Nvidia Struggles, Analyzing Intel, and Eric Adds 3 New Stocks to the Portfolio

It's been a huge week in AI investing news, but our AI Investor Podcast co-hosts have put as much of the craziness as possible into just one episode for you. Microsoft and Meta made headlines for difference reasons, Intel had a week of wild turns, and Nvidia continued to struggle. All of that as well as THREE new adds to Eric's AI portfolio!

0:00 Intro

1:45 Market update

5:43 Latest with Leopold Aschenbrenner

7:20 Finding opportunities

10:00 Alphabet Captures 2026 AI Capex Alpha

10:40 OpenAI user numbers continue to increase

13:10 Nvidia struggles

19:00 Data center spending

22:46 Microsoft and Meta

32:47 Portfolio earnings (Lam Research, Intel and more)

40:30 Corning and Bloom Energy

55:15 Portfolio adds

1:01:10 Celestica news

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Join Eric Bleeker and Austin Smith from 24/7 Wall St as they discuss how artificial intelligence technology is quickly flowing through the global economy - leading to massive changes and opportunities for forward-looking investors. 

The AI Investor Podcast from 24/7 Wall St. explains, in practical and accessible terms, why AI is such a disruptive and exciting technology and shows investors how they can potentially position their portfolios to benefit from these game-changing shifts.

Transcript

SPEAKER_01 0:00

You are listening to the AI Investor Podcast from 24-7 Wall Street. On today's episode, it's a tale of two tapes: Microsoft Zooms, Walmeta's Ags. Meanwhile, the Lisa Nal Ghaib of AI Investing, well, he needs a wellness check. Leverage is blowing up Korea. The Iran war continues. All that and more is next on the AI Investor Podcast. Stocks are sliding around the world as investors pull back from some of the biggest names in tech.

SPEAKER_02 0:31

What's behind investors' complete rejection of Alphabet and Tesla's earnings?

SPEAKER_00 0:36

Not a great day for Wall Street.

SPEAKER_01 0:46

At least, you know, temporarily we are in a bear market here. This is the worst month for momentum ever. We're seeing a lot of the wind come out of the sales of some of the most prominent AI positions of the last, you know, well, of the last few years, but all this is really unwound pretty quickly across the last two weeks. Now we're still sitting on substantial gains. People need to zoom out and take a look at the multi-year stock chart year here to appreciate how far we have still come. But yeah, this is a setback for the AI industry. So what are you seeing out there? What's driving this? Why the sudden acceleration? You know, with it, this is not a Kimmy K3 triggered moment. You know, we want to draw an analogy to Deep Seek because of how quickly things traded down, but then they recovered. This was already underway. And I don't really hang this at Kimmy's feet per se, although maybe that's one extra uh, you know, little little nudge here in the downward direction. But but what are you seeing? Explain to us what's happened over these last few weeks.

SPEAKER_02 1:42

Yeah, this is probably the most amount of news we've ever had in the week between a podcast. So I think we're gonna have a lot to cover today. And you hit the headline right there that when you look at what's been happening, it's it's interesting because the SP 500, again, it's it's not far from highs. The Nasdaq had briefly entered correction territory. I believe it's out of that today. But when you look at the momentum factor and stocks that are in the AI infrastructure trade far and away are going to be in this momentum factor, those stocks are down as a group about 40% through the close of yesterday, month to date. So when you go back, this is a according to most records. You know, you could you could nitpick whether or not it actually got worse during COVID or a time like great financial crisis, but we are in that territory. So why is that? We we've talked about some reasons. You know, uh you talked about the Iran war at the beginning. We we have an ongoing war that especially is having uh significant impacts on things like inflation that matter to the broader economy. We have we have interest rates, we have an FOMC meeting happening today as we film this and talk about them increasing this year. We talked about last week. We have crowded trades that semiconductors started having a lot of people who don't normally invest in semiconductors, crowd into them. Valuations got expensive. And Austin, what we're really gonna focus on today is a lot of margin on top all of this, which essentially made the situation a powder keg that has the word would be unwound this month. So the Cosby, which is Korea's index as of close yesterday, a 44% drop in 40 days. You know, Austin, 44% drops on index. Now it was up a lot, head into that, but we are talking great financial crisis territory. An index dropping that much is almost never heard of. And one of the big reasons for this is we had talked about before this kind of unwind really hit velocity, the amount of leverage. I had I called that out that I was very worried about the amount of leverage, the amount of leverage products specifically in the Korean market. And what we've seen is about 3.4% of their entire adult population has triggered margin calls. I mean, Austin, I was trying to think of how to compare this to an audience. If 3.4% of the entire US adult population was margin cold, that would be like the entire population of New York City and Los Angeles, all essentially being in some form of uh, you know, essentially bankruptcy when you think about what's effectively happening when you are margin cold. And we can even look at the US, it's not just Korea. Margin buying on a lot of these stocks has been increasing across the board. When we look at Schwab, which is generally considered a more uh conservative uh, you know, audience, right? You know, Robin Hood is going to probably have a higher rate of margin adoption. Well, Schwab's margin loan balances had doubled from where they were this past summer, uh, which kind of hits home how extreme the situation. So I think Austin, though, the big picture, and we're gonna unpack this from numerous angles today, but we are probably closer to the end than the beginning of this. And I'm seeing a lot of signs that this unwind, this portion of the sell-off is kind of reaching closer to its conclusion right now. That doesn't mean that we have other factors in play, such as, you know, macro risks that could still be a weight on stocks. But I think we're approaching the end here. And the news we have, you got to this with the Lisen all-gayib. I don't even know how to say that. I I think you got that better, but you were talking about Leo Ashenbrenner. We've talked about him as the uh uh I guess he would be the uh uh portfolio manager of situational awareness. This was the poster child of the AI stock run. He had gone from, I don't know what it was, hundreds of millions of dollars as under management to 45 billion at the beginning of the month. The problem is to achieve the returns he had, he was using a lot of leverage. I'd read up to four times leverage. And with momentum stocks down 40%. Well, if you have four times leverage, you know, the the simple math would be a 25% reversion can get you down to margin calls. He's been margin called, and we'll talk about the mechanics of this, Larry Austin. I think it's kind of something people think high finance is this very gentlemanly kind of area with a lot of sophistication. This is something out of the wire. This guy just got cornered and shot, and one large firm is, I think, behind it, which is Citadel. They're taking his remaining portfolio, and we're gonna talk about how, you know, this unwind, specifically in his stocks, is playing out on the other side today with now his largest holdings up 30%. So, you know, we had a lot of stocks that were dropping on this unwind. There's nothing fundamentally happening to them, it's just the short-term movements that in the moment are so painful. And when you zoom out, will eventually look like blips on a stock chart. But we are in this moment right now, and I don't want to belittle the fact that we have seen essentially all of the outperformance across most AI stocks since the end of February removed from the market. As you noted, if you zoom out, you go back to when we start from 2024, there's still a wide degree of outperformance, but this layer on top that had gone to be so much of it, that has been removed from the market right now. On the other side, we talked about last week, valuations are looking their most attractive in a long time. So if you are someone who has some capital to deploy, um, or you have been behind and haven't been able to get into many of these stocks because they recurringly look too expensive. Well, today presents that opportunity. Of course, Austin, that assumes we have any listeners at this moment, which I don't know after the way the past few weeks have gone.

