patrick.net

AD says

That trash panda has only 5 screens, so no wonder he is losing.

I suspect that most day traders are really hobbyists. I have a small IRA that I use to play speculator with, but also a long term much larger account that is left alone.

HeadSet says

I suspect that most day traders are really hobbyists. I have a small IRA that I use to play speculator with, but also a long term much larger account that is left alone.

I don't day trade, but I'm similar. Check the price of the stock (not amount in the account) and go on my way. Then my big money is in Roths and 401k that I check once a year when I get the call before tax season to toss some into Roths, depending on our tax situation. Once I'm 55 I'll keep a closer eye on it.

75% of gains, 80% of profits, 90% of capex—AI’s grip on the S&P is total and Morgan Stanley’s top analyst is ‘very concerned’

October 7, 2025 at 5:13 PM EDT

https://fortune.com/2025/10/07/ai-bubble-cisco-moment-dotcom-crash-nvidia-jensen-huang-top-analyst/

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Fed's Powell: Stock market is helping support consumer spending now

Fed Chair Jerome Powell acknowledged Wednesday that the soaring stock market is helping support consumer spending — and the overall economy — right now.

If the market goes down, Powell said, it could hurt consumer spending. But spending wouldn't take a large hit unless the market plunged.

"I think it's certainly a factor supporting consumption right now," Powell said in response to a question asked by Yahoo Finance about how much of consumer spending and the economy hinges on the stock market remaining strong.

The question gets at how prominent a role the stock market is playing in supporting spending and the overall economy.

Powell and others have noted the US is in a "bifurcated economy": Lower-income individuals are pulling back on spending, while wealthy individuals benefiting from market run-ups continue to drive spending — perhaps keeping the economy afloat.

According to a September analysis by Moody's Analytics chief economist Mark Zandi, Americans in the bottom 80% of the income distribution — those making less than $175,000 a year — are barely keeping their spending on pace with inflation. Meanwhile, the top 20% of consumers are growing their spending.

"The data also show that the US economy is being largely powered by the well-to-do," Zandi argued.

For his part, Powell cautioned that the relationship between the stock market and spending shouldn't be viewed as a dollar-for-dollar correlation. The more wealth someone has, the lower an additional dollar of wealth matters, Powell said, and consumers' inclination to spend drops as they reach very high levels of wealth.

Meanwhile, those at the lower end of the income spectrum have a higher inclination to spend as they earn more.

"It would affect spending if the stock market went down," Powell said in a press conference after the Fed's meeting on Wednesday. "But it wouldn't drop sharply unless there were quite a sharp drop in the stock market."

Stocks have reached new highs in 2025, led by Big Tech and investors' hopes that AI will lead to blockbuster profits, pulling the overall market higher.

https://finance.yahoo.com/news/feds-powell-stock-market-is-helping-support-consumer-spending-now-183222919.html

Google’s AI-related revenue is not broken out as a standalone figure, but analysts estimate that AI-driven products and infrastructure contributed at least $40–45 billion to Alphabet’s Q3 2025 revenue—roughly 40–45% of its $102.3 billion quarterly total.

How long does this rate of AI spending continue ? Will the rate slowly decline and then steady out ?

Robots like this are the next generation AI technology. So when the capital expenditures for Chat GPT, AI-security cameras, etc. start to decline, then machines like these robots will fill that demand void for AI.

https://mashable.com/article/1x-neo-humanoid-robot-preorder

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AD says

Google’s AI-related revenue is not broken out as a standalone figure, but analysts estimate that AI-driven products and infrastructure contributed at least $40–45 billion to Alphabet’s Q3 2025 revenue—roughly 40–45% of its $102.3 billion quarterly total.

How long does this rate of AI spending continue ? Will the rate slowly decline and then steady out ?

Robots like this are the next generation AI technology. So when the capital expenditures for Chat GPT, AI-security cameras, etc. start to decline, then machines like these robots will fill that demand void for AI.

https://mashable.com/article/1x-neo-humanoid-robot-preorder

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There is no "AI" in that "robot" - it's literally teleoperated by dot indians in VR goggles:

https://m.youtube.com/watch?v=n_VmMrAJc9Q&pp=ygUObmVvIHJvYm90IHNjYW0%3D

RWSGFY says

There is no "AI" in that "robot" - it's literally teleoperated by dot indians in VR goggles:

https://m.youtube.com/watch?v=n_VmMrAJc9Q&pp=ygUObmVvIHJvYm90IHNjYW0%3D

Yes I agree, but that robot will have AI once it completes that training phase and goes into low rate initial production.

