I like to post contrarian data points. Not advice! See important disclosures here: https://nitter.cf/t.co/MA7VJvMMjU
Dallas, TX
Joined March 2020
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Loic LeMener CFA, CFP® retweeted
US tech giants have raised a combined $387 billion from bond sales since 2025.... sounds like a lot @markets @soberlook thedailyshot.com/subscribe/
This better work...
Loic LeMener CFA, CFP® retweeted
New from Bridgewater: Change Is Accelerating Because It’s All Interconnected
1. Change and concentration are accelerating, increasing the risks of destabilization.
"In the past two years, Nvidia has overtaken Apple to become the most valuable company relative to GDP in history. By year-end, we will have built more compute in the last two years than in the prior six combined, most of it in the US."
Loic LeMener CFA, CFP® retweeted
"Watch CDS, not EPS. CDS and FCF (Free-cash flow) matter more than EPS for Hyperscalers' valuation multiples. A peak in CDS spreads would signal an inflection in FCF and an end to the de-rating cycle."
-Manish Kabra, SocGen
Loic LeMener CFA, CFP® retweeted
"It’s hard to overcome a high starting multiple, even when future growth is robust. The average 50x multiple stock underperforms, even when you only sample companies that also delivered at least 20% p.a. growth"
Source: HOLT
Loic LeMener CFA, CFP® retweeted
Business Insider confirms it: Amazon has warehouses of GPUs that can’t be installed, and is buying them so far in advance that a supply chain team said they “didn’t have a clear forecasted path” to installing them.
businessinsider.com/amazon-2…
Free newsletter: I estimate that ~50% of AI chip sales - $200bn to $300bn+ - are sitting in warehouses, with NVIDIA selling hundreds of billions of GPUs years in advance. Data centers take way longer to build than hyperscalers are leading us to believe.
wheresyoured.at/wherere-all-…
Loic LeMener CFA, CFP® retweeted
Steve Eisman on $NVDA's latest 10-Q: "70% of accounts receivable is from five accounts"
"There's a tremendous amount of concentration risk."
Loic LeMener CFA, CFP® retweeted
Each of the last several decades had a clear winner, an asset that rose so far and so persistently that it came to seem like the obvious place for money.
Each went on to disappoint in the decade that followed.
The pattern is consistent across very different assets:
* Gold rose more than thirteen-fold in the inflationary 1970s, then lost ground through the 1980s as inflation fell.
* Japanese stocks rose nearly six-fold in the 1980s, then lost half their value in the 1990s, beginning a slump that lasted decades.
* The Nasdaq rose roughly nine-fold in the 1990s, then fell 44 percent in the 2000s.
* Emerging market stocks nearly tripled in the 2000s, then barely moved in the 2010s.
In each case, the decade’s winner ended it with the widest following, the most confident forecasts, and the highest prices relative to its fundamentals.
Loic LeMener CFA, CFP® retweeted
PSA on this: stop googling price returns. They’re always wrong. So is Yahoo Finance (unless you look at historical data and the adjusted price column).
Use testfolio, stockcharts.com, koyfin free, Morningstar, portfolio visualizer free, totalrealreturns.com, etc. Your toilet paper is more accurate than Yahoo or Google! Use that if you must.
THANK YOU FOR YOUR ATTENTION TO THIS MATTER!
I don’t know if there’s anything in finance that drives me crazier than price charts. The major news sites report them and so do brokerage firms.
The brokerage firms at least have an excuse - tax reporting between distributed income and capital change. But everyone else using a price chart should be put immediately in jail.
Loic LeMener CFA, CFP® retweeted
You’re not gonna believe this.
5,000 stocks are down 20%+ from their 52-week highs.
And it gets crazier…
Nearly 4,000 are down 40%+.
Think about what that actually means.
While the major indices have held together, underneath the surface thousands of stocks have already been living through their own bear markets.
The index looking fine while individual stocks are getting absolutely destroyed underneath it.
Some seriously messed up shit when you actually look under the hood.
Loic LeMener CFA, CFP® retweeted
I get it, there are nuances for tech-bros who are deep in the weeds. Everyone has an anecdote about why I’m wrong.