SPEAKER_01 8:09

Yeah, you know what? I I want to remain sensitive to the fact that many of our listeners right there, along with both you and I, are probably experiencing a lot of this pain. But I hope they have heard our advice over these last few years and appreciate that this is the price of admission. And often outperformance comes with volatility. And while we know that this doesn't feel good and it's not easy, this is often the price that you pay for outperformance. And you know, going back to Leopold, he started with $200 million. He grew it to over $6 billion, I believe, in a year, year and a half or something. So, you know, you don't get those sort of returns without also getting some sort of volatility or hangover in the other side. That's not to say everybody should be leveraging up and doing, you know, max lever ETFs. In fact, Brad, I don't know if you can find it, but it was one or two episodes ago we started cautioning about the number of levered ETFs in the market, not necessarily as the spark that would light this off, but just as a sign of where market mentality was at the time. So there is no one single factor. We're not blaming levered ETFs, but when you layer on the appetite for lever uh of leverage and margin and layered ETFs and leverage, all that, it it creates this environment where you get these drawdowns um occurring this quickly. So this is this is the story of investing. And as you said, we do need to zoom out and remind ourselves, right? A 30% drawdown can really hurt, but if it's on the back of a 190% gain, you're you're still doing pretty well. Uh and it is important to always invest through these down cycles because that's often where you find the best opportunity, whether it's the deep seek moment or COVID or any of the other many drawdowns that we seem to face every two or three years of this magnitude. And as you said, you know, after that soliloquy, right? Let's actually get into some of the reasons we're still optimistic, not just to be Pollyanna-ish here. Let's talk about some of the fundamentals behind it because there's still a lot of encouraging things going on behind the scenes. The main engine of this entire AI trade, or most of the AI trade that you've been positioned for, has been the CapEx build-out. And the leading indicator for that has been how much are the hyperscalers continuing to put into these projects. And we continue to see that number going up. We now have two major hyperscalers committing to more than 200 billion in CapEx over the next uh 12 months. That's Amazon and Google. And everybody else is pretty close behind. I mean, it's it's inevitable that we're gonna pass a bill a trillion and probably close in on 1.2 trillion of CapEx just from the hyperscalers. So the number that has been driving this trade continues to go up, which means that engine persists. There's also plenty of other things to be encouraged about. So you had something here about OpenAI and their increasing usage of codex. Let's talk about that. This is OpenAI fighting back against Fable and Anthropic's uh incredible run lately. So, what else are you seeing besides just these CapEx numbers? What else has you optimistic?

SPEAKER_02 10:56

Yeah, and we like to always we'll talk about what's going on in the market. It's very important to contextualize that for everyone listening. But then we want to stress test it. Um, you know, narrative follows price action. People get really gloomy when price action is negative, um, but that doesn't always necessarily reflect what's what's happening underneath the surface, right? So we'll always look at recent price action and talk about, and then we'll talk about kind of the fundamental drivers that we see. And once again, it's been a pretty encouraging week. Uh, you mentioned OpenAI at the beginning. They had told their employees uh yesterday that recurring revenue in July has exceeded the entire second quarter. So, Austin, I mean, that is just a wild, wild business acceleration. We I I believe that was our last episode. We we talked about the user numbers that were growing on their agentic product codex, where it's essentially in February at a million users a day, and it was starting to add the entire total from February on a day-by-day basis. So we we talked about this, and now we're seeing kind of the output from that, where they're telling their employees that they are now making a single month what they made the entire prior quarter. And the prior quarter, you know, they were probably already at something like a $30 billion run rate, $20 to $30 billion. So, you know, they they have now accelerated to an absolutely massive run rate. And you would figure where narrative heads in the back half of the year, if they are still on track for an IPO and the numbers come out with these kind of growth rates, it's probably going to be a significant change to narrative. We also see, excuse me, Austin, I need to just take a sip of water quickly.

SPEAKER_01 12:41

That's how shocking the codex growth numbers are. I mean, like, to it's so shocking. Eric needs to take a sip of water just to process what it means to be able to have recurring revenue in July exceeds second quarter revenue.

SPEAKER_02 12:54

Oh. That was a spicy meatball, Austin. Um, but yeah, so I obviously that's incredible. The other thing that happens when there's this incredibly negative news cycle is news that previously will have been brushed off. It's gonna be presented in the most negative light. Nvidia has struggled tremendously this week um and has become a focus of kind of the declining credit worthiness. Uh, you know, there's there's a lot of headlines about how cred default swaps were blowing up on NVIDIA. Well, I mean, blowing up's all relative. It's still pricing in almost zero probability of any kind of uh, you know, financing struggles for the company. This was amidst quoted deals that they're working on of over 750 billion, which sounds so extreme until you look it at the details. 500 billion of this, Austin, was a partnership with SK Heinex that likely is going to be a lot of these long-term agreements to secure memory, they will have secured, anyways. That's probably a positive thing for a company like NVIDIA to do. And frankly, they've been the best operator of securing their supply chain. So they deserve the benefit of the doubt there. And other things are like data center backstops with large headline figures, but it's often large headline figures that work out across 15 to 30 years are um conditional terms that may or may not happen. So, you know, Austin, you could it would be like saying that um, you know, a baseball stadium is being built for the New York Yankees that costs six billion dollars and they only make 600 million a year. Well, that's not the proper way of framing it, right? You'd you'd look at the annual cost of the stadium over its useful life. And many of these deals for NVIDIA are one to two billion a year, but that's not the number that's being presented. What's being presented is the worst possible situation. And when I look at technology and what's going on technology, NVIDIA this week, they're backing Ilya Suske, uh, I believe it's Suskiver.

SPEAKER_01 15:04

I I think it's Pseudovecker. Um, but let's just that's probably it. Hopefully, it's a good thing we don't have a lot of listeners in this route this week because we are just absolutely butchering all of the names in this space. Leopold, we're sorry. Yeah, please, please take mercy on us.

