Your Capex is My Opportunity: The AI Capex Cycle Has Replaced the Old Economy Business Cycle

[0:00] Market continues to rally. Uh
[0:05] and despite
[0:07] still more calls for
[0:09] bubbles. I was at a an event in LA and
[0:12] in DC.
[0:14] And in LA, I did hear the bubble talk uh
[0:16] and I even heard people say that it's
[0:19] obvious that it's a bubble. So, we'll go
[0:21] through um
[0:23] how the market's being driven
[0:25] basically only by AI. Uh
[0:28] but that is driving earnings higher,
[0:30] revisions higher, margins to the upside,
[0:32] and
[0:34] we're in the early stages of this. GDP
[0:36] is stronger on the back of AI, and
[0:39] semiconductors are basically leading
[0:40] everything.
[0:42] And when you went go through the
[0:43] earnings reports, it's not just how
[0:44] strong things are. There are now
[0:46] trillions in backlog uh for future
[0:49] growth. So, again, this is the early
[0:51] innings of the AI situation. Now, we
[0:54] start to get into the warning signs that
[0:56] are showing up. We are going to have,
[0:58] despite earnings growing, GDP going
[1:00] higher.
[1:01] There's always negatives that show up.
[1:03] In the beginning of the year, we had the
[1:04] negatives of software, which the stocks
[1:07] are still sitting near the lows of the
[1:08] year. Private equity, those stocks are
[1:10] still sitting at least close to the lows
[1:12] of the year. We still have financials
[1:14] under the 200-day moving average, which
[1:15] is downward. So, don't forget the
[1:18] negatives from AI will show up again,
[1:20] and now we have a lot of the next year's
[1:24] uh earnings already built in with the
[1:25] PEs rising. I'll show some of that in
[1:28] stocks like Caterpillar.
[1:30] And we've got inflation and rates
[1:32] flashing early warning signs. Uh for
[1:34] subscribers, I did a webinar this week,
[1:37] and just so you guys hear it, I uh I on
[1:40] the website, I do have the turbulence
[1:42] model for the week. We
[1:44] finally saw our first uh signal in
[1:46] turbulence. Uh it's not a trigger point
[1:49] yet. It's just an early warning sign,
[1:51] but that's because we're starting to see
[1:53] a breakdown in some correlations across
[1:55] assets, and also the breadth is starting
[1:57] to
[1:58] uh break down. I go through the five
[2:00] layer cake framework and how you guys
[2:02] should be thinking about it. Uh for
[2:04] those of you who are working with me on
[2:07] uh
[2:08] your portfolios and how to navigate
[2:10] through this, particularly uh some of
[2:13] the wealth channels and the RIAs, uh I'm
[2:16] starting to release stuff called
[2:19] benchmark arbitrage. Uh it's an
[2:22] opportunity for you guys to think about
[2:23] how you can navigate through this and
[2:25] still make the money because the
[2:26] benchmarks are completely wrong for the
[2:28] AI world. They are still built around a
[2:31] world of software and partly the
[2:33] industrial and the consumer-based
[2:34] economy, which is gone right now because
[2:36] this is being driven by AI and it's
[2:39] going to stay that way because we're not
[2:40] creating jobs as nominal GDP is growing
[2:42] higher. So, the traditional framework
[2:45] between manufacturing and service or
[2:47] manufacturing and the consumer has
[2:50] broken down and a lot of the stocks and
[2:52] a lot of the business cycles that you
[2:53] guys have been associated with they're
[2:55] just not in there. So, I'll go through
[2:57] the AI business cycle and then I'll talk
[3:00] about chemicals uh and highlight I did a
[3:02] spotlight report on one of the
[3:04] chemicals, but I'm also going to give
[3:05] you more details. There's a new report
[3:07] up and then I'll go through Bitcoin and
[3:10] Ethereum. So, here's the S&P
[3:13] all-time highs,
[3:15] uh no divergences. We've got the Nasdaq
[3:18] or the NDX, the Qs, also just a violent
[3:21] move up to new all-time highs. Small
[3:23] caps new all-time highs. For the month,
[3:26] the S&P one of the best months in the
[3:28] last 25 years. Uh basically it looks
[3:31] like uh number four
[3:33] in the last 25 years.
[3:36] Uh I highlighted the growing risk that
[3:38] whenever we do have a recession, you get
[3:40] the six-month rate of change negative uh
[3:43] as the first warning signal. Uh we've
[3:45] now obviously gone back higher and we're
[3:47] now up 5%. The one thing I would say is
[3:50] uh historically when you've broken down
[3:52] to levels like this and then you get
[3:53] back above,
[3:54] the market's usually fine.
[3:57] Uh so, these are kind of mid-cycle
[3:59] warnings and I think that's where we are
[4:01] because I don't think we're going to
[4:02] have a change in the earnings growth and
[4:04] I don't think we're going to have a
[4:05] change any of this stuff uh it related
[4:08] to AI just because of what I'll go
[4:11] through today.
[4:12] Um Mike Wilson put this out. I think
[4:14] this was a just a good thing. Forward
[4:17] earnings in the S&P, look at
[4:19] look at this acceleration. I mean, this
[4:21] is not a small move. This is
[4:23] the trillions of dollars going into AI
[4:26] that is driving this,
[4:27] particularly stocks like
[4:29] Micron and other semiconductors, but
[4:32] also Caterpillar and things like that.
[4:34] Even the hyperscalers contributing to
[4:35] it.
[4:37] Median stock, no different. Small cap,
[4:39] no different. So, you've got
[4:41] year-over-year earnings forward earnings
[4:42] continue to move higher. Warren Pies put
[4:45] this out and just said estimates growing
[4:47] faster than they did in the mid-90s or
[4:49] late internet bubbles. The boom is
[4:51] unique because it is not coming off an
[4:54] EPS drawdown. And that's really the
[4:56] reality is that normally when we get
[4:57] this kind of acceleration, it's coming
[4:59] out of a recession where you've had
[5:01] earnings down and we've had job uh
[5:04] losses. This is all happening
[5:07] because of the CapEx boom that's going
[5:09] on, which I'll go through. And over the
[5:11] last 15 years, analysts have typically
[5:13] revised EPS down by about 2%. This is
[5:16] the normal average over the 2011 to 25
[5:19] period of EPS revisions as we go through
[5:21] the year.
[5:23] This is what's happened this time. So,
[5:24] this is the reason why stocks are going
[5:26] higher, margins continue to go higher.