Take a step back and be a commodity-bro who’s seen enough supply/demand cycles. Tokens are a commodity. Currently, the token factories are out-stripping token demand. Pricing is the adjustment factor. Except token factories are mostly fixed-price businesses. They have take-or-pay. They have commitments. They will produce tokens at a loss rather than turn off.
I’m not saying that token demand is slowing. It’s still growing at astronomical rates. I’m saying that token production is now out-pacing demand. The cycle will turn when demand accelerates or token production slows. There’s like half a trillion $ of GPUs waiting to be installed. I don’t think token production slows anytime soon.
Yeah, I get it. Jevon’s and all. It’s great for AI consumers and innovators. But the guys owning token factories are gonna all go bust in the process, and that’s like $2T of capex to date. You cannot even restructure these things and crush the debt. They’re just stranded by new, and more efficient chips. They’re always going to be stranded by new chips. More efficient Models will strand the more expensive ones. It’s a race to the bottom against fixed costs. It’s the most godawful business misallocation I’ve seen in a while. Makes the Chinese look like prudent capital allocators🤣🤣
It’s like having iron rails when the new railroads run on steel. This bankruptcy cycle will be epic…
In a normal functioning ecosystem, when the price of tokens drops below the cost of production, the quantity of tokens declines to normalize with pricing. In this case, nothing in AI has any unit economics and you don’t see normalization because everyone is still going full-speed ahead with external funding. (Sort of like shale oil in 2016-2019). Meanwhile, compute prices are based on LT contracts that were signed at above market prices, and are now capital destructive. They’ll eventually catch down to token prices in free-fall.
What we’re seeing here is spot price negatively diverging from term pricing. Usually, when this happens in a cyclical industry, it’s INCREDIBLY BEARISH. Especially when there are take-or-pay contracts that make it difficult to ration supply at prices below cost. What we’re witnessing is a world where losses will accelerate, just as more supply comes online….
Loic LeMener CFA, CFP® retweeted
Absolutely incredible.
Just 10 stocks have driven 70% of the S&P 500’s gain since March 30th.
These stocks have added +16 percentage points to the index’s +23% gain over this period.
Nvidia, $NVDA, has contributed the most, accounting for 13% of the S&P 500's gain, or +3 percentage points.
This is followed by Micron, $MU, Apple, $AAPL, and Microsoft, $MSFT, each accounting for 9% of the S&P 500’s advance, adding +2 percentage points.
Return contributions of AMD, $AMD, and Alphabet, $GOOGL, have been 8% and 7%, respectively.
Meanwhile, the remaining 490 stocks have accounted for just 30% of the S&P 500's gain since March 30th, adding +7 percentage points.
Diversification is dead.
Loic LeMener CFA, CFP® retweeted
Paul Tudor Jones says markets are “literally exactly like 1999,” split between AI adopters and everyone else, and warns the path may be great short term but not long term
“It still feels like 1999: a two-speed market. You’ve got it completely, perfectly bifurcated in the sense that you have everything that’s adopting AI and everything that’s not, and they’re going in opposite directions. That was pretty much the case in 1999.
“I did this conference about a week ago, and we were going through what period this reminded us of. We were talking about 1999. I asked everyone at the conference, ‘How many of you were trading in 1999?’ There were probably 200 people there. It was about 20%.
“I thought, ‘Oh my gosh,’ because for me it’s just so clear that we’re on this path that could be great short term but may not be so great long term. I forget that so many people haven’t lived this.
“We are literally exactly like 1999 in the sense that we have a two-speed economy.”
Jim Chanos explains why this AI boom carries more financial risk than almost any boom in history
“So, my friend Paul Kedrosky, I don’t know if you heard him recently, he had a wonderful point."
"I teach the history of financial-market fraud, but as part of it, we teach financial cycles because the fraud cycle follows the financial cycle, usually with a lag."
"And Paul made a wonderful point. I think he made it on your podcast, that major booms are either credit-related, government-related, technology-related, or real-estate-related."
"He said this is the first one in a long, long time, if not ever. I forget. I think railroads might have been the other one where all four boxes are checked."
"It’s government policy. It’s certainly technology. It’s certainly credit-driven now. And it’s real-estate-related with the buildout of data centers."
"And so you’ve got four giant drivers for this cycle that all need to be harnessed and going in the right direction, and that increases the financial risk that we’ve been talking about.”
