Good morning.

Markets are on the rise again this morning as two of the three major U.S. indices … the S&P 500 and Nasdaq … achieved new intraday highs … as excitement over AI continues to bloom.

And what is not to like about AI?  Students, teachers, researchers and scientists around the globe are discovering the many capabilities of this relatively new productivity booster.

But therein lies the problem.

Gordon Moore is well-known for having created the famous “Moore’s Law” which morphed into the belief that every two years the number of transistors on a microchip doubles.  I bring that up here due to a claim in the Telegraph (a UK paper) that AI power itself will double every 6 months.  The scary item here is that we’ve seen how powerful AI has suddenly become.  If, somehow, the “power” or proficiency of AI travels along this path … in 5 years (2 to the 10th power) the “smartness” will improve over 1,000 times!

An inflation number came out this morning, and it is a bit worrisome as prices continue to rise at a rate higher than what the Fed had publicly described as comfortable. So, you can imagine the situation in which the new Fed “independent” Chairman could find himself if things don’t straighten out within the next two months (aka. the next meeting).

Obviously, the President wants a cut in interest rates. But if Kevin Warsh does not lower rates soon (or, decides to … gulp … raise them), he might find himself on the receiving end of some 2 AM tweets from the White House.

One of my favorite items included below is Jimmy Rogers (called a “legendary investor” in the article).  While he ran a very famous … and successful … fund in the late 70s, his market calls ever since … seemingly calling for a crash every year … have been … well … terrible. Once again, he tells people to get out of the markets due to problems about to happen.  Yes, he may be right … but his history over the last decade leads you to believe he has one message and repeats it year-after-year … only bothering to change the dates.

That’ll wrap it up for me today.

I was kind of tied up yesterday with a college graduation … glad in the belief that the payments have ended …

… only to be told …

… “dad, I’m thinking of going to grad school.”

Oh my. What time do the bars open?

Have a great day,

Joseph G. Witthohn, CFA

Have any questions? Please contact info@teamemerald.com

A Look At The News | May 14, 2026 As of 11:22 AM today …   Inflation might be starting to hit consumers as a slowdown in spending has been seen as concerns arise over what happens when tax refunds are spent (APNews) https://apnews.com/article/retail-sales-consumer-gas-iran-f77b8986d274c40b913c26ba39492ead   … which, of course, puts the new Fed Chairman in a bit of a pickle as the administration probably hoped they had in place someone in support of rate cuts (NPR) https://www.npr.org/2026/05/13/nx-s1-5816235/kevin-warsh-federal-reserve-chair-jerome-powell   There are some areas of the country that really count on tourism … but what if they don’t’ come?  This is the question being asked by those who miss the disappearing Canadian tourists (CBC) https://www.cbc.ca/news/politics/cross-border-travel-down-dramatically-research-9.7198652   Well, the annual call from “legendary” Jimmy Rogers is out again as he warns of a complete stock market collapse (MoneyWise) https://moneywise.com/investing/stocks/jim-rogers-stocks-warning-gold-silver   There is no kidding aside, AI chips are big business … but if we open up Chinese markets will we then see their own chip manufacturers narrow the productivity gap? (CNBC) https://www.cnbc.com/2026/05/14/xi-china-open-us-business-ai-chips.html   A fear about AI is it will cost many … and maybe you … a job. Is there a way to stay ahead and prove yourself more important than some “AI agent” who never asks for a raise?  (ReadersDigest) https://www.rd.com/article/ai-career-pivot/   The statements above are supplied for educational purposes only. The statements depict the viewpoints and opinion of the author and are not necessarily the views of Emerald Asset Management or its affiliates. The information described herein is taken from sources which are believed to be reliable, but the accuracy and completeness of such information is not guaranteed by us. Emerald Asset Management PA, LLC | 717-556-8900 | 3175 Oregon Pike, Leola, PA 17540 Want to change how you receive these emails? You can unsubscribe from this list. ———————————————————————————- The statements above are supplied for educational purposes only. The statements depict the viewpoints and opinion of the author and are not necessarily the views of Emerald Asset Management or its affiliates. The information described herein is taken from sources which are believed to be reliable, but the accuracy and completeness of such information is not guaranteed by us.