In reality, the biggest returns tend to come from looking where others aren’t – overlooked, less crowded areas of the market.

In today’s issue, InvestorPlace Senior Analyst Brian Hunt uses a simple Easter egg hunt analogy to illustrate a powerful truth: the fewer competitors you have, the better your odds of finding outsized opportunities.

It’s a timely reminder that shifting where you “hunt” can dramatically improve your results.

Now, I’ll let Brian take it from here…

Picture this…

It’s Easter, and you’re ready for the neighborhood Easter egg hunt.

Over 100 eggs have been hidden in a small local park. Each egg has a treat inside it. You’re told that one special egg even has a cash prize in it.

If you’re in this hunt, which of the two following scenarios would you rather be in?

If you’re like most reasonable people, you picked B.

You’d rather have this:

Than this:

You’d rather have just 10 people in competition with you… instead of 1,000 other people picking over the park like a swarm of locusts.

What does this have to do with investing?

Well, this same dynamic is at work in the stock market every day.

The financial markets are where millions of people go to pick through opportunities in stocks, commodities, currencies, options, bonds, and real estate.

In this big market, everyone is looking to buy assets for less than what they are worth and looking to sell assets for more than what they are worth.

Essentially, everyone is trying to outsmart everyone else.

Everyone is looking for eggs.

The financial markets price most assets correctly most of the time.

However, it’s not a perfect system. Windows of opportunity – where you can buy assets for less than what they are worth or sell assets for more than what they are worth – appear from time to time.

In the investing world, these windows are called “market inefficiencies.”

These are the opportunities that can make us big money.

However, the more people that are studying, monitoring, and picking over a market and its opportunities, the more competition you have in that market… and the less likely you’ll be able to find market inefficiencies.

The more people picking over a market, the smaller its pricing inefficiencies will be and the shorter its windows of opportunities will be open.

In the financial markets, the biggest competitors are “institutional investors.”

Institutional investors are the elephants of the financial markets. This group includes mutual funds, pension funds, large hedge funds, and insurance funds. It also includes sovereign wealth funds, which manage the savings of entire nations.

A single large institutional investor can manage over $10 billion in assets.

So, even a wealthy individual with $5 million in assets is a mouse compared to this elephant (in this case, the elephant is 2,000 times larger).

Some institutional investors manage much more than $10 billion.

The sovereign wealth fund of Norway – which has been fattened by oil revenue for years – was worth more than $1 trillion in 2017.

This is 100 times bigger than the large institution with $10 billion to invest.

The large institutional investors of the world have ridiculously giant amounts of money to invest in stocks, bonds, and other assets.

These large institutional investors typically employ armies of analysts who spend hundreds of thousands of hours every year scouring the world for opportunities.

These analysts perform a lot of old-fashioned “financial detective” work by visiting public companies and interviewing industry experts.

They also use the world’s most advanced computer algorithms and “Big Data” analytical programs to comb through market data.

The programs run 24 hours a day, seven days a week… sifting all of the world’s financial data a thousand different ways at warp speed… hunting for pricing inefficiencies, small and large.

Picture those Easter egg hunts again… and realize that the stock market is a brutally competitive Easter egg hunt.

That’s the bad news.

The good news is that the financial market is a big, diverse place.

And there are Easter egg hunts the big guys can’t participate in.

The Problem of Size

In the investment world, professional investors obsess over “liquidity.”

When it comes to buying and selling investments, liquidity is a measure of how easy or difficult it is to transact in a security.

For example, take Amazon stock. Because Amazon is one of the world’s largest companies (worth over $2 trillion as of 2026), and since many people like to buy and sell its stock, we can say Amazon stock is “very liquid” or “has huge liquidity.”

There is a large market for Amazon stock where buyers and sellers execute many sales each day. In 2022, it was common to see over 70 million shares of Amazon change hands in a day.

On the other side of the spectrum, take an unknown small-cap firm with a market cap of just $50 million (less than one-tenth of one percent of Amazon).

Because this company is tiny by stock market standards, and since most people have never heard of it, the company’s stock will not have much liquidity.

Remember, market cap is simply the number of outstanding shares times the share price. That means with small-cap stocks, there simply aren’t all that many shares out in the market (compared to, say, Amazon, which we just talked about). This makes it harder for someone to buy up a huge amount of those shares – there may not be all that many sellers.

Now here’s where it gets interesting…

Let’s say you manage a $10 billion stock portfolio.

For a stock position to make a meaningful positive impact on your fund’s results, you need it to represent at least 3% of your fund’s assets.

Most good managers would rather put 4% to 8% of their fund into a stock idea they believe is truly great.

If you’re looking to put 3% of $10 billion to work in a great idea, that means you are looking to place $300 million.

That is six times more money than a $50 million small-cap.

Even if you wanted to put just 1% of your fund into a stock, that is $100 million.

You get the idea.

Big money managers can’t join in the small-cap stock Easter egg hunt.

They also can’t “play” in other small markets with limited liquidity, like many options markets, smaller investment funds (like closed end funds and ETFs), individual bonds, small-cap foreign stocks, and penny stocks.

When you “play” in small markets with modest liquidity, you don’t take on the world’s richest, most powerful institutions armed with armies of topflight analysts and the world’s best computers.

Instead of competing against thousands of other Easter egg hunters, you compete against modest amounts of them.

Think of it like you would buying a house. You want to be a buyer in an area with just a few other buyers… instead of being a buyer in a town where lines form down the block after homes go on sale. When you’re a buyer, you don’t want loads of competition.

I can’t resist rolling out one more analogy to get you on board:

Think of it like fishing. You don’t want to fish in the same spot as 1,000 other anglers. You’d rather have a quiet stream and its fish all to yourself.

Successful investing and trading are all about tilting the odds in your favor.

The more you can get this advantage, the more successful you will be.

Hunting in smaller, less liquid markets – like the small-cap market – is one of the best ways to do that.

Regards,

Brian Hunt

InvestorPlace Senior Market Analyst

P.S. 91����, here. Investing in small markets is an excellent way to protect yourself amidst today’s unpredictability… but knowing exactly which stocks to buy, which to sell, and when, can still be a challenge.

That’s why I encourage you to view my free “Sell This, Buy That” broadcast, where I explain my approach that’s led to gains across several sectors, including 60% and 30% in specific biopharma and energy companies.

Plus, I share the names of four companies to sell before they crater, and another four that could multiply your money in the coming months.

Click here for more information.

The post Why the Best Opportunities Are Off the Beaten Path appeared first on InvestorPlace.

Imagine starting an online business that isn’t available to 80% of Americans.

When Amazon went public in 1997, only about 20% of Americans had Internet access.

And, frankly, it looked ridiculous. Below is a screenshot of the website from those early days.

Not only was Internet usage low, but only about 37% of Americans even owned a computer in 1997.

So, investors who gambled on Amazon’s IPO were betting on an online book seller with no profits and very little reach, taking on established names like Barnes & Noble.

It’s easy to see why many investors dismissed the stock.

But inside Amazon, CEO Jeff Bezos wasn’t thinking about books.

In his 1997 shareholder letter, he called it “Day 1 for the Internet” – and made clear the company would “invest aggressively” in building its customer base, brand, and – perhaps most importantly – its infrastructure to create an “enduring franchise.”

Books were just the starting point. The revolution in a new online retail infrastructure was the real story.

We all know how this story turned out…

One share of Amazon bought then would become 240 shares today due to stock splits, and now sells for well over $200.

Those who understood what was coming and moved early built a fortune. Everyone who waited for confirmation might still have made money, but not to the extent of early movers.

A similar thing is happening right now in the stock market

People who understand the changes happening in the market have already changed their strategy… while retail investors stick to the same old methods of investing.

But it’s not 1997 anymore. You don’t have to guess what those insiders are thinking.

And you don’t have to wait years for their ideas to play out.

Today, the people building the future leave a trail for folks to follow. For those who know where to look, the trail isn’t difficult to find. They just have to follow what key insiders are doing…

Every time they write code…

Every time they release a new tool…

Every time other developers adopt their work…

They’re leaving a trail to where the next big breakthroughs are happening. Signals that can show up weeks – and sometimes months – before the market catches on.

That’s why some of the world’s smartest investors have already adapted.

They’re no longer relying on earnings reports, analyst upgrades, or any other data that could demonstrate that a company has “proven itself.”

Instead, they’re following this new trail, and detecting early signals to make short-term moves – getting in early and out before the rest of the market even as a chance to react.

In fact, one former hedge fund insider, working for our corporate affiliate Stansberry Research, has built an entire system around this idea…

The power of following “alternate signals”

This market approach identifies stocks with the potential to make major moves in as little as 90 days.

It has nothing to do with options…

Just following the same kind of “insider signals” that helped early investors spot companies like Amazon long before the rest of the world caught on.

Here’s a simple way to think about it…

Most investors follow what companies say by tracking earnings calls, press releases, and analyst coverage.

But the real signal often shows up in what companies do—before they say anything at all.

The signal is in what developers are building… and what other developers are adopting.

The signal is when a new tool, platform, or piece of code starts spreading rapidly among engineers…

Those are signs that something important is happening beneath the surface.

And by the time that shift shows up in quarterly earnings, the stock has usually already moved.

How to see it in action

This former hedge fund manager is going to reveal exactly how it works in a new presentation…including the name of one stock his system is tracking right now.

Next Tuesday, April 7, at 10 a.m. ET, you’ll have the chance to hear about his truly unique strategy at the Market Tremors 2026 event. The system behind it has flagged 442 winning trades since 2017 and could have turned $10,000 in each trade into nearly $620,000.

This strategy has virtually nothing to do with war in Iran, or any market indicator or trend you’ve likely heard about.

And that’s the point…

The man behind this hedge-fund-caliber trading strategy uses a system to analyze stocks and businesses in a way that few, if any, other analysts do. It stems from his years of expertise working at hedge funds and in the private sector as a tech insider.

Plus, the volatility we’ve seen so far in 2026 is a tailwind for this strategy, as it’s designed to deliver triple-digit gains in just 90 trading days… and then do it again, and again.

After signing up, you’ll get more details about the Market Tremors 2026 event, including stories about one of the world’s most envied hedge funds… what it really takes to find an edge on Wall Street… and a closer look at the man behind this strategy.

Then, just for tuning in next week, you’ll hear much more about this opportunity, plus two free stock recommendations… one to buy and one to avoid.

Sign up here now to make sure you don’t miss anything at this free event from our friends at Stansberry Research.

Enjoy your weekend,

Luis Hernandez

Editor in Chief, InvestorPlace

The post The Market Has Already Changed … but Most Investors Haven’t appeared first on InvestorPlace.

The book, which chronicles the miscalculations and rigid military thinking that led to the outbreak of World War I, would come in quite handy just a few months later during the Cuban Missile Crisis.

The existence of medium-range missiles in Cuba was a direct threat to the United States. But Kennedy was determined not to repeat the same missteps detailed in Tuchman’s book.

He knew that a crisis could escalate if the Soviets were backed into a corner. They needed room to maneuver, a way to choose de-escalation while still saving face.

But due to the growing thickness of the “fog of war,” it was difficult to determine the other side’s motives.

Ultimately, the Kennedy administration got what it wanted, and the missiles in Cuba were removed. The Russians got something out of it, too – the removal of U.S. missiles placed in Turkey.

The Fog of War Hanging Over the Market

Fast forward to this week, and we find ourselves once again in the middle of the “fog of war.”

Now, the geopolitical stakes may not be as high as they were in the Cold War, but the risks and uncertainty of the Iran war have driven many investors to the sidelines.

As a result, all of the major indices declined sharply in March. The S&P 500 and Dow closed out the month down 5% and 5.4%, respectively, while the NASDAQ declined 4.8%.

On Wednesday night, President Trump spoke to the nation about the conflict with Iran. He took a tough tone, and that caused the market to get up on the wrong side of the bed once again.

But on Thursday, rumors emerged that a deal could be in the works to reopen the Strait of Hormuz, and that’s caused a reversal.

At the time I’m writing this, that’s still a rumor. And, as investors, we can’t afford to overreact too much to rumors and innuendo.

Who’s in charge of Iran is a little unclear at this point. But what we do know is that the “fog of war” is likely to persist in April, as a ceasefire remains elusive and tensions in the Middle East remain elevated.

I suspect that stocks will continue to oscillate as investors react to the latest headlines regarding the Iran war, the Strait of Hormuz and rising energy costs. Mean reversion algorithms will also continue to play a role in the market’s oscillations, too.

But the biggest glitch for the stock market going forward will be inflation.

Inflation Strikes Again

There is no doubt that the conflict in the Middle East has driven energy, fertilizer and food prices higher. Even prior to the conflict, wholesale prices were already rising: The Producer Price Index (PPI) for February showed that food prices rose 2.4% and energy prices jumped 2.3%.

In the wake of the Iran war, both West Texas Intermediate (WTI) and Brent crude oil prices have surged above $100 per barrel. To put this into perspective… Brent crude oil rose about 55% in March, marking its biggest monthly surge on record. WTI crude oil also rose more than 50% in March.

With crude oil prices surging, Americans are feeling the pinch at the pump. Gasoline prices rose above $4 per gallon for the first time since August 2022. That’s an increase of more than a dollar since the start of the Iran war.

So, the March data for food and energy inflation is probably going to be hideous.

Some economists now expect U.S. inflation to exceed 4%. In fact, the OECD updated its inflation forecasts this week, projecting that inflation for the Group of 20 will rise to 4% in 2026, up from the previous 2.8% estimate. Inflation in the U.S. is anticipated to rise to 4.2%.

Due to the inflation “bubble” and higher Treasury yields, hopes for the Federal Reserve to cut key interest rates have been squashed for the time being.

Why I Want You to Remain Positive

Now, I know it’s hard to be excited after the gut-wrenching month of March. In this environment, it is very easy to be discouraged and to follow the crowds to the exits.

But here’s what I want you to remember: The stock market is currently oversold. So, when war concerns diminish or a ceasefire is established, the stock market will resurge in a massive relief rally.

I’m viewing the market’s pullback and the subsequent dip as a great buying opportunity for fundamentally superior stocks.

The fact is, we remain in a stunning earnings environment, and these are the stocks that should rebound impressively in the upcoming weeks, especially as the first-quarter earnings announcement season gets underway.

Remember, your best defense remains a strong offense of stocks with accelerating sales and earnings growth, positive analyst revisions and robust guidance.

Good stocks always bounce – and I look for my Growth Investor stocks to rebound 20% or more in the upcoming weeks, especially as the fog of war dissipates and our companies post wave-after-wave of positive quarterly results.

That’s because my Growth Investor stocks are showing 37.3% average annual sales growth and 144% average annual earnings growth. And ultimately, earnings are what drive stock prices – not the headlines.

So, if you want to learn more about Growth Investor, I encourage you to check out my latest research presentation by clicking here.

Sincerely,

91����

Editor, Market 360

The post How to Approach the Market During the “Fog of War” appeared first on InvestorPlace.

Right now, that money is flooding into AI infrastructure at an unprecedented pace. Hyperscalers are on track to spend more than $600 billion this year alone building the compute backbone of the AI economy. And as always, the biggest profits are flowing to the suppliers enabling that buildout.

But capital is always on the move, hunting for the next bottlenecks and finding new frontiers.

And one of the most important new frontiers in AI infrastructure is something most investors aren’t even looking at yet: underwater data centers.

It sounds unconventional. Yet it may be the next major evolution in how AI infrastructure is built – and one of the most overlooked investment opportunities in the entire AI trade.

Underwater Data Centers: A New Solution to AI’s Cooling Problem

Data centers are the critical component of this buildout. They are the physical backbone of the entire AI economy – where models are trained, deployed, and scaled.

But traditional data centers have one enormous structural cost problem: cooling. Keeping servers from melting requires industrial-scale HVAC systems that account for, on average, 40- to 50% of a data center’s total power consumption. That’s nearly half of every dollar spent on electricity going toward fans, chillers, and cooling towers rather than actual computation.

Some forward-thinkers, notably Elon Musk, believe outer space holds the key to solving this problem. In theory, space offers near-infinite solar energy and a naturally cold vacuum environment – both ideal for powering and cooling high-density compute. But for now, the cost, latency, and logistical complexity remain prohibitive.

That’s why others are pointing somewhere much closer to home: the ocean – and, more specifically, underwater data centers.

Seawater is free, plentiful, and cold. By submerging GPUs in the ocean, you eliminate the cooling problem almost entirely – reducing cooling’s share of total energy consumption from 40- to 50% down to roughly 10%. The result is a Power Usage Effectiveness (PUE) rating around 1.15, versus the 1.4 to 1.6 typical of even well-designed land-based facilities. That is a meaningful efficiency gap that translates directly to lower operating costs and lower carbon emissions.

Underwater Data Centers Are Already Operating at Scale

China, as it tends to do with emerging technologies, has moved first and moved fast. Two major underwater data centers are now operational:

• The Hainan Cluster: The world’s first commercial underwater data center, operated by Beijing Highlander/HiCloud off the coast of Lingshui County, Hainan Province. Currently serving live clients including China Telecom, Tencent, and SenseTime – running AI inference at 7,000 simultaneous queries per second. Already expanded to a second module in February 2025.
• The Shanghai Lin-Gang Wind-Powered Facility: Completed in October 2025 at a cost of $226 million. The world’s first wind-powered underwater data center, drawing 97% of its electricity from nearby offshore wind farms and targeting a PUE of 1.15. Phase one capacity: 198 server racks of AI-capable compute.

The Constraint That Delayed Adoption

Microsoft spent nearly a decade researching this concept under the banner of Project Natick, which found that submerged servers had a failure rate of just 0.7% versus 5.9% on land – an eightfold reliability improvement attributed to sealed, nitrogen-filled environments and the absence of human interaction. The company ultimately shelved the project – not because it failed, but because it arrived too early.

“The technology worked. The business case didn’t.” – Microsoft, 2024. 

Fast forward 18 months, and that calculus is changing.

The challenge that killed Microsoft’s commercial ambitions – the inability to quickly swap GPUs inside sealed pods – is a real constraint. But it is also a constraint that matters far less for specific workloads: stable inference serving, long-term archival storage, and edge compute at coastal density hubs. And importantly, these are large and rapidly growing markets.

