AI Is The New Macro

Added: 2026-05-15

[00:00:00]You got a lot of interesting things you've been talking about recently. I want to dig in with you, but for anybody who doesn't know Phil, Fulbright scholar, he's author, reporter, hugely successful founder. He's known for opening Bell Daily. We've got a link for that down below in the description here.

[00:00:15]So, go check that out. Also, follow Phil over on X. Now, this is read by Wall Street professionals and novice newcomers alike. It's a fantastic publication and it's regularly landing on 350,000 Bloomberg terminals. Dude, how did you swing that? That's awesome.

[00:00:28]I you know, I'm just trying to study the markets as best I can and whoever wants to follow along, uh, I hope you enjoy the ride. So, that's really all it is. I love it. I love it. Look, let's get into it and start just hitting some value because you wrote an article recently called the surprising reason stocks are defined to sell in May and go away. So, pointing out the historical seasonality says to sell at this time of year. So, what is your sort of take on that? What's the the takeaway that people should know here regarding this such popular saying?

[00:00:55]It just sounds sell in May and go away.

[00:00:57]It rhymes. Fantastic. But, beyond it rhyming, what's the actual value of this as an investment strategy? You know, typically we can look back to any year in Wall Street history and the seasonality suggests that, yeah, sell in May and go away because this is the weakest six-month stretch of the year for the S&P 500. But, my sense right now is that earnings continue to crush, analysts continue to revise their earnings estimates higher, actually, way more than typical. So, in in the first month of the second quarter, analysts have already revised their earnings expectations higher when at this point of the year they're usually lowering them right now. So, to me, that also runs counter to the sell in May thing.

[00:01:41]And if you look at the AI trade that's been propping up the market, you got a lot of people saying, "Hey, this is a bubble. We're getting too frothy. We're getting overextended." And yes, we have a bit of a pullback today, but in reality, the fundamental story to me is only getting better. It's a lot better than at the start of the year and on a forward earnings perspective, tech stocks are actually cheaper today than they were four months ago. So, I'm not in the camp that sell in May is the right strategy this year and as you probably can guess, I am not in the bubble camp either. The price to earning the earnings story with these tech companies has been absolutely insane.

[00:02:18]You look at something like Micron Tech and I think the Don't quote me on this, but I remember seeing something like the PEs like eight X or something like that and it's just been soaring. This stock's been going absolutely crazy. But, we have almost a trillion dollars in capex this year. Is that primarily what's holding up all this AI trade right now?

[00:02:34]I think so. I mean, that that's a big part of it and right now we're going to have all the hyperscalers trillion dollar capex that is being transferred into various winners and losers across the AI value chain. And the thing about Micron, that has been the most contentious stock of the last couple weeks because everyone's saying, "Okay, this thing might not be able to run any higher. It's already gone from 100 billion to 800 billion in about a year, which is absurd to think about it as far as a market cap change. But, to me, they can't even fulfill all their orders for the next year. So, if they're booked out for a year plus and you have all these customers, including the hyperscalers, lining up for their products and their chips, I'm not sure that I would be ready to call a top on Micron anytime soon. My guess is that they will hit a trillion dollar market cap before the end of the year. I don't think that's an absurd jump because again, going from 100 billion to 800 billion in less than a year, I think they can get the last 200 billion to get to the next milestone here pretty quickly. Yeah, it's only what, 25% higher or something like that.

[00:03:43]But, there has been some huge froth. I mean, the monthly RSI on SanDisk is 98.