SPEAKER_02 15:22

But he he was one of the kind of OGs with OpenAI. He had gone off to form uh SSI. It's an extremely secretive company. It's basically going for superintelligence in a straight shot. Nvidia got a demo of this, it was attractive enough, they're going to back it with five billion dollars. We we saw a bunch of researchers from AI labs, I think over a thousand of them, signed uh an open letter to basically create some kind of uh concerted uh effort to slow the progress of AI, which which in many ways is kind of a negative, because if that happened, you know, um there's a risk there. But Austin, all the same is the people who are most at the leading edge of AI are saying we are about to hit an inflection point that is hard to know what happens on the other side. I think this all comes back to two what we've been talking about, that there is a lot of advances once you start building around coding, there's advances in how these AI models can build themselves, what we've called recursive self-improvement. And we are on the precipice of some major gains to be had here. So when I look at this stool, let's let's picture the stool of AI investing. There's there's three kind of stool legs to this. Number one, progress of technology. Number two, is AI being adopted in the real world? And three, can you finance this build build out? Two of these stools at this moment are extremely strong. The progress. I just talked about it. You know, we've we've got NVIDIA investing in this company going for a straight shot. We've had a lot of talk this week about the fact that we are effectively already at AGI. We have a lot of gains happening in how we train these models and their capabilities. Um, you know, at the current pace we're at, we're going to have some incredibly capable and autonomous models by next year that are going to be at essentially human level at scale. In terms of adoption, the second stool. Well, I just talked about the open AI figures, Austin, that they are now doing more in revenue in a month than they were doing the entire previous quarter, let alone we're talking like 10x figures from where they were at the beginning of last year. We also saw quotes from Microsoft and Google. Microsoft talking about 90% of its uh, you know, AI demand or cloud, I guess it would be cloud computing demand, being from non-frontier labs. Google talking about the ROI they're getting and announcing earnings with 82% growth in their cloud computing division. So adoption seems extremely unevenly distributed. It's used dramatically by a small group of people and not as dramatically across, but it is very strong. And we get to the third leg of the stool, which is financing. Well, Austin, that's that is the weakest part. And that is where a lot of the sphere comes from because the pace is so frenetic. We've talked about so much on this podcast. It would be better for the AI trade if this was a little slower, if it was more predictable growth. The problem is what we continue to see this earnings season. We're going to talk about Microsoft, we're going to talk about meta reporting in the past few days, is company after company effectively says the ROI that they're seeing from AI is too attractive not to continue. The market is less certain. So the framework, Austin, and I I've laid this out on recent podcasts, but but the way I'm thinking about this, I just want to be as clear as possible for everyone listening. We are going to see about 700 to 800 billion in spend on AI data centers this year. I think that's going to grow to 1.2 trillion next year. It's going to be greater than 50% growth next year. I believe that between cash flow, debt, and other financing, the ceiling for what can be spent at this moment is somewhere between 1.5, maybe up to 2 trillion annually. Now, that ceiling can raise these companies are seeing significantly more revenue, or financing loosens, or some other terms such as that. But currently, this puts us in 2028 near that ceiling. I would say the expectations for 2028 right now are around 1.4 trillion in spend. And what we've talked about over and over again, Austin, in recent podcasts that has, you know, really dictated which stocks are selling off the most the past month is valuations matter. If you're a stock that historically trades for 15 times earnings and you're trading for closer to 40 times your 2020 or 2029 earnings, that's gonna be hard to justify because the market is near that ceiling. The more margin of safety you can get for these stocks in that zone of unpredictability where we're approaching that ceiling and it's hard to say where the growth goes after, the more margin of safety you can get there, the better stocks are going to be to purchase. The good thing is twofold. Number one, we've seen a lot of these stocks go from numbers that are historically out of line to historically attractive in the past few weeks. Number two, even if the overall rate is slowing, that doesn't mean the AI trade is dead. Because what's going to happen is as we approach 2028-2029, there's going to be new things that are using AI to see new growth rates, whether that's software, pharmaceuticals, industrial, robots. And also there's going to be areas in the infrastructure trade that are going to grow even with lower growth rates. For example, something like optics is going to have a fundamentally higher growth rate than the overall data center market. So if you can get those stocks at a cheaper price, it becomes a good opportunity. So, Austin, bottom line, let me just summarize three things because I know this is my second soapbox already. I'm going for a record soapboxes on this episode. I believe we're closer to the end of the current sell-off than the beginning. Second, a lot of risks do remain, primarily from the macro side. We're still looking at a probability of an interest rate rise in September. We're still looking at some inflation worries. We're still looking at GDP that hasn't accelerated. The way most people will have predicted when we are this close to things like AGI. But my third point is if you are someone who's been following this market and as I said earlier, um is is maybe didn't get invested in a lot of these companies earlier because valuations had run or you were on the sidelines, this is right now probably the most attractive moment since April, May 2025. So there's there's a lot to like at this moment.

SPEAKER_01 22:35

Uh fantastic soapbox. Let's see if we can get a third one in this episode. Uh you're you're talking about opportunities. I would love to look at two companies that, you know, are zigging while the other ZAGs. And it seems like there's some unfair, uneven treatment here. So I want you to help us unpack that. So I'm talking about Microsoft and Meta. Microsoft is up about 16% today. Now they've actually had a pretty rough year-to-date run. They've sort of been the castaway Mag 7 stock. The argument here was largely that they were investing too much in Azure. And now what, you know, lo and behold, we're actually seeing Azure uh accelerate from 38% to 43% growth. And I think they were actually forecasting even more, like 45 or 46% in the out year. So we're seeing an acceleration. So you get to sort of re-rate that the concern there that this CapEx wasn't paying off. Turns out not only is it paying off, it's accelerating and paying off more than people expected. Microsoft is rewarded. But then on the other side, we have Meta, which now trades for 20 times earnings, down about 10% today. This is a company that can grew, I think what, 28% of the top line, which is stunning at their size and stunning at their margins. But there's the same level of concern that they're investing too much in CapEx. How will you get an ROI on this? Meta's been very clear that they're seeing a crazy ROI internally, therefore it's worth continuing to do that. You and I have been talking about that for about a year. And it seems like we're maybe the only people who hold that view in the market right now. Uh, and then there's also this interesting element where Meta is now selling compute, and people see that as a sign of weakness, that maybe their build-out demand, their build out didn't make sense. But then Zuckerberg addresses that on the earnings call and says, Well, we're renting it for more than we paid for it. So, like, what do you want? Right? Like, this is this is like the Wall Street type of trade you should want. We paid X, we're renting it for X, you know, 1.2 X or 1.3 X. So why is it that Meta is selling down so much, 9%, while Microsoft is getting its day in the sun? And and these are two, you know, Meta's had a pretty uneven year to day run. I I would I could understand it if maybe Meta got ahead of itself and was, you know, 35, 40 times earnings to see the trade down today, but they're down around 20 times earnings. All of this negativity seems like it was baked in going into earnings today. And yet, lo and behold, totally uneven treatments on the same dynamic, which is CapEx for the AI infrastructure. So help me unpack all this.

SPEAKER_02 25:00

Yeah, it's a it's a great question. And there's a lot to say about the market as a whole right now. I would I would say it's probably overreactions in both directions, but it's also what the company said versus what Wall Street wants to hear. For Microsoft, they're kind of doing that meme of like the guy holding up the entire world today where it's like on top of the guy, it's as market on top the world, it's you know, or Microsoft.