Where Underwater Data Centers Actually Work

Underwater compute is a powerful niche complement to – not replacement of – terrestrial infrastructure; one that could attract significant capital because it solves specific, expensive problems that land cannot.

Two use cases are most compelling.

Coastal City AI Inference

Approximately 50% of the global population lives within 60 miles of a coastline. AI inference – serving real-time responses from already trained models – is latency-sensitive but far less dependent on constant hardware upgrades than training workloads. A subsea pod deployed offshore can serve dense coastal populations with lower latency and dramatically lower energy costs than a landlocked data center. Think of it as underwater edge computing: a permanent, high-density, energy-efficient inference node anchored to the ocean floor near the cities that need it most. As AI inference demand scales from millions to billions of daily interactions, the economics of coastal subsea compute improve significantly.

Long-Term Storage and Archival Compute

Storage hardware has a seven- to 10-year lifecycle – far longer than the 18- to 24-month GPU refresh cycle that makes sealed pods problematic for training workloads. That means that for archival data, compliance storage, digital sovereignty vaults, and frozen-model repositories, underwater data centers are close to ideal: lower power costs, higher hardware reliability, zero land footprint, and a stable thermal environment that extends hardware life. The world is generating data at an exponential rate, and it must be stored somewhere. Doing so under the ocean is increasingly cost-competitive.

Energy Co-Location

Beyond compute and storage, there’s a third driver emerging here. The world is building massive offshore wind capacity – hundreds of gigawatts over the next decade, particularly in Europe and the U.S. East Coast. The fundamental problem with offshore wind is transmission loss: you generate power 10 to 30 miles out at sea, then pay to move it onshore. An underwater data center co-located with an offshore wind farm would eliminate that transmission cost entirely. The wind farm becomes both the power source and the cooling infrastructure, in one integrated coastal deployment. China’s Shanghai facility is already doing exactly this.

Realistically, the total addressable market for this niche over the next five to 10 years could reach tens of billions of dollars – potentially approaching $50- to $150 billion depending on adoption rates. It’s a fraction of the overall AI infrastructure buildout – but a fraction of trillions is still a very large number.

More importantly, because underwater compute is capital-intensive and technically complex, it will attract a relatively small number of specialized suppliers who will capture outsized margins. That is exactly the dynamic that made terrestrial AI infrastructure suppliers so profitable.

How to Invest In the Underwater Data Center Supply Chain

The best way to invest in a new infrastructure wave is to own the supply chain. 

We saw how it worked with terrestrial AI compute. The infrastructure layer – Nvidia (NVDA) for chips, Vertiv (VRT) and Eaton (ETN) for power, Arista (ANET) for networking, Corning (GLW) for fiber – delivered spectacular returns for investors who understood this dynamic early.

That same logic applies to underwater compute. But that supply chain has a crucial difference: the most differentiated, highest-alpha layer is drawn almost entirely from the offshore oil and gas supply chain – not from tech. 

These are companies that AI investors have largely ignored because they don’t show up in any AI infrastructure ETF. 

That’s the opportunity.

Layer 1: Existing AI Infrastructure (Limited Upside)

Underwater data centers use the same compute hardware: Nvidia GPUs, Western Digital (WDC) and Seagate (STX) storage, Arista and Cisco (CSCO) networking. No incremental investment thesis here. Don’t buy these stocks for the underwater story if you already own them for the land story. They benefit marginally at best.

Layer 2: Partial Beneficiaries of Underwater Data Centers

Corning supplies fiber optic cable for both terrestrial and subsea applications. The underwater leg is a separate, higher-ASP product. Teledyne Technologies (TDY) makes subsea-rated hermetic connectors and penetrators with genuine marine heritage from defense and oceanographic work. Xylem (XYL) provides water quality and thermal monitoring around deployed modules. We expect these two will be legitimate secondary beneficiaries.

Layer 3: Pure-Play Winners In Subsea Infrastructure

This is where the investment case is most compelling. Every company in this layer built its core competency serving offshore oil and gas platforms. They know how to seal modules against saltwater corrosion, deliver power to the ocean floor, and install large structures in open water. Underwater data centers present the same engineering challenge with a different payload. These companies are now pivoting toward offshore wind and underwater compute as their next growth chapter – and the AI investor community has not yet connected the dots:

• Prysmian Group (BIT: PRY) is the world’s largest cable manufacturer with ~40% of the submarine cable market. It makes both the subsea power cable that delivers electricity from offshore wind to underwater pods and the fiber optic cable that connects them to terrestrial networks. Prysmian has a multi-year order backlog and strong pricing power – the single most direct publicly traded play on underwater data center infrastructure.
• NKT A/S (CPH: NKT) absorbed ABB’s high-voltage cable unit and now has ~45% of its high-voltage backlog in offshore wind. It looks to be the purest play on the subsea high-voltage direct current (HVDC) infrastructure that powers coastal underwater compute deployments.
• Nexans (EPA: NEX) is the No. 2 subsea power cable manufacturer, with the highest proportional offshore wind revenue exposure of the major European cable makers. Complementary to Prysmian with a different geographic mix.
• TechnipFMC (NYSE: FTI) specializes in offshore engineering and subsea systems. It’s the only major Layer 3 name trading on a U.S. exchange in a straightforward way. It partners with cable makers on complex subsea installation projects and sports a deep engineering moat.
• Subsea 7 (OSE: SUBC) is a marine installation contractor that owns cable-laying vessels – the true physical chokepoint of the entire industry. You cannot deploy an underwater data center without one. There are very few of them, they take years to build, and their operators charge accordingly.

Note: Prysmian, Nexans, NKT, and Subsea 7 trade on European exchanges (Milan, Paris, Copenhagen, Oslo respectively). They are accessible via international brokerage accounts, and some trade as OTC names in the United States. TechnipFMC (FTI) is the most direct NYSE-listed exposure. 

This accessibility gap is part of why these names are underowned by American AI infrastructure investors – and part of why the opportunity exists.

Why Underwater Data Centers Are an Early Stage AI Opportunity

There are really only two things you need to be right about to make serious money in markets. 

First, follow the money. Second, find the story that no one is paying attention to yet.

The AI infrastructure buildout checks the first box so decisively that it barely requires argument. Six hundred billion dollars of annual hyperscaler capex. Sovereign AI initiatives from Washington to Riyadh to Tokyo. A global race to build compute capacity faster than the next country, competitor, or model generation. The cash flow is unprecedented, and it’s going straight to the suppliers.

The only question is which suppliers the market has already priced in – and which it hasn’t.

Underwater AI compute checks the second box in a way that very few emerging themes manage. The concept is already operable, as China has proven at commercial scale. The efficiency gains are genuine. The use cases are defensible. And the supply chain is almost entirely invisible to the typical AI infrastructure investor.

That invisibility is the opportunity because markets price what people are paying attention to. When very few people are connecting the offshore oil and gas supply chain to the underwater AI infrastructure buildout, there is real potential for a re-rating when the narrative catches up to reality.

The Bottom Line

By our estimate, we are roughly at AI’s equivalent to cloud computing’s 2012-13 moment: the technology is proven, the first commercial deployments exist, the economics are becoming clear, and the investment community has not yet built a coherent framework for how to play it. 

The next 24 to 36 months will be when that framework takes shape – and the early investors in the right names will be well-positioned when it does.

Underwater data centers are a good example of how early this buildout still is.

Capital is still chasing bottlenecks, still finding new frontiers, still expanding the infrastructure layer in ways most investors haven’t fully processed yet.

But that phase doesn’t last forever. Once the infrastructure is in place, the value shifts – quickly – toward the platforms that sit on top of it.

That’s where the next phase of this story plays out. And right now, one company sits at the center of it: OpenAI.

Most investors will only have access after it goes public.

We’ve found a way in earlier.

Watch our full breakdown on this pre-IPO opportunity right here.

The post Is the Next AI Gold Rush Happening Beneath the Ocean? appeared first on InvestorPlace.

That’s exactly what legendary investor 91���� believes is happening right now inside the $3 trillion private credit market.

In today’s Friday Digest takeover, Louis explains how years of easy money may have kept a growing number of companies alive – not because they’re strong, but because financing was cheap and abundant. Now, with interest rates higher and conditions tightening, some of those businesses may be far more fragile than they appear.

He calls them “zombie companies.”

Below, Louis breaks down why this matters now, why June 30 could be a key inflection point, and how to spot the warning signs before the market does.

He also lays out his full game plan – including the specific stocks he believes are most vulnerable, and where capital may rotate next – in a presentation you can watch right here.

If Louis is right, this is a risk most investors won’t see clearly until it’s too late.

I’ll let him take it from here.

Have a good evening,

Jeff Remsburg

Zombie-themed movies and TV shows are very popular, so you probably know the pattern.

Many things look normal. People go to work. Stores are open. Life goes on.

But underneath the surface, something is wrong.

The infected are still walking around… still functioning… still blending in.

Until suddenly, they’re not.

The same is true of some companies. From the outside, everything looks normal, but they are rotting away on the inside.

For years, Sears looked like a company that was still humming along.

And technically, it was. The stores were open. The stock still traded. Management kept promising a turnaround.

But in reality, the business was being kept alive by asset sales, financial engineering, and borrowed time.

That is what I call a “zombie company.”

And if I’m right about what’s happening in private credit, investors may suddenly discover there are more of them out there than they realized.

In recent essays, I’ve explained how the private credit market grew into a $3 trillion shadow banking system, how investors may be able to profit from a coming flight to quality – and why June 30 could become a potential day of reckoning for this whole mess.

Why June 30? Because that’s when many private credit vehicles will be forced to update investors on what their holdings are really worth. And if some of those loans have been kept afloat by extensions, restructurings and wishful thinking, then this could be the moment when a lot of that hidden stress bubbles straight to the surface.

Today, I want to focus on what that could mean for investors’ portfolios.

Because if this private credit story keeps unfolding, some stocks are going to be a lot more vulnerable than others.

And believe me, you don’t want to be caught owning one of them if the private credit bubble begins to burst.

The “Zombie” Companies

A zombie company is not always obvious at first glance.

On the surface, it may look like a normal, functioning business. Revenue may still be coming in. Management may still be talking confidently. Wall Street may still be giving it the benefit of the doubt.

But underneath the surface, the story is very different.

These are companies that have been kept alive by easy money, cheap refinancing and constant access to credit. They do not really stand on their own. They depend on lenders continuing to extend terms, roll over debt and keep the game going.

That worked for a long time.

But now the environment has changed.

Roughly 80% of private credit loans are floating-rate, meaning they are at the mercy of prevailing interest rates.

That’s a problem, because borrowers’ interest costs have surged as rates have climbed.

In many cases, loans that once carried 4%-5% interest are now costing 12%-15%. That’s a massive jump, and it’s putting serious strain on already leveraged companies.

Now, to get the full details on what’s happening in private credit – and what I believe investors should do to protect themselves – you can learn more in my full presentation here.

In the meantime, in the next part of my interview series with InvestorPlace Editor-in-Chief Luis Hernandez, I explain why some so-called “zombie” stocks could be especially vulnerable if the private credit story keeps unfolding… and what investors should be watching for now.

Click the play button below to watch my conversation with Luis.

Are You Holding One of Them?

Here is the part that matters most.

This is not just a story about private credit funds or some hidden corner of Wall Street.

It is also a story about the public companies that depended on that easy-money system to survive.

Some are directly tied to private credit.

Others simply share the same warning signs: deteriorating fundamentals, mounting debt, weakening institutional support and business models that may not hold up well if financing conditions get tougher.

That is why I created a special report called: The Shadow Banking Blacklist.

In it, I identify 10 stocks I believe investors should be especially cautious about right now.

These are the names my system says look particularly vulnerable if the private credit cracks continue to spread. And if you own any of them, I believe you need to know before the rest of Wall Street catches on.

In my full presentation, I explain why I believe these “zombie” companies could be in serious trouble if credit conditions keep tightening. And I also show you where I believe investors may want to reposition as money begins moving toward higher-quality businesses.

If you want to get more details on the 10 stocks I’m most concerned about right now – and learn what I believe investors should do next – I strongly encourage you to watch my full presentation now.

Sincerely,

91����

Editor, Breakthrough Stocks

The post Why the Private Credit Squeeze Could Create “Zombie” Companies appeared first on InvestorPlace.

Headlines can swing from escalation to calm and back again in just a few days.

But one thing is already clear: Warfare is changing.

Not with bigger weapons or larger armies. But with faster, cheaper and smarter technology.

Right now, that shift is changing how wars are fought. It is also creating a new wave of investment opportunities.

In today’s Market 360 issue, I want to look at this major shift in modern warfare, how AI is pushing it further and tell you about one of my favorite companies that stand to benefit.

The Technology Taking Center Stage

What we’re seeing now brings a major shift in warfare into focus.

It’s a shift driven by speed, cost and scalability – not old-school military power.

In fact, some of today’s most effective battlefield weapons are not the most advanced or expensive. They are the simplest.

They’re being deployed in large numbers, often in coordinated waves, designed to overwhelm even the most sophisticated defense systems.

I’m talking about drones.

In its attacks on Iran, the United States has used low-cost, one-way attack drones in combat for the first time.

The system is called LUCAS, short for Low-cost Unmanned Combat Attack System. It is an autonomous attack drone used to hit IRGC command centers, air defenses, missile and drone launch sites, and military airfields.

It is 10 feet long with an 8-foot wingspan. It can travel about 500 miles, stay over a target for up to six hours and carry a 40-pound payload.

The LUCAS was developed by the Arizona-based company SpektreWorks.

Here’s a picture of a test launch, which took place in the Persian Gulf on December 16, 2025, from the USS Santa Barbara.

Total cost: about $35,000.

Compare that with a Tomahawk cruise missile, which costs about $2 million, or a Reaper drone, which costs about $30 million. By contrast, LUCAS looks like a game-changer for U.S. defense doctrine.

Interestingly, it was reverse-engineered from Iran’s own Shahed-136 drones, which have been used extensively by Russia on battlefields in Ukraine.

Meanwhile, Iran has launched hundreds of Shahed drones of its own to overwhelm air defenses and attack U.S. bases and Middle Eastern partners and allies.

The point is simple: Drone warfare is becoming the new norm.

The Real Arms Race Is Just Beginning

Now, before we go any further, let’s address a really basic question:

Why drones?

The answer comes down to one thing: Drones are cheap.

According to estimates by the Center for Strategic and International Studies, one Shahed drone costs between $20,000 and $50,000. In comparison, one Patriot interceptor, used by the U.S. to destroy incoming drones, costs $4 million.

From a military standpoint, spending $30,000 to make your enemy spend $4 million is a very good trade. It’s what the experts would call an “asymmetry” – a huge imbalance.

Your opponent must either spend a fortune to defend itself or adapt fast.

From the U.S. side of the coin, we’ve finally been able to do just that.

And as drones grow cheaper, they become far more accessible.

But cost is only part of the story.

These systems are also becoming more autonomous and more AI-driven. They can process data in real time, navigate tough terrain and operate with little human help.

That means they are easier to deploy, easier to scale and far easier to weaponize.

It also means advanced militaries no longer have the edge to themselves.

Insurgent groups in Africa now use drones in routine operations. Drug cartels south of the U.S. border use them for surveillance and smuggling. Both are learning from war zones like Ukraine, where drone tactics and AI targeting have improved fast.

In other words, AI is transforming drones into intelligent weapons that anyone can use.

But it doesn’t stop there.

As drones become more widespread, defense systems must also become smarter – using AI to detect, track and neutralize threats in real time.

That means governments will likely increase spending on counter-drone and AI-driven defense systems.

And companies at the center of this shift stand to benefit.

We’re Already Seeing the Winners

The real opportunity here isn’t just understanding this shift – it’s knowing which companies stand to benefit.

And as this trend accelerates, certain companies are already emerging as clear winners.

One of the clearest examples is Elbit Systems Ltd. (ESLT).

Elbit is an Israeli defense contractor sitting right at the center of this shift. It develops advanced drone systems, AI-driven surveillance platforms and integrated battlefield technology.

This company is built for the future of warfare, where smart machines gather intelligence, monitor threats and operate in high-risk settings with little human input.

Elbit has developed a range of unmanned aircraft for reconnaissance and surveillance. These systems are built for long missions, strong data collection and more autonomous operation.

At the same time, it is linking drones, sensors and command networks in real time to improve battlefield decisions.

In other words, Elbit isn’t just building drones.

It’s helping build the infrastructure of modern AI-driven warfare.

When we added Elbit to the Growth Investor Buy List at the end of April last year, the market hadn’t fully caught on to this shift. Since then, the stock has taken off, rallying roughly 123%.

That is what happens when you spot a major trend early and buy the companies leading it.

And luckily, this trend is far from over.

As governments ramp up spending on AI-driven defense systems and counter-drone technologies, companies like Elbit are likely to remain in high demand.

Where to Find the Next Winners

I bring this up because finding a powerful trend with a long runway can make you a lot of money.

And drones are just one example.

The fact is I’m tracking and recommending stocks across multiple sectors that are benefiting from mega shifts just like this one… from artificial intelligence to energy to emerging technologies.

So, how do I find them?

I rely on a proven, data-driven system that cuts through the noise and identifies fundamentally superior stocks with the strongest growth potential.

That same approach is the backbone of my Growth Investor service.

Right now, my Growth Investor stocks are showing 37.3% average annual sales growth and 144% average annual earnings growth.

That tells me one thing: These companies are not just riding major trends. They are leading them.

In fact, I expect my Growth Investor stocks to resurge by 20% or more in the coming months, driven by their spectacular fundamentals and in the wake of stunning quarterly results.

So, if you want to see my top recommendations and get positioned in the kinds of stocks that can outperform in any market environment, I encourage you to take a closer look at Growth Investor today.

Sincerely,

91����

Editor, Market 360

The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:

Elbit Systems Ltd. (ESLT)

The post The New Weapon Changing Warfare (and Markets) appeared first on InvestorPlace.

They focus on headlines.

Revenue beats. EPS misses. Conference call narratives.