[5:29] And if you want to look at it again,
[5:31] margins, same thing. Um forward,
[5:35] up here. Trailing, I mean, we're just
[5:37] talking about something that hasn't
[5:39] happened before. Revisions, which had
[5:41] started to eek down. This is overlaid
[5:44] with the PMI. We got the PMI number,
[5:46] went sideways, didn't shoot higher, Uh
[5:49] but I'll show some other things on this.
[5:51] But the revisions This is
[5:53] this white line here is the 10-week
[5:55] average, but this was the most recent
[5:58] week. We're back right up. So
[6:01] PMIs are going to remain strong.
[6:02] Francois put this out this week in
[6:04] LinkedIn and just highlighted that the
[6:06] regionals are very strong. We didn't get
[6:08] a follow through. This is the new orders
[6:09] category. We didn't get anything on the
[6:12] PMI, but the the breadth of the
[6:14] regionals is very strong. We got capital
[6:16] goods.
[6:17] The core capital goods year-over-year
[6:20] just exploding higher associated again
[6:22] with the PMI close to 60. And here are
[6:25] the PMIs. So capital goods continue to
[6:28] be there. I still have a lot of people
[6:29] that are fading the economy and that's
[6:31] because they're focusing on things
[6:33] related to the consumer.
[6:35] Here's Caterpillar. I don't know how you
[6:38] look at arguably the most important
[6:40] industrial stock
[6:41] and not see that this is doing the exact
[6:44] same thing as what we just looked at and
[6:45] this really started after liberation
[6:47] day. But to be honest with you, it
[6:49] started in the second half of the year
[6:50] and as I go through things, this
[6:51] coincides with when DRAM went higher.
[6:53] This is when the data center build-out
[6:55] really started to kick in. It is still
[6:57] early in this, guys, and it's going to
[7:00] continue. In their earnings report, we
[7:02] ended the quarter with a record backlog
[7:05] with excellent visibility into demand
[7:07] over the coming quarters. Backlog now
[7:08] stands at 62 billion. I'm going to show
[7:10] you backlogs for the hyperscalers, but I
[7:13] think when you're getting into
[7:13] Caterpillar and you're dealing with this
[7:15] kind of demand, you can just take it
[7:17] another level. Strong demand for large
[7:19] power generation equipment used in data
[7:21] centers supporting AI was a contributor.
[7:24] The AI boom is spurring additional
[7:25] construction. We now expect sales for
[7:27] power generation equipment to be roughly
[7:29] three times larger by 2030.
[7:33] We are closely monitoring macro econ. So
[7:35] the reason I want to bring this up,
[7:36] guys, historically, if you were seeing
[7:38] these types of things and this is what
[7:39] you're going to see people talk about,
[7:41] well, this is a problem and we're going
[7:42] to have overbuild and all of these
[7:45] things that happen um which
[7:47] traditionally I would say make sense and
[7:49] that's why Caterpillar, the orange line
[7:51] here, is their PE ratio.
[7:54] Forward.
[7:55] So, they're trading at 36 times next
[7:57] year's earnings. The green line here
[7:59] though
[8:00] is Nvidia.
[8:02] So, Nvidia is at 10-year lows in their
[8:04] forward PE. The reason I want to bring
[8:07] this up is historically if you get one
[8:10] of these scenarios up here, it's either
[8:12] coming out of a recession or it's some
[8:15] This is after oil went down to 10 and
[8:17] then you start to move lower. I don't
[8:19] think this is going to happen this time.
[8:21] I think multiples are going to stay at
[8:22] higher levels for what they just said,
[8:24] which is this demand is going to
[8:25] continue into 2030 and that's because
[8:27] it's being funded by
[8:30] the revenues that are happening within
[8:31] side
[8:33] AI, which you have to remember everyone
[8:35] who said we'll get no revenues and now
[8:37] the backlog for three hyperscalers is
[8:39] 1.3 trillion and we're running at an
[8:42] annualized run rate of 30 billion for
[8:46] uh for Anthropic and most estimates are
[8:49] 50 to 100 by the end of the year. The
[8:52] KOSPI, one of the important signs of
[8:54] this whole thing
[8:55] mainly because they have the semis uh in
[8:58] terms of memory, but they have tons of
[9:00] electronic side in there and they also
[9:02] have the heavy equipment, which I
[9:03] showed. So, the KOSPI is directly
[9:05] related to
[9:07] this build out. There's the machinery
[9:09] component, so it's not just semis of the
[9:11] KOSPI.
[9:13] Hyperscalers made new high. This is
[9:14] equal weight. Again, it's kind of
[9:16] lagging and it's just up here, but
[9:18] Google had a move a 10% move higher,
[9:20] Meta had a 10% move lower. I still
[9:22] believe shorting the hyperscalers as a
[9:25] way and being long all of the
[9:27] thematic portfolio I have is still going
[9:29] to work out extremely well going forward
[9:31] uh because that's the spenders and then
[9:34] on the other side you have the buyers
[9:35] now or the receivers. Here are the
[9:38] numbers for the cloud backlog.
[9:41] 400 460 400 Uh you're dealing with 1.3
[9:46] trillion dollars of backlog for these
[9:48] three companies, Amazon, Google, and
[9:51] Microsoft.
[9:53] That's revenue.
[9:54] Those are contracted
[9:56] dollars that right now they can't get
[9:59] because
[10:00] they don't have the capacity. And that's
[10:02] where the issue is right now is the
[10:04] shortage. Uh
[10:06] The hyperscaler is absolutely crushing
[10:07] it right now, and it goes through all
[10:09] the different components. I'm only
[10:11] bringing that up again because it's very
[10:13] hard if you're going to have on the one
[10:14] side all the semis and all the the
[10:16] receivers going, but at the same point
[10:18] you have the hyperscalers showing that
[10:19] adoption is happening at a much faster
[10:21] pace than people anticipated. It's very
[10:23] hard for the market not to have strength
[10:25] when these components are doing well.
