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Rahul Chavan @RahulChavan · 2h ·kept forever

Met Coal: The Quiet Commodity That Could Lead the Next Run in Stock Market?

What is met coal

Met coal stands for metallurgical coal. It is also called coking coal. It is not the same as thermal coal, which power plants burn for electricity. Met coal has one job. It gets baked into coke. Coke is the fuel and the chemical agent that turns iron ore into liquid iron inside a blast furnace. Without coke, most of the world's steel simply cannot get made.

How is Steel Produced: Electric furnace versus blast furnace, and why coal still matters

Here is the part most people miss. There are two ways to make steel.

Blast furnace (BF-BOF). Uses iron ore, coke, and met coal. Makes new steel from raw materials. This route produced about 70.4% of the world's 1.885 billion tonnes of steel in 2024.Electric arc furnace (EAF). Melts down scrap steel using electricity. This route made up the other 29.1% of global output.

EAF is often called the "green" route because it skips coal. But EAF has a real weakness. It needs two things in large supply: clean scrap steel and cheap, reliable electricity. Right now, electricity demand is exploding, mostly because of AI data centers and rising cooling and heating needs. Power infrastructure starts are rising more than 21% year over year just to keep up. When power-hungry data centers, EVs, and factories are all bidding for the same electrons, power prices tend to rise. That makes EAF steel more expensive to run, right when the world needs more steel, not less.

Blast furnace steel does not compete for electricity the same way. It runs on coal and ore, which are priced in their own markets and are not tied to the electric grid squeeze. So as power costs climb, the old-fashioned coal-based route starts to look economically sensible again, not just for legacy reasons but on pure cost grounds. That is a real tailwind for met coal that most people are not pricing in yet.

Where met coal ends up

Steel is everywhere, and met coal is the hidden ingredient behind most of it.

Bridges and highways use structural steel beams and rebar.High rises and warehouses use steel frames.Ports, railways, and pipelines all run on steel.Cars, ships, and appliances are steel-heavy products.Wind turbines and transmission towers, ironically, also need a lot of steel.

Every tonne of steel made the traditional way needs roughly 0.6 to 0.8 tonnes of met coal, once you count both the coke and the PCI coal. So when you hear that a country is building infrastructure, you are also hearing a call on met coal demand, even if nobody says the word coal.

AI, data centers, and a new source of steel demand

The AI buildout has turned into a steel story too. U.S. data center construction starts went from $14.9 billion in 2023 to $77.7 billion in 2025, a 190% jump in one year. Spending through April 2026 alone hit $49.5 billion, nearly four times the pace from a year earlier. Moody's now projects $3 trillion in global data center spending over the next five years.

Data centers are not just racks and chips. Visit one under construction and steel is everywhere: framing, strut ceiling supports, conduit, piping, racks, cabinets, and wall panels. Add in the power plants, substations, and transmission towers needed to feed all that electricity, and you get a new, durable source of steel demand that was barely on the radar five years ago. New steel demand, even scrap-based steel demand, tightens the whole market and lifts the value of primary steel capacity that still needs met coal.

Coal as a critical mineral

The U.S. government made a formal move on this front. In May 2025, the Department of Energy designated coal used in steelmaking as a critical material under the Energy Act of 2020. Then in November 2025, the U.S. Geological Survey added metallurgical coal to the official 2025 Critical Minerals List, alongside copper, silver, uranium, and eight other materials. Critical mineral status is supposed to go to commodities that matter for economic or national security and whose supply chains are vulnerable, and that are essential to key products.

The U.S. is actually the world's second largest met coal exporter and already produces most of what it uses, so this designation will not fix a foreign dependence problem the way it might for something like lithium. What it does instead is unlock federal permitting speed, financing support, and political protection for domestic coal projects. Congress also made met coal eligible for the advanced manufacturing production tax credit under the 2025 reconciliation law, and the Permitting Council fast-tracked Warrior Met Coal's mines as a transparency project. This is the government putting its thumb on the scale for domestic met coal supply and for the steel mills that use it.

The US Steel golden share connects the dots

This is where the earlier news ties in. The U.S. government now holds a golden share in US Steel as part of the Nippon Steel buyout. That share gives Washington veto power over plant closures, headquarters moves, and any move of production out of the country. At the same time, Congress extended production tax credits to metallurgical coal, the raw material these older integrated mills need for ironmaking. Nippon Steel has already reinvested $350 million into the coal-based ironmaking process at its Gary, Indiana plant.

Put it together and you get a government that will not let a legacy blast furnace plant simply shut down, paired with a subsidy that makes running that plant on coal cheaper. That is about as direct a policy tailwind for met coal demand as you are likely to find.

Global supply and demand, the last 20 years

China and India have driven coal demand for two decades, and China is now the swing buyer while India is the rising one. As you can see in the graph (chart1_top_importers_2024), China imported far more coal than any other country in 2024, with India a distant second and Japan third.

Supply versus demand for the decades ahead

Nobody can forecast 50 years of coal supply and demand with real precision, so the honest picture is a range, not a single number. As you can see in the graph (chart2_longterm_outlook), industry forecasts show met coal trade holding fairly steady in a base case, but dropping by more than half if the world moves fast toward net zero steel.

India, the new demand engine

India is where the growth story lives right now, since its steel sector imports 90% of its metallurgical coal and wants to keep expanding output. As you can see in the graph (chart3_india_imports), India's met coal imports are on a steady upward path, roughly doubling between 2025 and 2035.

India also has aggressive steel production goals, and most of that growth still runs through coal-hungry blast furnaces. As you can see in the graph (chart4_india_steel_targets), India aims to more than triple its current steel output by 2047.

Putting the case together

Here is the bull case in one place.

Met coal has no real substitute in blast furnace steelmaking, and blast furnaces still make 70% of the world's steel.India is entering a multi-decade steel buildout and is 90% reliant on imported met coal.Rising electricity prices, driven partly by AI data centers, make the electric furnace route more expensive, which favors the coal-based route on pure cost.AI and data center construction is itself adding fresh, durable steel demand.The U.S. government has classified met coal as a critical mineral and a critical material, unlocking permitting speed and tax credits.The golden share in US Steel locks in domestic blast furnace capacity that would otherwise be a shutdown candidate, and that capacity needs coal.Warrior Met Coal and Alpha Metallurgical Resources are both low-cost, low-debt producers that return cash to shareholders through buybacks rather than chasing growth for its own sake.