That’s surface-level noise.

What actually moves price is expectation — and how real capital is positioned against it.

I learned that lesson the hard way.

You see, I’ve been in the stock market for over 28 years. While I’ve learned the mindset of a pro trader in that span, the knowledge and insights I’ve gained haven’t come easy.

And four times a year, earnings season would roll around to remind me of just how much I hadn’t yet learned about trading.

When I started on the floor of the Chicago Mercantile Exchange (CME) in 1997, I thought trading was about reacting quickly. I thought if I could interpret earnings faster than the next guy, I’d win.

I was wrong.

For years, every earnings season was the same. Volatility everywhere – but no high-conviction trade setups landing in my crosshairs.

Everything changed when I stopped asking, “What happened?” and started asking, “What was priced in?”

That shift — from reaction to positioning — is what built my process.

And today, there’s an entirely new layer helping us answer that last question.

This “New” Prediction Market Shift Isn’t on Wall Street’s Radar

Prediction markets are online exchanges where participants buy and sell contracts tied to future real-world events — interest rate decisions, election outcomes, inflation prints, tariff rulings, geopolitical developments.

Instead of trading stocks or commodities, participants are pricing probabilities. And they’re putting thousands and even millions on the line to do so.

Contracts are binary: Yes or No, Will or Won’t, Above or Below. They settle at $1 if the event occurs, $0 if it doesn’t.

Now, these markets are nothing new. Polymarket came online back in 2020. Its nearest competitor, Kalshi, launched just a year later.

So why are prediction markets suddenly grabbing all the headlines?

Because when that much capital is on the line, belief adjusts quickly in the broader market.

In many cases, those probability shifts show up before analyst revisions… and before stock prices fully reprice.

That’s the edge. Prediction markets don’t replace fundamentals. They enhance them.

And they’re changing the entire stock market as we know it.

Major institutions are already incorporating these probability signals into their forecasting process. Financial media is even beginning to monitor them closely this year.

And we can see in real time how these markets are handicapping the outcomes of everything from potential military strikes to business acquisitions.

Just check out one of the wagers I’m watching right now:

Source: Polymarket

Traders are betting thousands – even millions – on the odds that the U.S. government will invest big in any one of these stocks.

The list represents everything from semiconductor manufacturers to the suppliers shoring up the key materials these firms need to build out their chips.

You’ll notice I highlighted several names including Taiwan Semiconductor Manufacturing (TSM), Freeport-McMoran (FCX), and Rigetti Computing (RGTI).

Each one was a winner for us over the last year. But it wasn’t just earnings or a major acquisition announcement that tipped us off to these opportunities.

These trades express one new truth about the markets.

Combine prediction market data with the key institutional signals showing where the smart money is getting into position before earnings prints hit the tape…

And you have the power to get a read on the best opportunities in the stock market before the headlines have anything to say about them.

Just like we did when RGTI handed my readers a massive 233% gain in just five days.

Or when TMC netted my readers a whopping 700%+ gainer in just over two months.

That was a very special trade for us. TMC was the product of government-led volatility, a strong earnings beat carrying the stock higher – and the early probability signals from prediction markets that tipped us off to the setup in the first place.

I’ve already used these signals to identify rapid moves in stocks during earnings season and beyond:

• Sunrun Inc. (RUN), 151% in two days.
• BHP Group Ltd. (BHP), 189% in 17 days.
• Alphatec Holdings Inc. (ATEC), 213% in two weeks.
• Fastly Inc. (FSLY), 300%+ in just over a month.
• Snap Inc. (SNAP), 375%+ combined in about two months.

During this quarter alone, my closed trades are running at a 60% win rate, with an average return of 85.76% over roughly 31 days.

That’s the repeatable edge we exploit.

Bets like the ones I showed you give us a stronger sense of the odds market participants are pricing in – and where they’re positioning ahead of any big moves.

It’s knowledge that, when paired with the data and fundamentals I highlight every day I go live with Masters in Trading, can help us pick more winners than losers.

Where the Edge Forms

Opportunities appear when belief changes — but stocks haven’t caught up yet.

That’s the gap.

If probability markets suddenly reprice the odds of tariffs, subsidies, policy shifts, or macro outcomes — and equities are still trading on outdated assumptions — you have temporary misalignment.

And markets don’t tolerate misalignment for long. That’s how we’ve captured some of our biggest gains.

When tariff confidence deteriorated late last year, we moved early. SunRun delivered 151% in just two days. BHP returned 189% in 17 days.

Before earnings in Alphatec Holdings, the stock itself moved just 21%. Our structured trade returned 213%.

Snap dropped 44% after earnings. We still produced a combined gain north of 375%.

Fastly delivered over 300%. Taiwan Semiconductor produced a 700%+ gain in just over two months.

These weren’t lucky breaks. They were pricing gaps closing.

I’m seeing more gaps like these emerging in the markets every day.

And right now, there’s another massive gap bubbling up under the surface. It’s right at the intersection of prediction market hype and institutional money flows.

Every earnings season I comb through the data to spot three new high-conviction trade ideas that bridge the gap between market hype and fundamentals. All in sectors that few investors are paying much attention to right now — and we’re just days away from our picks for the new quarter.

I want you to be able to profit from one of the most important earnings seasons in recent memory.

That’s why I put together a special presentation revealing these opportunities and much more.

Because here’s the truth about hype… It’s just another signal smart traders use to stay a few steps ahead of the crowd.

The kind of intel that allows you to stop gambling and start winning.

Here’s that link again for you. I hope to see you there.

Remember, the creative trader wins.

The post The ‘New’ Layer in the Market: How We Scored a 300% Trade on Polymarket Hype appeared first on InvestorPlace.

Missiles, sanctions, proxy conflicts, oil spikes – it’s consuming every headline, every conversation, and frankly, a lot of investor headspace. 

But at the same time, loud stories like these have a way of drowning out the ones that are quietly reshaping everything else.

Last week, for example, while most of the financial media was fixated on the latest developments out of the Persian Gulf, Anthropic accidentally leaked one of the biggest bombshells in recent tech history…

A configuration error in its content management system left a trove of internal documents – draft blog posts, internal memos, PDFs – sitting in a publicly searchable data store with zero authentication requirements. And tucked inside those files was a draft describing a model called Claude Mythos – a next-generation AI system that Anthropic’s own internal documents describe as the most powerful model the company has ever built.

When a security researcher stumbled across this revelation and the documents began spreading across forums and social media, Anthropic had a choice: deny, confirm, or say nothing. To its credit, the company confirmed.

“We’re developing a general purpose model with meaningful advances in reasoning, coding, and cybersecurity,” an Anthropic spokesperson told Fortune. “We consider this model a step change and the most capable we’ve built to date.”

What those documents reveal goes well beyond a product announcement – and the investment implications extend across nearly every corner of the AI trade.

Inside the Claude Mythos Leak: A New Tier of AI

Mythos – internally codenamed Capybara – is an entirely new tier of model, above Opus. 

The leaked documents describe it as “larger and more intelligent than our Opus models – which were, until now, our most powerful.” 

According to these files, Mythos delivers dramatically higher scores across coding and reasoning benchmarks. Claude Opus 4.6 already leads the industry, achieving 76.8% on the SWE-bench Verified leadboard. 

Even a slight improvement would put Mythos in territory no model has ever reached.

The angle moving markets is one thing. What’s rattling the government is another.

Anthropic’s internal documents describe Mythos as farther ahead of any other AI model in cyber capabilities – so much so that it will be able to exploit vulnerabilities in ways that far outpace the efforts of defenders. 

In fact, Anthropic is so alarmed by this that they are privately briefing top U.S. officials, warning that Mythos makes large-scale cyberattacks much more likely in 2026 and beyond. 

That’s a company scared of its own creation.

Mythos is not yet available to the public. Anthropic is currently testing it with a small group of enterprise customers, and the model remains too compute-intensive for general release – efficiency work is required before that becomes economically viable. Prediction markets put the odds of a public launch at roughly 73% by June 2026. 

When it does ship, the two investment implications below will only sharpen.

AI Is Entering the ‘Lift-Off Phase’ (And It’s Accelerating Fast)

For the better part of three years, AI model development has been on an exponential improvement trajectory. But for most of that time, the curve felt gradual enough that you could still debate this tech boom’s impact. 

ChatGPT, Claude, and Gemini were all impressive. But were they genuinely transformative? Were they actually changing how businesses operated at scale?

The answer over the past 12 months has shifted decisively from “maybe” to “definitely.” Over the past six months specifically, the pace of improvement has entered what we’d call the lift-off phase: the part of the exponential curve where the slope goes nearly vertical.

Consider what’s happened just since last year. 

Claude Opus went from strong-but-contested to undisputed coding leader as measured by SWE-bench. 

Gemini 3.1 Pro more than doubled its predecessor’s score on ARC-AGI-2 – a benchmark that tests a model’s ability to solve novel, pattern-based problems with minimal prior examples – rising from about 31% to roughly 77%.

GPT-5.4 marked a real inflection point in agentic execution – demonstrating the ability to plan and complete multi-step tasks end-to-end, and operate software directly.

And now Mythos enters, claiming yet another full generational leap above the current best. 

This is compounding progress. And compounding, as any investor knows, is where things get interesting.

The AI Arms Race Is Driving $600 Billion In Infrastructure Spending

The hyperscalers see it, too, which is why they’re keeping their feet on the gas. The top five – Amazon (AMZN), Microsoft (MSFT), Alphabet (GOOGL), Meta (META), and Oracle (ORCL) – are projected to spend over $600 billion on AI infrastructure in 2026, up 36% year-over-year. 

These titans collectively generate hundreds of billions in free cash flow and are now spending faster than they earn it, financing the gap with debt. 

That is the behavior of companies who believe they are in a race they cannot afford to stumble in.

Goldman Sachs (GS) estimates that AI capex has so far reached only about 0.8% of GDP, compared to peaks of 1.5% or higher during prior technology booms. There is a credible case that we are not even halfway through this infrastructure buildout.

Claude Mythos is the confirmation that all this spending is working; that the models are getting better at a rate that justifies, and will continue to justify, extraordinary capital deployment. 

And that confirmation has exactly two investment implications – one very bullish, one very bearish.

The Biggest Winners of the Mythos Era

If models are getting exponentially better, better models require exponentially more compute to train and run, and the hyperscalers are locked in a capability arms race, then AI infrastructure spending is only going to compound.

Every new model generation forces a re-architecture of data center infrastructure – more GPUs, better networking, more memory bandwidth, more power, more cooling. Mythos being described as extremely compute-intensive is indicative of what’s to come. And it means the capex cycle continues. 

Here are the stocks that sit most directly in the path of this spending wave:

Stocks to Buy

• Nvidia (NVDA) – Hyperscalers are building chip backlogs reportedly in the hundreds of billions for Nvidia’s next-generation Rubin architecture. If Mythos-class training runs require dramatically more compute, that backlog only grows. No intermediary, no ambiguity, no better seat at this table.
• Broadcom (AVGO) – Every GPU cluster needs interconnects and switches to function, and Broadcom supplies them. The major hyperscaler custom chip programs – Google’s TPU, Meta’s MTIA, Amazon’s Trainium – all run through Broadcom’s ecosystem.
• Taiwan Semiconductor (TSM) – Nvidia, 91����, Broadcom, and Micron all outsource production to TSM. It doesn’t matter which chip architecture wins the model wars. As long as frontier AI requires cutting-edge silicon, TSM makes it. Possibly the safest way to own the entire AI capex cycle without picking a chip winner.
• Arista Networks (ANET) – As GPU clusters scale to tens of thousands of chips for Mythos-scale training runs, the networking spend scales proportionally. Arista dominates 400G/800G switching – a category growing in lockstep with cluster size.
• Vertiv (VRT) – Compute density and heat output are rising, and Vertiv is the market leader in the cooling and power infrastructure required to keep it all running.
• Micron (MU) – Memory demand is a direct function of model size. Mythos being dramatically larger than Opus means more HBM per GPU, more NAND for inference caching, more memory everywhere. Also a recovery story – the recent AI memory selloff was overdone (a thesis we’ve covered in depth separately), and a new model generation accelerates the reversal.
• CoreWeave (CRWV) – When Anthropic needs to serve Mythos at scale before internal economics are workable, it rents CoreWeave. It is the most direct inference infrastructure play on frontier model deployment.

AI vs SaaS: Why Software Stocks Face Structural Decline

This is the part of the story that Wall Street is still wrestling with. And that’s costing investors money.

The SaaSpocalypse – a term to describe the roughly $2 trillion wipeout in enterprise software stocks that began in early February 2026 – was not irrational panic. It was the market correctly processing a structural truth: if AI models can perform the tasks that enterprise software enables, the per-seat licensing model that built the SaaS industry is fundamentally broken.

That is, if 10 AI agents can do the work of 100 sales representatives, you don’t need 100 Salesforce seats anymore. You need 10. That is a 90% reduction in seat revenue for the same economic output. And it doesn’t matter how entrenched the software is or how many years the enterprise has been on the platform – because the AI agent doesn’t need the software to complete the work.

Mythos accelerates this timeline dramatically. A model delivering dramatically higher capabilities in reasoning, coding, and autonomous task execution is more than  just a better chatbot. It is an agent that can replace knowledge workers across entire departments. And when the knowledge workers go away, their software seats go with them. 

Here are the stocks most directly in the crosshairs:

Stocks to Sell

• HubSpot (HUBS) – SMB-focused CRM and marketing automation = the category where AI agents displace humans most directly and switching costs are lowest. No meaningful data moat, premium multiple. And SMB customers are the fastest to cut seats the moment AI gives them a cheaper alternative.
• Atlassian (TEAM) – Jira, Confluence, and Trello are the canonical “AI will automate this” products. Task tracking, status updates, and documentation workflows are mechanical processes that AI agents handle natively. TEAM is already down 35% in the SaaSpocalypse, and the thesis has not changed.
• ZoomInfo (ZI) – ZoomInfo sells sales intelligence – prospect research, contact data, intent signals. That is precisely what an AI agent with web access does autonomously, continuously, and, increasingly, better. The disruption vector here is the most direct of any software name.
• Adobe (ADBE) – The creative suite under structural pressure from AI-native generation. If you can produce professional creative assets with a prompt, the case for a $600-per-year Creative Cloud subscription weakens materially. Firefly integration is a speed bump, not a moat.
• Workday (WDAY) – HR and finance workflow automation with per-employee pricing. As enterprises reduce headcount through AI automation, Workday’s revenue shrinks. The risk isn’t that AI replaces Workday; it’s that AI reduces the headcount that uses it.
• Datadog (DDOG) – As AI-native development tools handle monitoring and observability natively within agentic workflows, the need for a standalone observability layer compresses. Host-based pricing means revenue erodes with infrastructure abstraction.
• MongoDB (MDB) – AI coding tools weaken database lock-in by removing the expertise barrier that historically kept developers in a single architecture. A Mythos-class model that writes and optimizes database code at superhuman levels makes switching costs evaporate.

The Claude Mythos Leak Confirms the AI Investment Playbook

Let’s zoom out past the headlines for a moment. 

The Iran War is serious. The macro headwinds from elevated rates and lingering uncertainty deserve attention. 

We’re not looking past any of that. But consider what else is happening at the same time:

The most sophisticated AI research lab in the world just accidentally revealed that they’ve built a model so powerful they are afraid to release it publicly. They are privately briefing government officials about its implications. They have defined an entirely new tier of AI capability above their current best. And the hyperscalers — who have direct visibility into the ROI of these systems — are spending $600 billion this year, up 36% year-over-year, to build the infrastructure that trains and runs them.

That is a technology in lift-off.

In a situation like that, the investment playbook is clear: you bet on two things simultaneously.

These two bets are two sides of the same thesis. And Claude Mythos, accidental reveal and all, just made that thesis a lot more compelling.

The Bottom Line

Eventually, even the Iran War will end. The exponential improvement in foundational AI models will not.

The companies building the infrastructure that trains Mythos – and every model that follows – are the obvious first-order bet. But the second-order bet may be even more compelling: owning a piece of the AI platform that sits on top of all of it.

OpenAI is the company that forced every hyperscaler to restructure their roadmaps. It’s the platform that turned AI from a research curiosity into a $600 billion annual infrastructure commitment. And if the trajectory that Mythos confirms continues, OpenAI’s next chapter – as a public company – could be the defining investment event of this decade.

Most investors will wait for the IPO. We’ve found a way in before it happens, for under $10.

See the pre-IPO play before the window closes.

The post Anthropic’s Claude Mythos Leak Is Bigger Than You Think appeared first on InvestorPlace.

Editor’s Note: Our InvestorPlace offices are closed tomorrow for Good Friday.

If you need assistance from our Customer Service team, they’ll be happy to assist you when we re-open Monday.

Have a wonderful Easter Weekend!

As I write on Thursday morning, stocks are doing something we’ve grown accustomed to lately – swinging wildly, keeping us guessing about what’s coming next.

Behind the volatility is President Donald Trump and his address to the nation last night about the situation in Iran. The short version: we’re winning – but expect another two to three weeks of heavy fighting.

Markets were hoping for an exit ramp. Instead, they got a near-term timeline for continued fighting with no detailed ceasefire framework or reopening plan for the Strait of Hormuz.

Stocks opened sharply lower on the news, rallied back to flat, and are now bouncing around. Oil has jumped – both West Texas Intermediate Crude and Brent trade above $105 a barrel, though both are off their morning highs.

Overall, it’s one of those sessions where the close is anyone’s guess.

Given that we covered the Iran war’s market implications in yesterday’s Digest, let’s shift gears and take a closer look at a data point that came out yesterday that got a bit lost in the excitement.

What did we learn from the ADP jobs report?

ADP’s March private payrolls report came in yesterday at 62,000 – ahead of the Wall Street forecast of 39,000 and roughly in line with February’s upwardly revised total. On the surface, that’s a decent number.

But dig one layer deeper, and the picture gets a lot less comfortable.

Two sectors – education and health services, and construction – accounted for nearly all the gains, contributing 58,000 and 30,000 jobs respectively. Meanwhile, trade, transportation and utilities shed 58,000 workers. Manufacturing lost another 11,000. And large firms, those with 500 or more employees, actually reported a net decline.

