橙子Joyce

@Zheng Qian—Four Stripes 2

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Tesla and SpaceX merger countdown?

Tesla’s 2026 annual shareholder meeting must be held no later than December 6. While a merger of this kind would bring some financial synergies, its real value lies in the vertical integration of the two companies’ artificial intelligence (AI) technologies.

SpaceX and Tesla already have several business ties and overlapping investor groups, and both companies are led by Elon Musk. The rocket manufacturer has purchased more than $100 million worth of Tesla Cybertrucks, while xAI is a major customer for Tesla’s utility-scale batteries.

The two companies are also working together on a chip manufacturing project called Terafab. The project will produce semiconductors for Tesla’s electric vehicles, robotaxis, and Optimus robots, as well as a chip designed exclusively for SpaceX’s orbital AI satellites.

Musk has recently discussed various ways his two largest companies could interact and integrate. On the latest earnings call, for example, he said that Tesla and SpaceX “overlap in many areas.”

The possibility of a Tesla/SpaceX merger has increasingly become the market consensus. Although an announcement of a Tesla/SpaceX merger could be delayed until late October or even early November, if it slips into that window, securing shareholder approval for the acquisition at the annual meeting would become significantly more difficult.

Investors and analysts have long widely expected the two Musk-owned companies to merge, especially after SpaceX completes a record-breaking IPO this year. Reports in January said SpaceX had considered merging with Tesla, but ultimately decided to acquire Musk’s AI startup, xAI.

The main obstacle to any deal would be a shareholder vote, as shareholders of both Tesla and SpaceX may need to approve the merger.

“In the vote at Tesla’s 2025 annual shareholder meeting, about 11% of the total shares eligible to vote were ‘broker non-votes,’ which were effectively counted as ‘against’ votes. We expect Tesla to try to increase shareholder participation in a potential vote on a SpaceX merger.”

Are rate-cut expectations about to “cool off”? U.S. September CPI surges—will the Fed raise rates again in October? What does this mean for the crypto market?

Three key takeaways and their potential impact on the crypto market:
1️⃣ CPI exceeds expectations: Inflation rebounds across the board

* Month-over-month and year-over-year increases: In September, CPI rose 0.6% month over month (up from 0.4%) and 3.7% year over year (up from 3.4%).

* Inflation spreads: Price pressures have spread beyond the energy sector to a wider range of industries, raising concerns that “core” inflation could become entrenched.

* Odds of a rate hike rise: According to CME’s FedWatch Tool, the market-implied probability of a Fed rate hike in October has jumped from 22% to 37%!

2️⃣ Fed officials are divided: Hawkish and dovish voices coexist, while a “wait-and-see” approach prevails

* Daly (President of the San Francisco Fed): Inflation risks remain elevated, and further rate hikes may be needed—although there is no immediate need to act at the October meeting.

* Goolsbee (President of the Chicago Fed): Expressed serious concern about recent upward pressure on prices.

* Bowman (Fed Governor): Believes the Fed still has time to assess the delayed effects of previous rate hikes on the economy and financial markets.

3️⃣ “Beige Book” sounds a warning: Fuel costs are intensifying price pressures

* Labor market: Showing signs of stagnation—new hiring has declined, but layoffs have also fallen. * Regional inflation: Several districts reported “strong” or “accelerating” price increases; meanwhile, persistent uncertainty has also weakened businesses’ optimism about the future. The crypto market’s perspective: What potential impact could this have?

* Short-term liquidity pressures: Rising rate-hike expectations typically push up Treasury yields and the U.S. Dollar Index, potentially creating macroeconomic headwinds for Bitcoin (BTC) and the broader crypto market in the short term.

* Safe-haven and inflation-hedge properties: If high inflation persists and fiat currencies continue to lose purchasing power, the narrative of Bitcoin as “digital gold”—an effective inflation hedge—could regain attention in the market.

$LLY.US