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- Amazon lays off 16,000 employees and closes Fresh/Go stores amid AI spending pressures.
- Bank of America lowers AMZN price target to $286 but sees 18% potential upside.
- Dollar collapse warnings from Peter Schiff drive gold demand and global reserve shifts.
Amazon (NASDAQ: AMZN) is under scrutiny after announcing it will cut 16,000 jobs as part of a strategic push to streamline operations. Human Resources Chief Beth Galetti said the layoffs are aimed at “reducing layers, increasing ownership, and removing bureaucracy.” The e-commerce giant is also closing its remaining Fresh grocery stores and Go markets, moves that come as Amazon seeks to balance heavy investments in artificial intelligence.
Bank of America has revised its outlook on Amazon stock, lowering the price target from $303 to $286. Analysts cited concerns over workforce reductions, store closures, AI-related spending, and growing competition from both offline retailers and other e-commerce platforms. Despite the lower target, AMZN is trading around $243, suggesting a potential 18% upside if the revised forecast holds.
AI Investments and Market Headwinds
Amazon’s heavy AI spending is a double-edged sword. While positioning the company for long-term growth in cloud computing and e-commerce automation, the short-term impact on margins has alarmed investors. AWS, Amazon’s cloud arm, remains a revenue leader, but client cost optimization and regulatory scrutiny are affecting profitability.
Economic uncertainty, tariffs on imported goods, and rising operational costs add further pressure, making investor sentiment cautious. Market watchers are now closely evaluating whether these strategic moves will pay off in stabilizing profits or if further adjustments are needed.
Dollar Collapse Worries Add Market Volatility
Adding to the market unease, economist Peter Schiff has issued stark warnings about the U.S. dollar, predicting a collapse worse than the 2008 financial crisis. Schiff highlights structural weaknesses in the U.S. economy and the diminishing confidence in the dollar’s reserve status. Global central banks are responding by buying gold at record rates, with prices surpassing $5,000 per ounce.
Also Read: Did Amazon Really Negotiate 5B XRP? Community Reopens a Decade-Old Rumor
Investors are increasingly questioning whether gold could replace the U.S. dollar as the world’s primary reserve asset. Citadel CEO Ken Griffin and JPMorgan’s Jamie Dimon have echoed concerns, suggesting gold is emerging as a “safe harbor” investment amid rising inflation and sovereign risk. This shift signals a potential long-term realignment in global reserves away from U.S. Treasuries toward precious metals.
Navigating Uncertainty
Amazon’s strategic cuts and AI investments, coupled with global concerns over the U.S. dollar, create a complex landscape for investors. While AMZN still shows potential upside, broader economic shifts, including the dollar’s weakening, may influence market behavior in unpredictable ways. Investors are advised to watch both company fundamentals and macroeconomic trends closely.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
I’m a crypto enthusiast with a background in finance. I’m fascinated by the potential of crypto to disrupt traditional financial systems. I’m always on the lookout for new and innovative projects in the space. I believe that crypto has the potential to create a more equitable and inclusive financial system.