The other side of it

A fair case has to include the risks, because they are real.

Wood Mackenzie's own numbers show seaborne met coal trade could shrink by more than half by 2050 under a serious decarbonization path, from 378 million tonnes to 142 million tonnes.China, the world's largest steel producer, is a shrinking coal importer, not a growing one, and China still sets the tone for global steel and coal prices.Met coal prices are volatile and cyclical. AMR's own 2026 numbers show margins compressing hard when prices dip.HCC no longer trades at a bargain multiple. Much of the good news is already reflected in the price.Steel decarbonization technology, especially hydrogen-based direct reduced iron, is still early but well funded, and it directly threatens long-run coal demand.

Bottom line

The pieces line up better for met coal than for almost any other commodity right now. Steady India-led demand growth. A U.S. government actively protecting domestic coal-based steel capacity. Rising electricity costs pushing the economics back toward the old blast furnace route, right as AI adds a new source of steel demand. Two well-run, low-cost, shareholder-friendly producers sitting at the center of it.

This is a real, well-supported case for met coal doing well over the next several years. It is not a sure thing and I'm not a financial advisor, so treat this as the bull case laid out honestly, not as personal investment advice. It's worth weighing against the risks above, and maybe a conversation with a financial advisor, before sizing a position.

(edited)

Met Coal: The Quiet Commodity That Could Lead the Next Run in Stock Market?

What is met coal

Met coal stands for metallurgical coal. It is also called coking coal. It is not the same as thermal coal, which power plants burn for electricity. Met coal has one job. It gets baked into coke. Coke is the fuel and the chemical agent that turns iron ore into liquid iron inside a blast furnace. Without coke, most of the world's steel simply cannot get made.

How is Steel Produced: Electric furnace versus blast furnace, and why coal still matters

Here is the part most people miss. There are two ways to make steel.

Blast furnace (BF-BOF). Uses iron ore, coke, and met coal. Makes new steel from raw materials. This route produced about 70.4% of the world's 1.885 billion tonnes of steel in 2024.Electric arc furnace (EAF). Melts down scrap steel using electricity. This route made up the other 29.1% of global output.

EAF is often called the "green" route because it skips coal. But EAF has a real weakness. It needs two things in large supply: clean scrap steel and cheap, reliable electricity. Right now, electricity demand is exploding, mostly because of AI data centers and rising cooling and heating needs. Power infrastructure starts are rising more than 21% year over year just to keep up. When power-hungry data centers, EVs, and factories are all bidding for the same electrons, power prices tend to rise. That makes EAF steel more expensive to run, right when the world needs more steel, not less.

Blast furnace steel does not compete for electricity the same way. It runs on coal and ore, which are priced in their own markets and are not tied to the electric grid squeeze. So as power costs climb, the old-fashioned coal-based route starts to look economically sensible again, not just for legacy reasons but on pure cost grounds. That is a real tailwind for met coal that most people are not pricing in yet.

Where met coal ends up

Steel is everywhere, and met coal is the hidden ingredient behind most of it.

Bridges and highways use structural steel beams and rebar.High rises and warehouses use steel frames.Ports, railways, and pipelines all run on steel.Cars, ships, and appliances are steel-heavy products.Wind turbines and transmission towers, ironically, also need a lot of steel.

Every tonne of steel made the traditional way needs roughly 0.6 to 0.8 tonnes of met coal, once you count both the coke and the PCI coal. So when you hear that a country is building infrastructure, you are also hearing a call on met coal demand, even if nobody says the word coal.

AI, data centers, and a new source of steel demand

The AI buildout has turned into a steel story too. U.S. data center construction starts went from $14.9 billion in 2023 to $77.7 billion in 2025, a 190% jump in one year. Spending through April 2026 alone hit $49.5 billion, nearly four times the pace from a year earlier. Moody's now projects $3 trillion in global data center spending over the next five years.

Data centers are not just racks and chips. Visit one under construction and steel is everywhere: framing, strut ceiling supports, conduit, piping, racks, cabinets, and wall panels. Add in the power plants, substations, and transmission towers needed to feed all that electricity, and you get a new, durable source of steel demand that was barely on the radar five years ago. New steel demand, even scrap-based steel demand, tightens the whole market and lifts the value of primary steel capacity that still needs met coal.

Coal as a critical mineral

The U.S. government made a formal move on this front. In May 2025, the Department of Energy designated coal used in steelmaking as a critical material under the Energy Act of 2020. Then in November 2025, the U.S. Geological Survey added metallurgical coal to the official 2025 Critical Minerals List, alongside copper, silver, uranium, and eight other materials. Critical mineral status is supposed to go to commodities that matter for economic or national security and whose supply chains are vulnerable, and that are essential to key products.

The U.S. is actually the world's second largest met coal exporter and already produces most of what it uses, so this designation will not fix a foreign dependence problem the way it might for something like lithium. What it does instead is unlock federal permitting speed, financing support, and political protection for domestic coal projects. Congress also made met coal eligible for the advanced manufacturing production tax credit under the 2025 reconciliation law, and the Permitting Council fast-tracked Warrior Met Coal's mines as a transparency project. This is the government putting its thumb on the scale for domestic met coal supply and for the steel mills that use it.

The US Steel golden share connects the dots

This is where the earlier news ties in. The U.S. government now holds a golden share in US Steel as part of the Nippon Steel buyout. That share gives Washington veto power over plant closures, headquarters moves, and any move of production out of the country. At the same time, Congress extended production tax credits to metallurgical coal, the raw material these older integrated mills need for ironmaking. Nippon Steel has already reinvested $350 million into the coal-based ironmaking process at its Gary, Indiana plant.

Put it together and you get a government that will not let a legacy blast furnace plant simply shut down, paired with a subsidy that makes running that plant on coal cheaper. That is about as direct a policy tailwind for met coal demand as you are likely to find.