SPEAKER_01 25:28

You know, Brad, Brad, have a little thumb with it. Can we get a Satya as Atlas moment here where he's holding up the entire market? Please and thank you.

SPEAKER_02 25:36

There's there's, you know, this is the reason to watch it on YouTube. You don't get these memes. Yeah, yeah. You get the soapbox, but you don't get the memes. But Azure, you noted earlier, 43% growth. Uh, it's it's now at a $124 billion run rate. This is notable because Microsoft, the past four quarters, had been zone of 38 to 39%. I've talked about the prisoners' dilemma that Microsoft is in. They can increase their Azure rates, but doing so limits their internal compute. They need that internal compute to meaningfully improve their AI products to stave off disruption from companies like Anthropic and OpenAI that would be buying Azure. So it's it's a little bit of a prisoner's dilemma. What they've clearly done is they've allocated more because Wall Street smacked them each of the past few quarters. They said Uncle, Satya said Uncle. He moved some compute capacity over to Azure, and we're gonna see 43%, the prior quarter guidance to 45%. Um, as I noted earlier, Austin, they had some quotes too that are really encouraging. 90% of cloud demand outside of the frontier model. Companies clearly, again, this is something Telegraph or Wall Street, they are trying to emphasize over and over again the amount of demand they have outside open AI. And importantly, too, they didn't raise CapEx. Wall Street wants to hear these companies basically say we are slowing down because the pace of CapEx growth is so fast and so furious. As I've talked about in the past, it's a little bit like Apple with smartphones in the middle of the last decade. Smartphones just grew at such a furious rate, it really left open an undetermined future around mid-decade of how they're going to grow. And it led to a lot of choppiness for Apple compared to something like Google that over the long run saw similar growth rates, but was much more consistent the entire way. So they really made Wall Street happy. On the other side, Meta said everything Wall Street doesn't want in here. Their earnings were fine. They they missed EPS, but it's because they had some one-time cost for uh, I believe the largest one was effectively they were reducing their workforce, which is what Wall Street wants. But their top line also didn't accelerate at the same rate as last quarter and guide down to a little bit of more deceleration. Now, Austin, you made the point 28% growth, still higher than the other, generally higher than the other magnificent seven companies. Um most companies on earth.

SPEAKER_01 28:17

Higher higher than higher than you know, one billion dollar market cap young companies growing in, you know, with with seemingly infinite TAM. It's like this company is growing so fast. We but the other thing they did on their call. But investors would be investors would be should would be thrilled with that growth rate at a smaller company. It's just meta's got a communication problem. Meta has a PR and Meta has a PR and communication problem. And you know, it's it's I I I maybe we get this is this is the meme episode. Maybe we can get some sort of meme episode with like you know, tracking Mark Zuckerberg's like popularity because he was sort of like yeah, Darth Vader for a while, and then he was sort of the comeback cool kid. Uh and his PR team did great work and he was rocking gold chains and doing UFC. And now it feels like he's unloved again, right? He's back in the the nerd, uncool corner, and nothing he says is is being well received.

SPEAKER_02 29:07

Oh, he's he's sub Vader right now. He's like Charles Manson. I mean, he is as low as you can get. Uh but yeah, Austin, it's just they gained, we talked about in a prior episode, they gained eight or nine percent for when it was announced that they were going to basically become uh they were going to open up a cloud computing unit where they could sell off incremental capacity. But Zuckerberg effectively walked that back on yesterday's call. He he he was like, Hey, we've had a lot of attractive offers that would provide outstanding ROI um for our compute, but we want it for ourselves. So basically, he took back the expectations of how much revenue they could get for this. Second, they talked a lot about how their incremental compute is gonna go to uh meta superintelligence rather than their core business. And as we've talked about, Wall Street likes it going to the core business because it provides that acceleration to revenue and has had good ROI. So, Austin, yes, I I think we could. Is this an overreaction in both directions? Likely. Uh, Microsoft it's it's one of the most uh frantic market days. The the amount of trillion-dollar companies that are up 15% is absolutely astounding today. Uh, it is it is a wild day in the markets today on Thursday, July 30th. But Meta is is going to be where should they be down on earnings like this? I don't know. A few percent because of that top line. Um, the rest of it is just the PR thing. And for Microsoft, how much should they be up on the results? Again, maybe maybe a few percent. The rest of it's the PR of of uh Azure growing, which which might have some long-term negatives to it, but it it's a little bit of a PR move right now. And second, what Microsoft had to say about their CapEx, which was right in the wheelhouse of what Wall Street wanted. So, you know, Austin, I had talked about in recent episodes when we talked about things that are looking attractive. I specifically called Microsoft out because I thought they were in a position that they're gonna be able to exceed the hurdles. They provide that diversification where they've in the software bucket, which you know gives you some uh people exposure to kind of non-hardware uh related plays. And we're seeing that play out today. So for people that own Microsoft, congratulations. But, you know, I don't think the divide between what Microsoft and Meta are seeing in their share prices reflects the trajectory difference in the businesses.

SPEAKER_01 31:38

Yeah. That that software exposure, I mean, it's it's an asset today, but it's been a liability to Microsoft up until this point. It's one of the reasons they underperformed was concerns that their software business would be eaten by AI faster than their cloud business could, you know, offset it. Uh, and turns out their cloud business can accelerate while their software business remains remarkably strong and continues to print money, which has been my opinion on the SaaS Pocalypse trade. And we've talked a lot about that. You know, I was probably early to jump in and grab some stuff there, but it just seems like there's so many moments like that in this space right now where there, if your software stock, I know we're gonna we're gonna talk about one later. Let's tease it a little bit. There's a preview. There is a SaaS Pocalypse buy that we're gonna bury at the end of this episode. So stick around for that. Maybe built on this thesis, but just the idea that the soft software had a you know a moat that was like going from a normal-size moat to a stream in the world of AI. Turns out these software companies are actually going to be some of the earliest adopters of AI. They're gonna make their own products stronger. Uh, they're gonna be able to lock in with their existing customers more so. They'll probably run more efficiently and do some layoffs. So um, anyway, good time to pick up some software stocks. Let's talk about that in a minute. But first, I want to talk about some of the other companies in the portfolio. We spent a lot of here looking at the divergence between Microsoft and Meta. This, of course, comes on the heels of Google's earnings, which we chatted about in the prior episode. Let's talk about some of the other companies in the portfolio. Uh, Lamb Research had a great day. Uh, I want to hear about what drove that, particularly against the backdrop with Taiwan semi. I want to hear about Intel. I want to hear about CPU prices. So tell me what you saw on some of the other earnings for the portfolio positions.

SPEAKER_02 33:18

Yeah, a few, a few stocks we want to talk about. Austin, there are so many stocks reporting this week. It's I I feel like it's gone more and more concentrated. I don't have any data, but you know, I I thought earnings season last last quarter, we had like four of the Meg 7 companies report one night.