In other words, the headline number is doing a lot of heavy lifting to cover up what is really a two-cylinder jobs engine.

ADP’s chief economist, Nela Richardson, put it plainly:

We’ve seen two consecutive months of pretty steady job growth, but most of it has been in health care. That’s really the story.

Health care is transforming the labor market.

One sector carrying the labor market is not a sign of broad-based strength. It is a sign of narrow resilience – and narrow resilience has a way of becoming a problem when that one sector hits a speed bump.

We’ll get the official verdict soon. The Bureau of Labor Statistics releases its March Employment Situation report tomorrow morning. Wall Street’s consensus is for 57,000 nonfarm payrolls – a bounce from February’s ugly 92,000 job loss, but still well below the pre-tariff monthly average of roughly 180,000.

One wrinkle worth noting: the stock market will be closed tomorrow for Good Friday. Whatever that number says – good, bad or ugly – investors won’t be able to react until Monday. It could make for an interesting weekend and Monday morning session.

But the real threat won’t show up in tomorrow’s labor report

Even if tomorrow’s jobs report beats expectations, the structural backdrop for the labor market is shifting in ways that a single month of payroll data simply cannot capture. Let’s talk about why.

First, a quick primer on a term you’re going to hear a lot more of: AI agents.

An AI agent isn’t just a chatbot you type questions into. It’s a software program that can take actions on your behalf – autonomously, without you guiding each step. It can browse the web, send emails, book appointments, manage files, execute transactions and coordinate with other AI agents, all while you’re doing something else entirely.

Think of it less like a calculator and more like a tireless digital employee who never sleeps, never calls in sick and can be cloned infinitely at almost no cost.

Nvidia CEO Jensen Huang put it bluntly at his company’s GPU Technology Conference last month: one engineer with an army of AI agents at their disposal should be ten times more productive than one without. The math on what that means for headcount isn’t complicated.

Goldman Sachs estimates AI could automate tasks accounting for 25% of all U.S. work hours, projecting that 6% to 7% of jobs will be displaced over the adoption period.

Jeremy Allaire, co-founder and CEO of Circle – one of the largest stablecoin issuers in the world – was direct about where this is headed when speaking at the Economic Club of New York last month:

AI agents will replace a huge percentage of work that’s currently performed by humans on a massive scale…

It’s going to be most dramatic in white-collar work.

Regular Digest readers will recall the Citrini Research scenario we covered in our February 26 issue – the self-reinforcing loop where AI capabilities improve… companies need fewer workers… displaced workers spend less… and the ensuing margin pressure pushes firms to invest even more in AI. Rinse and repeat.

Increasingly, that’s appearing as a real risk.

Take the story we covered in yesterday’s Digest, Oracle’s mass layoffs. They’re affecting potentially 20,000 to 30,000 workers at a company that just posted a 95% jump in net income. This is the Citrini loop in motion.

Bottom line: Tomorrow’s labor market data will tell us what happened with jobs in March. But the dynamic above tells us what’s coming this decade.

How to invest ahead of the coming Agent Supernova

The structural shift playing out above has a name – at least in the pages of Money & Megatrends.

Brian Hunt, editor of this free daily e-letter, calls it the “Agent Supernova” – and he’s spent the past two weeks laying out exactly what it means for investors.

Here’s Brian on the scale of what’s coming:

Within the next two years, the number of AI agents operating in the American economy isn’t poised to increase by 10X… or 50X… or even by 1,000X.

Try at least 100,000X.

This is the coming Agent Supernova. Agents working with people. Agents working with other agents. Agents running businesses. Agents negotiating and haggling with other agents.

To bring this to life, Brian offers a simple illustration. A single restaurant could soon run five specialized agents simultaneously – one managing cooking schedules, one handling accounting, one overseeing staff, one tracking supply orders and one general-purpose agent coordinating all the others.

Now, multiply that model across every business in the economy, and you start to grasp what 100,000X growth in AI agents actually looks like in the real world.

So, how do we invest?

Brian argues that this economic shift runs straight through the semiconductor industry. AI agents don’t live in the cloud alone – they run “at the edge,” inside our phones, cars, homes, offices, hospitals and factories. All of that requires specialized chips built for the job.

One company Brian has his eye on is Advanced Micro Devices (91����).

Brian calls 91���� one of the safest bets on the agentic wave. While Nvidia (NVDA) still dominates in GPUs, 91���� has carved out nearly 40% market share in the CPU space – deeply embedded with hyperscalers like Amazon AWS, Microsoft Azure and Google Cloud. As agentic AI shifts the compute mix toward CPUs alongside GPUs, 91����’s positioning looks increasingly strategic.

Brian has three more semiconductor names he’s watching in this space. To get those picks totally free – along with his full Agent Supernova investment thesis – sign up for Money & Megatrends here.

So, where does all this leave us?

This week’s ADP jobs number was decent. And Friday’s official labor report may well be “decent” too.

But “decent” is doing a lot of work in a labor market where two sectors are carrying everyone else, monthly payroll growth is running at roughly a third of its pre-tariff pace and the most powerful tech companies on earth are openly planning for a workforce where digital employees dwarf human ones.

The question for investors isn’t whether the March jobs number looks okay. It’s whether you’re positioned for the swarm of AI agents that will be coming after “okay.”

We’ll keep tracking these stories here in the Digest.

Have a good evening,

Jeff Remsburg

(Disclaimer: I own 91����.)

The post Trump’s Iran Update Spikes Volatility. Now What? appeared first on InvestorPlace.

Consider this year’s NCAA Division 1 men’s basketball tournament. The term March Madness certainly applied this year. In fact, there were so many “upsets,” with lower-seeded teams defeating higher-seeded teams, that only about 14,000 perfect brackets existed after the first round.

Of the 26-36 million NCAA men’s tournament brackets people filled out on major web platforms, nearly all were busted by the second round after Tennessee defeated Virginia.

If that’s not the perfect illustration of how hard it is to guess everything right, I don’t know what is, folks.

Of course, this year, there was a lot more than basketball upsets that made March a little “mad”.

The month was full of distractions on Wall Street, which understandably rattled many investors.

But the big one is the war in Iran.

And the market certainly felt it. In March, the Dow fell 5.4%, the S&P 500 dropped 5.1% and the NASDAQ slid 4.8% – and that’s even after a powerful rebound on Tuesday to end the month.

That sharp bounce is important. It tells us that while geopolitical shocks can hit stocks hard in the short run, sentiment can reverse just as quickly when investors begin to see a path forward.

That is why the real risk right now is not just volatility itself. It is letting all this noise distract you from the much bigger story quietly unfolding.

So, in today’s Market 360, I want to show you why the market’s recent March Madness may prove temporary, why investors are already starting to look past the latest Iran headlines – and why a couple of overlooked developments in Elon Musk’s orbit say a lot about where the future is heading.

Let’s dive in.

The Big March Distraction: Iran

First, there’s the conflict in Iran.

Tensions in the Middle East reached a tipping point at the beginning of March, with the U.S. and Israel launching coordinated attacks on Iran’s nuclear facilities, military infrastructure and leadership on February 28. The conflict is now on day 34.

In retaliation, Iran not only launched its own missile strikes but also decided to halt shipments in the Strait of Hormuz, which has significantly impacted global food and energy prices.

Not only that, but the market has also been struggling to keep up as developments keep changing.

You may recall that last week, President Trump paused military action in Iran until April 6. Then, on Monday, Trump threatened to attack Iran’s vital energy resources and infrastructure if a deal isn’t met and the Strait of Hormuz doesn’t reopen.

But now the tone has shifted.

On Tuesday and Wednesday, stocks rebounded strongly as hopes for de-escalation grew, oil prices eased and President Trump signaled that he was prepared to wind down the conflict.

In other words, the situation remains fluid. But the market’s response is a reminder that headline-driven fear can reverse in a hurry when investors begin to sense an off-ramp.

While the rebound was a good thing, uncertainty remains high and energy prices are feeling the heat.

The Strait of Hormuz closure has pushed West Texas Intermediate (WTI) and Brent crude oil to $100 per barrel, though both have pulled back from their recent highs as investors bet the conflict may not drag on indefinitely.

Even when a ceasefire is negotiated and the Strait of Hormuz is reopened, it will take months for energy shipments to resume to pre-war levels. 91���� one-third of the world’s seaborne fertilizer trade passes through the Strait of Hormuz, and the resulting shortage will keep global food prices elevated.

So, food and energy inflation are anticipated to persist for several months.

The Problem With Distractions, and the Bigger Story…

Now, there are a couple of problems with these distractions. One is that they impede U.S. GDP growth.

Geopolitical shocks like this can interrupt economic momentum. They can push up energy costs, weigh on sentiment and make it harder for businesses – and investors – to plan with confidence.

The Atlanta Fed has already cut its first-quarter GDP estimate to a 2.0% annual pace, down from 2.8% on March 18 and 3.2% on March 5.

So, you might be wondering what happened to my prediction for 5% GDP growth this year. (I predicted this in early January, and by not even halfway through the month, signs pointed to it coming true.)

I still believe the U.S. economy has the potential to reaccelerate meaningfully once this latest wave of uncertainty fades. But in the short run, wars, energy shocks and Washington drama can all get in the way.

The second problem is how all of this complicates the path to lower interest rates.

Two weeks ago, the Federal Open Market Committee (FOMC) voted 11-1 to keep the target range for the federal funds rate unchanged at 3.5%-3.75%. Surging energy prices, inflation fears and geopolitical concerns clearly played a role in the FOMC’s decision.

In fact, instead of saying that the war-related inflation would be temporary, the FOMC chose to say, “the implications of the developments in the Middle East for the U.S. economy are uncertain.”

Now, you may know that the Federal Reserve and other global central banks like to ignore food and energy inflation. Their favorite inflation indicator is core Personal Consumption Expenditures (PCE), which excludes food and energy. We’ll get a look at this next Thursday.

Despite the food and energy inflation caused by the Strait of Hormuz closure, I expect global central banks to cut key interest rates in the coming months to stimulate their respective economies. The Fed should join the global rate-cutting parade in May, when Kevin Warsh takes over as the new Fed Chair.

Once key interest rate cuts start and uncertainty fades, 5% annual GDP growth should materialize – as soon as the second quarter.

Don’t Head for the Bench

Now, it’s clear that recent distractions have caused many investors to call “time out” and head for the sidelines.

But I want to urge you to resist that impulse.

One thing I’ve learned in my decades on Wall Street is that you have to keep your head in the game. The second is that it pays to be an optimist.

For example, while Wall Street was glued to every new development out of Iran, one story reminds us of the bigger picture.

Yesterday, SpaceX filed confidential paperwork for an initial public offering (IPO). Some estimates value the company at roughly $1.5 trillion, making it the largest IPO in history.

Think about what that means. Even with war headlines dominating the news, America’s innovation machine is still moving forward.

That is the bigger story.

What You Can Do to Profit

I remain convinced that 2026 will be one of our best-performing years in decades!

Because what’s driving this recent volatility is temporary, and it’s distracting investors from where real growth is coming from.

Just look at what Elon Musk has been up to, for example.

Between xAI, SpaceX and the broader buildout now unfolding around artificial intelligence, data centers and next-generation infrastructure, it is clear that the world’s biggest players are not pulling back. They are accelerating.

And that is why I believe investors should pay very close attention to what Elon Musk is setting in motion right now…

Between xAI, SpaceX and the broader infrastructure boom unfolding around artificial intelligence, I believe his latest moves are pointing to where some of the biggest opportunities of 2026 may emerge.

That’s why I recently put together a special presentation explaining what’s driving this shift, why Wall Street may still be underestimating it and the companies I believe are positioned to profit most as it unfolds.

You can watch the full presentation here.

Sincerely,

91����

Editor, Market 360

The post The Bigger Story Behind March’s Market Selloff appeared first on InvestorPlace.

Hello, Reader.

Most people don’t realize they’re living in a revolution while it’s happening – and that’s exactly the case with the AI Revolution.

Each new, incremental AI update can feel almost unremarkable – until you zoom out and see you’re standing in a completely different world than you were years ago.

Almost four years ago, OpenAI launched ChatGPT, a large language model (LLM) chatbot. Artificial general intelligence (AGI), which can understand, learn, and perform at a human level, was just a fantasy.

But now, that fantasy might be turning into a reality after Nvidia Corp. (NVDA) CEO Jensen Huang said last week: “I think we’ve achieved AGI.”

This was in response to a podcaster’s question about what it would take for AI to build and manage a $1 billion company on its own. In terms of profitability, Huang believes it’s currently possible – citing the profits Anthropic’s Claude has generated.

And he’s right to consider Anthropic’s achievements. 2026 already seems to belong to the AI company – and we’re only four months into the year.

In today’s Smart Money, let’s examine the latest AI developments that are leading the push toward AGI.

Then, I’ll share my three-part investment strategy you need to know before we’re fully submerged in the AI waters.

Let’s jump in…

Anthropic’s Leak – and Arm’s Breakthrough

Anthropic has had a standout year.

From entertaining Super Bowl commercials to the releases of Claude Code and Cowork, and now to lawsuits involving the Department of Defense’s use of the company’s AI models, Anthropic has been a constant headliner.

In addition, total Claude users and new users over the last six months have grown significantly, and subscriber numbers have steadily increased to record numbers. Though Anthropic hasn’t disclosed this specific data, TechCrunch has seen the total number of Claude consumer users range from 18 million to 30 million. And paid subscribers have already more than doubled this year.

But Anthropic is making new headlines this week with the leak of Claude Mythos.

Described as the company’s “most powerful AI model ever developed,” Mythos is part of a new model tier called Capybara. This agentic AI model will be able to arrange and perform tasks autonomously, including making decisions, moving across different software platforms, and completing operations with less human interference.

Along with advancements in reasoning and coding, Mythos also brings significant leaps in cybersecurity capabilities. The model is so powerful at spotting software weaknesses that Anthropic has expressed a desire to give cyber defenders early access.

Claude is already widely considered a significant precursor to or an early form of AGI by researchers and users. Mythos could very well raise that water line higher. 

But Anthropic isn’t alone in its AGI-related developments…

Last week, Arm Holdings Plc (ARM) announced its first chip built on silicon, the Arm AGI CPU. Created on the Arm Neoverse platform, these chips are designed to power the next generation of AI infrastructure and address agentic AI’s new demand for CPUs.

The Arm AGI CPU’s configuration performs sustainably at a massive scale, delivering more than double the performance per rack compared to the latest x86 systems.

This move signals how serious Arm – and the AI industry – is about fueling the AGI buildout. The company says it “remains committed to enabling progress across the ecosystem – meeting customers where they are, from hyperscale cloud providers to AI startups.”

Sink or Swim: Your AGI Investment Framework

Investors who are unprepared – or fail to notice the water slowly rise above them – will miss the transformative opportunities that AGI will bring.

And since there are so many ways to profit from AI’s exponential growth, I’ve developed a three-step process for finding companies that will survive and thrive on the Road to AGI…

• Invest “in” AI: Buying shares of companies that are providing key parts of the infrastructure that will accelerate AI technology toward AGI. Think chip companies.
• Invest “alongside” AI: Getting in on the companies primed to rise in tandem with AGI, like those that provide the physical infrastructure of AGI facilities.
• Invest in “stealth” AI: Investing in non-tech companies that will adopt and apply AI to reap huge gains in efficiency, productivity, and profits.

I explain each of these methods in more detail in my The Road to AGI: Final Warning broadcast.

I’ve also put together three reports, each with one recommendation: one for investing in AGI, another for investing alongside AGI, and a third for investing in stealth AGI.

You can learn how to access those reports and the names of these companies in my special presentation.

Click here for more details.

Regards,

91����

The post What Anthropic’s Latest Model Signals for Investors appeared first on InvestorPlace.

Micron (MU), SanDisk (SNDK), Western Digital (WDC), and Seagate (STX) had been among the hottest stocks in the entire market, riding the AI memory bottleneck thesis. Each were up hundreds of percent as investors collectively woke up to a simple truth: you cannot build AI without memory, and there wasn’t nearly enough of it to go around. 

Then came TurboQuant, and just like that, the hottest group in the market found itself in a selling frenzy.

Google’s TurboQuant targets something called the Key-Value (KV) cache – the working memory AI models use to store contextual information so they don’t have to recompute it with every new token they generate. As models process longer inputs, the KV cache grows rapidly, consuming GPU memory at an alarming rate. TurboQuant compresses that cache from 16 bits per value down to just 3 bits – a 6x reduction in memory footprint – with, per Google’s benchmarks, zero loss in model accuracy. No retraining required. No fine-tuning. It’s genuinely impressive; a real breakthrough.

So why aren’t we panicking? Because there is a very old and very reliable pattern in technology investing. An efficiency breakthrough gets announced. The market panics. Investors dump the stocks that allegedly benefit from inefficiency. And then, six to 12 months later, everyone quietly realizes they sold exactly the wrong thing at exactly the wrong time.

We think that’s exactly what’s happening now – and we’ll show you why.

The Bear Case for AI Memory Stocks After TurboQuant

Before we dismantle it, let’s give the bear case its due. The bears aren’t unintelligent – they’re just drawing the wrong conclusion from a real observation.

AI memory demand has been projected to grow explosively because of the KV cache. As context windows expand from 100,000 to 1 million-plus tokens, the KV cache grows proportionally, creating insatiable demand for high-bandwidth memory (HBM). That demand thesis is a huge part of why stocks like MU and SNDK ran so hard.

TurboQuant, if widely adopted, compresses the KV cache by 6x. So the bearish argument goes that if the KV cache is 6x smaller, we’ll need 6x less memory. 

‘Memory demand – and memory stocks – will crater. Sell everything.’

Wells Fargo (WFC) analyst Andrew Rocha articulated this cleanly: if TurboQuant is adopted broadly, it quickly raises the question of how much memory capacity the industry actually needs. 

That’s a fair question. It’s just that the answer isn’t what the bears think.