Global supply and demand, the last 20 years

China and India have driven coal demand for two decades, and China is now the swing buyer while India is the rising one. As you can see in the graph (chart1_top_importers_2024), China imported far more coal than any other country in 2024, with India a distant second and Japan third.

Supply versus demand for the decades ahead

Nobody can forecast 50 years of coal supply and demand with real precision, so the honest picture is a range, not a single number. As you can see in the graph (chart2_longterm_outlook), industry forecasts show met coal trade holding fairly steady in a base case, but dropping by more than half if the world moves fast toward net zero steel.

India, the new demand engine

India is where the growth story lives right now, since its steel sector imports 90% of its metallurgical coal and wants to keep expanding output. As you can see in the graph (chart3_india_imports), India's met coal imports are on a steady upward path, roughly doubling between 2025 and 2035.

India also has aggressive steel production goals, and most of that growth still runs through coal-hungry blast furnaces. As you can see in the graph (chart4_india_steel_targets), India aims to more than triple its current steel output by 2047.

Putting the case together

Here is the bull case in one place.

Met coal has no real substitute in blast furnace steelmaking, and blast furnaces still make 70% of the world's steel.India is entering a multi-decade steel buildout and is 90% reliant on imported met coal.Rising electricity prices, driven partly by AI data centers, make the electric furnace route more expensive, which favors the coal-based route on pure cost.AI and data center construction is itself adding fresh, durable steel demand.The U.S. government has classified met coal as a critical mineral and a critical material, unlocking permitting speed and tax credits.The golden share in US Steel locks in domestic blast furnace capacity that would otherwise be a shutdown candidate, and that capacity needs coal.Warrior Met Coal and Alpha Metallurgical Resources are both low-cost, low-debt producers that return cash to shareholders through buybacks rather than chasing growth for its own sake.

The other side of it

A fair case has to include the risks, because they are real.

Wood Mackenzie's own numbers show seaborne met coal trade could shrink by more than half by 2050 under a serious decarbonization path, from 378 million tonnes to 142 million tonnes.China, the world's largest steel producer, is a shrinking coal importer, not a growing one, and China still sets the tone for global steel and coal prices.Met coal prices are volatile and cyclical. AMR's own 2026 numbers show margins compressing hard when prices dip.HCC no longer trades at a bargain multiple. Much of the good news is already reflected in the price.Steel decarbonization technology, especially hydrogen-based direct reduced iron, is still early but well funded, and it directly threatens long-run coal demand.

Bottom line

The pieces line up better for met coal than for almost any other commodity right now. Steady India-led demand growth. A U.S. government actively protecting domestic coal-based steel capacity. Rising electricity costs pushing the economics back toward the old blast furnace route, right as AI adds a new source of steel demand. Two well-run, low-cost, shareholder-friendly producers sitting at the center of it.

This is a real, well-supported case for met coal doing well over the next several years. It is not a sure thing and I'm not a financial advisor, so treat this as the bull case laid out honestly, not as personal investment advice. It's worth weighing against the risks above, and maybe a conversation with a financial advisor, before sizing a position.

Investments

0

Rahul Chavan @RahulChavan · 23h ·kept forever

Warrior Met Coal (HCC): Digging Alabama Dirt to Build the Green Future

Rahul Chavan | July 30th 2026

Summary

Warrior Met Coal is a pure play metallurgical coal producer born out of Walter Energy's 2016 bankruptcy, when lenders used a credit bid to acquire the Alabama mining assets debt free. The company doesn't sell to US steel mills, it exports 98% of its coal overseas, with 2023 sales split roughly 48% to Europe, 29% to Asia, and 21% to South America, only 2% stayed in the US. Its entire business rests on one number, the S&P Platts index price for premium hard coking coal, and the gap between that price and its roughly $90 to $100 per ton cash cost to dig it out of the ground.

Business Model

Warrior mines low and mid volatility metallurgical coal from two underground longwall mines, Mine 4 and Mine 7, near Brookwood, Alabama, then ships it 300 miles to the Port of Mobile by rail or barge for export. The coal gets baked into coke, then fed into blast furnaces to chemically strip oxygen from iron ore, a process electric arc furnaces (which dominate the US market) don't need. That's why Warrior sells almost entirely overseas, where blast furnace steelmaking still dominates.

Bull Case

The numbers show extreme operating leverage. In 2020, average selling price was $113 a ton against a $92 cash cost, resulting in a $35.8 million net loss. In 2021, price jumped to over $180 a ton while cash cost barely moved to $96, producing $150.9 million in net income and over $280 million in free cash flow, a swing of roughly $185 million in a single year on cost structure that barely changed. The company also holds a genuine logistics moat: 300 miles to port, the shortest mine to port distance of any US met coal producer, versus Australian competitors shipping around the Cape of Good Hope. The Blue Creek project adds 103 million metric tons of new reserves for a 30 plus year mine life, funded by a $700 million buildout, layered on top of Mine 4's roughly 40 million tons and Mine 7's 56 to 68 million tons of existing reserves. Because the company emerged debt free from bankruptcy with zero legacy pension or retiree healthcare obligations, nearly all free cash flow can go toward growth or shareholders rather than servicing old liabilities.

Bear Case

Production is volatile and labor dependent. The 2021 UMWA strike dropped output from 7.1 million metric tons in 2020 to just 5.1 million tons in 2021, even as prices were rising, showing how a single labor dispute can erase a chunk of a good pricing cycle. The business is entirely tied to one commodity, one export corridor, and one blast furnace steelmaking process that is facing long term substitution risk from electric arc furnaces, hydrogen based green steel, and alternative structural materials like carbon fiber and aluminum alloys.

Risks

A single port dependency is the sharpest operational risk, the McDuffie coal terminal in Mobile sits on a hurricane prone stretch of the Gulf Coast, and a shutdown there halts the entire export pipeline. Underground mining brings constant geological risk: methane outbursts, water flooding, rock faults, and equipment damage. Regulatory exposure runs through the Clean Air Act and Clean Water Act, and since 98% of revenue is export based, the company is also exposed to tariffs and international trade policy shifts. Longer term, hydrogen direct reduction steelmaking threatens to eliminate the chemical need for metallurgical coal entirely, though that shift is likely measured in decades, not years.