SPEAKER_01 33:37

And this week I was just trying to look for that. It was four, and I'm trying to find it. Was it uh uh God, I'm gonna figure out what it was. It was it was definitely four. Anyway, I'll I'll find it while you're talking. But I agree, it's it's become like you know, on those earnings days where you have these stacked earnings, it's like you gotta keep your head on a swivel to keep up with them.

SPEAKER_02 33:55

There's you know, we won't be able to cover everything. We just we just can't, unfortunately, but uh a couple of the more noble ones. Let's talk about Lamb Research and Intel. Lamb Research, a semi-equipment company. We had recommended this in our original memory sleeve. It's it's been a very fantastic buy. It had seen a significant sell-off along with most companies across July. Um, the thing is semiconductor equipment, I'll talk a little bit more about this. It's a great industry. I love its position across the coming years, and it's just a question of valuation and how high stuff is valued relative to its historical levels. So, with Lamb Research, a very good quarter. They reported yesterday on Wednesday. Um, it they're up 20%, maybe coming back just a little bit in the teens right now. It wasn't that good of a quarter, but obviously, Austin, this is a reaction to how much they had fallen across the past month. They had a 182 in EPS versus 170, so solid beat. The real star was guidance, $2.15 next quarter, street expected 184. This year, the current Wall Street estimate is $9.40. So they're trading at let's call it a little bit above 30 times, which is right in that zone. Am I going to be adding to Lamb research next? Probably not. I'm probably gonna look for some other opportunities just because it kind of remains on the upper end of the range. But the bottom line that I want to talk about, Austin, is that semi-equipment, the environment just looks very good for them across this earnings season. We had Taiwan semiconductor, they raised CapEx. We have Intel. They were very optimistic about CapEx needs. We'll talk more about them in a moment. The likely scenario is that this equipment that goes to make semiconductors, it's going to be my guess where Wall Street has it in 2028, where it's going to be, it's probably gonna be like 25% higher, um, which is a significant overage. I really like this space as I've talked about before. There's specific verticals inside it that are even more advanced than the broader trend, uh, some areas in how you package chips, how you test chips. So this is an area we're going to continue investing in. But Lamb Research, you know, it's it's kind of like one of the Meg 7 stocks for semi-conductor equipment. There's there's a group of you know larger semi-equipment companies, and Lamb Research right now is um, if not the best operator in the space amongst them. So, you know, this this just kind of remains it kind of remains a core holding. It's a company that I love for the long term and I think will be a continuing compounder. Second was Intel, we're gonna talk about from portfolio earnings. Uh, they reported they were up 10% after hours, and then they dropped like 30% across the next few days, which is just so illustrative of what this past month has been. Um, even with today's gains, they're down 34% across the past month. You know, Austin, you've you constantly emphasize this as the right thing to emphasize that zoom out. This is still a stock that's up 134% year to date. The general trend for momentum stocks has been erasing post-February gains. They are still up more than double from post-February. So this still remains a structural winner. And the reason is what we called at the beginning of the year, that in 2025, we had put a huge focus on the year of memory. At the beginning of this year, we really put a big focus on a number of things. But the the first thing we previewed was the rise of CPUs. It's happening, it's bigger than anyone anticipated at the time. Their CPU prices were up 48%. And the longer term thing that really matters for Intel Austin is just again, can they get their business of making chips, their foundry business moving? And they had some really great quotes on this in the quarter. They talked about volume production for the next process 14A on track for volume production in 2028. I think Wall Street was a little upset because um they they didn't necessarily name names, but that's pretty common, right? Like this is a company that's stealing market share from Taiwan Semiconductor. I don't think companies want Intel saying, Yep, they're gonna be an anchor customer. It's kind of like Taiwan Semiconductors, like, okay, there goes your allocation, right? So this makes sense. Um, there's no reason that these companies would want to be announced, but what I'm seeing, Austin, we knew that they would get customers to some things like packaging. What they need is wafer customers. These companies actually go into them for 14.8, and that looks to be on track. I think they've got some tailwinds. I think some companies like Google that could be major customers are drifting in their direction. So everything looks really good for Intel Austin. You know, they're up more than 100% from earlier this year. But when you look at companies that structurally have seen a change in their business across the year, they have to be near the top, right? The the forecast for what their future looks like has improved across this year, thanks to both the foundry environment and the CPU environment, more than just about any company I can think of. So, you know, I I continue, I I really like Intel. Uh, it's been something that's that's been painful, but um they continue to seem to be not only having the tailwind at their back, but they seem to be operating really well. So highly encouraged by that.

SPEAKER_01 39:36

I really love that point on not naming customers, probably being a headwind here, but at the same time being completely rational. I also don't know that Wall Street should be that like some of these customers are somewhat known already. There's no reason for Intel to go out and say them on an earnings call, right? But haven't we heard like you know, formerly X, now SpaceX is a large customer. There's the Apple deal that has been you know much you know discussed in the headlines. So it's not like they're complete vapor customers. Like there's there's pretty reliable evidence out there around who some of these customers are. There's probably just no reason for Intel to go rub that in Taiwan semi's face. Uh, let's talk about some of the other positions outside of the portfolio. There's you know, AI missed opportunity corning, which is a company you had covered for years and you had sort of discussed in a prior episode that it was one of the you got a lot of AI stocks in the portfolio, let's be clear. But I think Bloom Energy and Corning were two that you have discussed as like, God, you know, they've been on my radar, I've watched them and I just didn't add them. Well, are we going to get another look at corning here? Because it looks like they're trading down quite a bit. So I'd love to hear about corning. You've also talked about a lot about Bloom Energy. So what are they doing? And are we now getting opportunities where it looks like they may be adding added to the portfolio, or is the narrative changing where you're actually glad that you didn't put a position on?