AD says

RWSGFY says

There is no "AI" in that "robot" - it's literally teleoperated by dot indians in VR goggles:

https://m.youtube.com/watch?v=n_VmMrAJc9Q&pp=ygUObmVvIHJvYm90IHNjYW0%3D

Yes I agree, but that robot will have AI once it completes that training phase and goes into low rate initial production.

Or not.

RWSGFY says

AD says

RWSGFY says

There is no "AI" in that "robot" - it's literally teleoperated by dot indians in VR goggles:

https://m.youtube.com/watch?v=n_VmMrAJc9Q&pp=ygUObmVvIHJvYm90IHNjYW0%3D

Yes I agree, but that robot will have AI once it completes that training phase and goes into low rate initial production.

Or not.

So you are saying that the robot company may view it more profitable to just have "dot Indians" to manually operate the robots instead of producing autonomous or AI-chip robots ?

AD says

Google’s AI-related revenue

Another example of Google's AI - related revenue stream.

https://finance.yahoo.com/news/google-strikes-game-changing-3-110000267.html

Google has helped to secure a 10-year, $3 billion artificial intelligence hosting contract with Bitcoin miner Cipher Mining and U.K.-based AI computing startup Fluidstack.

In exchange, Google will receive a 5.4% equity stake in Cipher. But since AI training is known for being energy-intensive, and dirty fuels still power most facilities, the deal could spell bad news for the environment.

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RWSGFY says

AD says

RWSGFY says

There is no "AI" in that "robot" - it's literally teleoperated by dot indians in VR goggles:

https://m.youtube.com/watch?v=n_VmMrAJc9Q&pp=ygUObmVvIHJvYm90IHNjYW0%3D

Yes I agree, but that robot will have AI once it completes that training phase and goes into low rate initial production.

An android will need AI semiconductors.

Or not.

The goal is for an android like Data in Star Trek Next Generation. Gene Roddenberry was a brilliant visionary, and so was Steven Speilberg with his movie AI.

AD says

Yes I agree, but that robot will have AI once it completes that training phase and goes into low rate initial production.

Just like all those self-driving cars?

AD says

The goal is for an android like Data in Star Trek Next Generation. Gene Roddenberry was a brilliant visionar

"Rossum's Universal Robots" came out un the 1920s. In fact, the author coined the word "robot" from a Czech noun for "work." His robots were human-like and intelligent. They also became self-aware and wiped out humanity in a civil war.

HeadSet says

AD says

The goal is for an android like Data in Star Trek Next Generation. Gene Roddenberry was a brilliant visionar

"Rossum's Universal Robots" came out un the 1920s. In fact, the author coined the word "robot" from a Czech noun for "work." His robots were human-like and intelligent. They also became self-aware and wiped out humanity in a civil war.

"RUR" - in the end, the creator fabricates a pair of self-replicating robots to continue civilization.

A low-budget movie along these lines was "Creation of the Humanoids."

From the Kobessi Letter

The elephant in the room:
AI stocks are outperforming consumer stocks by 20%+ over the last 60 DAYS. And, as AI investment exceeds $1 TRILLION per year, car repossessions are at 2009 levels. There are 2 US economies:
Rich vs Poor, and AI is the lifeline of it all.
For the first time in history, the Magnificent 7 stocks are now worth over a combined $20 TRILLION. This means that these 7 stocks alone now account for a record ~35% of the S&P 500. Not even the Dot-Com bubble in 2000 saw concentration like this. Tech has taken over.
And, this has been fantastic for investors. Since the April 2025 bottom, the S&P 500 has added over +$18 trillion in market cap. Last week, Nvidia became the first company to become worth over $5 trillion. Over HALF of the S&P 500's gains since 2023 are from 7 stocks.
But, on the other side of the table is a more bleak picture. Consumer-facing stocks are getting crushed, and the latest earnings season only underscored that. Take a look at the YTD performance of these consumer stocks. General Mills and Kraft Heinz are in a bear market.
The list goes on and on:
Take a look at Starbucks now down -11% YTD, and Chipotle down -47% YTD. Wendy's is down -48%, and Sweetgreen is down -80% this year ALONE. Many of these corporations cite a decrease in demand due to inflation and the economy.
Chipotle's CEO said it blatantly last week:
Young Americans are pulling back on eating out, specifically those in the 25 to 35 age group. "Unemployment, increased student loan repayment, and slower real wage growth" are supposedly to blame.
The data generally agrees.
The economy is particularly bad for Americans who are seeking entry level jobs. The US unemployment rate for youth graduates aged 20-24 has averaged 8.1% over the last 3 months, the highest in 4 years. This is up sharply from under 4% just 2 years ago, when the AI boom began.

