Elon Musk has been saying for the past year that with humanoid robots, there will be “no meaningful limit to the size of the economy.”

What does he mean?

If labor is no longer scarce… if every human can be matched with two or three autonomous robots doing physical work… then the economy’s productive capacity is virtually limitless.

He calls it the coming “age of abundance.”

And he thinks Tesla will dominate it.

Tesla has the most valuable proprietary data on real-world conditions, behaviors, environments, and scenarios (billions of miles driven). And it knows how to manufacture at scale. That’s why Elon sees Tesla as the leader in humanoid robots.

Now the board has put this vision into writing.

They just filed a proxy for shareholder vote on the boldest compensation package in corporate history.

It could make Elon a trillionaire. 

But he only gets paid if he delivers:

• One million robotaxis in commercial operation.

• One million humanoid robots.

• Earnings nearly 30x higher than his last plan.

• And a $7.5 trillion increase in Tesla’s market value.

Elon has already said Optimus, Tesla’s humanoid robot, could make Tesla worth $25 trillion.

This all lines up with what Nvidia’s Jensen Huang has been telling us. After generative AI and agentic AI, the next wave is physical AI: robots in the real world.

He says it will reshape $100 trillion worth of global industry.

So let’s connect the dots: Elon says humanoid robots will remove the cap on economic growth. Jensen says robotics will be the biggest technology industry in history. And Tesla’s board has written a comp plan that only pays Elon if he makes it happen.

That’s why we own Tesla in our AI-Innovation Portfolio. Tesla isn’t just an EV company. It’s the company with the world’s largest fleet of AI-driven robots (its cars), the deepest proprietary data on real-world behavior, and the ability to manufacture at scale. 

Tesla is the bridge between digital AI and physical AI.

And remember, when we launched this portfolio in June 2023, we said AI would grow the economic pie. We said the age of multi-trillion-dollar companies was coming. Nvidia became one soon after. Tesla has now joined that club. More are coming.

If you have yet to join our AI-Innovation Portfolio, it’s still early.

Our AI-Innovation Portfolio has returned 31% annualized since inception. And this 25 stock portfolio is even better positioned now, than it has been over the past two years, because of the scale of this coming physical AI wave.

If you’ve been reading my notes over the years and waiting on the sidelines, now is the time to get involved. My AI-Innovation Portfolio is the easy way to do it — and you’ll be in good company. Our subscriber base spans from C-suite executives and entrepreneurs to hedge fund managers, financial advisors, engineers, doctors, lawyers, academics, and discerning individual investors.

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If Elon is right, the economy — and the markets — are about to get much bigger.

Remember, two Fed governors (Waller and Bowman) voted to cut rates in the July meeting, dissenting from the majority vote.  Both made their cases in public speeches prior to the meeting. 

Chris Waller, who is on the list of candidates to become the next Fed Chair, went so far as to say that the Fed had not been following the data, instead had paused the easing cycle on assumptions about tariffs that were (his words) “counter to economic theory.”

And he used the analogy of walking on ice in describing the labor market — he said, “when you start hearing cracks … it’s too late.”

Still, the two dissenters couldn’t convince the rest of the committee, and the Fed held rates steady for a fifth straight meeting in July.

Days later, there was a big negative surprise in the jobs data, which included massive downward revisions to the two prior reports.

That same day, Waller released a statement saying “a host of data argues that monetary policy should now be close to neutral.” 

That’s a big statement.  Neutral (not restrictive, nor stimulative), based on the Fed’s consensus is 3% – roughly 130 basis points lower than the policy rate.

We’ve since had another bad jobs report, and the largest negative one-off adjustment to job growth (-911k) on record.

That brings us to today’s decision.

Remember, when the Fed started the easing cycle last year this time, with a surprise 50 basis point cut, Powell said the move should be taken “as a sign of [their] commitment not to get behind the curve.”