[10:28] The buildout is uh the beta. The
[10:30] hyperscalers are just kind of market
[10:32] performers this year. They're actually
[10:34] underperforming by a couple percent when
[10:36] you equal weight them. Uh so, we're just
[10:38] in that scenario. I did do a market
[10:40] update video this week that the
[10:42] subscribers saw, which went through just
[10:45] the warning signs, a lot of which uh fit
[10:47] in with what I'm going to show here,
[10:48] which is we had a breakout in
[10:51] unleaded gas futures. So, this is this
[10:53] week. So, if you haven't been paying
[10:55] attention, I know Iran's moved to the
[10:56] back burner. Forget about it being about
[10:58] Iran and just think about it being
[11:00] a signal for inflation, and a signal for
[11:02] future growth coming down. Those are the
[11:04] two things that historically will impact
[11:05] stocks. When you add in the fact that
[11:07] we've had a massive rally, and people
[11:09] are very much in the market, you end up
[11:11] in the exact situa- uh situation that
[11:13] normally causes an issue because now
[11:15] people are in the market, and it might
[11:18] not be all institutions, but you do have
[11:21] a lot of people in. This is And again, I
[11:23] showed you gas futures. That was 6-month
[11:26] or September. This is September, as
[11:28] well. So, it's not just that we had a
[11:30] move higher in energy, it's that the
[11:33] back months are starting to go up, which
[11:36] means this problem is going to last
[11:38] longer, which means the inflation
[11:39] component, I mean just look at where
[11:41] this is, go back to the gas side, you're
[11:43] talking about now a significant move
[11:45] that if we're in September and we've got
[11:47] prices up around $87,
[11:50] you've got a bigger issue because now
[11:52] you're going to have this year-over-year
[11:53] CPI.
[11:55] And again, I've talked about it being
[11:56] above 4%. I think the risks are growing
[11:59] the longer the strait remains closed
[12:00] that this gets up even higher. Here is
[12:03] uh gas at the pump, which shot higher
[12:05] last week, and again, this is a a a
[12:08] straight line higher, and yes, it does
[12:11] come at a time when we're seeing a
[12:12] straight line higher
[12:13] in profit margins, so that's where the
[12:16] offset is, but again, this reminds me a
[12:19] lot when you have nominal GDP going
[12:20] higher and inflation going higher.
[12:23] This is very 1970-ish in terms of that
[12:25] side. Uh we're not creating jobs, we've
[12:28] got
[12:29] no job creation. We'll see what happens
[12:31] when we get into the stuff next week
[12:33] because it does look like we could have
[12:36] uh a surprising number in the payroll
[12:38] side, if for no other reason, just the
[12:40] claims data plus the ADP weekly. We're
[12:42] not seeing that in the manufacturing
[12:44] PMIs, their employment component went
[12:46] lower, uh but it's just something to
[12:48] keep on. Diesel prices sitting near the
[12:51] highs, so this is diesel prices
[12:54] across the country.
[12:56] The inventory side is is now at that
[12:58] point that people warned about, and so
[13:00] all the energy side, this is from
[13:02] Goldman Sachs, is basically saying under
[13:04] the three scenarios of when it starts,
[13:07] we're past late April. Uh so, let's go
[13:10] to mid-May. This is where they're saying
[13:12] the global inventories would be are
[13:13] likely to reach all-time lows even if
[13:15] the strait opens by late May.
[13:18] Um to show you how the market is not
[13:21] prepared for this, I wanted to use
[13:22] Chevron. Uh on the weekly call, I I
[13:25] mention that uh one of the places that
[13:27] I'm starting to add is in the chemicals
[13:29] and the energy which I believe will are
[13:32] are lower beta
[13:34] parts of this. And the reason is because
[13:36] they're not part of the buildout.
[13:38] They're kind of mid-cycle to late-cycle.
[13:40] I'll show you that in terms of the AI
[13:41] side. The early cycle is really the
[13:43] semis, the optical fibers, and all the
[13:45] stuff that went through it. But, let's
[13:46] just take this as what it is. You've got
[13:49] this
[13:50] when oil was down here
[13:53] uh and again, we're using September oil
[13:55] prices which matters the most for the
[13:57] energy stocks.
[13:58] You were around 66 bucks. Well, now
[14:01] you're up at
[14:03] almost 90.
[14:04] Chevron's basically unchanged from where
[14:06] we were before the war.
[14:08] So, just remember that um there's been a
[14:10] lot of movement. Oil's gone higher, but
[14:13] the energy stocks haven't. And again, I
[14:14] think that's because right now the focus
[14:17] for everyone trying to make money is on
[14:19] the stuff that's working on the long
[14:20] side and chasing all of these names
[14:22] which are related to the semiconductors,
[14:24] the optical fiber, all of the names that
[14:26] are in my thematic portfolio just
[14:28] continue to rip higher to all-time
[14:31] highs, and that's what's driving the
[14:32] market. And I think the earning side has
[14:34] been a lot of the enthusiasm. But, now
[14:36] that we're through the bulk of it, I
[14:38] think maybe you should worry about the
[14:40] things that I mentioned. And like I
[14:41] said, I am now getting more turbulence
[14:44] uh signals. If I get any intraweek this
[14:46] week, I will put them up. If I get any
[14:48] signal that says that just like we had
[14:51] in early February that we've hit a
[14:52] trigger point across assets, where
[14:54] deleveraging starts, I will send that
[14:56] out as a special video update. Um
[14:58] airlines would be an obvious candidate
[15:00] for something to go on. And remember,
[15:02] they've fallen off and they're sitting
[15:04] here. So, kind of the opposite of the
[15:05] Chevron thing,
[15:07] uh the airlines would be the number one
[15:09] risk. You start to see things. And B of
[15:11] A put out this week that air travel
[15:12] travel has slowed substantially.
[15:15] Uh
[15:16] we'll see where this goes. But again,
[15:17] when you start getting into the price
[15:19] moves in the inflation side, you should
[15:20] see a demand response. We got the uh PMI
[15:23] this week and here was the prices paid.
[15:26] I mean, we're basically in stratosphere
[15:28] levels associated with, you know, oil
[15:31] was up at 155 during here before the
[15:33] great financial crisis. And then
[15:35] obviously we had the shutdowns and
[15:37] before that it's very hard to find times
[15:39] where you get prices paid in there at
[15:41] these levels.
[15:43] Uh China
[15:45] there's all kinds of stress going across
[15:47] there.
[15:48] Exporters are raising prices on
[15:49] swimsuits, ski suits. Basically, all the
[15:51] Chinese exports are starting to show it.
[15:53] Fuel inflation's about to hit the
[15:54] kitchen table. We've got crop prices
[15:56] that are breaking out. So, the futures
[15:58] are finally starting to move. They're
[16:00] late cycle of in the inflation side
[16:02] related to oil as the fertilizer prices
[16:05] are higher and then the crop prices
[16:07] eventually go higher. So, you should
[16:08] start to see that. Um this will be the
[16:11] next uh I'm always looking for the next
[16:13] fear-mongering thing of, you know,
[16:15] scaring people and so
[16:17] now we've got not only the fertilizer
[16:19] issue from the gas, but they're
[16:21] forecasting the strongest El Niño in 150
[16:25] years
[16:26] with droughts and all kinds of things.