Why TurboQuant Will Increase AI Memory Demand, Not Reduce It

In 1865, British economist William Stanley Jevons noticed something counterintuitive about coal consumption in England. 

You might expect that as steam engines became more efficient – requiring less coal to do the same work – coal consumption would fall. Instead, as Jevons observed, it exploded. More efficient engines made coal-powered applications cheaper to run, which unlocked a massive wave of new use cases that more than offset the efficiency gains.

Jevons called it a paradox. And it’s why we’re confident that Google TurboQuant will not kill memory demand.

Here’s how we see the Jevons paradox playing out for AI memory specifically:

Channel 1: Context Window Expansion 

Right now, long-context AI inference is brutally expensive because KV cache memory scales linearly with context length. That cost constraint has been a real ceiling on how ambitiously developers deploy long-context models. TurboQuant effectively makes the same GPU that currently supports a 100K-token context window capable of supporting a 600K-token context window – for free.

The moment that reaches widespread deployment, a massive wave of applications that weren’t economically viable suddenly become viable: deep document analysis across entire legal libraries, persistent AI agents with genuinely long memory, complex multi-step reasoning chains. All of those new applications consume more total compute and memory than the constrained baseline. 

The efficiency gain doesn’t reduce the memory market – it expands it into territory that was previously off-limits.

Channel 2: New Application Categories

Cheaper inference means more inference. Every major reduction in inference cost has historically triggered a more-than-proportional expansion in what developers actually build. When OpenAI slashed GPT-3.5 Turbo API pricing through 2023, developers who had been prototyping suddenly deployed at scale – and entirely new application categories emerged almost overnight. AI writing tools, coding assistants, and customer service bots went from niche experiments to mainstream products not because the technology improved, but because the economics finally made sense. TurboQuant is the same forcing function for a new tier of applications. 

The ceiling for AI capabilities has been cost. Lower that cost, and you unlock demand tiers that simply didn’t exist before.

Channel 3: Edge and Mobile AI

TurboQuant enables meaningful LLM inference on devices with far less memory than today’s data center GPUs. One benchmark showed that a 3-bit KV cache could make 32K-plus token contexts feasible on mobile phones. That means the addressable market for memory in an on-device AI world is potentially larger than the data center market. 

Efficiency enabling edge deployment is a demand expansion story, not a demand destruction story. In fact, the market was handed a near-identical lesson just months ago – and most investors have already forgotten it.

The DeepSeek Playbook: What the Last AI Efficiency Panic Got Wrong

In early 2026, DeepSeek published a paper showing you could train frontier-quality AI models at a fraction of the cost. 

The market’s immediate reaction? Sell Nvidia (NVDA). Sell AI infrastructure. Panic.

What actually happened: hyperscalers immediately used the efficiency gains to run more inference at greater scale. Capex guidance went up, not down. The dip became one of the most obvious buying opportunities of the year, and AI infrastructure stocks subsequently ripped.

TurboQuant is the same dynamic applied to memory. Right now, the market is selling memory stocks because AI will need less memory per query. But the real question isn’t “how much memory per query?” It’s, “how many queries?” 

As cheaper inference unlocks an ocean of new use cases, exponentially more.

Now, there’s one distinction worth flagging. Unlike DeepSeek, which was a deployed model developers could download and run the day the paper dropped, TurboQuant is still pre-production – real-world integration across hyperscaler infrastructure is likely 12 to 24 months out.

But the direction looks the same. And the valuation setup for memory stocks right now makes the entry point arguably even more compelling.

The AI Memory Stock Selloff Makes No Analytical Sense

Set Jevons aside entirely. Even accepting the bear’s core premise – that TurboQuant will reduce KV cache memory demand – the selloff in SNDK and STX is still nonsensical.

TurboQuant compresses the KV cache, which lives in GPU HBM and DRAM. That’s the domain of Micron and SK Hynix. 

SanDisk is primarily a NAND flash company. Seagate is an HDD company. Neither has meaningful HBM exposure.

The fact that SNDK and STX sold off as hard as MU tells you everything you need to know: this is panic-driven, not analytical.

The market is pattern-matching on “AI efficiency breakthrough = sell memory” without distinguishing between what type of memory is actually affected. 

That’s the kind of indiscriminate selling that creates generational entry points.

The Bottom Line

AI memory stocks have been punished by a confluence of macro headwinds – now-fading geopolitical uncertainty from the Iran conflict – and an algorithm-driven panic that misreads a genuine efficiency improvement as a demand destruction event. 

SemiAnalysis memory analyst Ray Wang put it plainly: it will be “hard to avoid higher usage of memory” as a result of improving model performance. And Quilter Cheviot‘s technology head Ben Barringer called TurboQuant “evolutionary, not revolutionary – it does not alter the industry’s long-term demand picture.”

We agree.

The Jevons Paradox is about to take its revenge on everyone who sold AI memory stocks because Google figured out how to make AI more efficient. History is littered with investors who made exactly this mistake – who sold the shovels because gold became easier to find, then watched the gold rush accelerate instead.

Don’t sell the shovels. This gold rush is just getting started.

What Smart Money Does While Everyone Else Panics

The memory stocks getting sold off today are the shovels of this gold rush — and we’ve argued they’re being thrown away at exactly the wrong moment. But if the real Jevons rebound plays out the way we expect, the next leg of this AI bull market won’t just reward the infrastructure. It’ll reward the platforms built on top of it…

Which brings us to the company at the center of it all.

Every efficiency breakthrough we’ve discussed – TurboQuant, DeepSeek, cheaper inference unlocking new application tiers – ultimately accelerates demand for one thing: AI platforms capable of deploying at scale. And no company is better positioned to capture that demand than OpenAI.

Most investors are waiting for the IPO. That’s the wrong move. The biggest gains in generational companies don’t go to investors who buy on listing day — they go to investors who found a way in before the crowd arrived. 

We have identified a way to stake a claim in OpenAI right now, before any IPO is announced, for under $10.

When OpenAI goes public at an expected $1 trillion valuation and gets added to the S&P 500, the wave of institutional buying alone will be historic. The window to get in ahead of that moment is open right now – but it won’t stay open forever.

Click here to see that pre-IPO play before it’s too late.

The post What TurboQuant Actually Means for AI Memory Stocks appeared first on InvestorPlace.

This morning, President Trump posted on Truth Social that Iran’s president has requested a ceasefire – adding that the U.S. would only consider the proposal once the Strait of Hormuz was “open, free, and clear.”

Meanwhile, the United Arab Emirates is reportedly preparing to help open the Strait by clearing it of mines, while also encouraging neighboring Gulf states to join the effort.

Here’s The Wall Street Journal:

Emirati diplomats have urged the U.S. and military powers in Europe and Asia to form a coalition to open the strait by force…

Saudi Arabia and other Gulf states are now turning against Iran’s regime and want the war to continue until it is disabled or toppled.

Altogether, it’s enough to keep optimism high and market gains coming. The S&P 500 is up about 3.5% over the past two sessions as oil prices fall – it’s a welcome exhale after one of the roughest stretches of the year.

Let’s pull back and get some perspective

Even with this two-day bounce, as I write, the S&P remains roughly 6% below its January peak. The Nasdaq and the Dow – which both temporarily crossed into official correction territory – are still down about 9% and 7%, respectively, from their highs.

As you can see from the chart below, even after our two-day bounce, the S&P 500 is still trading below its 200-day moving average (MA).

Here’s how Brian Hunt, editor of the free e-letter Money & Megatrends, described the significance of being below the 200-day MA in last Friday’s issue:

Stocks, ETFs, and indexes below their 200-day moving average are “on the wrong side of the tracks.” It’s the ugly part of town.

All the really bad things — crashes, panics, horrible bear markets — happen below the 200-day moving average.

But look back at the chart, and you’ll see that the S&P is looking to retake that key technical level.

Will the market break through and continue to strengthen? Or will the S&P get rejected and begin a deeper leg lower?

Brian points out that today’s fundamentals, valuations, and interest rates aren’t driving the recent price action in the broad market. The volatility is nearly exclusively due to Operation Epic Fury and President Trump’s social media posts.

So, he sees a simple binary that could influence this 200-day MA test:

If the war ends soon, the S&P is very likely to pop higher and get back on the right side of town.

If the war does not end soon, its constriction of critical resource supplies will seriously damage the global economy and stocks will trade lower.

Bottom line: The last two days are encouraging. But the resolution remains unclear – and as we noted in yesterday’s Digest, even a ceasefire doesn’t automatically reopen the Strait, which will have the greatest influence over oil prices and, by extension, inflation, interest rates and the rest of the tipping dominoes.

Brian publishes his free e-letter every day the market is open. If you’re interested in learning more about the megatrends that are driving the market today, sign up for Money & Megatrends right here.

Now, even amid this uncertainty, our hypergrowth expert Luke Lango, editor of Innovation Investor, is betting on a bullish outcome.

Luke’s bull case: why he thinks this rally could have real legs

Even with the market below its 200-day MA, Luke sees a compelling setup building beneath the surface – particularly for tech and AI investors.

He notes a few converging signals. First, market breadth has deteriorated to levels historically associated with correction bottoms – the kind of readings that, in past cycles, marked the zone of maximum dislocation between price and fundamental value.

Meanwhile, fear indicators are compressing from their peaks, suggesting the worst of the uncertainty may already be priced in.

And the correction math itself is encouraging. Luke’s research found that every market pullback since 1950 that was constrained to 10%-20% went on to post an average six-month return from the trough of roughly 24%.

But the most bullish piece of Luke’s argument is the valuation reset in tech specifically. Here’s Luke from his most recent Innovation Investor Daily Notes:

Tech stock valuations have reset to levels that are genuinely compelling relative to the confirmed earnings growth trajectory.

The S&P 500 tech sector’s forward earnings multiple has compressed to 20.5X — essentially a post-COVID low, and just above where tech stocks bottomed in the 2022 bear market.

Over the next three years, tech earnings are projected to grow at a 25% CAGR. So, at current levels, investors are paying 20X forward earnings for ~25% compounded earnings growth.

That’s a very attractive setup.

Luke’s takeaway is that while we may not be at the exact low, waiting for a perfect all-clear signal could mean missing the opportunity. In his words, we’re “bottom enough.”

Now, shifting from the obvious impact of the Iran war on Wall Street, there’s a new related issue that could be a black swan lurking ahead…

The new brewing risk to the AI trade

While all eyes are on oil and the Strait of Hormuz, a quieter supply chain story is developing that AI and tech investors should closely track.

Helium.

The same invisible gas that keeps party balloons aloft is also essential for cooling the machines that manufacture AI chips – and right now, roughly a third of the world’s supply is offline.

Iran’s strikes on Qatar’s Ras Laffan LNG facility earlier this month didn’t just disrupt natural gas. They disrupted helium production lines that could take up to five years to repair.

Qatar supplies about a third of global helium, and virtually all of it travels through the Strait of Hormuz – which, despite Wall Street’s two-day party, remains paralyzed.

Here’s Entrepreneur on Monday:

Without helium, leading chip makers including TSMC, Samsung and SK Hynix could struggle to keep production running.

Helium cools superconducting magnets during chip manufacturing and flushes toxic residue after wafers are washed.

The gas is irreplaceable for making chips that power iPhones and Nvidia’s AI servers.

There is no easy substitute here. Helium’s unique combination of thermal conductivity, chemical inertness and atomic size makes it irreplaceable in chip fabrication.

The Semiconductor Industry Association acknowledged this in a 2023 filing to the U.S. Geological Survey, warning that a supply disruption “would likely cause shocks to the global semiconductor manufacturing industry.”

And though some headlines cite “months” of helium reserves, the inventory picture is more precarious than it sounds. The gas is notoriously difficult to contain. As Lita Shon-Roy, president and CEO of semiconductor materials advisory firm TECHCET, told Scientific American:

Helium can leak out about 0.1 to 1 percent per month, depending on how good the gaskets are. There’s never a good gasket or fitting. It just leaks over time.

Meanwhile, roughly 200 specialized cryogenic containers used to transport liquid helium – each worth about $1 million – were stranded near the Strait when the war began.

Industry consultant Phil Kornbluth told The Wall Street Journal that repositioning, refilling, and delivering those containers alone could take months.

Here’s his overall assessment:

There is a tsunami coming, but it’s still a thousand miles offshore.

So, where might that tsunami hit?

Of the major chipmakers, Samsung and SK Hynix appear most exposed. Both are heavily dependent on Qatari supply and are critical producers of the high-bandwidth memory (HBM) inside Nvidia’s AI servers.

Taiwan Semiconductor Manufacturing Company (TSMC) carries its own exposure as the foundry behind chips for Nvidia (NVDA). Meanwhile, Micron (MU), with more diversified sourcing, looks better positioned in the near term, but still has exposure.

But the helium story also has an unexpected winner hiding in plain sight: ExxonMobil (XOM).

Its Shute Creek facility in Wyoming accounts for roughly 20% of global helium production capacity and has an 80-year reserve runway. As 24/7 Wall St. noted, the shortage “hands Exxon a low-effort margin expander at a time when chip demand for AI keeps climbing.”

For investors already holding XOM for its oil-and-gas core, the helium angle makes it even more interesting. For new money, it’s worth putting on your radar.

The key variable, as with everything right now, is time. A swift ceasefire resolves this before it becomes critical. But a prolonged conflict turns a distant tsunami into a very close wave.

We’ll keep you updated.

Finally, another round of layoffs – and a darker question for AI investors

By now, most investors are familiar with AI’s threat to jobs. It’s the story everyone is watching.

But there’s a less-discussed question starting to surface – one I’ll tackle in a deep-dive Digest soon. It goes something like this…

What if AI will eventually be just as destructive to most AI companies as it is to the workers they’re replacing?

Consider Oracle (ORCL)…

Yesterday, the software giant announced a new round of layoffs – TD Cowen estimates between 20,000 and 30,000 workers – even as it simultaneously ramps AI infrastructure spending aggressively. Oracle has committed to a jaw-dropping $455 billion in remaining performance obligations following its OpenAI agreement, all while reshaping the company around the AI buildout.

And yet ORCL is down 25% this year. Part of that reflects investor concern about cash flow amid surging capital expenditures. But another part reflects something more unsettling…

The market is beginning to ask whether generative AI threatens not just Oracle’s employees – but its core business.

This question extends well beyond Oracle

It cuts to the heart of the entire AI investment thesis…

If AI commoditizes intelligence, who actually wins?

The companies building it?

The companies deploying it?

Or, maybe, nobody?

And – perhaps most unsettling – what about the investors currently holding the companies that appear to be winning right now?

The recent answer – own the infrastructure layer, the picks-and-shovels, the Nvidias of the world – has served investors well. And it will likely continue to… for at least a while.

But that thesis rests on one assumption: that demand for AI compute will keep compounding indefinitely. However, what happens if the economics of AI start working against that assumption?

What if we’ve started a race to the bottom that eventually circles back to the infrastructure layer, too?

That’s a bigger conversation than we have room for today. But it’s coming.

For now, here’s our takeaway

Oracle slashing potentially tens of thousands of jobs while simultaneously betting $455 billion on AI infrastructure isn’t a contradiction. It’s what the AI structural reset looks like in real time.

The technology is reordering how companies are built, staffed and financed – and that process is still in its early chapters.

Yes, short-term headwinds are real…

There are potential supply shocks like helium… unresolved geopolitics… and an S&P still on the wrong side of the 200-day MA. These are meaningful speed bumps.

But as Luke reminds us, investors are currently paying 20X forward earnings for roughly 25% compounded earnings growth in tech. Whatever the road ahead looks like, that’s an attractive set-up.

Have a good evening,

Jeff Remsburg

(Disclaimer: I own MU.)

The post Is the Bull Market Rally Back On? appeared first on InvestorPlace.

In 1564, the teenaged King Charles IX moved New Year’s Day from the spring equinox to January 1. What followed was basically a 16th-century communication disaster.

Those who didn’t get the news, or were slow to adapt, were labeled “April fools”.

One royal decree began centuries of pranks.

This calendar confusion is just one working theory for the origins of today’s mischief-filled holiday. But it serves as a timely reminder: Change is messy, and it is easy to fall behind.

We see this playing out with the U.S.-Iran conflict.

Oil prices are hovering around $100 per barrel and are expected to remain high, driven by intense volatility, geopolitical risks, and fears of a prolonged supply shock. The Strait of Hormuz, a key oil shipping route, remains closed to most shipping traffic. And analysts at Wood MacKenzie are warning oil could rocket to more than $200 a barrel.

This is the new normal. Oil prices are not merely high, they are thrashing around wildly from day-to-day. But even though oil is grabbing most of the headlines, it is not the only commodity under the thumb of the Iran conflict.

It turns out that when a butterfly flaps its wings in the Straight of Hormuz, a tsunami of chaos sweeps over nearly every commodity industry in the world.

Today, I’d like to focus on another major global commodity – aluminum – and how to position your portfolio before this growing ripple effect turns into a full-blown supply shock.

Let’s dive in…

When Oil Moves, Aluminum Follows

Like oil, aluminum prices have swung wildly since the U.S. launched its first attacks on Iran in February. That’s because the war is causing a double-whammy for the aluminum market.

First, it is directly eliminating most of the Middle East supply, which accounts for about 10% of the world total. Second, it is driving the price of energy much higher. That’s bad news for aluminum production, which requires huge volumes of electricity.

By definition, therefore, an energy shock is an aluminum shock.

We saw this scenario play out in the 1970s, when oil prices surged due to geopolitical conflict and embargoes. Electricity costs jumped globally, and aluminum smelters become costly to run.

As a result, high-cost regions, like the U.S., Western Europe, and Japan curtailed aluminum production. Predictably, supply tightened… and prices rose.

Now, higher prices can be a tailwind for aluminum companies. When prices go up, producers sell aluminum at increased prices. In turn, their revenues and profits can climb.

But there’s a catch.

If aluminum prices rise because energy costs are also rising, then costs are going up at the same time as aluminum prices, and profit margins may not improve much.

That means that the real aluminum winners will be those with cost advantages – like access to cheap electricity or stable energy, especially hydro and nuclear power.

These companies will benefit from rising aluminum prices without much of their own costs rising.

