NEWSLETTERS

The US job market continues to chug along despite heightened uncertainty about the economy and how President Donald Trump’s tariffs could shake out.According to the June jobs report, Job growth was solid at 147,000 and the unemployment rate was at 4.1%, down from 4.2%.  Despite the continuation of fairly solid monthly employment gains, the jobs report showed several potentially concerning signs. N early half of the jobs added were from the government sector. Private industry showed only the smallest gains in the last eight months . Additionally, the reduction in the unemployment rate was in part due to the fact that some people left the labor force, whether to retire, or voluntarily quit their jobs. Finally, the average work week for all private non-farm payrolls fell to 34.2 hours in June, down from 34.3 hours in May. This suggests that employers are reducing the hours of their employees. If this is the case, it is likely to see weaker job growth in the months ahead. Perhaps the biggest negative in this report is a slowing in the pace of wage growth. The annualized rate of growth comparing the last three months (April-June) with the prior three (January-March) is just 3.2 percent, down from 3.7 percent year-over-year. According to Brian Bethune, an economics professor at Boston College, "The private sector was clearly losing momentum in the latter part of the second quarter, which does not augur well for the performance of the economy in the third quarter.” Are these potentially concerning issues a real threat to the economy, or is it a necessary “hiccup” required to correct the problems caused by Biden-economics and the inflation that has ravaged the country since 2020? The policies that were implemented during the Covid Pandemic, in which the government paid people to stay home and not work has crippled this economy. Five years later, employers are struggling to find skilled workers who will work for a reasonable wage. In fact, they are struggling to find people who will just show up to work. This has created extreme wage hikes just to get people to show up to work, which is costly to the employer causing him to limit the number of hours his employees can work. For example, pre-Covid, unskilled construction laborers made an average wage of $10-$12 hour depending on their level of skill. Today, that same unskilled worker will not show up to work for less than $25/ hour. This creates an extreme burden on the employer, who now can either only hire one worker instead of two, or has to raise his rates to his customer in order to meet the demand of payroll. Another problem is the inflated interest rates that occurred during the past 5 years. This has caused increases to mortgage payments for those who are purchasing homes. This in turn increases the rent that a landlord has to charge in order to make his rental property pencil out. In Bend, Oregon, an average monthly rent payment for a 3 bedroom/ 2 bath 1500 sq. ft. home pre-Pandemic was between $1200-$1500/ month. Today, that same home would rent for $3000/ month. We all know that the cost of food and groceries have gone through the roof in recent years. The high cost of living makes it almost impossible for workers to accept a “reasonable” wage. They simply cannot live on less than $25/ hour due to the high cost of living. A correction needs to occur in order to get things under control. Wages, rents, mortgages and food needs to become more affordable and reasonable. How this will occur has still yet to be answered. Maybe reducing the work week hours, and reducing wage growth is a start. But the government needs to do their part by not making it so easy for people to not go to work. There are a lot of people who choose to not go to work, because they make more off of their unemployment check than they would going to work. That has to stop! That will just promote laziness and lead to higher unemployment. Both are detrimental to the economy and the country as a whole. Tickers to consider: JTAI , VNRX , ZVSA , FBRX , POAI , PPCB Sylva Disclaimer: https://www.sylvacap.com/disclaimer

Layoffs in 2025 are reshaping the workforce. Government, tech, retail, accounting, manufacturing, and logistics have been dealing with the biggest cuts. Driven by tariffs, cost-cutting, AI adoption, and federal downsizing, these layoffs show a shift in the economy. Government-related layoffs remain the biggest single source of reductions, with more than 284,000 job cuts attributed to direct or indirect impacts of Elon Musk’s Department of Government Efficiency (DOGE). The Retail industry announced 11,483 job cuts in May, bringing their total year to date job layoffs to more than 75,000, up 274% from 2024. Tech Layoffs also surged. According to data by Challenger, Gray & Christmas (CG & C), an outplacement firm, the tech industry holds the bronze medal for most layoffs in 2025. Total layoffs for 2025 hover right at 75,000, representing a 35 year over year surge. Why is this happening? What are the reasons behind the mass layoffs of 2025? Per CG & C, nearly half of all layoffs so far in 2025 have been driven by cuts related to