[16:28] If we get any of that, just remember
[16:30] again, you're looking for things within
[16:32] side the market that could have an issue
[16:34] and cause the next wave and I do think
[16:36] this is the 1970s. So, I think you have
[16:38] to focus on the government is shoving
[16:40] money in the system. We're growing and
[16:43] even though we aren't creating jobs, if
[16:45] we start creating jobs, then I think
[16:47] they have to build rate hikes in. As of
[16:49] now, we've started to build in some rate
[16:51] hikes or at least one into next year
[16:54] after this week, but I think we have to
[16:56] pay attention. The inflation swaps
[16:58] this is another part of the warning part
[17:00] of the video. I mean, we're we're moving
[17:02] higher. Um last time we were at these
[17:04] levels, we had CPI
[17:07] kind of
[17:08] where you associate up here the fears of
[17:10] us getting back in the four or five
[17:12] handle. So, I think the inflation swaps
[17:14] are going higher and long-term yields,
[17:16] they're contained in the US. This chart
[17:18] just looks like eventually it's going to
[17:19] break higher,
[17:21] um, 5%. Michael Hartnett came out and
[17:23] said that's where he expects, uh,
[17:25] problems to be. The government's been
[17:26] trying to keep this below 5%. Obviously,
[17:29] you've got the housing issue if you get
[17:30] above five. Well, right now 30-year
[17:31] yields are sitting just below five and
[17:34] 10-year yields still sitting in this
[17:36] triangle formation. Uh, again, I think
[17:39] you have to watch this. That would be a
[17:40] risk that would come.
[17:42] And we already have it spreading. So,
[17:44] this is 10-year GGB yields, which have
[17:46] broken out to new highs.
[17:48] Uh, we also have gilts. So, 30-year UK
[17:52] yields have broken out to new highs.
[17:54] Uh,
[17:56] the breadth is bad. This is one
[17:58] measurement. Goldman Sachs warned about
[18:00] this. I think it's a good one. The
[18:01] median stock is currently still 13%
[18:04] below
[18:06] its 52-week high. Uh, there are about
[18:08] 50% of the S&P stocks that are that are
[18:10] down on the year. So, despite the
[18:12] all-time highs, it's not being
[18:15] seen with a lot of contribution. Uh,
[18:18] this was an interesting one just because
[18:21] the Nasdaq 100 closed up more than
[18:23] more than half a percent, fewer of the
[18:25] 29% of the stocks, uh, ended up being
[18:29] up. Last time that happened has not
[18:32] happened in at least 20 years. These are
[18:33] all from Jason Gephart, and I think he
[18:36] does a good job of just highlighting
[18:37] when you get these issues of breadth. On
[18:39] Monday, the S&P closed at a record high.
[18:41] The next day at least 1% more stocks hit
[18:44] a 52-week low than high. Uh, that is
[18:46] also not normal. Just shows it's being
[18:48] led
[18:49] by very few companies, and more
[18:51] importantly, it's probably being led by
[18:53] a lot of small and mid-cap names, uh, in
[18:55] terms of what you're seeing on the
[18:57] screen. And inside the S&P, it is a lot
[19:00] of the names that are related to the
[19:01] semis and uh, infrastructure side.
[19:04] Financials, as I mentioned,
[19:06] still below. They've tried to work
[19:08] higher, but they've stayed below.
[19:11] And I just want to bring this up because
[19:13] this is where I think the issue is going
[19:15] to be before the year the end of the
[19:17] year.
[19:18] Elon Musk warns the US could soon be
[19:20] producing more chips than we can turn on
[19:22] and China doesn't have the same issue.
[19:24] So, he said this at the World Economic
[19:26] Forum at the beginning of the year. He
[19:28] said it on Moonshots. I've reported it
[19:30] twice.
[19:31] This is becoming more and more of a
[19:33] reality. So,
[19:35] early cycle, you hoard and buy as many
[19:38] chips as you possibly can
[19:40] in expectation of what you're going to
[19:42] need
[19:43] and as the compute is ramping up,
[19:46] everyone's buying more because there's
[19:48] more compute that's needed. But again,
[19:50] we don't have the compute right now. So,
[19:52] we're starting to run into issues and
[19:55] semis have just accelerated. So, I just
[19:58] wanted to make sure that we get into
[19:59] this point of where we are. If you're
[20:02] not invested in semiconductors, they are
[20:04] now the biggest
[20:06] level two gig in the S&P at $10
[20:08] trillion.
[20:10] Uh media, software, tech,
[20:13] diversified financials. And again, this
[20:15] is level two, so it strips it out. And
[20:17] this is why when you're looking at tech
[20:19] and how tech is driving everything, it's
[20:21] not tech that's driving everything. It's
[20:23] semis, which happen to be in tech when
[20:25] you have a level one gig. When you
[20:27] separate them out, semis are the biggest
[20:29] contributor. And if you don't have a big
[20:31] weighting in them, and again, if you
[20:33] equal weight this, it's even bigger
[20:35] because of that $10 trillion, about half
[20:37] of it is Nvidia, which is one of the
[20:38] worst performing of the semis this year.
[20:41] So, this is being driven by the other
[20:43] semis. This is something I presented at
[20:47] the event in California.
[20:50] So, the prior 15 years was about your
[20:52] margin is my opportunity. The next 15
[20:55] years is about your CapEx is my
[20:57] opportunity. And this is the five-layer
[21:00] cake that Jensen Huang speaks about for
[21:02] the $90 trillion.
[21:04] This is why this won't stop, guys. It's
[21:06] being funded by these companies that
[21:08] were the best that made all the money.
[21:10] So, everyone meta, Tesla, Amazon,
[21:14] Google, just go through the list. They
[21:16] are the ones funding this buildout. $90
[21:20] trillion. Now, it's also going to
[21:21] involve Morgan Stanley, Goldman Sachs,
[21:23] Eli Lilly, Merck, all of the big
[21:25] companies that need AI are also going to
[21:27] be funding this cuz they're going to
[21:29] need their own data centers as well.
[21:31] That's why the 90 trillion is just the
[21:33] beginning. We've only started this. So,
[21:36] this is where you want your portfolio to
[21:37] look like. The problem is the way the
[21:39] portfolios are set up, these are the
[21:41] heaviest weights, the spenders. So, for
[21:44] you RIAs that are looking for what you
[21:46] need to do, this needs to be a higher
[21:48] weighting than what's actually in the
[21:50] weighting.
[21:52] The business cycle has changed. So, this
[21:54] is what everyone looks at. This is what
[21:56] had historically happened.