********** Without Artificial Intelligence (AI) spending, the US economy would likely be contracting right now. AI spending contributed ~1 percentage point to the 1.6% US GDP growth rate recorded in the first half of 2025. This means ~63% of economic growth came from AI investment. This is by far the most on record. *************

As a result, US market concentration has hit levels not seen since the 1880s. In other words, the market is the least diversified in ~140 years. This isn't necessarily "bad" for stocks, if tech keeps on rising. But, those without exposure to stocks are being left behind.
And, while asset owners generate TRILLIONS in market cap, car repos are at 2009 levels. In 2024, 1.73 million vehicles were seized, up +16% YoY and +43% compared with 2022. We are literally in an economy where you are either "rich" off of AI or having your car repossessed.
Lastly, the Fed is cutting rates into stagflation and asset prices are rising sharply across the board.

And to continue my last post (# 343) just look at how bad Las Vegas stocks are now. Less are willing to pay to vacation and gamble in Las Vegas.

Michael Burry betting that AI-stocks runup will end soon



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Michael Burry's net worth

AD says

Take a look at the YTD performance of these consumer stocks. General Mills and Kraft Heinz are in a bear market.
The list goes on and on:

I think we are seeing is people switching from name brands to store brands or no name brands. This also applies to things like tires in that people now mostly default to the cheapest Chinese crap that they can find. Storage stocks are getting hit too; I think that is because of all the local competition. You would think that with high rents and not so great economy that there would be a bigger demand for storage units? There either isn't or they are being built in such a way as to outstrip demand. Only looking at storage stocks for the dividend, but can't justify buying when the price keeps falling.

AD says

And to continue my last post (# 343) just look at how bad Las Vegas stocks are now. Less are willing to pay to vacation and gamble in Las Vegas.

Vegas has priced itself out of the market!

AD says

But, on the other side of the table is a more bleak picture. Consumer-facing stocks are getting crushed, and the latest earnings season only underscored that. Take a look at the YTD performance of these consumer stocks. General Mills and Kraft Heinz are in a bear market.

Campbells Soup, also another known dividend payer getting clobbered as people switch away from name brands.
Pfizer also down, but we know the reasons for that.

AD says

Michael Burry betting that AI-stocks runup will end soon



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Michael Burry's net worth

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Now after Michael Burry's announcement on Nvidia, Peter Thiel has sold all his stock ownership of Nvidia

https://www.thestreet.com/investing/peter-thiel-dumps-top-ai-stock-stirring-bubble-fears

AD says

Michael Burry betting that AI-stocks runup will end soon



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Michael Burry's net worth

If he invested these $100M he got from shorting the subprime market in 2007 in S&P index fund after the 2008 crash he'd be sitting on ~$1B now. And ~$2B if invested in QQQ.

Instead he's worth puny $300M. Smart, so smart.

Bank of America raised its long-term sales estimates for Nvidia

Bank of America has raised its long-term sales and earnings estimates for Nvidia, citing explosive demand for AI infrastructure and strong pricing power across its chip lineup.

📈 Updated Forecast Highlights
• Revenue Projections:
• Bank of America now estimates $300 billion in annual revenue from Nvidia’s Blackwell and Rubin chips by 2026.
• This represents a 20% upside to previous forecasts and reflects accelerating enterprise adoption of AI hardware.
• Earnings Outlook:
• The firm projects $8 per share in calendar year 2026 EPS, implying a valuation of 25x earnings—considered reasonable given Nvidia’s growth trajectory.
• Earlier in 2025, BofA raised its price target from $160 to $180, and later to $200, suggesting potential for a 60% rally from current levels.
• Strategic Confidence:
• Analysts dismissed concerns over China export restrictions as “irrelevant” to Nvidia’s near-term earnings, emphasizing robust demand in other regions.
• Nvidia’s average selling prices are reportedly rising more than 50% generation-on-generation, boosting margins and long-term profitability.