Trump’s newly appointed Fed governor, Stephen Miran, was at the table over the past two days.  As we know, the Trump administration thinks rates should be much lower.  Treasury Secretary, Scott Bessent, has argued to start with 50 in this September meeting, and to ultimately get to 150-175 basis points lower. 

When it came time to vote, Miran voted to cut rates today by 50 basis points. 

He was alone.

Where was Waller?  Where was Bowman?

The rest of the committee voted to cut by 25.

What’s the takeaway? 

Miran either didn’t make a convincing case to sway other voters to his camp, or the other voters were pressured by the existing Fed regime to show consensus and alignment with Powell, the Fed Chair. 

Still, regime change is coming at the Fed, and the market got a view of the policy path from Miran’s participation (i.e. the Trump camp) in the Fed’s Summary of Economic Projections ….

This is the Fed’s ‘dot plot’ — a visual representation of the individual projections from each of the 19 participants in the Federal Open Market Committee (FOMC) meetings. Each ‘dot’ represents a single participant’s forecast for the appropriate level of the federal funds rate at the end of each of the next few years and over the longer run.

It’s safe to assume the lowest dots (circled in yellow) are Miran, which would suggest he is pushing for a fast recalibration, to get the policy rate near the neutral level.

Today, he was a lone dissenter. But the dots make clear how the Trump Fed wants to move.

Miran will be a good interview to watch for in the coming days. 

Of the many moving tributes to Charlie Kirk, this one sticks out …

I’ll start.

Charlie was a seeker of the truth in a world where truth has been inverted. He was a man of courage. A man of God. And he was targeted for it — because he was effective.

If we look at the numbers, among 18–29 year-old men, voter preference swung from +26 Democrat in 2023 to +18 Republican in 2025. That’s a 44-point swing in two years. Charlie was the force behind that change.

He was effective resistance to the “progressives‘” ongoing cultural revolution, and he was silenced.

Yet as Scripture shows, persecution never silences truth — it amplifies it.

That brings me to the bigger picture — the “why” behind so much of the disruption and chaos we’ve all lived through over the past five years.

We’ve talked often in these notes about the strategy behind the Trump tariffs/ “trade war.”

At its core, it has always been about China.

For decades, China has manipulated its currency to undercut global competitors, corner export markets, and build the world’s largest war chest of foreign currency reserves.

What did they do with that capital?

They used it to buy global influence (including inside the U.S.) — in politics, academia, corporations, media, and medicine.

And they expanded economic warfare into what is now “hybrid warfare”: economic, psychological, biological, informational, political, and cyber.

It’s no secret that the Chinese Communist Party (CCP) has an explicit goal of global dominance. Against that backdrop, it’s not difficult to connect the dots and see their fingerprints on the societal deterioration of the West.

It’s the Mao Zedong playbook.

Mao’s Cultural Revolution (1966–1976) was built on the idea that revolution must be continuous, that culture itself had to be torn down to make room for the Party’s control. It meant erasing traditions, mobilizing youth against authority, dividing society into oppressors and oppressed, and keeping the population in constant turmoil.

Here’s how ChatGPT maps it against events we’ve seen in the U.S. since COVID:

Mao engineered chaos and cultural destruction to centralize control and remake identity.

In the U.S., post-COVID, while the context and severity differ (no mass famine, labor camps, or Mao-level death toll), many tactics are similar: reliance on perpetual crisis, use of youth activism, identity-based division, removal of monuments, ideological conformity enforced via social and corporate pressure, and historical revisionism to reshape collective memory.

The jobs picture took another blow this morning.

The Bureau of Labor Statistics (BLS) revealed a huge downward adjustment to the job growth that was reported over the March 2024 to March 2025 period.

In this scheduled annual revision 911,000 jobs were erased from the records.

If we distribute that equally across the already twice revised job growth data for the twelve months through March of this year, we get the chart below … 

It’s now updated with August payrolls, and the revisions of the prior two months.

We now have a job market that has averaged just 27k net new jobs over the past four months.  For context, the five-year period prior to the pandemic was 182k.