[21:58] What you're seeing right now is it
[21:59] doesn't matter if oil goes higher. It
[22:01] doesn't matter if the Fed doesn't cut
[22:03] rates, which had been expected. It
[22:05] doesn't matter if jobs aren't being
[22:07] created. The money is still being spent
[22:09] and there's a new cycle that's
[22:11] happening. The early cycle is the
[22:12] semiconductors. The mid cycle is the
[22:14] power, the data centers. We have to get
[22:16] this done. So, you're starting to see
[22:18] the transports go higher and that's
[22:20] because now we're finally in the
[22:21] buildout stage. They've hoarded the
[22:22] semiconductors and as Elon Musk said, if
[22:25] this doesn't come in, we got a problem.
[22:27] Well, once we finally do start getting
[22:29] this built out and we actually can meet
[22:31] some of those RPOs, which is going to
[22:32] take another
[22:34] year to two years, then we'll start
[22:36] getting into the late cycle, which will
[22:38] be the humanoids. This is when AI will
[22:40] be the strongest and this is when we
[22:42] will start solving problems.
[22:44] This is why I'm writing a paper on the
[22:46] benchmark is late.
[22:48] The time where this matters is when I
[22:49] talk about the supersonic tsunami. When
[22:53] something changes rapidly, you end up
[22:56] with an obvious benchmark arbitrage. So,
[22:58] benchmark arbitrage for traders ends up
[23:01] being the ad deletes uh around the
[23:03] Russell or the S&P, but this one is
[23:06] different. The benchmark is completely
[23:09] weighted improperly for the future.
[23:12] Um a lot of the winners back here, if we
[23:14] go back into the Dan Ives and Cathie
[23:17] Wood world of what they've brought to
[23:19] the retail and the RIA world, a lot of
[23:21] that has the software companies in there
[23:23] because those were the winners of the
[23:25] past cycle.
[23:26] This is a non-tech story.
[23:30] That thing I showed you, semiconductors,
[23:32] those are not pure tech. We have their
[23:34] hardware. We've got the hardware names.
[23:36] We have the commodities. All of this is
[23:38] a different story. Chemicals,
[23:41] those are not thought of as AI names,
[23:42] but they are. So, again, here's the
[23:44] breakdown of the way that I did the
[23:46] five-layer cake specifically for this.
[23:48] You have the rack.
[23:49] So, up here, the rack,
[23:52] the advanced packaging is the best one,
[23:54] and then uh you've got the optical. So,
[23:57] these three are the early cycle. This is
[23:59] what was ported. You had the deals with
[24:01] Meta buys uh 6 billion of Corning's
[24:05] fiber. You've got all these deals that
[24:07] Jensen has done with both optical fiber,
[24:09] coherent light, but also
[24:12] Marvell. All of these different places
[24:14] are the semi side. Then, when you move
[24:16] down here, this is the chemicals. So,
[24:18] chemicals have had a good run, and I'm
[24:20] going to go through the chemicals in
[24:21] more detail because they're a big part
[24:23] of this on both the tubing side for the
[24:26] fiber, and also the advanced packaging.
[24:28] The issue is these guys are more
[24:30] mid-cycle. They're a little bit more
[24:31] steady. So, this is lower vol, and then
[24:33] you have the power side. The power side
[24:35] does include Exxon and Chevron and Bloom
[24:37] Energy, but it also includes a bunch of
[24:40] different components, and then some
[24:41] things that I think are going to be
[24:42] brought into the mix related to
[24:43] batteries. So, those are the reasons why
[24:46] I've chosen the five, and here's the
[24:47] S&P. So, if you're overweight these by
[24:50] even 10%,
[24:52] and you're reducing the S&P by 10%,
[24:55] you're getting an outperformance, and
[24:57] this is what people need to do. This is
[24:58] why I'm starting to do swaps with
[25:00] clients so that they have the ability to
[25:02] invest in this stuff. This is just an
[25:04] important thing, and the reason that
[25:05] I've set up those thematic portfolios
[25:07] for you guys. Um here is all of them as
[25:09] a thematic uh the thematic basket as a
[25:12] portfolio, and I just wanted to
[25:14] highlight. The white line here is the
[25:15] S&P. The yellow line here is the
[25:17] hyperscalers. They've still
[25:18] underperformed the S&P, and then you
[25:20] have software. This is the way the world
[25:22] is weighted today. That's why the S&P is
[25:25] is dragged down here. A lot of these
[25:26] names are in the mid-cap, small-cap, and
[25:28] overseas. That's why you've seen the US
[25:31] underperform international over the
[25:33] course of the last uh 16 months.
[25:36] Uh I've been pounding the table over and
[25:38] over again as this AI agent megatrend
[25:40] moves. So, again, when you're looking at
[25:42] these parabolic moves, including the
[25:45] hyperscalers uh and
[25:48] Anthropic, it's all because of AI
[25:50] agents. This all changed, and again,
[25:51] this is why on the one side, why did
[25:53] software get killed? Because of Volpe's
[25:55] 4.5. Why did all of a sudden the
[25:57] adoption start to increase? Because of
[25:59] Volpe's 4.5. Cuz that's when the agentic
[26:01] world took over. This is not some
[26:02] speculation. This is triggered by an
[26:04] actual event, and that is the reason why
[26:06] my thematic portfolio has gone straight
[26:08] up because it is geared towards the
[26:10] agent world. The thing I will say is
[26:12] that has just started. So, are we going
[26:15] to have corrections, and will it stay
[26:16] this parabolic? No, we'll have
[26:17] corrections, of course. The issue is for
[26:20] people that are looking for correction,
[26:22] these numbers are just going to
[26:23] accelerate. We barely have that much
[26:25] adoption happening. It's going to
[26:26] increase dramatically. And if you think
[26:29] about where Anthropic is today, and
[26:30] they're forecasting 50 to 100 billion by
[26:32] the end of the year,
[26:34] and they're at 30,
[26:36] that's a compounding number. We are
[26:38] going to continue to have excess demand
[26:41] because as OpenAI said this week,
[26:43] there's not going to be enough compute
[26:44] in the world to meet the demand. So,
[26:46] think about all of the people, Michael
[26:48] Burry, the people that wrote all of
[26:50] these papers about how it's a bubble.
[26:52] Just go back and think about it. That
[26:55] was 6 months ago. So, how could people
[26:57] be invested in here? I still hear people
[26:59] saying they've seen a bubble, they know
[27:00] what a bubble looks like, this is a
[27:01] bubble.
