TMTB EOD Wrap

Good afternoon. QQQs -2% as the “AI disruption pain” has started to spread outside of sw and internet, spreading into property managers and freight logistics yesterday and today.

These are obviously just some big ones that don’t include much of sw, e-commerce, things like ADBE last year, etc. These AI tape bombs making it an incredibly frustrating tape for many unless you are only long memory, HDDs semi-caps, and optical (which I think we all wish was the case). Lots of existential musings today about the future of companies in a world of AI. VK put it well today:

Big problem for the market is that AI has now decidedly become a net negative, pressuring equities in three primary ways: 1) morphing the mega-cap/hyperscaler models in a less favorable (for the stock multiple) direction (more capital intensive, less free cash flow, slower pace of buybacks, margin headwinds, etc.); 2) decimating legacy industries due to fears (mostly imagined, but some real) of disruption and displacement (…