Reward

If global steel demand holds up while new met coal mine supply keeps shrinking due to ESG financing restrictions, Warrior sits in a scarcity position as an already operating, low cost producer. Every dollar of price increase in the Platts index tends to flow almost directly to the bottom line given the fixed cost structure, as shown by the 2020 to 2021 swing from a $35.8 million loss to $150.9 million in profit. Blue Creek extends that cash generation runway past 30 years without needing new mine permitting in an environment where new coal mine financing is increasingly hard to secure.

My Take

The most numerically convincing part of this business is the operating leverage: a roughly 60% jump in price from 2020 to 2021 turned a loss into a nine figure profit because extraction cost per ton barely moved. That kind of cost stability paired with a genuine 300 mile logistics advantage is a real, durable edge, not just a story. The single port dependency and labor strike exposure are the two things I'd watch closest, since both have already caused real, measurable production and earnings swings in the historical data, not just theoretical risks.

Disclaimer

This is analysis based on my opinion, not financial advice. I haven't verified the numbers cited (13F details, earnings report, FTC settlement terms etc) against primary sources, so worth confirming those before acting.

(edited)

Warrior Met Coal (HCC): Digging Alabama Dirt to Build the Green Future

Rahul Chavan | July 30th 2026

Summary

Warrior Met Coal is a pure play metallurgical coal producer born out of Walter Energy's 2016 bankruptcy, when lenders used a credit bid to acquire the Alabama mining assets debt free. The company doesn't sell to US steel mills, it exports 98% of its coal overseas, with 2023 sales split roughly 48% to Europe, 29% to Asia, and 21% to South America, only 2% stayed in the US. Its entire business rests on one number, the S&P Platts index price for premium hard coking coal, and the gap between that price and its roughly $90 to $100 per ton cash cost to dig it out of the ground.

Business Model

Warrior mines low and mid volatility metallurgical coal from two underground longwall mines, Mine 4 and Mine 7, near Brookwood, Alabama, then ships it 300 miles to the Port of Mobile by rail or barge for export. The coal gets baked into coke, then fed into blast furnaces to chemically strip oxygen from iron ore, a process electric arc furnaces (which dominate the US market) don't need. That's why Warrior sells almost entirely overseas, where blast furnace steelmaking still dominates.

Bull Case

The numbers show extreme operating leverage. In 2020, average selling price was $113 a ton against a $92 cash cost, resulting in a $35.8 million net loss. In 2021, price jumped to over $180 a ton while cash cost barely moved to $96, producing $150.9 million in net income and over $280 million in free cash flow, a swing of roughly $185 million in a single year on cost structure that barely changed. The company also holds a genuine logistics moat: 300 miles to port, the shortest mine to port distance of any US met coal producer, versus Australian competitors shipping around the Cape of Good Hope. The Blue Creek project adds 103 million metric tons of new reserves for a 30 plus year mine life, funded by a $700 million buildout, layered on top of Mine 4's roughly 40 million tons and Mine 7's 56 to 68 million tons of existing reserves. Because the company emerged debt free from bankruptcy with zero legacy pension or retiree healthcare obligations, nearly all free cash flow can go toward growth or shareholders rather than servicing old liabilities.

Bear Case

Production is volatile and labor dependent. The 2021 UMWA strike dropped output from 7.1 million metric tons in 2020 to just 5.1 million tons in 2021, even as prices were rising, showing how a single labor dispute can erase a chunk of a good pricing cycle. The business is entirely tied to one commodity, one export corridor, and one blast furnace steelmaking process that is facing long term substitution risk from electric arc furnaces, hydrogen based green steel, and alternative structural materials like carbon fiber and aluminum alloys.

Risks

A single port dependency is the sharpest operational risk, the McDuffie coal terminal in Mobile sits on a hurricane prone stretch of the Gulf Coast, and a shutdown there halts the entire export pipeline. Underground mining brings constant geological risk: methane outbursts, water flooding, rock faults, and equipment damage. Regulatory exposure runs through the Clean Air Act and Clean Water Act, and since 98% of revenue is export based, the company is also exposed to tariffs and international trade policy shifts. Longer term, hydrogen direct reduction steelmaking threatens to eliminate the chemical need for metallurgical coal entirely, though that shift is likely measured in decades, not years.

Reward

If global steel demand holds up while new met coal mine supply keeps shrinking due to ESG financing restrictions, Warrior sits in a scarcity position as an already operating, low cost producer. Every dollar of price increase in the Platts index tends to flow almost directly to the bottom line given the fixed cost structure, as shown by the 2020 to 2021 swing from a $35.8 million loss to $150.9 million in profit. Blue Creek extends that cash generation runway past 30 years without needing new mine permitting in an environment where new coal mine financing is increasingly hard to secure.

My Take

The most numerically convincing part of this business is the operating leverage: a roughly 60% jump in price from 2020 to 2021 turned a loss into a nine figure profit because extraction cost per ton barely moved. That kind of cost stability paired with a genuine 300 mile logistics advantage is a real, durable edge, not just a story. The single port dependency and labor strike exposure are the two things I'd watch closest, since both have already caused real, measurable production and earnings swings in the historical data, not just theoretical risks.

Disclaimer

This is analysis based on my opinion, not financial advice. I haven't verified the numbers cited (13F details, earnings report, FTC settlement terms etc) against primary sources, so worth confirming those before acting.