Add this to the OVER-reporting of jobs in the first seven months of the year, and clearly this is not the job market the Fed has been incorporating into its policy making decisions.

And with that, the question is:  would the Fed have cut rates earlier this year had they been privy to the numbers in the final revision column of the table above?

Let’s do an experiment.

If we ask ChatGPT to play the role of an FOMC voter, with the Fed’s publicly stated policy making framework in mind, how would it have voted in its June meeting (at that point-in-time), given the knowledge of the actual payroll numbers (i.e. the final revisions)?

Below is the actual data heading into that June meeting — and the week prior, they would have gotten a reading on May CPI of 2.4%.

Remember, the Fed has admittedly been in a restrictive stance (putting downward pressure on the economy), and claims to be “data dependent” (led by the data).

So, here’s the vote from ChatGPT …

On June 18, 2025, with the data you’ve laid out, the FOMC’s decision calculus would look like this:

FOMC Assessment

Inflation:

• Near target. No evidence of re-acceleration. CPI/PCE converging at ~2.4%.

• Inflation expectations remain anchored.

Employment:

• A +19k print (knowing it’s final) is essentially zero jobs growth.

• This signals labor demand slackening abruptly.

Policy Stance:

• At 4.33%, policy is restrictive relative to inflation outcomes.

• Real rates are too high for a labor market already showing cracks.

Decision

Cut by 50 bps (to ~3.8%).

Reasoning:

• A 25 bps trim risks being behind the curve when the labor market has stalled.

• Inflation data gives you cover: at 2.4%, you’re not reigniting price pressures.

• A bold move signals you’re serious about the employment half of the mandate, while still leaving real rates positive.

Bottom line: On June 18, with PCE at target and jobs collapsing, the FOMC would almost certainly deliver a 50 bp cut and open the door to more if the labor data deteriorates further.

So, based on the Fed’s policy making framework, and the conditions of the economy based on the actual (final) data, ChatGPT thinks it warranted a 50 basis point cut in June. (xAI’s Grok said 50, Google’s Gemini said 25 and Anthropic’s Claude said 25).

Instead, the Fed held steady, on the false belief (in their words) that the “labor market conditions remain solid.”

Now we head into the September Fed meeting next week.

And we now have clear evidence of the deterioration in the labor market.  But we have an uptick in inflation, which we may find on Wednesday will be as much as half a percentage point higher than June (as measured by CPI).

Will the Fed make up for its late start (i.e. deliver the 50bps cut it missed)?  The market is pricing in only about a 10% chance.

But that positioning may change tomorrow.

The BLS is expected to make a big one-off downward adjustment to the jobs picture, in its scheduled annual “benchmark revision.”  A year ago, it slashed 818k jobs in this revision.  Bessent said over the weekend he thinks it could be a similar number in tomorrow’s revision.

We get the jobs report tomorrow.

Remember, the report last month had huge downward revisions (i.e. job creation has been over-reported).

And we looked at this graphic on the reporting for the year …

The Bureau of Labor Statistics (BLS) has overshot job growth on its initial report seven consecutive months — nearly half a million jobs.

Remember, the Fed is tasked with setting policy to achieve price stability and full employment.  So, the most important data point in assessing one part of its mandate has been misleading.

And misleading reporting has been a trend, not an exception.

And it has led to very, very costly policy mistakes.

From the unreliable jobs data over the past several years, we’ve gotten reckless fiscal spending in 2021, when the economy was already running hot/ inflation was already on fire.

And then later (2023-2024), we got all of the debt from the trillions of dollars of government spending, and a devalued dollar, but only a fraction of the economic growth — because the Fed had its foot on the brake, with an inaccurate picture of the health of the economy.

And it has continued this year, leading to Fed policy that has been a headwind to pro-growth fiscal and industrial policy.

But regime change is coming at the BLS.

Trump’s nominee to head the BLS should go through Senate confirmation hearings this month.

As for tomorrow’s data, the credibility has been shot.  But the market probably reacts to weaker numbers, and likely ignores any positive surprise.