AI

In the absence of official government data, investors are turning to alternative sources to gauge the direction of the US economy. Our analysis of this data suggests that the economy has continued to expand at a moderate pace over the past two months. If the Supreme Court were to strike down the tariffs, this would reduce the near-term odds of a recession while raising the odds of overheating.

Détente between China and the US is a big deal. Economic data continues to give the Fed reasons to cut. What is there to be worried about? Very little. But we chew on some bearish thoughts as we start thinking about 2026.

We discuss which variables we are tracking to assess the risks to the bull market in the absence of government data. So far, we do not see any obvious red flags. Remain overweight on equities and fixed income.

Fresh off a month of boning up on all things AI, we walk through a high-level Q&A discussing AI capex and how much the AI investing boom is really contributing to US growth.

The rush to build AI infrastructure is based on a false premise: that there are significant advantages to being the first to come to market.

Precious metals, corporate credit, and tech stocks are all showing signs of late-cycle euphoria. We identify various trigger points that investors should monitor to turn more bearish.

The most significant divide in the stock market and the economy is the gap between companies positioned to benefit from the AI boom and companies without a link to it. The former are surging while many of the latter are struggling.

Broad GenAI adoption and monetization, alongside falling inference costs, should make hyperscalers’ and enterprise investments worthwhile. While the GenAI boom echoes the dot-com era, it differs in key ways: Valuations are elevated but not extreme, and the rally is still underpinned by solid earnings growth. With few warning signs flashing red, the bull market likely has further to run, though a period of consolidation is overdue.