Investments

0

Rahul Chavan @RahulChavan · 23h ·disappears in 6d

📈 Stock Market Recap | July 31

🟢 Stocks capped a wild July with gains: Dow +0.53% to 52,485.03, S&P 500 +0.7% to 7,489.72, Nasdaq +1% to 25,373.85

💻 Amazon rocketed 14-15%, its biggest single-day jump in over a decade, on blowout AWS growth

📉 Apple sank 7-9% as Services revenue and China sales missed, plus rising chip costs

🍏 Big 7 check: Amazon soared, Apple slumped, Meta fell over 9% on an EPS miss, Microsoft cooled a day after a record $450B market cap gain, Nvidia dipped to $195, Alphabet rose on strong earnings, Tesla is weighing a sale or spinoff of its China unit

🥇 Gold: around $4,086/oz, down about 0.4%

🥈 Silver: around $58/oz, down about 1.6%

🔥 Thermal coal: around $130-134/tonne, holding near multi-month highs

⛏️ Met coal: around $218-220/tonne — HCC traded $76.50-$79.60, AMR held near $143

🛢️ Transocean (RIG): $5.26, up 3.5% on Valaris deal optimism

🏆 Big winners: Amazon, Alphabet, Caterpillar. Big losers: Apple, Coca-Cola, Visa

Bottom line: Amazon's blowout quarter and Apple's stumble split the Big Tech story today, while gold and silver cooled off after a strong week.

Quick news

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Rahul Chavan @RahulChavan · 1d ·disappears in 5d

📈 Midday Check | July 31

🟢 Market is up since the open. Dow +0.4%, S&P 500 +0.6%, Nasdaq +0.9%, as strong Big Tech earnings offset rising bond yields.

💻 Amazon is up about 11% on blowout Q2 earnings and strong cloud growth.

🍏 Big 7 check: Amazon leads the pack. Apple is down 7.6% on a weak iPhone sales outlook. Microsoft is flat. Alphabet, Meta, and Tesla are each up about 1%. Nvidia is up 0.8%.

🥇 Gold: $4,086/oz, down about 0.4% today. Overnight gains from the pause in Iran airstrikes have faded.

🥈 Silver: $58/oz, down about 1.6%.

🔥 Thermal coal: holding near $130/tonne on strong Chinese demand.

⛏️ Met coal: near $218/tonne, down almost 2% this week. AMR is up 3.3% to $143.81. HCC is roughly flat near $81.

🛢️ Transocean (RIG): $5.26, up 3.5% as oil prices rise and the Valaris deal spread holds steady.

Bottom line: Big Tech earnings are driving stocks higher today, but rising bond yields are capping the gains.

Quick news

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Rahul Chavan @RahulChavan · 1d ·kept forever

Leverage Kills. Patience Pays. A Look at Aschenbrenner, Buffett, and Jhunjhunwala

Rahul Chavan | July 31st 2026

There is an old rule in investing. You can be smart, you can be right, and you can still go broke. The one thing that ties every blowup together is leverage. The one thing that ties every great fortune together is patience. This week gave us a fresh, painful example of the first rule. It also gave us a good reason to revisit the second.

What happened to Leopold Aschenbrenner's fund

Leopold Aschenbrenner is a young former OpenAI researcher. He became famous for a long essay called "Situational Awareness," which argued that artificial general intelligence was coming faster than most people believed. He turned that thesis into a hedge fund, backed by well known tech investors like Daniel Gross, Patrick and John Collison, and Nat Friedman. He bet big on AI. The bet worked, for a while. His fund reportedly grew from around $225 million to roughly $45 billion, riding a huge run in AI-linked stocks like semiconductor makers and cloud providers.

Here is the part that matters. He was not just betting on AI. He was betting on AI with borrowed money, reportedly around four times his own capital. That means for every dollar he actually had, he was controlling about four dollars of stock. When your bet goes your way, leverage feels like a superpower. Your gains get multiplied. When your bet goes against you, even a little, leverage turns a bruise into a bloodbath.

In late July 2026, AI-linked stocks like SK Hynix and CoreWeave dropped somewhere between 35 and 47 percent. That is a bad month, not a bad decade. Plenty of great investors have sat through drops like that and come out fine. But Aschenbrenner did not have that luxury, because his positions were pledged as collateral against loans from his prime brokers, Goldman Sachs, JPMorgan, and Bank of America. When the value of that collateral fell below what the loans required, the brokers issued margin calls. He needed to post more cash or more securities, fast, or the brokers would sell his positions for him.

He did not have the cash. So on July 30, 2026, his fund sold its entire public stock book, longs and shorts together, in a single block trade before the market opened. The buyer was Ken Griffin's Citadel, which picked up the portfolio at a discount, because that is what happens when you are a forced seller. Aschenbrenner's fund reportedly shrank from around $45 billion to about $10 billion in a matter of days. The one thing he kept was a private stake worth about $5 billion in Anthropic, which was not part of the public, leveraged book.

To be clear about what actually happened: his research was not necessarily wrong. AI stocks had gone up over 1,000 percent under his watch before the crash. The problem was not his judgment about the future. The problem was that he built a position so leveraged that he could not survive being wrong, or even survive a normal, temporary dip, long enough to be proven right.

The same story, explained like you are five

Imagine you have ten dollars. You really believe your friend's lemonade stand is going to be the best one on the block. So you buy ten dollars of lemonade stand tickets.

Now imagine a grown-up offers to lend you thirty more dollars, so you can buy forty dollars of tickets instead of just ten. If lemonade sales go up, you make four times as much money as if you had only used your own ten dollars. Sounds great.

But the grown-up says one thing. "If the value of your tickets ever drops too much, you have to pay me back right away, even if that means selling your tickets when the price is low." One rainy afternoon, fewer people want lemonade, and the price of the tickets drops a little. Not a lot. Just a little. But because you borrowed so much, that little drop is a big problem for you. The grown-up says pay up now. You do not have thirty extra dollars sitting around, so you have to sell all your tickets right away, at a bad price, to someone else who is happy to buy them cheap.

If you had only used your own ten dollars, that rainy afternoon would not have bothered you at all. You would have just waited for sunny days to come back.

That is the whole lesson. Borrowed money makes good days feel great and bad days force you to sell exactly when you should be holding on.

Why long term investing works

Warren Buffett has said that the stock market is a device for transferring money from the impatient to the patient. Good businesses grow in value over years and decades, not days and weeks. But their stock prices bounce around every single day for reasons that have nothing to do with the business itself: interest rate news, a bad headline, a scared seller, general mood swings.