[27:02] Open eyes revenue chief says enterprise
[27:04] business is accelerating. I have used
[27:07] chat GPT 5.5 more than Claude for this
[27:10] entire week. While I was in LA, it is a
[27:13] phenomenal model. All of the visuals and
[27:15] the images you're seeing were done that
[27:17] by GPT 5, all of the new ones.
[27:20] I only use Nano Banana for about 9
[27:23] months.
[27:24] I've not used Nano Banana once because
[27:26] this imaging is off the charts compared
[27:28] to that. And this is by far the
[27:30] smartest, the most intelligent by far
[27:34] model that I've used. Um
[27:37] Thomas Kurian, the CEO of Google's cloud
[27:40] Google Cloud regarding compute. I think
[27:42] for the next 10 years there will always
[27:43] be more demand than supply.
[27:46] Take a picture of it, save it. Before
[27:49] you go to bed every night, read it
[27:50] again.
[27:51] This way you don't make the mistake of
[27:53] listening to the people who will
[27:54] continually tell you that there's a
[27:56] bubble being thrown. Some White House
[27:58] officials also worried that Anthropic
[28:00] wouldn't have enough
[28:01] access to compute to serve that many
[28:04] more entities. So, the question that's
[28:06] becoming there, when you see the
[28:07] benchmarks of 5.5, it's pretty much
[28:10] right on Mythos.
[28:11] So, the question is, was this
[28:13] advertising for Mythos? Was this a
[28:17] slowdown because they didn't have enough
[28:18] compute and they wanted to get some
[28:21] positive press out of this to say
[28:23] they're
[28:25] I'm going to go with the latter for
[28:26] sure.
[28:28] Uh why Google and Amazon are betting
[28:29] billions on Anthropic. These deals are
[28:31] as much about compute and infrastructure
[28:33] as they are about capital.
[28:34] I don't think they have enough compute
[28:36] for what's going on. Uh just talked to a
[28:37] lab with a war chest balance sheet, they
[28:39] are actively contract actively contract
[28:42] compute across all major clouds and
[28:43] Neos. No one has any material capacity
[28:46] coming online between now and September.
[28:48] Hourly compute pricing is going much
[28:51] higher in the coming 5 months.
[28:53] The cost of compute is far beyond the
[28:55] cost of the employees, an Nvidia
[28:56] executive says right now. This was this
[28:58] week.
[29:00] I was quoted a couple times in the
[29:01] Atlantic article. Here we go.
[29:04] We went from AI is a bubble to there is
[29:07] not enough compute in the data centers
[29:08] in less than 6 months.
[29:11] It's agents.
[29:12] Uh here's the chart of those RPOs again.
[29:15] Just look where it started.
[29:17] OpEx 4.5.
[29:20] Looking ahead, the strong results
[29:22] reinforce our conviction to invest the
[29:23] capital required to continue. Anyone
[29:26] who's worried that the CapEx won't come
[29:30] I just showed you how much they are
[29:32] behind. The CapEx is not only coming, it
[29:35] will continually be revised higher.
[29:40] CapEx consensus, just looking at all of
[29:43] these numbers.
[29:45] If you think for a second we're near the
[29:47] end of this, um I will say I overheard
[29:49] commentary
[29:51] uh with people
[29:53] hedge funds at this event, major pension
[29:56] event, and just listening to the
[29:57] conversations, the number one reason
[29:59] that this is an overbuild now
[30:02] is because magically we're going to come
[30:04] up with some efficiency gain that will
[30:07] allow
[30:09] I I don't know how you can look at these
[30:11] charts and not realize there's no such
[30:13] thing as an efficiency gain which will
[30:15] stop this. In fact,
[30:17] what we have had only over the last 3
[30:20] years is efficiency gains. That's all
[30:22] we've had. We've been able to use the
[30:24] compute we have and get the progress
[30:26] faster, and now the adoption is kicking
[30:28] in. And the adoption is kicking in
[30:30] because the agents are here. The agents
[30:32] use far more.
[30:33] So we're going to be constrained. So go
[30:35] back to the benchmark arbitrage.
[30:38] You're if you're thinking that this is
[30:40] an overbuild and you're using history
[30:42] then you're using the industrial
[30:43] consumer cycle to make a decision on
[30:45] what's going on and that includes the
[30:47] dot dot com bubble guys.
[30:49] The dot com bubble was a quarter of a
[30:51] century ago.
[30:53] Before the iPhone.
[30:55] Do not listen to the bubble heads.
[30:59] Severe shortages of Taiwan semi's most
[31:01] advanced processes are pushing an all
[31:02] out effort to build blah blah blah.
[31:04] Taiwan semi one of the constraints if
[31:06] you guys haven't drawn the map on it,
[31:08] you got three end results of what we
[31:11] need. We've got Intel, we've got Samsung
[31:13] and we've got Taiwan semi.
[31:15] Uh Elon Musk basically bought up all of
[31:17] Samsung's production a year ago or not
[31:20] even a year ago and he now is out there
[31:22] doing terrafab cuz he realizes we're not
[31:24] going to have compute ever.
[31:26] Again, I can say it over and over again.
[31:28] We are not catching up. Semis are going
[31:30] to be needed. This is a completely
[31:32] unique situation. Now,
[31:36] Nvidia stock has been able to go higher
[31:38] while I just want to highlight how much
[31:41] the multiples have gone down. So at the
[31:42] end of this month we'll get theirs but
[31:45] I would say at this point no one
[31:46] believes the compute story because
[31:48] Nvidia has gotten cheaper and cheaper
[31:51] and cheaper. This week
[31:53] the White House admitted we are in
[31:55] trouble with compute. So they're putting
[31:57] in
[31:58] section 303 the Defense Production Act
[32:01] to help with grid infrastructure
[32:02] equipment and supply chain capacity
[32:04] because we are falling behind China and
[32:05] we don't have enough compute. They don't
[32:07] want to use anthropic cuz we don't have
[32:09] enough compute.
[32:11] Uh US spending on power plant equipment
[32:13] expected to triple through 2030s. Again,
[32:16] power
[32:17] is the base of the five layer cake.
[32:20] Uh the Compass data center is pulling
[32:22] out of Virginia.
[32:25] We still have bottlenecks going on that
[32:27] are preventing this and it's going to be
[32:29] an election issue in the midterms.
[32:30] Voters do not want AI and they do not
[32:33] want data centers.
[32:34] Uh Uh, I released this this week on the
[32:37] power semiconductors as the next
[32:39] scarcity trade.
[32:44] It was a reminder that this is the
[32:45] report I put up last week into the
[32:47] subscriber level about the edge as we're
[32:50] getting into and that power semis were
[32:51] in there. You got six companies uh that
[32:54] I highlighted in there.