🧠 Why It Matters
• AI Infrastructure Boom: Nvidia is positioned at the center of a projected $3–4 trillion annual AI infrastructure spend by 2030, according to Morningstar.
• Investor Sentiment: Despite recent volatility, Wall Street remains bullish. Nvidia stock trades near $190, about 8% below its October peak.

RWSGFY says

AD says

Michael Burry betting that AI-stocks runup will end soon



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Michael Burry's net worth

If he invested these $100M he got from shorting the subprime market in 2007 in S&P index fund after the 2008 crash he'd be sitting on ~$1B now. And ~$2B if invested in QQQ.

Instead he's worth puny $300M. Smart, so smart.

But he's been "contrarian investing" and "active in macroeconomics bets"! A man got to do something with his time!

Also interesting besides this circular investing between Open AI, Oracle and Nvidia is that Michael Burry is assailing essentially accounting fraud in regards to the "AI companies" like Meta or Facebook are knowingly depreciating assets (i.e., AI systems) beyond their likely useful life causing stocks like Meta being artificially inflated by about 20%.

........................................................................................................

Michael Burry's depreciation observation is that major tech companies ("hyperscalers") are allegedly overstating their earnings by using unrealistically long depreciation schedules for their AI computing equipment, such as Nvidia chips and servers. He calls this practice "one of the more common frauds of the modern era".
Core Argument
Extended Useful Life: Burry argues that while the AI hardware market features rapid technological advancements, often with a 2-3 year product cycle for new, more powerful chips, companies are depreciating this equipment over 5-6 years.
Inflated Earnings: By extending the "useful life" of an asset on their books, companies reduce their annual non-cash depreciation expense, which in turn artificially inflates their reported net income and makes their profits look higher than they are in economic reality.
Projected Impact: Burry estimates that this accounting practice could lead to a collective understatement of depreciation expenses by $176 billion across these tech giants between 2026 and 2028. He projected that by 2028, Oracle's earnings could be overstated by 26.9% and Meta's by 20.8%.
"Race Against Time": The issue creates a "race against time" where companies are rapidly spending capital (capex) on new infrastructure, hoping that future AI-driven revenues will eventually catch up and justify the massive investment before the current hardware becomes technologically obsolete and requires significant write-downs (impairments).
Company Actions
Several companies have adjusted their depreciation schedules:
Meta extended the useful life of its network equipment from 4-5 years to 5.5 years earlier this year.
Alphabet and Microsoft have made similar moves, extending their useful lives to six years.
Amazon recently moved in the opposite direction for a subset of equipment, reducing the useful life estimate from six years back to five years, citing the "increased pace of technology development, particularly in AI and machine learning".
Market Context
Burry's observation is part of a broader critique of the AI sector, which he believes is in a bubble. He has also disclosed short positions in Nvidia and Palantir. Critics suggest that while Burry's analysis may be "early" (a common theme for his famous 2008 housing market short), the concerns about the long-term return on investment for AI capital expenditures are shared by others, including some analysts at BlackRock.

He assumes algorithms won't improve over the next years. A very bold assumption.

Anyone buy the dip today? I put in a buy for Wendy's if it hits $7.80.

HeadSet says

Anyone buy the dip today? I put in a buy for Wendy's if it hits $7.80.

Nope my stonks were mostly up today, one ran 6%. I agree with Burry on the tech/AI bubble but there won't be a crash, at least not for now. Just poor performance of the sector for a while.

mell says

HeadSet says

Anyone buy the dip today? I put in a buy for Wendy's if it hits $7.80.

Nope my stonks were mostly up today, one ran 6%. I agree with Burry on the tech/AI bubble but there won't be a crash, at least not for now. Just poor performance of the sector for a while.

We can’t use market fundamentals to analyze anymore. It’s not a free market, it’s heavily manipulated. It would have crashed while ago and self corrected. Now we have massive manipulation to keep it afloat by corporations, government, investors… it’s all fake.

At this point it’s just gambling,

FortWayneHatesRealtors says

mell says

HeadSet says

Anyone buy the dip today? I put in a buy for Wendy's if it hits $7.80.

Nope my stonks were mostly up today, one ran 6%. I agree with Burry on the tech/AI bubble but there won't be a crash, at least not for now. Just poor performance of the sector for a while.