the DOGE’s efforts to reduce government waste, and restore fiscal discipline to the federal government. Another big contributing factor in the layoffs across the sectors is Artificial Intelligence. Tools like ChatGPT, GitHub Copilot, and RPA (Robotic Process Automation) have made several support and low-code tasks redundant. Those who haven’t upskilled to work with AI are the most vulnerable to losing their jobs. This segues into another contributing factor…. employees working in outdated technologies. Many of these employees are being replaced by fewer, highly skilled professionals in AI, Cyber security, and Data Engineering. Today, layoffs are not about performance, but about irrelevance. Finally, thanks to remote work, companies can now hire skilled talent from anywhere. While this is a plus for employers, it also comes with negative consequences such as more pressure for local salaries, more competition for every job, and outsourcing jobs to cheaper regions. How can individuals position themselves to be layoff-proof? Most people would agree that reducing government wasteful spending and restoring fiscal discipline to the federal government is a good thing; therefore those layoffs will probably continue until that gets under control. However, while those government employees may not currently be layoff-proof, they can reinvent themselves to become layoff-proof if they are willing to put in the work. Here are a few tips: Learn future ready skills such as AI, Data, Cloud, etc. Be agile and ready to adapt to cross-functional roles. Upgrade your tech stack regularly through certifications, real world projects, and online courses. Layoffs in 2025 are not just about cutting costs. They are also about realigning talent with the future of work. Tariffs and trade wars are sometimes scapegoats for companies. They may use these trends to conduct firings, pivoting to AI-driven models. If a person is working in outdated technologies, or not adapting to the new AI driven world, then their risks are real. However, opportunities are just as real. Those who take initiative, invest in upskilling, and stay future focused will not only survive, but will thrive. Tickers to consider: JTAI , VNRX , ZVSA , FBRX , POAI , PPCB Sylva Disclaimer: https://www.sylvacap.com/disclaimer

The price of gold has increased rapidly in the months since Trump took office, surging particularly since his April 2 announcement of a baseline 10 percent tariff on all US imports. Gold has often been regarded as a safe-haven asset during times of economic uncertainty. When the economy is shaky, investors put more of their money into gold to preserve their wealth and protect their portfolios. Gold typically has an inverse relationship with interest rates. When interest rates go up, the value of gold often goes down. The reason for this is that higher interest rates make other investments, such as stocks and bonds, more attractive to investors, thereby decreasing the demand for gold and subsequently its price. Should this trend continue, lower interest rates could affect the economy in several ways. Lower interest rates make it cheaper to borrow money. This tends to encourage spending and investments. Lower interest rates will reduce the monthly costs of mortgage repayments. This will leave households with more disposable income and potentially cause a rise in consumer spending. Lower interest rates make it more attractive to buy assets, such as houses, land, vehicles and businesses. This will cause a rise in prices and therefore a rise in wealth. Gold maintains its intrinsic value better than any other commodity. It remains our best barometer of monetary trouble. A sustained rise in gold prices typically signals inflation; a price decline indicates deflation—a shortage of dollars. According to Forbes, The Federal Reserve fundamentally misunderstands inflation. Monetary inflation results from reducing a currency's value, by creating too much of it. Non-monetary inflation occurs when prices rise due to production disruptions: natural disasters, wars, pandemic lockdowns that severed supply chains, costly regulations, or certain tax increases. Gold has climbed over 60% since mid-2023, during the very period when the Fed claimed to be fighting inflation through interest rate hikes. The Fed's flawed thinking lies in its belief that prosperity causes inflation. Per the Fed’s reasoning, in order to lessen inflation, then the economy needs to be slowed. This approach fails to account for non-monetary price changes or the consequences of a weakening dollar. Stabilizing the dollar appears to be a better approach to fight inflation. The Federal Reserve should focus on returning to a “gold-backed” standard for the dollar. By focusing on dollar stability rather than manipulating interest rates, the Fed could end inflation without causing economic contraction. This addresses the monetary cause directly rather than attempting to slow growth—a strategy that inevitably causes unnecessary economic pain. The warning from the gold market cannot be ignored much longer. The question is whether the Fed will heed it before it's too late. Tickers to consider: JTAI , VNRX , ZVSA , FBRX Sylva Disclaimer: https://www.sylvacap.com/disclaimer