Alcoa Corp. (AA) is better positioned than many other aluminum producers. The company has been preparing for this moment for decades, literally.

Alcoa’s Structural Advantage

Alcoa is not just the largest American aluminum producer; it is also among the world’s most environmentally progressive.

As I mentioned, producing aluminum requires immense amounts of electricity, and that energy intensity is reshaping the industry. Increasingly, companies such as Tesla Inc. (TSLA) are seeking to source their aluminum from clean-energy smelters powered by hydro, nuclear, or renewables. That shift is elevating low-carbon producers like Alcoa to the top tier of the aluminum world.

Today, renewable energy powers roughly 87% of Alcoa’s smelting operations. This alignment with the global push toward decarbonization gives the company a durable strategic advantage, and positions it not merely as a cleaner metal producer.

After suffering a tariff-induced selloff in early 2025, Alcoa’s shares have been trending higher. And since the butterfly flapped its wings in the Middle East, the company has soared on aluminum supply concerns.

This past weekend, Iran attacked two of the region’s producers. Emirates Global Aluminium, the area’s top aluminum supplier, said it sustained “significant damage” at its Abu Dhabi site. Aluminium Bahrain, the second target, is examining the damage at its own facility.

Meanwhile, Alcoa’s smelters continue humming along and churning out aluminum.

Beyond a conflict-related rally, I expect Alcoa’s uptrend to gain momentum – driven not only by firmer aluminum prices, but also by the company’s exceptional fundamentals. The company beat Wall Street’s expectations for the fourth quarter 2025, and is expected to release its next quarterly report on April 16.

Alcoa currently trades for less than 12 times estimated 2026 earnings – well below its historical forward multiple of roughly 20 times earnings. So, although the shares of this leading aluminum producer are climbing higher, they are still relatively “cheap” compared to estimated earnings… and I should point that Wall Street has been busily raising its estimates for this year.

Alcoa is one of the several commodity-related companies I recommend in Fry’s Investment Report.

To stay up-to-date on the aluminum producer – and learn more about my other recommendations – join me at Fry’s Investment Report.

As a member, you’ll get access to all of my latest research, reports, and trade alerts. (There is no chance of becoming an unsuspecting “April fool” here.)

The bottom line is that commodity markets, like aluminum, are excruciatingly capital intensive, requiring years, long or decades, long lead times, and do not often immediately reward those spectacular investments.

But inevitably, a shock of some kind arrives, either due to simple supply demand factors, tariffs, wars, or acts of God.

When those moments arrive, commodity-focused companies ring the register in a big way.

The aluminum market has arrived at such a moment. 

Click here to join me at Fry’s Investment Report today.

Regards,

91����

The post The Hidden Commodity Winner of the Oil Crisis appeared first on InvestorPlace.

Then came Citron.

On March 26, Andrew Left’s activist short-selling firm posted on X with a simple message and a chart titled “VCX Explodes!” – and within minutes, the stock plummeted from over $400 to around $270 as 31,000 shares changed hands. By the close, shares had fallen 49%. The fund that retail investors had rushed into as their ticket to the AI revolution had just been cut nearly in half in a single session.

As of this writing, VCX trades at around $130 – a roughly 585% premium to the actual value of its underlying assets. The mania isn’t over. But the easy part of the trade is.

We’re publishing this on April 1. None of it is a joke. And the most important part of the story is still ahead.

Inside the AI IPO Pipeline: Anthropic, OpenAI, SpaceX

Nobody pays 30 times the value of something unless they desperately want what’s inside. So what’s inside?

VCX’s largest holding is Anthropic – one of the most important AI companies in the world. Indeed, by many accounts, it’s built the best frontier model available today. And the company’s revenue trajectory is simply historic: from roughly $1 billion annualized at the start of 2025 to a $14 billion run rate by early 2026. It closed a $30 billion Series G in February 2026 at a $380 billion valuation, has hired IPO counsel, and is widely expected to file for a public listing before the year’s end. When it does, it will almost certainly be one of the most significant market events in a generation.

Then there’s OpenAI, the company that started the entire AI Boom. The ChatGPT creator put generative AI on the cultural map and permanently changed what consumers and enterprises expect from software. Its latest financing round values it north of $840 billion, and it is targeting a potential IPO valuation of $1 trillion. That would make it, at debut, one of the most valuable companies in American history.

And among its smaller – but no less significant – holdings is SpaceX: widely considered the most valuable private company in the world. Its Starlink satellite internet network serves millions of subscribers across 155 countries. Its Falcon 9 rocket handles more than half of all orbital launches on Earth. The company filed confidential IPO documents with the SEC earlier this month and is targeting a June 2026 listing at a valuation between $1.5- and $1.75 trillion – a figure that would make its IPO the largest in history by a wide margin, dwarfing even Saudi Aramco‘s record $29.4 billion offering.

VCX owns all three companies – before they’ve gone public – through a single, liquid, exchange-traded security that any retail investor can buy with a brokerage account. No wonder the market was going bonkers for it.

But there’s a big difference between something being conceptually understandable and being financially rational.

The Math Behind VCX’s Premium Problem

At the time of its listing, VCX’s net asset value (NAV) was $18.97 per share. Within four trading days, it reached an intraday high of $575 – more than 30 times the actual value of its underlying assets. 

Now, as of this writing, the fund trades around $130.

The reason for this sharp decline? The structure couldn’t support the price.

At its peak, investors weren’t just buying exposure to Anthropic, OpenAI, and SpaceX. They were paying an extreme premium for access – access that only exists as long as those companies remain private. 

That distinction matters more than any valuation model – because the moment that access becomes widely available, the premium collapses.

That’s VCX’s core flaw. The trade hinges less on whether these companies succeed and more on how long they remain out of reach.

Walk through the mechanics. VCX owns minority stakes in a handful of elite private companies. The appeal is straightforward: you can’t buy Anthropic directly, so you buy the closest proxy. In the early days post-listing, that scarcity pushed shares to extraordinary levels.

But scarcity fades. Liquidity doesn’t.

When these companies eventually IPO, the rationale for paying a premium quickly erodes. Investors are no longer buying access. They’re holding a fund that owns what can now be purchased directly – without the markup.

As the underlying companies succeed, the fund’s advantage compresses.

This is a trade where success becomes the exit signal.

There’s also the supply side. Most of VCX’s pre-IPO investors are locked in at entry prices around $19 per share. When that lockup expires and that large base of holders can sell into the public markets, the supply shock will be severe. That kind of overhang doesn’t require a narrative shift, only an opportunity.

What’s playing out now is a transition.

VCX is moving from a narrative-driven asset – priced on scarcity and excitement – to a financial asset, where price has to reconcile with net asset value, liquidity, and supply. 

Assets in that phase rarely sustain extreme premiums.

Smarter Ways to Invest In the AI IPO Wave

Gaining exposure to the most important private AI companies before they go public is a powerful strategy. But there are other ways to access the same core exposure without paying for a premium that disappears as soon as the story delivers.

Three of them stand out right now.

SuRo Capital: AI IPO Exposure at a Discount

SuRo Capital (SSSS) is the original publicly traded venture fund. Its portfolio spans approximately 35 private technology companies, with a heavy emphasis on AI infrastructure. Key holdings include OpenAI, which SuRo has held since the company was a fraction of its current valuation, as well as a significant CoreWeave (CRWV) position that generated meaningful realized gains when the firm went public in 2025.

SuRo reported a Q4 2025 NAV of $8.09 per share. However, on its March 2026 earnings call, management disclosed that 2026 financings not yet reflected in the year-end marks – including OpenAI’s latest massive financing round – are expected to add between $5.00 and $6.50 per share to NAV. That implies a true forward NAV of $13 to $15 per share. SSSS currently trades around $9.89.

Put that together, and you have a fund with significant OpenAI exposure trading at an implied 25% to 30% discount to its forward NAV. 

In a world where people are paying 585% premiums next door, SSSS is offering AI mega-IPO exposure at a discount. 

Destiny Tech100: A More Rational Premium

Destiny Tech100 (DXYZ) is the most direct comparable to VCX in terms of structure – a pure closed-end fund holding only private companies, with no public equity sleeve diluting the exposure. Its portfolio of approximately 24 companies is anchored by SpaceX at roughly 23% of assets, with smaller positions in OpenAI and, more recently, Anthropic after a post-year-end investment.

DXYZ reported a Q4 2025 NAV of $19.97 per share. The stock currently trades around $26.52 – a 33% premium to NAV. That premium reflects a rational market assessment of the scarcity value of holding a liquid vehicle with SpaceX and OpenAI exposure. It is elevated, yes; but it is the kind of premium you’d expect for a unique product offering hard-to-access assets.

Thirty-three percent versus 585%… 

XOVR ETF: Diversified AI IPO Exposure

ERShares Private-Public Crossover ETF (XOVR) takes a different structural approach. 

Rather than holding only private companies, it combines a public equity core – tracking ERShares’ proprietary Entrepreneur 30 Index – with a measured private equity sleeve capped at 15% of assets. Current private holdings include SpaceX – held through an SPV and representing a meaningful share of the fund’s private equity sleeve – and Anduril Industries, the defense technology company building AI-powered autonomous systems for the U.S. military.

XOVR’s NAV sits at $17.04, while the stock currently trades around $16.80, as of this writing. With XOVR, investors are buying SpaceX and Anduril pre-IPO exposure at a discount to the fund’s stated asset value, packaged alongside a diversified basket of publicly traded large-cap innovators. This is as close to a free lunch as you’re likely to find in this space.

The tradeoff: because more than 85% of XOVR is in public equities, the private-company kicker is diluted. But for investors who want a measured, ETF-structured exposure to the pre-IPO AI and defense wave without taking on the concentrated risk of a pure-play VC fund, XOVR offers a uniquely clean on-ramp.

The Comparison You Need to See

The Bottom Line On the AI IPO Trade

The VCX craze is a masterclass in what happens when genuine excitement about transformative technology collides with a microscopic float and an army of retail investors armed with Robinhood accounts. 

We think the underlying thesis – that Anthropic, OpenAI, and SpaceX are going to be among the most valuable companies in human history – is probably correct. The execution of expressing that thesis through VCX at a hefty premium is not.

The good news is that the AI mega-IPO story is real, the opportunity is enormous, and there are rational ways to participate. 

SSSS, DXYZ, XOVR – none of these are perfect instruments. All carry the standard risks of pre-IPO investing: illiquidity, valuation uncertainty, lockup provisions, and the ever-present possibility that the underlying companies’ IPOs are delayed, dilutive, or priced in ways that disappoint.

Yet all three are far more rational than paying $130-plus for $19 worth of assets. 

The AI mega-IPO wave is coming. But you don’t need to lose your mind – or your capital – to ride it.

And if you want to go even further upstream than SSSS, DXYZ, or XOVR, we’ve found a way for everyday investors to stake a claim in OpenAI itself before it ever trades on a public exchange – for under $10.

The biggest gains in market history haven’t gone to investors who bought on IPO day. They’ve gone to those who were already inside when the doors opened. That window is still open – but it won’t be for long.

Here’s how to be early on OpenAI.

The post The VCX Frenzy Is a Warning for AI IPO Investors appeared first on InvestorPlace.

As I write on Tuesday, markets are surging on war news – but the logic behind this rally deserves a closer look…

This morning, the Wall Street Journal reported that President Trump has told aides he’s willing to end the U.S. military campaign against Iran even if the Strait of Hormuz remains largely closed.

Stocks jumped on the headline, reading “end of war” and buying first, asking questions later. But this rally is ignoring a critical detail…

Roughly 20% of the world’s seaborne oil passes through the Strait every single day. So, if Iran remains in control of that chokepoint when the guns go quiet, has our energy problem really been solved?

While Wall Street seems to be whistling past this issue, the oil patch isn’t – and the spread between the oil benchmarks, WTIC in the U.S. and Brent in Europe, tells the real story. As I write, WTIC is slightly down on the day while Brent has surged 5%.

The gap between them is roughly $15 a barrel, which is near an 11-year high. That spread reflects how much more exposed European supply is to a closed Strait than U.S. crude.

Oil industry executives and analysts warn the Strait of Hormuz needs to be reopened by mid-April or supply disruptions will get significantly worse – and that even then, enough damage may have been done to leave energy prices higher for longer.

Now, as we’re going to press, Axios is reporting that China and Pakistan have presented a new plan for ending the war that includes an immediate ceasefire and the reopening of the strait. We’ll keep tracking this as new details emerge, but it’s encouraging – and markets are applauding. 

So, what does this mean for investors?

Wall Street is trying to price in the end of active hostilities. That may well happen – and if it does, a relief rally is justified. But the deeper energy problem doesn’t resolve on ceasefire day, especially if Iran remains in control of the Strait.

So, while Wall Street appears to be asking “which stocks should I buy?” we’re mulling a different question…

If Trump ends hostilities with the Strait closed, where do oil prices settle as we move into the summer driving season? And what will that mean for inflation, Main Street budgets, and the Fed?

We’ll keep tracking this.

Today’s energy shock isn’t landing on households that are in good financial shape

Here’s the uncomfortable context around the recent oil surge…

The pain at the pump isn’t hitting families with cash reserves and low debt. It’s hitting families already stretched to their limits – and the data tells that story clearly.

New figures from J.D. Power and Edmunds put some striking numbers on the table.

An estimated 30.5% of car buyers with a trade-in now owe more on their current vehicle than it’s worth – what’s known as being “underwater.”

The average amount owed on these underwater trade-ins hit $7,214 in Q4 2025, an all-time high. And 27% of those trade-ins carried more than $10,000 in negative equity – also a record.

Here’s Edmunds consumer insights analyst Joseph Yoon:

While these levels of negative equity are nothing new… it’s the amount underwater that is the real, and troubling, story.

When you trade in a car with negative equity, that remaining balance doesn’t disappear. It gets rolled into your new loan. The average monthly payment for buyers who did exactly that reached $916 in Q4 2025 – that’s $144 more than the average new-car payment for buyers without negative equity.

And 40.7% of those negative equity trade-ins are now financed on 84-month loans. That’s seven years to pay off a vehicle that will likely be worth a fraction of its purchase price long before the loan is done.

Now throw in the possibility we covered in yesterday’s Digest – that the Fed’s next move is a rate hike, not a cut – and the picture darkens further. Borrowers already carrying heavy auto debt don’t get a lifeline in that environment…and that pressure must land somewhere – which puts lenders on watch.

The largest independent auto lender in the country, Ally Financial (ALLY), sits directly in the middle of all of this, with more than 70% of its $83.9 billion loan book in consumer auto.

To be fair, ALLY has been tightening its underwriting standards. But its Q1 2026 earnings on April 17 will be the first real window into how this consumer stress is affecting its numbers. If delinquency trends deteriorate further, it would be a meaningful signal – not just for ALLY, but for the broader consumer credit picture.

Bottom line: The auto loan data isn’t a crisis today – it’s a pressure gauge. But right now, the pressure is rising.

The same pressure is showing up in a corner of the market most investors aren’t watching

We’ve spent several recent Digests tracking the stress building inside private credit, covering the AI software angle. But recent data from Fitch Ratings suggests this isn’t just a software issue…

The problem is spreading.

According to Fitch, the overall private credit default rate climbed to 5.8% for the trailing 12 months through January 2026 – the highest since the agency began tracking it. But the sector leading in defaults isn’t software…

It’s healthcare.

Healthcare service providers recorded the highest number of unique defaulters in private credit over that period.

The playbook that got them here is familiar…

Over the past decade, private equity firms loaded dental chains, veterinary clinics and behavioral health networks with debt using the same leveraged buyout strategy they applied to software companies. The pitch was identical: sticky recurring revenue and a fragmented market that was ripe for consolidation.

But the cash flows aren’t holding up. Cuts in Medicaid reimbursement, staffing cost inflation, and the operational complexity of rolling up thousands of small practices have crushed the margins that were supposed to service all that debt.

Many of these companies have already seen their interest coverage ratios fall below 1.0x – translation, they’re no longer generating enough cash to cover even the interest on their loans.

Here’s William Barrett, managing partner at Reach Capital, speaking to CNBC:

“Funds concentrated in volatile sectors or holding covenant-lite loans with weaker protections are also vulnerable, as are highly leveraged healthcare roll-ups… certain smaller issuers have recently recorded a 10.9% default rate, due to a lack of resources to absorb shocks.”

Morgan Stanley’s 2026 private credit outlook independently echoes that concern – the firm notes it maintains a significant underweight to healthcare, which has led all sectors in loans placed on non-accrual status over the past year.

By the way, healthcare isn’t the only sector flashing red. According to the same Fitch data, consumer products recorded the second-highest default rate, more than doubling over the past year from 6.1% to 12.8%. That’s the institutional echo of the kitchen-table stress we described in our story on trade-ins being underwater.

Bottom line: stress in the private credit market isn’t limited to just one corner. Software is a big problem, but healthcare and consumer products are widening that problem.

We’ve been tracking this alongside legendary investor 91����, editor of Breakthrough Stocks

Louis has been warning about private credit stress since mid-2024, and his concern has grown considerably as the default data has accumulated.

It’s a subject he knows from the inside – early in his career, he worked as a banking analyst during the savings and loan crisis of the 1980s, watching firsthand how financial problems build long before they become headlines.

That experience shapes how he reads what’s happening today:

Financial crises do not start when the headlines hit. They start months earlier. Sometimes years.

The first cracks show up quietly. Loans stop performing the way they should. Cash flows weaken. Institutions start adjusting their exposure.

And most investors do not notice until the story is already much bigger.

He’s been watching those early cracks form in private credit for over a year. And now he’s flagging a specific date that most investors haven’t circled yet: June 30, 2026.

As I detailed yesterday, that’s the deadline when Business Development Companies (BDCs) and private credit funds must report their semiannual results – and for the first time in this cycle, put honest marks on their loan portfolios. What these assets are actually worth will become public record.

If the stress building beneath the surface is as significant as the early data suggests – and the Fitch numbers above indicate it is – June 30 could be the moment hidden losses become visible ones, with real consequences for markets.

Louis isn’t just warning investors. He’s also identified specific steps to both protect your portfolio and potentially profit as this story develops.