SPEAKER_02 40:53

Um, for corning, I'm not adding it to the portfolio, but I should note I I personally made an investment in them uh in the past week. They are down, man, they are down 48% across the past month. That is absolutely wild. Austin, this is a company again. I I don't want to belabor this, but it is so important. Where Corning Peak, they were trading about $270 per share. And at the time that they were trading there, I think the estimates for their 2029 earnings were around $7 a share. So you're trading somewhere, you know, let's generously call it 30 on the low end, but 40% of 2029 earnings. Like I've said before, you they get to that zone of uncertainty where we know there's a lot of growth until then, and then we're kind of at an amount allocated to the build-out that we're we're going to need some growth if we want to keep financing it. And they are at 30 times their expected earnings that year. When, you know, historically this is a stock that trades in the mid-teens, right? So this is this is where valuations have been too high, and that's why I hadn't added corning to the portfolio. Now, after their earnings, by my estimates, they're down to somewhere closer to it's gone up a little bit since then, but let's just say 10 to 12 times 2029 earnings, which means they are now it's it's still a two, three years away, but they are now closer to their historical range on that Ford basis. And their company's still with tailwinds at their back because a lot of their products would continue growing an outsized rate relative to the overall data center market. So, you know, Austin, their earnings they dropped like 20% the next day, and they nuke the entire optics space. And what happened was they guided inline next quarter, but they issued a compounded annual growth rate target through 2029 that by my estimates put where their revenue ends up in 2029 at something like 25 to 30 percent higher than Wall Street's consensus. So it's it, you know, Austin. This comes back to you know, narrative follows price action so much. This is a company that is down, you know, 60% plus from where it was recently trading. Its position is actually materially better at this moment than where it was when it was trading at those rates. Second, we see how price action gets a little bit irrational during these panics. Corning's overlap with a lot of these optics companies is light at best. You know, they they do have uh they do have some overlap, but where a lot of these companies are in is um the scale up of the servers seeing a lot of their business is actually a very light area for corning. So corning's read through to a lot of these stocks isn't what you might think it is. But the day after Corning's earnings, almost everything in Optics was down another 10 to 15%. So it it was, in my opinion, a little bit irrational. But again, you know, sell-offs tend to exaggerate on the up and the down side, right? So, regardless, corning is a stock that had a lot of attention at the peak. It probably has a lot less attention now, but this is just an example. I've talked about how stocks are attractive. I wanted to put this into numbers. That at the top, this was pricing in to be two times or more its historical valuation three years away when earnings growth potentially slows down. Now you're getting at that 2029 zone below its historical levels. This is why things are attractive right now, when a lot of them were becoming very unattractive at the peak. And you know, Austin, I personally bought Corning. Would I add to the portfolio? Yeah, I would consider it. This is a really diversified company with some really dominant positions in markets. And uh again, the valuation is now at a level. I believe it's a lot less risky and more attractive. Uh, do you want to talk about Bloom Energy next?

SPEAKER_01 45:06

I do. You know, Bloom Energy has been the one that got away from you. Um, it's also in many ways the front runner in situational awareness's portfolio, which is Leopold's portfolio. I'm not sure if it was the biggest winner or just the largest position, but it was a major uh reason for his incredible outperformance. So I would love to hear what you saw with their earnings. And if anybody has a little bit of time on their hands, they want a little extra homework assignment, they should listen to the last episode where you had discussed um the natural gas uh interview that you had seen on Invest Like the Best, uh, which would just be really good context and information if you're considering a position in anything related to energy delivery to these uh data centers, specifically behind the meter and turbines, which uh need natural gas. But Eric, Bloom Energy, uh, what did you see?

SPEAKER_02 45:55

Ooh, you you know I always love Austin. Episodes really get good when we start assigning homework. That's what everyone's waiting for. I I did want I want to talk about Bloom, but I mostly want to talk about this situation with Leopold, uh Ashen Brenner, which I'm probably butchering, being liquidated today. So we're gonna talk about that and and why I'm comparing it to something from the wire. But Bloom Energy.

SPEAKER_01 46:19

By the way, by the way, you might get into this up 26% today.

SPEAKER_02 46:23

Oh, I'm I'm getting into this. We're getting into this, Austin. Okay, let's just they had earnings. I I think they were uh Tuesday. Very strong. EPS of 78 cents versus 41 cents blowout. Uh, one of the most optimistic conference calls you'll ever hear. Uh, just really positive about behind the meter, which is what they do, um, having its moment right now. It was up 12% after hours, and we open the next day, and the game is just completely evaporated. It's down. Uh, and you know, Austin, I think what's going on in the background is there's some kind of financial games being played. And we talked about earlier the liquidation of situational awareness. This was a fund that at the beginning of the month was up to $45 billion, which is massive. What's happening, I believe, is it's become clear this company was using, or this fund, I should say, was up to four times leverage. It became clear, knowing among the biggest uh financial companies that do trading, that they were on the ropes. And if they could just push them, they could force a massive unwind. This was the potential for a very profitable scenario. So, what I think happens at the beginning of the week, it's known they're on the ropes. There's a lot of short positions opened across the other side of their portfolio. And then once they hit a point that they had received a margin call, they basically were going to have their portfolio liquidated. Citadel steps in, buys their entire portfolio in a block trade, and then what happens on the other side? Everyone takes their shorts off, everyone removes their positions because they had essentially known that if they just pushed hard enough, they could essentially break this situation and see massive profit. So let's look at the top 10 positions in situational awareness's portfolio and what they're doing today, after it's known that Citadel took this block trade and this situation's effectively over. Number one, top position, Bloom Energy up 27%. Number two, Sandisc up 24% today. Core Weave, three, up 24%, four, iron up 29%, five, core scientific up 23%, six, applied digital up 21%, seven, ride platforms up 24%, eight, clean spark up 22%, nine, uh Solaris Energy up 19%, and 10 TE energy up 13%. Austin, the top nine positions today are all up 19 to 29%. So if you were invested in Bloom Energy and wondering what was going on after the earnings that they were so good and the stock was down, these are all games being played. This is the BS that gets people so mad about Wall Street, right? That you know, this should be something about liquidity to the market, but you can you can push situations, you can in the short term uh move things to your advantage. And that's what these companies are so good at, right? This is what Citadel and these large companies they are so smart about this. And what I believe happened, you have situational awareness, a fund that grew up almost overnight to $45 billion, and it was known that with some movement they could push them over the edge. Why was Citadel pushing a huge narrative earlier this week that the Fed was gonna raise rates? Hmm. Could it be that they knew that taking control of this block trade was worth potentially tens of billions of dollars in profit?

SPEAKER_01 50:12

This is the leading company to do it. This is some Game of Thrones shit. I like this. I'll find another. I like this. It's spicy. I like this. No, there's definitely um, I think you're correct, first of all. You know, what Wall Street is not um, you know, white white shoes and gentlemanly. We we see this sort of bare knuckle, uh, you know, knockdown, drag out, uh, your fund is mine moments all the time. Uh Carl Icon and Bill Ackman had a pretty famous one around herbalife, right? Where like Ackman was right, but Icon spotted the moment and was able to paint him into a corner and just crush him on it. And you know, we're not going to get into the mechanics of that, but this feels similar and moments like this are always occurring. It feels like there's there's something like this in some fashion every six months, and I'm sure there's many more we never hear about, where the people are playing the dynamics of the market as opposed to the underlying investments to create opportunity. So uh I feel bad for Leopold uh to an extent. He still made a ton of money, made a ton of money, put himself out there with a lot of risk. This is the price of that risk. Um, I hope, I hope he's uh feeling okay after his incredibly epic three-year run. I'm sure though, I might my prediction, and this is an easy one, this is not the end of this story. We are going to hear more here. There was either, as you said, you know, a coordinated effort to suffocate this fund, or Leopold is going to come back with another fund. He's not gonna have any trouble raising. I'm confident in that. But this is not the end of this story. That is my prediction. Uh, Eric, you have mentioned a couple things in this episode, and I want to see if we can get these extra little spicy tidbits in before, you know, under our one-hour mark here. You've mentioned a couple times that you were adding to your portfolio. You said you added to corning. I know you also personally added to Bloom Energy. Talk to me about some of the personal buys you've made in this route and some of the drum roll, drum roll for our listeners, portfolio buys that you're going to be making in the AI investor portfolio. We are talking about how this is a good moment. You need to invest through the volatile times. Guess what? It's not just noise. You actually do it, right? Here you are putting your own money on the line, doing what you recommend to our listeners, which is buying on the dips, buying in the challenging, cloudy moments, not just personally, but also in the AI investor portfolio. So give us the names. What were you what were you doing these last two weeks?