If you own a good business without debt hanging over your head, those bounces do not threaten you. You can simply wait. Time does the heavy lifting. A wonderful business compounds its earnings year after year, and if you hold on long enough, the stock price eventually reflects that. Mohnish Pabrai, who studied Buffett closely, likes to say investing is about a few big decisions, not constant activity. Find a good business, buy it at a fair price, and then do almost nothing. Let boredom be your strategy.

Long term investing also lets compounding work in your favor. A dollar that grows at a steady rate for thirty years turns into far more than most people intuitively expect, simply because growth builds on top of growth. But this only works if you are never forced to sell. Selling early, especially selling at a low point because you have to, is the single biggest way people destroy their own returns.

Why leverage is the enemy of patience

Leverage and patience cannot coexist for long. The whole point of long term investing is that you get to choose when to sell. Leverage takes that choice away from you. A lender or a broker gets to decide, based on a formula, not based on whether your reasoning about the business was right.

This is why Aschenbrenner's story is not really a story about AI stocks being a bad bet. It is a story about the danger of being right on the idea but wrong on the structure. Even Buffett, who has been enormously right about American business for seventy years, has almost never used leverage in a way that could force him to sell. He keeps huge piles of cash on hand specifically so that no one can ever make him sell a good business at a bad time. Charlie Munger put it simply: to get rich, you do not need leverage, you just need to avoid being wiped out. A small chance of a total wipeout, multiplied across a long enough career, eventually catches up with almost everyone who uses heavy leverage. That is the whole moral of the Aschenbrenner story, and it is not new. It happened to Long-Term Capital Management in 1998, it happened to countless investors in 2008, and it happened here in 2026.

Warren Buffett's big bets

There is a well known idea, often traced back to Charlie Munger, that Berkshire Hathaway's extraordinary results did not come from thousands of small, clever trades. They came from a small number of very large, very concentrated decisions, held for a very long time. Munger once said Berkshire's record was built on something like ten or twelve truly good decisions over fifty-plus years, not constant trading.

Look at the current numbers and the pattern holds up. As of early 2026, Berkshire's top five public stock holdings, Apple, American Express, Coca-Cola, Bank of America, and Chevron, made up about 67 percent of the entire public equity portfolio. Apple alone was worth more than a fifth of it. And that is before counting Berkshire's wholly owned businesses like GEICO, BNSF Railway, and See's Candies, which are not even in that public stock count but which have generated a staggering amount of the actual wealth over the decades. See's Candies, bought for $25 million, has thrown off more than $2 billion in profit over time.

The exact number, whether it is four bets or ten or twelve, is less important than the pattern. Buffett did not get rich by owning a little bit of everything. He got rich by finding a small handful of wonderful businesses, buying them without borrowed money, and then simply refusing to sell for decades. That patience, not any single stock pick, is the real skill.

Rakesh Jhunjhunwala's Titan bet

Rakesh Jhunjhunwala, often called India's Warren Buffett, built much of his legend on one stock: Titan Company, the watches and jewelry maker owned by the Tata Group. He started buying Titan around 2002 and 2003, at roughly 30 to 35 rupees a share, when almost no one else was paying attention to it.

Over the next two decades, Titan turned into one of the greatest compounding stories in Indian markets, rising well over 10,000 percent from his entry price. By the time of his death in 2022, Titan was the single largest holding in his portfolio, reportedly making up close to one-third of its total value. That is an enormous concentration for one stock to hold in a diversified portfolio, and it is a big reason his overall fortune, estimated at around 5 to 6 billion dollars near the end of his life, grew as much as it did.

It is worth being precise here, since the numbers get repeated loosely online. Titan was not literally "most" of his $5 billion portfolio in the sense of being over half. It was close to a third, which still made it by far his single biggest position and his single biggest source of gains. The rest of his fortune came from a long list of other holdings, companies like Crisil, Escorts Kubota, Star Health, and several others, plus new ventures he backed directly. But if you had to point to one decision that defined Jhunjhunwala as an investor, it would be Titan: spot a quality business early, take a real position in it, and then simply hold it through twenty years of ups and downs without flinching.

Putting it all together

Three stories, one lesson. Aschenbrenner had a good idea, wrapped it in heavy leverage, and lost most of the value in days when the market dipped and his lenders called. Buffett had good ideas too, wrapped them in patience and zero forced-selling risk, and built one of the greatest fortunes in history over seventy years. Jhunjhunwala did the same thing in India with Titan, buying early, sizing it big, and refusing to sell for two decades.

The difference between these outcomes was never really about who was smarter or who understood the future better. It was about who could afford to be patient. The investors who avoid borrowed money give themselves the right to wait out bad weeks, bad months, even bad years. The investors who lean on leverage hand that right away to someone else, a bank, a broker, a lender, who does not care about your thesis and will sell you out the moment the numbers say so.

If there is one thing worth taking from this week's news, it is this. Find good businesses. Buy them with money you actually have. Then be boring enough, and patient enough, to just hold on.

Leverage Kills. Patience Pays. A Look at Aschenbrenner, Buffett, and Jhunjhunwala

Rahul Chavan | July 31st 2026

There is an old rule in investing. You can be smart, you can be right, and you can still go broke. The one thing that ties every blowup together is leverage. The one thing that ties every great fortune together is patience. This week gave us a fresh, painful example of the first rule. It also gave us a good reason to revisit the second.

What happened to Leopold Aschenbrenner's fund

Leopold Aschenbrenner is a young former OpenAI researcher. He became famous for a long essay called "Situational Awareness," which argued that artificial general intelligence was coming faster than most people believed. He turned that thesis into a hedge fund, backed by well known tech investors like Daniel Gross, Patrick and John Collison, and Nat Friedman. He bet big on AI. The bet worked, for a while. His fund reportedly grew from around $225 million to roughly $45 billion, riding a huge run in AI-linked stocks like semiconductor makers and cloud providers.

Here is the part that matters. He was not just betting on AI. He was betting on AI with borrowed money, reportedly around four times his own capital. That means for every dollar he actually had, he was controlling about four dollars of stock. When your bet goes your way, leverage feels like a superpower. Your gains get multiplied. When your bet goes against you, even a little, leverage turns a bruise into a bloodbath.