[32:56] Uh, this came out. Lead times for power
[32:58] semiconductors have become extremely
[32:59] stretched because of AI servers. Again,
[33:02] the reason that the power
[33:05] semiconductors are so important is
[33:07] because they fit both inside the edge
[33:10] side and the power side. This is really
[33:13] important from the efficiency, from the
[33:14] thermal, all of these different
[33:16] components.
[33:17] And here's a chart of those six names,
[33:20] um
[33:23] that I put out in the power semis that
[33:24] are in that report. So, there's two
[33:26] things I want you to look at. Yes, it's
[33:27] gone completely parabolic over the
[33:29] course of the last 2 weeks.
[33:30] But secondly, it just broke out of a
[33:32] 5-year high, just now.
[33:35] So, massive up week again.
[33:38] But again, it just broke out. Now,
[33:42] here's chemicals.
[33:44] Again, mid-cycle, late-cycle, whatever
[33:46] you want. Um, this is the European
[33:48] chemicals overlaid with one of those
[33:50] power semis, Texas Instruments, which
[33:52] just broke out. If I showed you the the
[33:54] power semis, it would look very similar.
[33:56] Chemicals will go up with power semis.
[34:00] They fit into the exact same side. So,
[34:02] as a reminder again, back to the themes,
[34:05] here are the the power names, here are
[34:07] the chemical names. You want to be
[34:08] focused
[34:09] on the late cycle part. Uh, this is a
[34:12] report I just put up uh this weekend.
[34:15] You guys can see it already. Uh, the
[34:18] chemical layer of AI. I go heavily into
[34:20] the 17 names, which I did as a thematic
[34:23] portfolio. But now I go one by one, just
[34:25] like I did for the Kentucky Derby
[34:27] handicapping.
[34:29] Uh, and this breaks them down by
[34:30] exposure scores for early, mid, late
[34:32] timing, and the the investment logic
[34:35] behind both. Again, these are not
[34:38] suggestions on which ones to buy. Same
[34:40] thing as when I released a spotlight on
[34:43] Integris. This is not a timing thing,
[34:45] but these are ones that to me are going
[34:47] to benefit the most over the course of
[34:49] the next few years. I'm not trading
[34:51] these things, but I'm buying them. I
[34:53] bought Integris this week after this
[34:55] report came out, after the earnings
[34:57] knocked the stock down.
[34:58] Uh I bought
[35:00] the stock at that point, and I will
[35:02] continue to look for particular names in
[35:04] there. Kamorsis is another name within
[35:06] there, which I've said to many of you I
[35:08] thought would double this year. Well,
[35:09] we're almost there. Uh I think we're up
[35:11] 50% We might be close to double now at
[35:14] this point, but uh I still think it has
[35:16] a ways to go. All of these names on the
[35:18] chemical side are involved, and you've
[35:21] got advanced packaging, and you have
[35:24] the optical fiber and the tubing side on
[35:26] the polymers. My argument on this stuff,
[35:28] and what I'm writing a report on, is on
[35:30] the energy intensity for chemicals at
[35:33] this stage of AI
[35:34] instead of oil. Oil does not have the
[35:37] same importance in today's world for a
[35:39] variety of reasons, but one of the major
[35:40] things is how chemicals to me are going
[35:42] to become far more important because of
[35:44] the size of the terrafab. What Elon Musk
[35:48] wrote out, the amount of chemicals
[35:49] needed. That is not an oil trade. So,
[35:52] when you're building these things,
[35:53] you're taking a lot. So, the chemical
[35:55] side to me is a major theme that will be
[35:57] in a long-term bull market.
[35:59] Compounded Friends had a great interview
[36:01] this week with my boy Adam
[36:04] uh
[36:05] Parker, and uh I thought he did a great
[36:07] job. I just want to highlight some of
[36:09] the things that he said.
[36:12] He basically said, "Here's the sequence
[36:14] he laid out from the opening software
[36:15] discussion." So, first the market
[36:17] compresses the multiple. That's what we
[36:19] did. The market cuts the valuation
[36:21] first, then the fundamentals start
[36:22] disappointing. What usually happens next
[36:24] is an an miss.
[36:26] He says, "Analysts still have models
[36:28] that assume things like roughly 80%
[36:30] gross margin, similar margins in 2027,
[36:33] 2028, 2029, very little structural
[36:34] change profitability. His argument that
[36:36] those are too static for an AI disrupted
[36:38] world. After earnings misses come sales
[36:41] misses.
[36:42] Multiples contract, then earnings miss,
[36:44] then eventually sales miss. Why would
[36:46] earning Why earnings would break first,
[36:48] margin pressure before revenue pressure?
[36:51] His reasoning is that software companies
[36:53] may need to spend more to stay
[36:54] competitive in AI.
[36:57] Regardless of your view on this, you
[36:59] have to really start to remember this
[37:00] gets back into that benchmark arbitrage.
[37:03] If you're along the S&P 500, you are
[37:05] long salesforce.com and Adobe and all of
[37:07] these companies as a much higher weight
[37:10] than the future says they should be. If
[37:12] for any reason these things were
[37:13] disrupted to the manner they are,
[37:16] you would see a very, very large fall. I
[37:19] didn't include this in this week's
[37:20] video, but Naval Ravikant, who I really
[37:22] enjoy, he has a podcast, I believe it's
[37:25] Naval. Um, he talked about Apple in a
[37:27] very similar way. He was very negative
[37:29] on Apple and he basically talked about a
[37:31] lot of the things that have to do with
[37:33] terminal value. We are at a massive AI
[37:35] disruptive phase. The certainty is that
[37:37] we will need more power, we will need
[37:39] more optical fiber, we will need more
[37:41] compute.
[37:44] We don't need software companies the way
[37:46] we did.
[37:47] We don't need a company like Apple for
[37:49] the infrastructure as this changes
[37:51] unless they can find a way to go through
[37:53] this. Naval was very strong in this. I
[37:55] find him to be one of the
[37:56] most clear-headed thinkers on any of
[37:59] this, not making bombastic comments. You
[38:01] should go listen to it. I thought it was
[38:03] very good. Um, here's IGV versus the
[38:05] S&P. So,
[38:07] if this was like last year out of
[38:09] liberation day, you would have seen
[38:11] software trade with its normal beta. So,
[38:13] here it is the collapse. Everyone who
[38:15] told you, "We got to go in here. We got
[38:16] to buy these." This is wrong. Every
[38:19] single tech person, and I'm not going to
[38:21] go through the names anymore. That said,
[38:24] this is a mispricing. This is panic.