We can’t use market fundamentals to analyze anymore. It’s not a free market, it’s heavily manipulated. It would have crashed while ago and self corrected. Now we have massive manipulation to keep it afloat by corporations, government, investors… it’s all fake.

At this point it’s just gambling,

That's why iTulip closed up shop almost 10 years ago - EJ considered the entire economy to be bullshit fake.

FortWayneHatesRealtors says

We can’t use market fundamentals to analyze anymore. It’s not a free market, it’s heavily manipulated. It would have crashed while ago and self corrected. Now we have massive manipulation to keep it afloat by corporations, government, investors… it’s all fake.

At this point it’s just gambling,

Also there could be another "industrial revolution" or economic surge such as with internet and ecommerce stocks in the 1990s. A lot of money is going to AI capital expenditures which are benefitting the major stocks like Google and Nvidia. That is why Google is up at least 58% year to date. Both companies revenue has skyrocketed this year because of AI.

But how long will this rate of growth continue ? It is bound to slow down.

"Circular finance deals" are part of the current boom in AI, and Mish Talk website has an excellent article about this titled "S&P 500 Bounce Off Support, What About Bitcoin?".

Mister Mish brought up a great example about Lucent doing the same with financing upstart telecom and internet companies and then its stock collapsing +90% as part of the internet stock bubble.

Lucent's stock collapsed starting in early 2000, and by 2002, it had dropped from a high of over $63 per share to under $1. The collapse was due to a series of factors, including the bursting of the dot-com bubble, accounting issues, failed mergers, and a sudden downturn in demand for telecommunications equipment.

Many of the smaller, riskier start-ups that Lucent lent money to, such as Winstar Communications and Global Crossing, did not survive and eventually went bankrupt, leading to significant financial losses and write-offs for Lucent. However Sprint (later acquired by T Mobile) and Verizon were Lucent equipment customers who survived.

AD says

Lucent's stock collapsed starting in early 2000, and by 2002, it had dropped from a high of over $63 per share to under $1. The collapse was due to a series of factors, including the bursting of the dot-com bubble, accounting issues, failed mergers, and a sudden downturn in demand for telecommunications equipment.

I was on the front lines for this as an employee for a small process measurement and control company that sold to the big OEM's that sold turnkey production lines to fiber producers such as Lucent, Corning, General Cable, Sumitomo, and others - all of whom had a huge manufacturing presence in my state of North Carolina (Lucent was in Georgia just north of Atlanta on 85).

Fiber was the sexy "AI" of the early 2000's and they overbuilt production capacity in anticipation of FTTH (fiber to the home) for every house in the U.S. When the demand didn't materialize and improvements in switches increased capacity of existing fiber all of these companies had active production capacity or capacity in the pipe line that became worthless in the space of 6 months.

Suddenly 70% of the process engineers and engineering managers I was working with disappeared. IIRC this was at least a year after the dot com bust but it got almost no national news coverage. It was a big deal in NC and the state even passed a law allowing these companies to depreciate 100% of their production equipment in one year - the only caveat was that all of this equipment had to go to the land fill immediately to get the tax benefit.

It was surreal hearing about brand new never turned on multi-million dollar fiber drawing towers at Siecor (a joint venture between siemens and corning) and general cable being de-installed and trashed before they ever got into production. My employers' revenue (we were small) for the Southeast went from 300k in 1997 to over 3 million in 2000 down to about 200k by 2002. It was brutal.

stfu says

My employers' revenue (we were small) for the Southeast went from 300k in 1997 to over 3 million in 2000 down to about 200k by 2002. It was brutal.

Yes, seems like in most industries especially technology that it is never steady, straight line growth which in your case is with the fiber optic sector. It seems more like a speculative boom-bust, feast or famine environment.

At least your small company survived, as so will the big players like Google and Nvidia will survive albeit with some proverbial bruises and at least some small AI firms will also after the AI bubble pops or slowly collapses.

So what is the status of your small company now ? How long did it take to return to 1997-level sales ?

AD says

So what is the status of your small company now ? How long did it take to return to 1997-level sales ?

They're still in business but I have no idea of numbers or if they ever got back to the sales figures we achieved back then. They have a diversified business selling into Plastic, medical, and rubber extrusion and hot and cold steel. Wire and Cable used to be 80% of revenue when I first started with the company but it was below 50% when I left.