In late July 2026, AI-linked stocks like SK Hynix and CoreWeave dropped somewhere between 35 and 47 percent. That is a bad month, not a bad decade. Plenty of great investors have sat through drops like that and come out fine. But Aschenbrenner did not have that luxury, because his positions were pledged as collateral against loans from his prime brokers, Goldman Sachs, JPMorgan, and Bank of America. When the value of that collateral fell below what the loans required, the brokers issued margin calls. He needed to post more cash or more securities, fast, or the brokers would sell his positions for him.

He did not have the cash. So on July 30, 2026, his fund sold its entire public stock book, longs and shorts together, in a single block trade before the market opened. The buyer was Ken Griffin's Citadel, which picked up the portfolio at a discount, because that is what happens when you are a forced seller. Aschenbrenner's fund reportedly shrank from around $45 billion to about $10 billion in a matter of days. The one thing he kept was a private stake worth about $5 billion in Anthropic, which was not part of the public, leveraged book.

To be clear about what actually happened: his research was not necessarily wrong. AI stocks had gone up over 1,000 percent under his watch before the crash. The problem was not his judgment about the future. The problem was that he built a position so leveraged that he could not survive being wrong, or even survive a normal, temporary dip, long enough to be proven right.

The same story, explained like you are five

Imagine you have ten dollars. You really believe your friend's lemonade stand is going to be the best one on the block. So you buy ten dollars of lemonade stand tickets.

Now imagine a grown-up offers to lend you thirty more dollars, so you can buy forty dollars of tickets instead of just ten. If lemonade sales go up, you make four times as much money as if you had only used your own ten dollars. Sounds great.

But the grown-up says one thing. "If the value of your tickets ever drops too much, you have to pay me back right away, even if that means selling your tickets when the price is low." One rainy afternoon, fewer people want lemonade, and the price of the tickets drops a little. Not a lot. Just a little. But because you borrowed so much, that little drop is a big problem for you. The grown-up says pay up now. You do not have thirty extra dollars sitting around, so you have to sell all your tickets right away, at a bad price, to someone else who is happy to buy them cheap.

If you had only used your own ten dollars, that rainy afternoon would not have bothered you at all. You would have just waited for sunny days to come back.

That is the whole lesson. Borrowed money makes good days feel great and bad days force you to sell exactly when you should be holding on.

Why long term investing works

Warren Buffett has said that the stock market is a device for transferring money from the impatient to the patient. Good businesses grow in value over years and decades, not days and weeks. But their stock prices bounce around every single day for reasons that have nothing to do with the business itself: interest rate news, a bad headline, a scared seller, general mood swings.

If you own a good business without debt hanging over your head, those bounces do not threaten you. You can simply wait. Time does the heavy lifting. A wonderful business compounds its earnings year after year, and if you hold on long enough, the stock price eventually reflects that. Mohnish Pabrai, who studied Buffett closely, likes to say investing is about a few big decisions, not constant activity. Find a good business, buy it at a fair price, and then do almost nothing. Let boredom be your strategy.

Long term investing also lets compounding work in your favor. A dollar that grows at a steady rate for thirty years turns into far more than most people intuitively expect, simply because growth builds on top of growth. But this only works if you are never forced to sell. Selling early, especially selling at a low point because you have to, is the single biggest way people destroy their own returns.

Why leverage is the enemy of patience

Leverage and patience cannot coexist for long. The whole point of long term investing is that you get to choose when to sell. Leverage takes that choice away from you. A lender or a broker gets to decide, based on a formula, not based on whether your reasoning about the business was right.

This is why Aschenbrenner's story is not really a story about AI stocks being a bad bet. It is a story about the danger of being right on the idea but wrong on the structure. Even Buffett, who has been enormously right about American business for seventy years, has almost never used leverage in a way that could force him to sell. He keeps huge piles of cash on hand specifically so that no one can ever make him sell a good business at a bad time. Charlie Munger put it simply: to get rich, you do not need leverage, you just need to avoid being wiped out. A small chance of a total wipeout, multiplied across a long enough career, eventually catches up with almost everyone who uses heavy leverage. That is the whole moral of the Aschenbrenner story, and it is not new. It happened to Long-Term Capital Management in 1998, it happened to countless investors in 2008, and it happened here in 2026.

Warren Buffett's big bets

There is a well known idea, often traced back to Charlie Munger, that Berkshire Hathaway's extraordinary results did not come from thousands of small, clever trades. They came from a small number of very large, very concentrated decisions, held for a very long time. Munger once said Berkshire's record was built on something like ten or twelve truly good decisions over fifty-plus years, not constant trading.

Look at the current numbers and the pattern holds up. As of early 2026, Berkshire's top five public stock holdings, Apple, American Express, Coca-Cola, Bank of America, and Chevron, made up about 67 percent of the entire public equity portfolio. Apple alone was worth more than a fifth of it. And that is before counting Berkshire's wholly owned businesses like GEICO, BNSF Railway, and See's Candies, which are not even in that public stock count but which have generated a staggering amount of the actual wealth over the decades. See's Candies, bought for $25 million, has thrown off more than $2 billion in profit over time.

The exact number, whether it is four bets or ten or twelve, is less important than the pattern. Buffett did not get rich by owning a little bit of everything. He got rich by finding a small handful of wonderful businesses, buying them without borrowed money, and then simply refusing to sell for decades. That patience, not any single stock pick, is the real skill.

Rakesh Jhunjhunwala's Titan bet

Rakesh Jhunjhunwala, often called India's Warren Buffett, built much of his legend on one stock: Titan Company, the watches and jewelry maker owned by the Tata Group. He started buying Titan around 2002 and 2003, at roughly 30 to 35 rupees a share, when almost no one else was paying attention to it.

Over the next two decades, Titan turned into one of the greatest compounding stories in Indian markets, rising well over 10,000 percent from his entry price. By the time of his death in 2022, Titan was the single largest holding in his portfolio, reportedly making up close to one-third of its total value. That is an enormous concentration for one stock to hold in a diversified portfolio, and it is a big reason his overall fortune, estimated at around 5 to 6 billion dollars near the end of his life, grew as much as it did.