[38:26] Well, now you've had a fall, you've had
[38:28] a rally.
[38:29] Adam Parker's right, in my opinion.
[38:33] Uh what he said on semis for Adam
[38:34] Parker, he thinks investors
[38:36] underestimate how much estimates were
[38:38] wrong. And again, that's the point.
[38:39] That's the only way you can have Nvidia
[38:42] at the multiples it is, and Micron.
[38:44] Micron, the multiples were just wrong.
[38:47] So, the fact that it still trades at a
[38:48] five PE off next year's earnings, and
[38:50] you've had a massive beat, Micron's too
[38:52] cheap. And he makes his argument
[38:53] specifically on this. He thinks Micron
[38:56] is a perfect example of why it makes
[38:57] sense, something like 4.5 times next
[39:00] year's earnings. The product is in
[39:02] shortage. Earnings are being revised
[39:03] sharply higher.
[39:05] Micron is not a mean behavior. It is the
[39:07] market repricing to a much stronger
[39:08] earnings path. Again, Benchmark
[39:10] arbitrage. Do not listen to the bubble
[39:12] talk.
[39:13] Bitcoin, to finish off. Um all right,
[39:16] the MACD, we're
[39:18] despite it being boring and having
[39:20] really no movement, remember, we're just
[39:23] getting these MACD weeklies. We're just
[39:25] breaking through some resistance.
[39:28] We've had now one week, two week, three
[39:30] week, four week, and then this week kind
[39:32] of finished around where we are.
[39:36] Um meaning we're up at uh we're getting
[39:38] close. We're unchanged from last week.
[39:41] We are trying to move higher, and we're
[39:43] coming from a level that normally would
[39:45] be explosive when it finally does go.
[39:47] Uh Anthony Pompliano, on our weekly this
[39:49] week, did mention something in talking
[39:51] to someone about Korea. Korea, which is
[39:53] a major trading hub,
[39:56] and especially for Bitcoin,
[39:58] uh this seems to be an issue. So, this
[40:00] is the Asia growth story.
[40:02] And basically, this is Bitcoin overlaid
[40:04] with it. Right now, everyone in Korea
[40:06] and Asia is trading the AI trade.
[40:08] Bitcoin has lost interest.
[40:10] But the good thing is, it's found a way
[40:12] to move from 60,000 up to 80,000.
[40:15] Well, that's a 33% rally from the lows,
[40:18] so it is moving. Uh it's doing better
[40:21] than software. It's doing better than
[40:22] the Asian growth story.
[40:24] If for any reason we start to see any
[40:26] turn in these things, maybe we can get
[40:28] it higher, but then again, like I've
[40:29] said, my trigger point is the fact that
[40:31] I think CPI is going above 3-month
[40:33] yields. The Fed's not going to be able
[40:35] to
[40:36] uh raise raise rates or cut rates,
[40:39] whatever you want. We're going to be
[40:40] stuck. You have a new Fed chair who's
[40:42] coming into the most
[40:44] dislocated situation. You got Powell
[40:46] staying on board. This just argues for
[40:48] just chaos going forward and a period
[40:51] where they're going to run it hot with
[40:52] rates at lower levels and inflation up
[40:54] at higher levels. We get anything on the
[40:56] jobs picture that moves uh
[41:00] long-term rates higher, short rates
[41:01] can't go higher. The Fed's not raising
[41:03] rates. So, we'll see what happens. Uh
[41:05] but I would keep it in Clarity Act, some
[41:07] positive news. Also, that could be a
[41:10] very big catalyst for this. What really
[41:12] needs to happen is retail needs to just
[41:14] jump on board. And if they do jump on
[41:16] board,
[41:17] go through. I mentioned that I bought
[41:18] MicroStrategy calls uh into the end of
[41:21] the year. I wasn't targeting short-term
[41:23] cuz I think this could take a little bit
[41:25] longer and I'm targeting when inflation
[41:27] gets above 3-month yields.
[41:29] But, PMIs are moving higher. 3-month
[41:31] yields are stuck where they are. The
[41:33] Fed's not move I think all of these
[41:35] things gone. Um on that same podcast
[41:37] with Adam Parker,
[41:39] uh
[41:40] the other person
[41:43] I I brought this up just because I
[41:45] thought it was really interesting that
[41:47] you're starting to see a change and I've
[41:49] believed that Ethereum is the main
[41:51] important story for the rest of the
[41:53] year. If the Clarity Act does go through
[41:54] and as I show you, there are positive
[41:56] developments that are happening on
[41:58] stablecoins and you're starting to get
[42:00] more and more people talk about Ethereum
[42:02] because
[42:04] there is a way to value it.
[42:06] The usage of the network is what creates
[42:08] value. All of these things in here,
[42:11] programmable.
[42:13] So, you get into the coding side.
[42:14] Everything with Ethereum gives people a
[42:16] chance to use discounted cash flow. And
[42:18] in a world where growth assets are dead,
[42:21] I will say this to RIAs again. I will
[42:23] say this to the mutual funds that watch
[42:24] this. You guys that are benchmarked
[42:28] Ethereum and Bitcoin need to be part of
[42:30] your portfolio and they need to be part
[42:31] of your growth asset basket or
[42:33] allocation. I wrote this in Substack
[42:36] about killing the float, the beginning
[42:39] of programmable money
[42:40] programmable money and the new financial
[42:42] guardrails where this goes through the
[42:44] DoorDash decision.
[42:46] Uh and their decision to basically take
[42:49] stable coins in and what this means and
[42:51] how this is different than the legacy
[42:53] system which took forever
[42:55] and how the new codebase system of
[42:58] programmable money has started. Here's
[43:00] the Ethereum chart. We keep running into
[43:03] this 200-week moving average. Uh we've
[43:06] broken the downward trend line, but
[43:08] until we again, I've said it before
[43:10] until we're above 2400. In this case,
[43:12] that line is 2456. I want two closes
[43:15] above that level. Uh we've got a buy
[43:17] signal down there, but right now we
[43:19] haven't gone anywhere.
[43:20] Uh
[43:22] and that's it for this week, guys. So, a
[43:24] lot of stuff in there. Uh thanks to
[43:26] everyone uh who saw me in LA and DC. I
[43:30] appreciate it. For those of you who want
[43:32] more details on any of the stuff here,
[43:34] uh just go to the website for uh 22V.
[43:38] And if you want if you always look at
[43:40] YouTube, I put the link in there. They
[43:42] go directly to the website and see some
[43:44] of the stuff on the subscriber list. See
[43:45] you next week.