On Wednesday, April 2, 2025, President Donal Trump announced new tariffs on nearly all U.S. Trading partners, including 34% tax on imports from China, and 20% tax on the European Union. Responding to what he considered an economic emergency, elevated tariff rates will be placed on several countries that run trade surpluses in the United States and a 10% baseline tax will be imposed on imports from all countries. The purpose behind these tariffs is to boost domestic manufacturing here in the United States, and at the same time bring in hundreds of billions in new revenue to the U.S. government and restore fairness to global trade. Although the President campaigned on this policy, these so-called reciprocal tariffs were much more aggressive than anyone on Wall Street anticipated. The announcement triggered a plunge in the Stock Market. On Friday, April 4, 2025, the S&P 500 closed down 5.97% and the Dow Jones Industrial Average was down 5.5%, both the biggest single-day declines since June 2020 during the COVID pandemic and the Nasdaq Composite dropped 5.8%. Some Trump officials acknowledge that there will be some short- term pain. How much pain before the gain has yet to be determined. According to Trump, these tariffs will force other countries to lower their import fees on U.S. goods and services. That will create a more balanced economic playing field for U.S. exports and a strong incentive for companies to manufacture goods in the United States. In retaliation, China announced on Friday, April 4, 2025, that they will be imposing a blanket 34% tariff on all American products. These tariffs are set to go into effect on April 10, 2025, the day after the Trump tariffs go into effect.  In 1913, the 16th Amendment to the Constitution introduced a national income tax. Prior to this, tariffs supplied as much as 90% of the federal government’s revenue in the mid-1800s. The U.S. moved from tariffs to income taxes to raise more money to finance an expanding government, collect more revenue from the wealthy and make the economy more efficient by reducing trade barriers and encouraging competition. In 2024, tariffs accounted for less than 2% of Federal revenue, 51 % came from income taxes and 36% came from Social Security and Medicare Taxes. Trump would like to replace income tax revenues with tariffs, allowing Americans to keep more of their hard earned money. Goldman Sachs Chief U.S. Equity Strategist, estimates that every 5 percentage point increase in the U.S. tariff rate will cut S&P 500 earnings per share by 1%-2%. This year's estimated 22.5 percentage point increase implies a potential 4.5%-9% cut in S&P 500 earnings from Trump tariffs. Despite a boost to inflation as firms pass through some portion of tariffs to customers, the economic hit will likely prompt the Fed to resume rate cuts. That would proceed tax cuts, which could give the economy a shot in the arm to start 2026. Tickers to consider: JTAI , VNRX , ZVSA , FBRX Sylva Disclaimer: https://www.sylvacap.com/disclaimer

Artificial Intelligence (AI) is the ability of a digital computer or a computer-controlled robot to perform tasks commonly associated with intelligent beings such as learning, problem solving, reasoning, and decision making. AI, and the data centers required, demand more of one thing… Energy. Energy is essential to addressing the challenges of reducing costs on everything from groceries to housing. History proves that economic progress only comes when energy production increases. Long story short, energy fuels the growth that improves people’s lives. AI requires significant computational power primarily due to the complex algorithms and large datasets involved in training and deploying machine learning models. Many AI applications utilize deep learning, which involves networks with multiple layers. Training these networks requires extensive computations, which require large amounts of data for training to improve accuracy and performance. This data must be processed, stored, and analyzed at data centers, consuming a significant amount of computational resources. The more robust the AI workload, the more energy is consumed by the data center. As AI continues to evolve, further advancements in data centers will be necessary to keep pace with its requirements. By 2030, data centers could potentially consume the equivalent energy of New York City's annual energy use. Approximately 60% of that usage would be powered by gas. According to S&P Global, this shift could add 50 GW of gas-fired power to US grids, and increase the natural gas demand by 17%. According to McKinsey & Company, global demand for data center capacity could rise at an annual rate of between 19 and 22 percent from 2023 to 2030 to reach an annual demand of 171 to 219 gigawatts (GW). This contrasts with the current demand of 60 GW, raising the potential for a significant supply deficit. To avoid a deficit, at least twice the data center capacity built since 2000 would have to be built in less than a quarter of the time. Access to power has become a critical factor in driving new data center builds. Without ample investments in data centers and power infrastructure, the potential of AI will not be fully realized. Meeting this demand will require considerably more electricity than is currently produced in the United States. Below are some suggestions to create new solutions to power access and sources. 