[00:03:51]98. You almost never see that happen on any assets. Like, some of these things are mind-blowingly overbought. So, is there a case for if you're late to the AI trade, you're late to Micron, you're late to SanDisk, or some of these others, is it worth at this point trying to chase these names? Cuz we had Paul Tudor Jones come out the other day, which is someone, you know, a goat investor, someone I massively respect, and he came out and said, "Yeah, I'm buying AI stocks." I'm like, "Paul, you're buying AI stocks here? That's crazy, man." So, the big names, the ones everyone's talking about, is there a case to be chasing that potential 25% move on Micron Tech, or are there some lower-cap names, some lower-cap niches that still have big potential to run for people who might be looking for a catch-up trade? You know, I would never try to go against the goats in investing, of course, but from where I'm sitting, look, the price action, I would say it looks a little frothy compared to historical norms, and I just published a chart this morning that showed the semiconductor index, SOX, is about 35% above its 50-day moving average, and that's just the third time it's happened in 30 years. So, that is a sort of technical warning sign right now that we are a little overbought, and you had the pullback today, so maybe that's going to soothe things a little bit. I'm not sure, but on a fundamental side, it's a totally different story than what the price action suggests. Price action, it looks like the dot-com bubble, honestly.

[00:05:17]Like, you have all these parabolic charts, you have all these lines that go straight up, and it looks pretty ridiculous. But then you look at the supply-demand story, you look at the cash flow, the fundamentals behind all these companies, and everything looks kind of mind-blowingly robust. So, who am I to argue against those numbers? To me, it's like, would you buy in Micron at 800 bucks? I don't think you're late, especially if you don't think that AI is a bubble right now, cuz, you know, you have guys like Dan Ives saying we're still in the very early innings of a broader AI revolution. And if we're in in inning three or four of nine innings, then what? How high could Micron go or something like Nvidia or even a Google, which both of those companies are running to 5 trillion right now.

[00:06:05]Micron's on the way to 1 trillion. Could all of those double from here? Maybe. I don't know. It's not I would say if you believe in AI, you believe in the technology and the companies that are driving it, why would it not make sense for Google and Nvidia, let's say, to hit 7, 8, 9 trillion dollars in the next few years? I don't think that's an absurd outlook. And you know, I I certainly hold those names as well myself, and I'm not going to be selling anytime soon.

[00:06:32]It's interesting when people make the dot-com comparison because well, I was not an investor during the dot-com era by any means. The Well, how old was I during the dot-com bubble? I think I was like 14, 15, something like that. So, I wasn't really investing yet. When you look back at the dot-com, the reality of that was that the earnings were not there, right? We were trading on hype alone for the dot-com bubble. The AI bubble is fundamentally different because the earnings is telling an incredible story despite how overbought some of these things are. Look, there's going to be big pullbacks along the way for everybody listening. There's always big pullbacks along the way. But, the earnings are there, and the reality is we have an entire new sector essentially being birthed right now. And the long-term implications for AI are just nuts. Now, here's an interesting thought for you, Phil, because in case you haven't seen, the world is literally ending right now. And we're not talking about hentai virus here. We're talking about the Strait of Hormuz, the Iran conflict, the oil. But, the market doesn't care about all this geopolitical tension. We've had the one of the craziest V-shaped recoveries. The the QQQ's up 20, 25% in the last 6 weeks. It's absolutely nuts. So, what are you seeing here? Why are investors simply not caring about what's going on here regarding the Iran situation, the oil situation, all that stuff? You know, the the easiest way to think about it, AI is the macro right now. It doesn't matter what's going on in the Middle East, with Iran, even with President Trump in the White House and their foreign policy. The thing that is moving markets right now is AI. AI is the new macro. It's going to be the new macro for some time. That story is not going to change. And the craziest thing about the market right now, all the pockets of the market that people say are a bubble are getting cheaper. So, that to me it's like if you just think about that alone, what could it possibly mean if we have happenings geopolitically overseas that are going to change that fact? I I'm not really sure and I I think a lot of investors I'm speaking with and the ones I'm interviewing on my show, they they're not even talking about Iran right now. And sure, maybe it's making the most headlines and it is important from a, let's say, war and political, humanitarian viewpoint. All those things matter a lot, but from a pure price perspective in the market, the thing that is moving prices is AI because that is the defining story, that is the defining narrative. And again, the lens to look at everything right now, AI is the new macro.