It is worth being precise here, since the numbers get repeated loosely online. Titan was not literally "most" of his $5 billion portfolio in the sense of being over half. It was close to a third, which still made it by far his single biggest position and his single biggest source of gains. The rest of his fortune came from a long list of other holdings, companies like Crisil, Escorts Kubota, Star Health, and several others, plus new ventures he backed directly. But if you had to point to one decision that defined Jhunjhunwala as an investor, it would be Titan: spot a quality business early, take a real position in it, and then simply hold it through twenty years of ups and downs without flinching.

Putting it all together

Three stories, one lesson. Aschenbrenner had a good idea, wrapped it in heavy leverage, and lost most of the value in days when the market dipped and his lenders called. Buffett had good ideas too, wrapped them in patience and zero forced-selling risk, and built one of the greatest fortunes in history over seventy years. Jhunjhunwala did the same thing in India with Titan, buying early, sizing it big, and refusing to sell for two decades.

The difference between these outcomes was never really about who was smarter or who understood the future better. It was about who could afford to be patient. The investors who avoid borrowed money give themselves the right to wait out bad weeks, bad months, even bad years. The investors who lean on leverage hand that right away to someone else, a bank, a broker, a lender, who does not care about your thesis and will sell you out the moment the numbers say so.

If there is one thing worth taking from this week's news, it is this. Find good businesses. Buy them with money you actually have. Then be boring enough, and patient enough, to just hold on.

Investments

0

Rahul Chavan @RahulChavan · 1d ·disappears in 5d

📈 Morning Brief | July 31

🟢 Stocks rallied Thursday. Dow rose 1.2% to 52,208. S&P 500 climbed 1.7% to 7,438. Nasdaq jumped 2.8% to 25,122. Markets bounced back from the Fed day selloff.

🏦 Fed held rates at 3.5% to 3.75% in a 9-3 vote. Three officials dissented and wanted a hike. It's the first three way hawkish split since 2016.

📅 Microsoft, Meta, and Apple all reported this week. Microsoft and Meta beat big Wednesday night and jumped 16% and 11.5%. Apple beat on earnings Thursday night but guided soft on Q4 revenue, and the stock is falling today. Amazon also reported and jumped 11.7%. Treasury yields are climbing too. The 10 year yield is near 4.74%, the highest since January 2025.

🍏 Big 7 check: Amazon up sharply on earnings. Apple down on weak guidance. Microsoft and Meta still riding Wednesday's pop.

🥇 Gold: around $4,090 an ounce, holding near record highs.

🥈 Silver: near $58 an ounce, choppy this morning.

🔥 Thermal coal: $134 a tonne, up almost 3% on China heat wave demand.

⛏️ Met coal: still elevated for the year, roughly in the $200 to $240 a tonne range. HCC trades at $83.65, AMR at $143.91.

🛢️ Transocean (RIG): around $5.05, up slightly.

Bottom line: Apple's soft guidance and rising yields could pressure stocks today after Thursday's big rally.

(edited)

Quick news

0

Rahul Chavan @RahulChavan · 1d ·kept forever

Top 10 Movie recommendations to watch it online:

Ever spend half your weekend night just scrolling Netflix, Prime, and Disney, still not knowing what to watch? Same here. So I put together my top 10 picks, all streaming online right now. Watch them in order or jump around, but don't skip any. Every one of these will hook you and keep you glued till the end.

1. Oppenheimer (2023)

A physicist builds something he can't fully control, and spends the rest of his life answering for it in rooms full of people who weren't there when it mattered.
IMDb: 8.2
Cast: Cillian Murphy, Emily Blunt, Robert Downey Jr., Matt Damon

2. Nuremberg (2025)
A psychiatrist is assigned to determine if a top Nazi official is fit to stand trial, and finds himself in a battle of wits he didn't expect to lose ground in.
IMDb: 7.4
Cast: Russell Crowe, Rami Malek, Michael Shannon, Richard E. Grant

3. The Imitation Game (2014)
A brilliant, difficult mathematician is handed an impossible problem during wartime, and the cost of solving it turns out to be just as complicated as the puzzle itself.
IMDb: 8.0
Cast: Benedict Cumberbatch, Keira Knightley, Charles Dance, Mark Strong

4. Pressure (2026)
In the final hours before the largest military operation in history, one man's forecast becomes the single decision an entire war might hinge on.
IMDb: N/A
Cast: Andrew Scott, Brendan Fraser, Kerry Condon, Damian Lewis

5. The Trial of the Chicago 7 (2020)
A politically loaded trial turns into a performance, with the courtroom becoming the real battlefield for a country tearing itself apart.
IMDb: 7.8
Cast: Eddie Redmayne, Sacha Baron Cohen, Mark Rylance

6. Bridge of Spies (2015)
A lawyer gets pulled into the coldest corner of the Cold War, negotiating an exchange where one miscalculation could tip into something much bigger.
IMDb: 7.6
Cast: Tom Hanks, Mark Rylance, Amy Ryan

7. Conspiracy (2001)
A group of officials sit down for what looks like an ordinary meeting, and the calm, bureaucratic language they use makes it far more unsettling.
IMDb: 8.2
Cast: Kenneth Branagh, Stanley Tucci, Colin Firth

8. Eye in the Sky (2015)
A modern war room drama where one strike decision gets passed between officials across continents while a countdown quietly runs in the background.
IMDb: 7.3
Cast: Helen Mirren, Aaron Paul, Alan Rickman

9. The Report (2019)
An investigator spends years buried in classified files trying to push an uncomfortable truth past people who'd rather it stayed buried.
IMDb: 7.2
Cast: Adam Driver, Annette Bening, Jon Hamm

10. Darkest Hour (2017)
A newly appointed leader faces the loneliest decision of the war, surrounded by advisors pushing him toward a different answer.
IMDb: 7.4
Cast: Gary Oldman, Kristin Scott Thomas, Lily James