1 . Investors can funnel investments into utility companies to build out transmission and distribution (T&D) infrastructure in key markets. The demand for data centers and power show no signs of slowing, so T&D markets should respond accordingly. 2. The timeline of building out data centers and those of power infrastructure development can take years. Hyperscalers are building out capacity in new and atypical locations outside the core data center markets because these areas offer cheaper, available power and have the potential for carbon-free infrastructure . Investors have opportunities to fuel growth by accelerating the build-out of fiber or power infrastructure in these secondary locations. 3. Investors can seek to support behind-the-meter solutions to provide power in areas where utilities providers cannot keep up with pace or reliability requirements as local supply availability or transmission constraints worsen. The sites available for these opportunities are limited, but creating more competition and urgency among investors to act sooner than later can help secure the talent, connectivity, and regulatory requirements necessary to run the sites. 4. Investment in clean energy such as solar power or offshore wind. Investment in this space has a long track record, but does have mixed returns. AI has forced the pace of progress. Whether we can provide the energy to keep up with that pace is something only time will tell. Tickers to consider: KALA , EVAX , JTAI , VNRX Sylva Disclaimer: https://www.sylvacap.com/disclaimer

DeepSeek is an AI development firm based in Hangzhou, China. DeepSeek focuses on developing open source Large Language Models (LLM). A large language model is a type of artificial intelligence algorithm that applies neural network techniques with lots of parameters to process and understand human languages or text using self-supervised learning techniques . The company's first model was released in November 2023. The company has repeated multiple times on its core LLM and has built out several different variations. On Jan. 20, 2025, DeepSeek released its R1 LLM at a fraction of the cost that other vendors incurred in their own developments. DeepSeek is also providing its R1 models under an open source license, making it free to use. Deep Seek’s R1 LLM will also have far-reaching impacts for the energy sector. Not only is DeepSeek far cheaper than its rivals, it also claims to be far more energy efficient. This is an important declaration, as data center energy demand growth has recently been pushed to extreme heights thanks to the enormous spread of AI. The scale of these newfound energy needs are so significant that it has single-handedly destroyed the tech sector’s hopes of meeting its own decarbonization goals, placed stress on energy grids around the world, and threatened the energy security of entire nations. The scale of the challenge posed by data center demand poses a serious money-making opportunity for energy providers. “Energy firms ranging from small reactor startups to incumbent utilities to gas producers — and plenty in between — see data centers as a critical U.S. market,” One segment of the energy industry that could potentially benefit from the expected data center boom is nuclear power. Older power plants have been closing across the country for the past decade. Yet, atomic power has seen a surge in interest and investments in the last year, as owners revive shuttered plants and tech companies seek contracts for the electricity. Nikki Hsu, Analyst for Bloomberg Intelligence Utilities, said that power demand is going to climb from homes and factories that are increasingly shifting to electricity. “Demand is definitely going to rise, but by how much, we don’t know,” she said. “Nobody knows exactly what AI demand will be.” Rob Thummel, Senior portfolio manager at Tortoise Capital, asserts that AI will boost natural gas. He alluded that natural gas could steal some of growth from nuclear power developers, since reactors typically take longer to build and are far more expensive than gas plants. “We still think natural gas will be a winner here, primarily because it is the lowest cost from a reliability perspective,” Thummel said. DeepSeek’s efficiency could even lead to more widespread use of AI. According to Carlos Torres Diaz, head of power markets research for Rystad Energy, “if data centers become more efficient, they may end up simply processing more data — making it difficult to model their future energy use.” It is important to remember that if you download Deep Seek, then all of your data will be sent back to China. However, since Deep Seek open sourced its R1 LLM , then it is available to everyone. Venture capitalist and newly appointed AI and crypto czar for the White House, David Sacks, stated in an interview with Fox Business that Perplexity and Ollama are two American hosted companies that will allow you to have access to Deep Seek without sending all your data back to China. Tickers to consider: KALA , EVAX , JTAI , VNRX Sylva Disclaimer: https://www.sylvacap.com/disclaimer