He’s put together a full presentation laying out what he’s seeing – and where he believes the opportunities are on the other side of it. Click here to watch Louis’ presentation before this story gets bigger.

Coming full circle, today’s Digest tells one story from three angles

We have an oil market pricing in peace while ignoring who still controls the strait… households rolling record negative equity into seven-year car loans… and a $3 trillion private credit market where defaults are spreading well beyond where they started.

These aren’t separate stories. They’re different readings of the same pressure gauge – a financial system built for low rates, cheap credit, and steady growth that is now being stress-tested on multiple fronts at once.

One of these stories is already flashing red. The other two are still building quietly in the background – which is exactly how Louis would tell you the dangerous ones always start. The cracks appear small and contained…until they don’t.

We’ll keep tracking all of this with you here in the Digest.

Have a good evening,

Jeff Remsburg

The post Markets Are Rallying – Are They Ignoring a Major Risk? appeared first on InvestorPlace.

Many things look normal. People go to work. Stores are open. Life goes on.

But underneath the surface, something is wrong.

The infected are still walking around… still functioning… still blending in.

Until suddenly, they’re not.

The same is true of some companies. From the outside, everything looks normal, but they are rotting away on the inside.

For years, Sears looked like a company that was still humming along.

And technically, it was. The stores were open. The stock still traded. Management kept promising a turnaround.

But in reality, the business was being kept alive by asset sales, financial engineering and borrowed time.

That is what I call a “zombie company.”

And if I’m right about what’s happening in private credit, investors may suddenly discover there are more of them out there than they realized.

In recent essays, I’ve explained how the private credit market grew into a $3 trillion shadow banking system, how investors may be able to profit from a coming flight to quality – and why June 30 could become a potential day of reckoning for this whole mess.

Why June 30? Because that’s when many private credit vehicles will be forced to update investors on what their holdings are really worth. And if some of those loans have been kept afloat by extensions, restructurings and wishful thinking, then this could be the moment when a lot of that hidden stress bubbles straight to the surface.

Today, I want to focus on what that could mean for investors’ portfolios.

Because if this private credit story keeps unfolding, some stocks are going to be a lot more vulnerable than others.

And believe me, you don’t want to be caught owning one of them if the private credit bubble begins to burst.

The “Zombie” Companies

A zombie company is not always obvious at first glance.

On the surface, it may look like a normal, functioning business. Revenue may still be coming in. Management may still be talking confidently. Wall Street may still be giving it the benefit of the doubt.

But underneath the surface, the story is very different.

These are companies that have been kept alive by easy money, cheap refinancing and constant access to credit. They do not really stand on their own. They depend on lenders continuing to extend terms, roll over debt and keep the game going.

That worked for a long time.

But now the environment has changed.

Roughly 80% of private credit loans are floating-rate, meaning they are at the mercy of prevailing interest rates.

That’s a problem, because borrowers’ interest costs have surged as rates have climbed.

In many cases, loans that once carried 4%-5% interest are now costing 12%-15%. That’s a massive jump, and it’s putting serious strain on already leveraged companies.

Now, to get the full details on what’s happening in private credit – and what I believe investors should do to protect themselves – you can learn more in my full presentation here.

In the meantime, in the next part of my interview series with InvestorPlace Editor-in-Chief Luis Hernandez, I explain why some so-called “zombie” stocks could be especially vulnerable if the private credit story keeps unfolding… and what investors should be watching for now.

Click the play button on the image below to watch my conversation with Luis.

Are You Holding One of Them?

Here is the part that matters most.

This is not just a story about private credit funds or some hidden corner of Wall Street.

It is also a story about the public companies that depended on that easy-money system to survive.

Some are directly tied to private credit.

Others simply share the same warning signs: deteriorating fundamentals, mounting debt, weakening institutional support and business models that may not hold up well if financing conditions get tougher.

That is why I created a special report called: The Shadow Banking Blacklist.

In it, I identify 10 stocks I believe investors should be especially cautious about right now.

These are the names my system says look particularly vulnerable if the private credit cracks continue to spread. And if you own any of them, I believe you need to know before the rest of Wall Street catches on.

In my full presentation, I explain why I believe these “zombie” companies could be in serious trouble if credit conditions keep tightening. And I also show you where I believe investors may want to reposition as money begins moving toward higher-quality businesses.

If you want to get more details on the 10 stocks I’m most concerned about right now – and learn what I believe investors should do next – I strongly encourage you to watch my full presentation now.

Sincerely,

91����

Editor, Market 360

The post Do You Own One of These “Zombie” Companies? appeared first on InvestorPlace.

Redemption caps at Ares and Apollo. A fresh monthly loss at Blackstone’s BCRED. A subprime auto lender collapsing amid fraud. My colleague 91���� has been tracking this buildup since mid-2024 – and he thinks the moment of reckoning is fast approaching. Specifically, June 30, 2026, when private credit funds must mark their holdings to fair value and hidden losses may finally come to light.

Louis lived through the S&L crisis in the 1980s. He knows what it looks like when problems get papered over – and what happens when they can’t be anymore. He’s put together a full presentation on what he’s seeing and how to prepare before this gets more obvious. You can check that out here.

If he’s right, the biggest moves may come faster than most investors expect.

Here’s Louis.

It was an experience that scarred me for life. 

Early in my career, I worked as a banking analyst. It was the 1980s, and the savings and loan crisis was in full swing

At the time, we were restructuring failing institutions – merging balance sheets, reworking loan portfolios, and doing everything we could to make them appear stable.

Simply put, it was my job to “put lipstick on a pig.” 

It didn’t fix the underlying problem. It just delayed it.

That’s part of the reason I very rarely recommend financial-sector stocks – especially banks. 

There’s just too much funny business that goes on. 

Here is another one of the most important lessons I learned during my time as a banking analyst:

Financial crises do not start when the headlines hit.

They start months earlier. Sometimes years.

The first cracks show up quietly. Loans stop performing the way they should. Cash flows weaken. Institutions start adjusting their exposure. And most investors do not notice until the story is already much bigger. 

I saw that during the savings and loan crisis.

I saw it again ahead of the 2008 financial collapse.

And I saw the same pattern emerge before the regional banking failures in 2023. 

This time around, the risk has been building for years in private credit.

In fact, I’ve been warning my followers about this since mid-2024. 

If you want the full story on what is happening inside private credit, and what I believe investors should do before this gets more obvious, you can learn more in my full presentation here.

But what matters today is that the pressure inside that system is getting harder to hide. 

Private Credit Stress Is Already Showing Up

Tricolor, a subprime auto lender, collapsed last year amid fraud allegations. 

First Brands, an auto-parts company backed by private credit, filed for bankruptcy after struggling under its debt load. 

And more recently, large private-credit funds have started limiting withdrawals as investors ask for their money back faster than these illiquid portfolios can provide it… 

• The Ares Strategic Income Fund capped redemptions after investors sought to withdraw about 11.6% of fund shares.
• Apollo’s private-credit fund also enforced a 5% withdrawal cap amid heavy redemption requests.
• Blackstone’s $48 billion BCRED posted its first monthly loss since 2022 in February 2026, driven in part by markdowns on certain loans, while first-quarter redemptions reached 7.9% of assets.

It seems like every morning we see a new headline about troubles in the private credit world.

Frankly, if it weren’t for the conflict in Iran, I think this would be a much bigger story right now. 

That is why I recently sat down with InvestorPlace Editor-in-Chief Luis Hernandez for another part of my special interview series.

In this conversation, we discuss why the first warning signs in private credit matter so much, what I believe they are telling us now, and why investors should not wait until the broader market fully catches on.

Click here or the play button on the image below to watch my conversation with Luis.

Why Investors Need to Prepare for a Private Credit Reckoning

Now, here’s what you really need to understand. 

All of this is building toward a single moment: June 30, 2026.

That’s when BDCs (Business Development Companies) and private credit funds are required to file their semiannual reports and mark their holdings to fair value.

That will give us a crystal clear picture of just how ugly this mess is, folks. 

No internal estimates, no rosy outlooks, no vague assurances. 

And when that happens, the losses that have been building beneath the surface may finally be exposed.

If history is any guide, this could unravel pretty quickly. 

In March 2023, concerns around banks involved in lending in the cryptocurrency industry escalated into a full-scale regional bank crisis within just days.

But this time, the risk is spread across thousands of companies tied to the $3 trillion private credit system.

That’s why, in my latest presentation, I call these vulnerable businesses “zombie companies” – firms that appear stable on the surface but rely on constant access to credit to survive.

Many are already showing signs of strain – weakening cash flow, rising debt burdens, and increased sensitivity to even small changes in credit availability.

That’s why identifying these companies now – before the broader market fully reacts – is so important. And I’ve generated a full-blown research report dedicated to 10 stocks I think you should avoid. It’s called The Shadow Banking Blacklist. 

Some are directly involved with lending in the private credit industry. Others are simply companies that my system is flagging for their weak fundamentals.

If you own any of them, I recommend taking a closer look now before it’s too late. 

Go here to learn more about this report now.

The post This $3 Trillion Market Is Approaching a Breaking Point appeared first on InvestorPlace.

Last Friday, futures markets flashed a warning that would have seemed almost unthinkable six months ago…

A rate hike.

According to CME Group’s FedWatch tool, the probability of a rate increase by year-end crossed the 50% threshold for the first time last Friday. That’s a stunning reversal from the rate-cut narrative that has dominated market thinking for the better part of two years.

Now, the rate hike odds have fallen to nearly 10% as I write on Monday morning, but still – this is an enormous shift in market sentiment.

What changed?

Three things, arriving in rapid succession.

What’s behind a potential rate hike

First, global crude prices have topped $110 a barrel as the Iran war drags on. As I write, Brent Crude trades at $114. This injects an energy-cost shock into an economy that doesn’t need higher prices.

Second, the Bureau of Labor Statistics reported that import prices jumped 1.3% in February – the largest monthly increase since March 2022 – while export prices rose 1.5%, the biggest gain since May 2022.

Third, the Organization for Economic Co-operation and Development (OECD) sharply revised its U.S. inflation forecast upward to 4.2% for the year, well above the Fed’s own projection of 2.7%.

Put it all together, and the outlook is getting uncomfortable…

These inflationary pressures are arriving at the same moment that recession odds are climbing. Moody’s Analytics estimates the probability of a downturn over the next 12 months at about 50%. Goldman Sachs raised its own forecast to 30% last week. And EY Parthenon and Wilmington Trust are putting odds at 40% or higher.

That combination – rising inflation and rising recession risk simultaneously – is the textbook definition of stagflation. And it’s precisely the scenario that puts the Fed in an almost impossible position.

Cut rates to protect the economy, and you risk higher inflation. Raise rates to contain inflation, and you risk tipping a fragile economy into contraction.

The FOMC meets April 28-29. As I write, the CME Group’s FedWatch Tool assigns just a 2.6% probability of a hike at that specific meeting – so a near-term move remains unlikely.

But this shift in expectations from a cut to a hike is huge. It matters for your portfolio and every asset class – especially for one corner of the market that was built on the assumption that rates would keep falling. More on that in a moment.

But first, let’s cover a story from last week that deserves a closer look than many investors gave it…

The AI industry just said something very important for investors who are willing to listen

Just six months after launch…and only three months after inking a billion-dollar deal with Disney…OpenAI pulled the plug on Sora, its video-generation model.

The move sent its entertainment partners and the AI community scrambling for answers.

Now, you can read this as a simple corporate pivot – a company sharpening its focus ahead of an IPO, killing side projects to concentrate on what pays.

But regular Digest readers will recall what we explored together in last Thursday’s Digest when we asked a pointed question…

If the world is paying billions to build AI, but consumer-facing AI software companies are struggling to pay back their loans, what does that tell us about how much businesses and consumers will actually pay for AI?

The Sora shutdown is a concrete answer – and it isn’t encouraging.

What the numbers actually showed

According to Slate, Sora downloads plunged nearly 75% from their November peak just months after launch.

OpenAI management reportedly realized they were burning an enormous amount of computing power – and torching cash – to generate very little in return. The unit economics simply didn’t work.

Here’s MAXC.com with some additional numbers:

After Sora launched in September 2025, downloads exceeded one million in the first ten days…

However, the glory was short-lived—downloads dropped by 32% month-on-month in December, and continued to decline by 45% in January 2026, with user spending also continuing to fall…

Meanwhile, Forbes reported that OpenAI was spending $15 million – per day – to run it.

From Bill Peebles, OpenAI’s head of Sora, last October:

The economics are currently completely unsustainable.

The result? Goodbye, Sora.

This is precisely the divide we described last week between what we called the AI “secure elite” and everything else. The infrastructure layer – the chips, the data centers, the power management – is generating real, locked-in revenue today. Hyperscalers are spending on decade-scale horizons, and that money is already flowing.

But the consumer-facing application layer is where the economics are still unproven at best…troubling at worst.

And Sora is now Exhibit A.

But this is more than a one-company story

Last week, news outlets reported that Walmart has ditched its ChatGPT shopping integration after the model consistently failed to improve sales.

Meanwhile, earlier this month, Reuters suggested that Nvidia is reportedly reconsidering chip commitments to OpenAI.

And Bloomberg reported that Oracle scrapped a planned data center expansion with OpenAI.

These stories could all be isolated data points – but as wise investors, we need to recognize that we could also be seeing a pattern.

To be clear: we are not proclaiming the end of AI. The technology is real, the productivity gains in specific domains are real, and the buildout will continue for years. But the growing list of similar stories illustrates that the gap between building AI and monetizing AI is wider and more stubborn than the market has assumed.

The investors who will profit won’t abandon the AI trade, but they will navigate to the part of the trade that’s actually working. And that means one thing…

We need to follow the money, not the narrative.

Right now, the money is flowing into the physical layer of AI…but we’re seeing increasing evidence that it’s not yet trickling down to the application layer at scale.

We’ll keep tracking this closely. But recognize the warning that Sora is sending. It’s not a fire alarm, but it is a signal that well-informed investors will take seriously…while the typical investor just reads the press release and moves on.

The Sora story isn’t the only place this early AI warning is showing up

If we think of the Sora shutdown as an unexpected crack in the ice, what’s happening in private credit is the sound of that crack spreading.

We’ve been tracking this story here in the Digest, but here’s the short version to make sure we’re all on the same page…

In recent years, billions of dollars in private credit flowed into software companies on the assumption that their AI-driven subscription revenues would make them safe, reliable borrowers.

That assumption is now cracking, and the latest data shows the pace is accelerating.

New figures from Morningstar Direct, cited by Bloomberg last week, show that inflows into open-ended private credit funds fell by more than a third in the first two months of 2026.

They crashed from $1.8 billion over the same period last year to just $1.1 billion. February marked one of the weakest monthly inflow readings since August 2024.

The reason, according to Morningstar Senior Principal Mara Dobrescu, is straightforward: investors are growing nervous about private credit funds’ exposure to software-as-a-service companies (SaaS) – exactly the consumer-facing AI application layer we’ve been flagging.

The withdrawal demands have been so heavy that major institutional fund managers – including Ares Management (ARES) and Apollo Global Management (APO) – have been forced to gate withdrawals, blocking investors from pulling their money out.

From Bloomberg:

In some cases, investors have received less than half of what they asked for.

They must then resubmit requests in subsequent quarters, with no guarantee of being fully repaid if redemptions remain elevated.

And here’s where the Fed story we led with today becomes directly relevant…

Beware the refi wall

Much of the debt sitting inside these private credit funds was originated when rates were near zero – structured for a world where borrowing was cheap, and refinancing was easy.

As one Raymond James analyst noted last week, the risk extends beyond AI software – it touches any highly-leveraged, rate-sensitive borrower whose business model was built for a world of cheap money.

That world is now in question.

If markets are right that we’ll enter 2027 with higher rates, the roughly $1.2 trillion in leveraged debt maturing between 2027 and 2029 faces a dramatically more difficult refinancing environment than anyone modeled when those loans were written.

Here’s a visual on the size of the maturity wall headed our way…

Source: Apollo

For borrowers barely covering interest payments at today’s rates, higher ones in the months/years ahead would be a serious problem.

Bottom line: The “extend and pretend” strategy that has kept many of these loans off the default list works when you can refinance into similar or lower rates. It breaks down when you can’t.

We’ve been tracking the growing trouble in private credit alongside legendary investor 91����, editor of Breakthrough Stocks

Louis has been warning about private credit stress since mid-2024 – and his concern has sharpened considerably in recent weeks.

In fact, he’s warning investors about a specific date – June 30, 2026. That’s when Business Development Companies (BDCs) and private credit funds must file their semiannual reports and mark their holdings to fair value.

This means no internal estimates. No “extend-and-pretend” of shaky loans. Just a clear accounting of what these loans are actually worth.

If the stress building beneath the surface is as significant as the early signals suggest, that deadline could be the moment hidden losses become visible ones with market-moving consequences.

Louis has put together a full presentation explaining what he’s seeing – and more importantly, how investors can protect their portfolios and potentially profit as this story develops.

Click here to watch Louis’ presentation before this story gets bigger.

Wrapping up

Three stories. Three different corners of the market. One underlying message…

The easy-money assumptions that powered the last several years – cheap rates, abundant credit, AI monetization “just around the corner” – are being stress-tested simultaneously.

How they hold up will define which investors come out ahead and which ones wish they’d been paying closer attention.

We’ll keep tracking all of this with you here in the Digest.

Have a good evening,

Jeff Remsburg

The post Rate Hike Odds Top 50% – And That’s Not the Only Warning appeared first on InvestorPlace.

Last week, President Trump paused military action until April 6 and said that talks with Iran were “going well.”

But this morning, on Truth Social, he threatened that if the Strait of Hormuz doesn’t reopen and a deal isn’t reached “shortly,” there will be attacks on Iran’s vital energy resources and infrastructure.

This back-and-forth is creating a lot of noise right now. But among that noise, there is an opportunity hiding in plain sight…

Small-cap stocks.

If you follow me at all, then you know that I’ve always described small caps as bunnies. They sit for a bit, not doing much, but then they hop on a major catalyst like good earnings.

So, are small caps up for a major run?

