S.-bound shipments of rare-earth magnets.

So while front-loading may buy companies a little time, it won’t offer much predictability. And that — as most CEOs will tell you — is the real cost.

🛡️ After the Intel deal, are Pentagon collabs next?

President Trump isn’t done making corporate deals, especially ones where the federal government takes an ownership stake in corporate America. 

Following Trump’s praise of the Intel deal, National Economic Council director Kevin Hassett hinted that more moves are on the table.

“The president has made it clear all the way back to the campaign — he thinks that in the end, it would be great if the U.S. could start to build up a sovereign wealth fund,” Hassett said. 

“So I’m sure that at some point there will be more transactions, if not in this industry then other industries.”

Less than 24 hours later, Commerce Secretary Howard Lutnick pointed to what could be next: defense.“Oh, there’s a monstrous discussion about defense,” he said.

Lutnick revealed that Trump officials are weighing a plan to give the Pentagon a direct stake in defense contractors like Lockheed Martin, which he described as already “basically an arm of the U.S. government.”

Lockheed didn’t confirm any such talks but issued a rather diplomatic statement.

“As we did in his first term, we are continuing our strong working relationship with President Trump and his Administration to strengthen our national defense.” 

🧨 A divisive approach

While the Intel deal was touted as a win by the White House, the idea of more state-backed corporate partnerships isn’t exactly unifying the right.

Sen. Rand Paul (R-KY) bluntly called the Intel investment a “terrible idea.” 

“If socialism is government owning the means of production, wouldn’t the government owning part of Intel be a step toward socialism?” he said.

The White House isn’t letting up, and talk of turning defense into a government co-op is getting harder to ignore.