On January 20,2025, this country will inaugurate a new and previous President. This inauguration represents a change in political power in the Executive Branch. How much impact will this transition of power affect the Stock Market? Historically, the U.S. Stock Market tends to struggle a short time after inauguration day. Since the DOW Jones was created in 1896, one of its worst quarterly returns has been the first three months of a President’s term in office , producing an average return of 0.2%. This compares to an average return of 1.9% in the other quarters of the Presidential term. This pattern has been consistent whether or not the incumbent political party won or lost. In Donald Trump’s first presidency, the S&P 500 performed very well. Specifically, the S&P advanced 70% during Trump’s first term, this equates to 14.1% annually. Some analysts are anticipating strong returns in his second term driven by deregulation and tax cuts. In fact, since the creation of the S&P 500 in 1957, the index performed better under President Trump than any other president except Bill Clinton. It is important to remember that presidents do not control the stock market. However, they can influence it by shaping policies that impact the economy. As Trump prepares to be sworn in as the 47th president of the United States, he is set to inherit a strong economy, characterized by robust growth opportunities, low unemployment, and positive financial markets. The agenda of a second Trump administration could have a stimulating effect on the U.S. economy in 2025 and into 2026. Many experts making stock market forecasts for 2025 are convinced that stocks should enjoy not only a rally, but broad-based prosperity. Sameer Samana, a global market strategist at Wells Fargo Investment Institute, noted the importance of the Republicans capturing not only the White House, but the Senate and House of Representatives as well. According to Samana, this red sweep means “more cohesion,” supporting a strong stock market forecast for the coming year. Tickers to consider: IKT , KALA , EVAX , JTAI Sylva Disclaimer: https://www.sylvacap.com/disclaimer

The November election gave the Republicans control of two of the three branches of government. Former President Donald Trump’s victory over Vice President Kamala Harris gave the Republicans control of the Executive Branch and by winning a majority in both the House of Representatives and the Senate, they now have control over the Legislative Branch as well. What will this “Red Sweep” mean for the economy? With former President Donald Trump regaining control of the White House and having majority support in both the House and the Senate, it is more than likely that President Elect Trump’s economic campaign promises will come to fruition. Trump has proposed increasing Federal revenue by imposing tariffs on goods made in foreign countries. He plans on imposing a 60% tariff on all goods made in China and a 10-20% tariff on all goods made in other countries. While some feel that this will hurt US competitiveness, others believe it will encourage the US to manufacture its own goods on our own soil. Leading to another Trump incentive, his proposal to lower the Corporate Tax rate from 21% to 15% for any companies producing goods in the US. Trump has also pledged to renew most of the provisions of the 2017 Tax Cut Job Act (TCJA) , which is set to expire in 2025. He plans on making these provisions permanent, including a higher level for personal standard deductions and lower taxes in most brackets. Trump has proposed several new targeted tax breaks, including an exemption on taxes on both overtime and tipped income. The former president has also proposed excluding Social Security payments from income taxes. He has also proposed expanding the Child Tax Credit from $2000 to $5000.00. President-elect Trump has argued for broad deregulation, which has been supported by the Supreme Court’s decision to repeal the Chevron Doctrine . By overturning Chevron the powers of regulatory agencies have become extremely limited if not potentially non-existent. Big Tech may see mixed impacts from de-regulatory policies, and energy companies stand to benefit most from looser regulations. Additionally, the perception of less anti-trust enforcement could boost corporate Mergers and Acquisitions (M&A) moving forward. In response to the election, Equity markets have rallied strongly, the Treasury yields and the U.S. dollar have surged. Greater policy change under a “sweep” could affect economic growth, inflation and market performance. Time will tell in the months to come how much an effect this sweep will have. Tickers to consider: IKT , KALA , EVAX , JTAI Sylva Disclaimer: https://www.sylvacap.com/disclaimer