SPEAKER_02 52:28

Yeah, and obviously I try and be as transparent as possible. Uh, I I have bias I'll personally make, and then I have things that I'm trying to put into a portfolio construction for the AI portfolio. So I mentioned Bob Bloom Energy because it's it's a stock that I've long admired. I I did own some already. Um, it's risky, but I did want to get a little bit more exposure after what I had seen from last quarter. Um, you know, another name that I had purchased was Quanta Services. We had talked about them with John Rotonti. I continue to like getting a little bit more of this industrial's exposure. Um, you know, this is this is things that are aligned to what I believe will be a decade-long build-out in the electrical grid and also have some trends at their back, such as uh, you know, modular data center. So I add Quanta Services, then I also add Modi and Manufacturing, which has taken a significant step back. Uh companies like Eden, I had added a little bit. Eden, I see as um a much less risky play, a stock that hasn't run up uh across this entire time frame, but something that I'm just comfortable holding in my portfolio for five plus years. Not something I I plan to sell. Um, it's it's just gonna be kind of a long-term purchase. I think other stocks that fit that category, I guess I'd purchase ABB as well. Now, riskier, and I do need to really point out, Austin, these are small allocations. But stocks like a Wolf Speed, Novitas, we had recommended both those. They are bad recommendations at this moment because I had done my initial power generation recommendation in March, March 13th. Um, and I wanted to go back and say some of the names I had talked about, but didn't recommend. I do like as part of this trend, that was poor timing. Uh, these are stocks that firmly fit into the momentum category. We've seen a pullback on that, but I still like them. I like the dynamic of trying to capture the upside potential of the market that they're in, um, which I'm going to do via some leaps on these stocks buying January 2028 calls. Um, you know, again, these are small allocations, but I like the potential of the markets that they're in. And these are stocks that are off and off 60 to 70% across the past couple months. So, where I would like the exposure is kind of capturing the potential for that high upside across the next year or two, as a lot of the trends at their back of uh this power management uh that's gonna be beginning with this next wave of NVIDIA systems really plays out. So that's just kind of a view of what I'm doing. Now, portfolio buys today. I want to start with three buys. I do feel like this is a very attractive moment. And as I often talk about, I think about trend, then stock. So I've got three different trends I want to focus on right now. Number one, service now. I've talked about in the most recent two podcasts, so I don't need to belabor it too much. I think we should put $20,000 into that. And the reason is, Austin, is because I continue wanting some best of breed software plays. Ironically, if the portfolio does fantastic across the next few months, this will probably be a loser. That is the way this is going to work. If the portfolio does relatively poorly, this will probably be a winner. Um, because right now, for whatever reason, you cannot have both hardware and software work. I don't know if this situation continues forever. I don't believe it will have continue forever. Um, but for the time being, this is the dynamic.

SPEAKER_01 56:07

It's too, it's too irrational to continue forever, but for forever, but for whatever reason, and and some of it could just be investor profile, right? That the SaaS trade was the trade for so many years. I mean, almost a decade, SaaS was like, you know, the infinite money printing machine. And a lot of those investors, those tech investors, moved into the AI trade. And then now, after you know, a multi-year incredible run, a lot of those people are moving back into the software trade. But the day will come that you know the business fundamentals trump all here and actually both sectors do well. But I do think, as you're alluding to, there is a bit of you kind of have one or the other right now, and that's probably a result of who the investors are in these companies.

SPEAKER_02 56:45

Yeah, and at the end of the day, Austin, it it is these companies, they need to get to a point where AI is a significantly more meaningful part of its business. Service now is kind of racing to get to 30% of its business by 2030, I believe, is the time frame. Uh, they they are closer to 10%, the beginning of that path today. But I I just I really think as it becomes clear how much agentic workflows are going to be the future of every enterprise, it's gonna be like how every company eventually became, in many ways, an internet company. Every company in the world is going to become an agentic AI company. And I do believe of the companies that offer a unique solution in orchestration for this, ServiceNow is near the top. I think that narrative is gonna matter. They were it was highly controversial that they've made some moves into things like cybersecurity, but they do have exposure to that now. And again, this is a company that just has re-rated uh significantly. At one point, they were trading. Let me look at their market cap right now. I think they were trading for closer to $300 billion, and now they are worth $113 billion, Austin. So valuation matters, getting to a sensible valuation matters, and I just like having this for a diversification of a portfolio, even if this isn't taking advantage of this moment, maybe as much as other stocks. Second, memory. Um, we we saw this week, uh I wasn't able to cover because so much happened, but SK Heinnix actually missed earnings, which was shocking, but they missed when they were growing like 51% quarter over quarter. So, you know, whilst it's all relative, yeah.

SPEAKER_01 58:25

But what have you done for me lately? Yeah, but you know, come on, like really 51.

