A very busy afternoon as we await Micron earnings, about an hour removed from a big Fed decision that didn't move rates but said a lot about where the Fed is at.

The big headline is Fed Chair Jay Powell basically saying 'I'm not going anywhere, we're going to wait until all this stuff is resolved.' This helps explain market reaction: stocks under pressure, yields moved up.

The ball moves to Janine Piro and Senator Tom Tillis regarding Fed chair nomination process. If we don't see a nomination soon, Jay Powell stays and it's messy - a messy succession plan for the most important financial institution in the world.

Market losses accelerated once Jay Powell started speaking. Broadest based sell-off in S&P 500 all year long: Dow down 1.4%, Nasdaq down 1.5%, Russell 2000 down 1.6%. All 11 sectors in the red.

Most S&P names lower, all sectors red. Brent crude climbing back to intraday highs around $109/barrel. Yields on 2-year highest since August.

Micron Q2 adjusted revenue $23.86B vs estimate $19.74B, adjusted gross margin 74.9% vs estimate 69.1%, cash flow $11.9B vs estimate $8.93B.

Year-over-year comparison: cash flow was $3.94B a year ago, revenue was $8B a year ago vs $23-24B now.

Q3 revenue outlook $32.75B-$34.25B vs street estimate $23.66B.

Sanjay Mehrotra says this is Economics 101 - all about supply and demand. Micron set new records across revenue, gross margin, EPS and free cash flow driven by strong demand environment, tight industry supply and strong execution.

Stock only up 0.9% despite more than doubling revenue in most recent quarter and guidance for 50-60%+ more growth next quarter.

Investors want clarity on pricing and whether current trends continue, which affects margins. Stock was up 390% over last 12 months, 65% year-to-date.

Nvidia is 17% of Micron's revenue according to Bloomberg terminal supply chain function, so maybe some of this was priced in due to visibility through other companies.

Shift from building large language models to inference phase benefits memory chips like Micron's DRAM. Last quarter issue was demand exists but capacity doesn't.

Analysts will ask how long manufacturing expansion takes and where we'll be in cycle when it completes (maybe 2028). Business historically cyclical but now in structural phase.

Bloomberg story: Micron offering positive forecast after surging memory chip prices. Global shortage likely to persist 4-5 years due to semiconductor production constraints.

At some point, high prices work against companies when customers can't afford it. Middle East disruptions could create more upward price pressure on key chemicals and supplies.

Nvidia has pricing power because no one else can produce what they do. As long as Nvidia maintains moat and controls prices, Micron can keep increasing prices.

Nvidia's biggest customers (Lenovo, Microsoft, Dell, Apple, Amazon) have money to spend, tapping debt markets. None have said they can't afford this spending.

Big question is how much Nvidia will rely on Micron for new high bandwidth memory (HBM4) component.