The United States will elect a new President on November 5, 2024. This is set to be one of the most important economic and political events in recent history. The outcome of this election will have a major impact on the US economy, and will determine the direction that the US will be traveling toward for the future. The trajectory of the US economy looks very different under each candidate. What will a Trump victory mean for the economy? Former President Trump has made a series of promises to help revitalize the US economy. These promises include changes in the trade policies, eliminating taxes on tips and Social Security benefits, and a proposal to reduce the corporate tax rate. President Trump is confident that these measures will help in restoring employment opportunities, and also cool down inflation. Trump plans to impose a universal tariff of 10%-20% on all imports and as high as 60% on goods from China. He emphasizes that imposing tariffs will protect jobs of Americans and industry workers as this will encourage domestic production and reduce reliance on foreign goods. Trump believes that the tariffs would be absorbed by foreign producers; therefore the rising costs would not affect Americans. Trump also plans to bring back all of the tax cuts that he signed in 2017, and further reduce taxes for individuals and corporations. His proposal includes elimination of taxes on Social Security benefits and also tips. Trump also believes that lowering the corporate tax rate from 21% to 15% would produce more jobs and spur economic growth. Trump also supports strengthening our borders and a mass deportation for undocumented immigrants. This would increase jobs for documented immigrants or Americans, and decrease the country’s financial burden for providing for undocumented immigrants. Undocumented immigrants consume the benefits of living in the United States (healthcare, education, etc.), but do not contribute fiscally (through taxes) for the services that they use. How will the economy be affected if Harris wins the election? Vice President Kamala Harris has been in office for the past four years. During her time in office, inflation has been out of control. The cost of living has significantly increased since Harris has been VP. Over the past four years, grocery prices have increased by 22%, utilities have increased by 28% and the price of new homes have increased by 28%. In a speech she gave in Washington this past week, the Vice President focused on the challenges facing Americans, including high prices for food, housing and childcare. She stated, “I get it.” What she failed to address is that these price increases occurred on “The Biden Watch,” which technically implies “her watch.” Vice President Harris has indicated that she would like to see the corporate tax rate return to 35%. This would mean continued higher costs for corporations and small businesses that are categorized as a corporation (Limited Liability Corporations, S- Corps, and C-Corps). This high tax rate would cause the owners of said companies (whether large or small) to pass their costs onto their consumers. This would probably result in the companies charging more for goods and services that they provide. Ultimately keep prices higher for the average consumer. The Vice President has also promised to keep a Biden promise that those earning less than $400,000.00/ year would be spared any higher taxes. However, she does have a record of favoring steeper taxes, not only for businesses, but also for individuals. She would have to find the money to pay for the expanded social programs that she is focusing on, such as affordable housing , paid leave, and childcare support. It is highly likely that the money for those programs will have to come from tax increases, unless she knows of some buried treasure somewhere. The Vice President has not addressed her thoughts on tariffs. So it is uncertain how she will proceed regarding trade tariffs. Harris does support Biden’s commitment to renewable energy. However, renewable energy investments require more upfront costs. Again, it is unclear where that money will come from. With regards to high grocery prices, Harris has proposed a plan for a federal ban on grocery price gouging during national emergencies . This may help to manage food costs during a time of crisis, but will probably have little impact on prices outside of emergencies. Harris supports current immigration laws and does not support mass deportations. She has signaled support for enhanced border security, but fails to have policies that will strengthen the border. Trump’s policies are very aggressive and bold. While his policies may not be palatable with everyone, he believes that his policies prioritize American industry and independence. Kamala Harris, in turn, is coming from a more passive role as vice president. She plans to build on Biden-era policies with a focus on sustainability and middle-class support. Yet, Harris has still not proposed any tangible actions on her plans, leaving many economists concerned about the viability of her plans. Tickers to consider: IKT, KALA, EVAX Sylva Disclaimer: https://www.sylvacap.com/disclaimer