SPEAKER_02 58:31

And speaking of market rationality, we also saw this week in the midst of uh some of the most brutal sell-offs, CXMT, which I've talked about a lot, Chinese memory company, they went public. Uh, they popped 500% on their IPO day. Uh, so they're worth like $500 billion. So you have this company which CXMT, the value of them is that they're going to try and flood the market with memory. Um, and they are getting a premium valuation where the companies that are trying to maintain more of a uh scarce environment in Micron, uh Samsung, SK Heinx, they are getting a much lower valuation. You know, it just doesn't fully connect to me, Austin. So ACM research, again, they have exposure to the Chinese market. I've seen most of the recent news flow from China being positive. There's a big freak out about China starting to mass produce DUV machines, which is kind of the precursor technology for lithography to EUV machines. The thing is, China is going to use DUV machines, which don't have, you know, you're not going down to two nanometers. You're gonna, you're gonna be at these higher wavelengths. What they'll do is they'll use those and they will combine it with other uh techniques for things like advanced packaging to be able to get to comparable technologies to what's happening in the Western supply chain. This is what ACM Research does. They have a lot of business in this specific area. So if this DUV situation happens where China is increasingly building out its domestic supply chain, I continue to see them as a winner. So I see them both from trends within China and where their kind of um technology supply chain that they're building is moving, and I see them as a winner in the fact that almost all the incentives for incremental memory production are happening inside China and they are most levered to that. So this is a company. I had said it's really expensive, it's run up, but pay attention to it, put it on your watch list because if we get an opportunity, I don't think this is one you want to miss relative to the tailwinds. We're getting that opportunity at this moment. So I want to be opportunistic. Austin, the third thing I want to talk about is how ambitious Google is with their TPU supply chain. We've talked about this divergence between companies that are uh gonna be kind of uh have exposure to Google versus other companies. One of the most impressive earnings this week was Celestica. It's a company I personally own. Uh, while everything else was getting absolutely beaten up, they went out and they reported, they blew the doors off all expectations. I think Wall Street was expecting their growth rate to decelerate to 40% next quarter or next year. They they said it's gonna be higher than 65%. That's that's a huge delta, and it's all because of Google's ambitions and TPUs. Semtech's a company, and this is Ticker SMTC, I see as one of the most levered to Google's build-out. They um not only benefit from optics, but also the growth of alternative uh copper cable technologies. And again, this is they haven't sold off as much as other companies, but they have sold off presenting a much more attractive entry price. So we're being opportunistic here with key trends, Austin. I always say, I think trend first, company second. I like all of these trends, and I'm gonna add stocks inside them, one new stock, two rebuys, and we will continue looking to allocate. I want to be aggressive at this moment. I do. I think that we're gonna look back at this as a great opportunity, much the same when we we hosted on March 30th, and we said we think this is gonna be a great opportunity. We are playing our flag in the sand. Last April, we said we think this is gonna be a great opportunity. After Deep Seek, we said that this is gonna be a great opportunity. I feel similarly about this moment today. So I want to be aggressive, I want to keep adding, and I know it's hard for everyone out there. I know it sucks. What else can you say? It sucks to look at your portfolio and see money vaporized. But you know, as you've said, Austin, it's all in context. And the only thing that you can do at this moment, what are the opportunities in front of me? Are these going to be above average opportunities across the next year? We're seeing more risk-adjusted great opportunities at this month than I've seen in a long time. So it's hard to go out there and keep buying, but it is what's right at this moment, I believe. And we'll we'll continue to be on the lookout in coming weeks. And if these aren't the stocks you're looking for, we're gonna have more ideas for you.

SPEAKER_01 1:03:27

Eric, I've always appreciated how uh transparently you are, how transparent you are with your own investments, your own thesis here. This is not just you know hot air, you actually put your own money to work here as you always have done in the portfolio. I know our uh listeners appreciate it as well. And as you said, this is hard. I'm not gonna try and uh restate your points because that was beautifully said. I would just ask our listeners, at any point in the last five years, there's never been any shortage of things to be concerned about with whatever industry, whatever market was, there's always doubters, there's always things that could go wrong. You can visualize them, and there's reasons, there's there's no shortage of reasons to not invest. And yet at any point across the last five years, if you could go back in time, what would you want yourself to have done at that moment? You would have wanted to buy those positions. So I believe that this is another one of those moments that doesn't mean it's the bottom, but it does mean that we're getting a better price than we were a couple weeks ago. And in an uh industry, as you have said, where the trend is on our side, right? It's trend first, then company. This is an industry where the trend continues to be pointed in the right direction. And now we're getting a better price than we were a few weeks ago. Uh so Eric, love to hear those investments. I know our listeners are as well. That's why they're here. And Eric, any other closing thoughts here at the end of this episode as investors are trying to unpack this moment of volatility? You've got three buys, you've got the the God king of AI investing getting wood shedded. Is that a sign of the top? Or like, is that like what what other parting thoughts do we have here? Do you want to go into another soapbox, a fourth one?

SPEAKER_02 1:05:02

I I don't think I I've got in me for one more soapbox. I think my my voice might implode, but you know, I would just like to say for everyone out there, we we do appreciate you listening. I know it's hard in moments like this, and we always say the hardest moments are when it matters the most. I do think there is something to be said that I I've said since the beginning of this podcast, I think how people position themselves for the age of AI will be the defining moment of how much you perform or underperform the market across the next 10 years. Um, I continue to, as as we've reviewed, I continue to think what's actually happening in the news right now is is deeply positive. And we're not going to be blind optimists about everything. We will talk about when there are negatives, but you cannot let you cannot let narrative follow fear in a way that. Drives you, or else that will be the number one ticket to underperforming the market. You have to steal yourself and have resolve. So I would just mention to everyone think about how you felt across this past month. Write it down. Remember that. I've talked so many times on this podcast about how we are not going for the top score. Leopold Ashenper's strategy was going for the top score. He was going for leverage. He was doing a lot of things. And, you know, people in that portfolio, you know, he was still provide outstanding returns. You know, we will see this as a cautionary tale. There will probably be books written about this in time. But most of the investors have done a fantastic job. But, you know, this was an example of too much risk. And what you need to understand for yourself is what you are capable of absorbing. If a 20% drawdown makes you want to jump off, you know, I don't want to say jump off a bridge. I think in Korea they are actually installing cameras to make sure people aren't jumping off bridges right now, which is terrible, but it but it shows the reason you invest is for a better life, a more secure life. And if a portfolio has too much risk that you're not able to do that, then that's not the right portfolio for you, right? And it's just everyone who's listening thinking about how this moment has shaped you and whether or not the risk level that you have allows you to take advantage of moments like today. And if you have too much risk that you are not able to take advantage of a moment like today, you're probably not in the right type of stock. So I would just say moments like today for long-term investors and people who want to do this over time, they stink, they're not fun, but they're also what determines how long you're gonna be in this game and how successful you are. So again, I I appreciate everyone who is not tuning out and uh, you know, listening to a Real Housewives podcast this week because it's a lot less painful. Um, and and I do think if if you are engaged at a moment like today, um think about how think about how this past month has shaped you, how that reflects how you should be investing going forward. And the sheer fact that you are listening and you are involved today tells me that you're gonna you're gonna make it, you're gonna do a great job over time if if you can keep this mentality.

SPEAKER_01 1:08:26

Beautifully said, wonderful words of wisdom, as always, Eric. I won't try and top them. I will just add one last thing, which is the best return you're ever gonna get in your portfolio is peace of mind. So if you are reaching for positions and industries and exposure and leverage that threatens that, that's a bad investment, even if you end up doing well on it. So you have to invest uh in a way that you can sustain the ups and the downs. And I hope that our listeners, after years of listening to you and your wisdom and your picks, have internalized that this is this is one of those moments. And if you want the sort of returns that you put up, you do have to be able to invest through these moments. Eric, we won't belabor it from there. You've got three new recommendations for our listeners. Thank you so much for your time today. Uh, to our dear listeners, thank you so much for tuning in and giving us your time. We are very grateful for it. And if any of you are still with us at the end here, we would of course appreciate any comments or questions. Please share, as we've said many times, the the lowest listenership of this portfolio of this podcast tends to correspond to the best opportunities. Eric and I were looking at the numbers just recently, and this is one of those moments. So hopefully you can help us uh stand that upwards with some comments and feedback on YouTube, Spotify, or wherever you listen to us. Until then, we will see you next time. The AI Investor Podcast is for educational purposes only and should not be considered investment advice.