That’s what we talked about in this week’s Navellier Market Buzz with special guest Michael Borgan. He’s a specialist in small- and mid-cap stocks and works behind the scenes with me on my Breakthrough Stocks service.

We also discuss the AI data center buildout and preview some upcoming earnings announcements that could move the market in a big way.

Click the image below to watch now.

To see more of my videos, click here to subscribe to my YouTube channel, and to learn more about Michael, check out his website here.

Plus, the grades in Stock Grader (subscription required) have been updated this week! Click here to plug in your own stocks and see how they’re rated.

A Warning Sign Most Investors Are Missing Right Now

While the market continues to digest the geopolitical headlines, there’s something else happening right now that investors need to be aware of.

For the past year and a half, I’ve been telling my followers that I was growing concerned about the $3 trillion private credit market.

And now, we’re starting to see real stress show up in this “shadow banking” sector.

Blue Owl Capital Inc. (OWL) – one of the biggest firms in the space – just limited withdrawals from one of its funds. That’s not a routine move.

That’s what happens when too many investors want out, and there isn’t enough cash on hand to meet those requests.

You see, many of those funds are built on loans made when borrowing was cheap. Now that rates are much higher, some of the companies that received those loans are under pressure – and it’s getting harder to hide.

This isn’t the only troubling sign emerging in private credit.

That’s why I put together a special presentation that explains everything you need to know.

In it, I break down where the risks are building, including the stocks that are most vulnerable right now. I also discuss why I believe capital is likely to move into what I call “fortress stocks,” which are positioned to thrive if the dam in the private credit market breaks.

So, if you haven’t seen it yet, now is the time to get up to speed before the crowd catches on.

Go here to watch now.

Sincerely,

91����

Editor, Market 360

The post Are Small Caps Ready to Run? appeared first on InvestorPlace.

This Week’s Ratings Changes:

Upgraded: Strong to Very Strong

Downgraded: Very Strong to Strong

Upgraded: Neutral to Strong

Downgraded: Strong to Neutral

Upgraded: Weak to Neutral

Downgraded: Neutral to Weak

Upgraded: Very Weak to Weak

Downgraded: Weak to Very Weak

To stay on top of my latest stock ratings, plug your holdings into Stock Grader, my proprietary stock screening tool. But, you must be a subscriber to one of my premium services.

To learn more about my premium service, Growth Investor, and get my latest picks, go here. Or, if you are a member of one of my premium services, you can go here to get started.

Sincerely,

91����

Editor, Market 360

The post ExxonMobil Upgraded, Microsoft Downgraded: Updated Rankings on Top Blue-Chip Stocks appeared first on InvestorPlace.

Today, Louis is joining us to explain why a key deadline — June 30 — could force long-hidden problems into the open. That’s when certain funds will have to mark their assets more realistically, potentially revealing losses that have been building for months.

He believes this could be a turning point for the broader market. He’s also put together a presentation explaining what he’s seeing and how he’s preparing. You can check that out here.

If he’s right, the biggest moves may come faster than most investors expect.

Here’s Louis…

It was an experience that scarred me for life.

Early in my career, I worked as a banking analyst. It was the 1980s, and the savings and loan crisis was in full swing

At the time, we were restructuring failing institutions – merging balance sheets, reworking loan portfolios, and doing everything we could to make them appear stable.

Simply put, it was my job to “put lipstick on a pig.”

It didn’t fix the underlying problem. It just delayed it.

That’s part of the reason I very rarely recommend financial-sector stocks – especially banks.

There’s just too much funny business that goes on.

Here is another one of the most important lessons I learned during my time as a banking analyst:

Financial crises do not start when the headlines hit.

They start months earlier. Sometimes years.

The first cracks show up quietly. Loans stop performing the way they should. Cash flows weaken. Institutions start adjusting their exposure. And most investors do not notice until the story is already much bigger.

I saw that during the savings and loan crisis.

I saw it again ahead of the 2008 financial collapse.

And I saw the same pattern emerge before the regional banking failures in 2023.

This time around, the risk has been building for years in private credit.

In fact, I’ve been warning my followers about this since mid-2024.

If you want the full story on what is happening inside private credit, and what I believe investors should do before this gets more obvious, you can learn more in my full presentation here.

But what matters today is that the pressure inside that system is getting harder to hide.

Tricolor, a subprime auto lender, collapsed last year amid fraud allegations.

First Brands, an auto-parts company backed by private credit, filed for bankruptcy after struggling under its debt load.

And more recently, large private-credit funds have started limiting withdrawals as investors ask for their money back faster than these illiquid portfolios can provide it…

• The Ares Strategic Income Fund capped redemptions after investors sought to withdraw about 11.6% of fund shares.
• Apollo’s private-credit fund also enforced a 5% withdrawal cap amid heavy redemption requests.
• Blackstone’s $48 billion BCRED posted its first monthly loss since 2022 in February 2026, driven in part by markdowns on certain loans, while first-quarter redemptions reached 7.9% of assets.

It seems like every morning we see a new headline about troubles in the private credit world.

Frankly, if it weren’t for the conflict in Iran, I think this would be a much bigger story right now.

That is why I recently sat down with InvestorPlace Editor-in-Chief Luis Hernandez for another part of my special interview series.

In this conversation, we discuss why the first warning signs in private credit matter so much, what I believe they are telling us now, and why investors should not wait until the broader market fully catches on.

Click on the play button below to watch my conversation with Luis.

Why You Need to Prepare Now

Now, here’s what you really need to understand.

All of this is building toward a single moment: June 30, 2026.

That’s when BDCs (Business Development Companies) and private credit funds are required to file their semiannual reports and mark their holdings to fair value.

That will give us a crystal clear picture of just how ugly this mess is, folks.

No internal estimates, no rosy outlooks, no vague assurances.

And when that happens, the losses that have been building beneath the surface may finally be exposed.

If history is any guide, this could unravel pretty quickly.

In March 2023, concerns around banks involved in lending in the cryptocurrency industry escalated into a full-scale regional bank crisis within just days.

But this time, the risk is spread across thousands of companies tied to the $3 trillion private credit system.

That’s why, in my latest presentation, I call these vulnerable businesses “zombie companies” – firms that appear stable on the surface but rely on constant access to credit to survive.

Many are already showing signs of strain – weakening cash flow, rising debt burdens, and increased sensitivity to even small changes in credit availability.

That’s why identifying these companies now – before the broader market fully reacts – is so important. And I’ve generated a full-blown research report dedicated to 10 stocks I think you should avoid. It’s called The Shadow Banking Blacklist.

Some are directly involved with lending in the private credit industry. Others are simply companies that my system is flagging for their weak fundamentals.

If you own any of them, I recommend taking a closer look now before it’s too late.

Go here to learn more about this report now.

Sincerely,

91����

Editor, Breakthrough Stocks

P.S. 91���� believes June 30 could mark an important inflection point for the private credit market — and possibly for stocks more broadly. In his latest presentation, he explains what this deadline could reveal… and how he’s positioning ahead of it. He also outlines which types of companies he believes may be most vulnerable. If you haven’t seen it yet, it’s worth taking a look before this story becomes more widely recognized. Go here to check it out.

The post Why June 30 Could Trigger a Private Credit Reckoning appeared first on InvestorPlace.

Fintech. Enterprise software. Crypto. Now traditional banking.

Different industries, same message: fewer people are needed to do the same work.

Not long ago, we detailed Jack Dorsey’s 40% headcount cut at Block (XYZ) and argued it would go down as a crossing of the Rubicon – the moment AI moved from productivity talking point to pink slip. 

Assuming the trend continued, we modeled a potential range of 8–13% structural unemployment for the U.S. economy, on par with the worst recessions of the last 100 years. 

We warned that the cascade would start in fintech and spread outward from there, ultimately sweeping through the entire knowledge economy.

Well, it has been about three weeks since then.

And unfortunately, the pace is accelerating faster than we expected.

The AI Layoffs Scorecard: What Just Happened

Let’s take inventory of what has happened since we last discussed AI-driven layoffs because the landscape is changing swiftly.

On March 11, Atlassian (TEAM) – the Australian enterprise software giant behind Jira and Confluence – announced it was cutting 1,600 employees, with over 900 layoffs aimed directly at software research and development. CEO Mike Cannon-Brookes wasn’t quite as blunt as Jack Dorsey in his approach, but he came close:

“It would be disingenuous to pretend AI doesn’t change the mix of skills we need or the number of roles required in certain areas. It does.”

The market rewarded the move, with the company’s stock rising 1% after the announcement.

Now, it’s not like Atlassian is some struggling startup. Cloud revenue growth accelerated to 25%-plus, RPO growth is running at 40%-plus, and the firm counts more than 600 customers who spend over $1 million annually. 

This is an already-healthy company choosing to be leaner. 

Healthy Companies Are Cutting Anyway

Atlassian isn’t an isolated case. Many of the companies making these cuts aren’t under pressure – they’re choosing to operate differently.

Snowflake (SNOW) laid off its entire technical writing and documentation department. 

The news followed the announcement of a $200 million partnership with OpenAI, which included an autonomous agentic platform capable of drafting complex API documentation directly from source code in minutes – work that previously required human teams weeks to accomplish. The department didn’t just get cut – it got replaced – by the very product the company provides.

If you wanted a cleaner illustration of the mechanism, you could not invent one.

This pattern continues to spread.

The Template Is Being Copied

The Winklevoss twins’ crypto exchange started the year with roughly 700 employees – and has spent two months systematically eliminating 30% of them. This line from their shareholder letter is likely to be remembered:

“AI is now too powerful not to use at Gemini. Not using AI at Gemini will soon be the equivalent of showing up to work with a typewriter instead of a laptop.”

Following suit, Crypto.com‘s CEO Kris Marszalek posted on X: “We are joining the list of companies integrating enterprise-wide AI. Companies that do not make this pivot immediately will fail.” 

Unlike most corporate rhetoric, this one has real implications.

Now, here’s the headline that stopped the financial world in its tracks. Reuters reported, citing three sources familiar with the matter, that Meta (META) is planning sweeping layoffs that could affect 20% or more of the company. Meta employs nearly 79,000 people. Twenty percent is roughly 15,700 jobs.

Meta’s spokesperson called it “speculative reporting about theoretical approaches.” Wall Street called it a reason to buy; Meta’s stock climbed nearly 3% on the report. 

The company that is allegedly about to lay off 15,000 people saw its market cap go up. The mechanism is playing out in real time. Dorsey set the template. Every CEO in America watched what happened to Block’s stock, and they are drawing the same conclusion.

Back in January, Zuckerberg himself said he was starting to see “projects that used to require big teams now be accomplished by a single very talented person.” That’s not a man who is going to defend a 79,000-person headcount for long.

From Tech to Finance: The Spread Begins

What started in tech is now moving into more traditional sectors, as we suspected.

Financial services firm HSBC Holdings (HSBC) is weighing deep job cuts over the coming years. CEO Georges Elhedery is looking to AI to shrink the company’s middle and back offices – one of the first signs of how the technology could reshape Wall Street workforces. The potential cuts could affect around 20,000 roles, or roughly 10% of the bank’s global headcount, over the next three to five years, targeting non-client-facing positions in global service centers.

Twenty thousand bankers. Compliance. Operations. Data processing. The unglamorous but enormous layer of human labor that keeps the global financial system running – increasingly automated.

And Goldman Sachs (GS) and Citi (C) are considering similar moves. Goldman’s CEO David Solomon has been talking about an AI-driven operating system called “OneGS 3.0” and has tightened performance criteria specifically in light of AI capabilities. Insiders say cuts could be announced as soon as April.

The Running Tally

These numbers are still small relative to the 50 million-person knowledge economy we modeled.

The displacement has just begun. But the pace of announcement is accelerating, and the gap between “announcement” and “execution” is shrinking.

How the AI Layoff Wave Is Spreading Across Industries

The AI-driven layoff cascade we mapped just weeks ago is unfolding largely along the lines we outlined:

• Block — Healthy fintech business, explicit AI rationale, 40% cut. Stock up 24%. 
• Gemini, Crypto.com, and adjacent fintech — Direct competitors and adjacent fintech firms followed. 
• Atlassian / Snowflake — Enterprise software followed. 
• HSBC — Traditional finance is now entering the fray; Goldman and Citi are reportedly next. 
• Meta / Amazon — Mega-platform stage underway. Amazon already cut 16,000 in January. Meta is next. Alphabet and Amazon will likely follow suit. 

We modeled 8- to 13% structural total unemployment as the range for full knowledge economy adoption of Block-style AI efficiency. We are still in the very early innings. What we are watching right now is the permission structure being established, the template being copied, the social license to cut expanding with each announcement.

The key distinction here is structural, not cyclical. 

Every one of these announcements is a company explicitly saying it does not intend to rehire for these roles. Snowflake’s entire documentation team was replaced by software, not put on temporary leave. Atlassian is “reshaping its skill mix” — executive language for: these job categories are not coming back. HSBC’s plan spans three to five years and targets systematic automation of processes, not a headcount buffer for a bad quarter.

These workers are being structurally displaced.

‘AI-Washing’ vs. Real AI Layoffs: Why It Doesn’t Change the Outcome

The counterargument — and it is a real one, worth taking seriously — is “AI-washing.”

Skeptics argue that companies are using AI as narrative cover for cuts they would have made anyway: over-hiring during COVID, post-zero-interest-rate reality checks, pressure from activist investors and public markets. Last month, Sam Altman himself said that some companies are “blaming AI for the job cuts they would have made anyway.”

He’s right. Some of them are. Algorand cutting 25% when its token is down 98% has more to do with the crypto cycle than Claude. These things are not mutually exclusive, and untangling genuine AI displacement from COVID-hangover cost-cutting is genuinely hard.

But here is the thing: even if 50% of these announced cuts are AI-washing – pure financial rationale with AI as the PR veneer – the other 50% are real. Snowflake didn’t keep its documentation team and tell investors it was using AI. It eliminated the team because AI can do the work instead.

And more importantly: the AI-washing critique assumes that even the “fake” AI cuts won’t eventually become real. Companies that eliminate documentation teams to save money today, and then find that AI-generated documentation works adequately, do not hire those teams back when their stock recovers. The rationalization becomes the reality. 

The AI-washing argument may explain the timing of some cuts, but it does not argue against the direction of the structural shift.

What AI Layoffs Mean for the Economy

We painted this picture three weeks ago, and nothing has changed. If anything, the recent data reinforces the underlying dynamic.

GDP grows. Markets rise. The ServiceNow CEO predicts 35% unemployment for new college graduates. All three will probably be simultaneously true. The dual economy is assembling in real time.

The AI infrastructure plays — the hyperscalers, semiconductor manufacturers, energy and data center builders who power the whole apparatus — are direct beneficiaries of these shifts. 

Every time Block cuts 4,000 people and buys more AI tools, that’s compute spend. HSBC replacing 20,000 middle-office employees with AI represents more cloud, inference, and foundation model API spend. The labor savings don’t disappear – they get redirected into AI capital spending, which flows into the earnings of the companies building the infrastructure.

What we’re watching isn’t just a labor shift – it’s a reallocation.

From wages to compute. From headcount to systems. From people to platforms.

And as that transition unfolds, the center of gravity moves with it.

That’s where the next phase of this story begins – and where platforms like OpenAI’s sit.

While OpenAI is not yet publicly traded, expectations are building for what could eventually become one of the most important tech IPOs of this cycle.

But as we’ve seen time and again, by the time those IPO headlines hit, a large part of the opportunity is already priced in.

That’s why I recently recorded a briefing outlining a lesser-known way investors may be able to position themselves ahead of that moment… before the broader market fully catches on.

You can watch that briefing right here.

The post AI Layoffs Are Spreading Faster Than Expected appeared first on InvestorPlace.

Crises are when capital begins to reorganize itself, leaving weaker companies and moving into stronger ones with solid finances, steady cash flow, and pricing power.

So, rather than reacting to headlines, my InvestorPlace colleague Louis Navelleir looks at how money typically moves when uncertainty rises – and why that rotation can reveal some of the most compelling opportunities in the market.

His goal is simple: cut through the noise of panic and focus on where financial strength becomes a competitive advantage.

Louis details a current opportunity in the private credit market in his newest presentation.

And he’s joining us today…

When most investors hear the word “crisis,” they think about danger.

That’s natural. After all, the media loves to juice ratings and clicks by giving you a good scare.

But after nearly five decades of doing this, I can tell you that every crisis on Wall Street has another side.

Opportunity.

Just look at what happened in past market shocks:

• In the 2008 financial crisis, capital fled weak financial institutions and rotated into stronger, more resilient companies like Walmart Inc. (WMT) and Dollar Tree Corp. (DG). And as the panic cleared, long-term winners like Amazon.com Inc. (AMZN) and Netflix Inc. (NFLX) emerged from the wreckage stronger than ever.
• In the 2020 pandemic crash, the biggest winners were the companies powering the stay-at-home economy: e-commerce, cloud computing, digital payments and remote-work stocks all surged as the world changed almost overnight.
• In the 2023 regional banking panic, money again rushed toward stronger names. As Silicon Valley Bank and Signature Bank collapsed, my system identified companies like Nvidia Corp. (NVDA), Meta Platforms Inc. (META), and Royal Caribbean Cruises Ltd. (RCL) as major beneficiaries of that flight to quality.

When a crisis emerges, wealth moves away from weak companies with too much debt, weak cash flow, and no margin for error. And it moves toward fundamentally superior businesses that can keep growing even when the market gets more selective.

That is the pattern I saw in 2008. And it is the pattern I saw again in 2023, when Silicon Valley Bank and Signature Bank collapsed.

In both cases, fear did not hit every stock equally. Money moved quickly toward companies with strong balance sheets, superior fundamentals, and the ability to stand on their own.

That is why, during a crisis, I spend my time thinking about where the smart money is likely to go next.

I’ve been concerned about this $3 trillion “shadow” banking sector for over a year now. But today, I want to focus on the opportunity that can emerge when fear takes hold and investors start moving toward stronger companies.

Now, if you want the full story on what is happening in private credit – and what I believe investors can do to prepare and potentially profit– you can learn more in my full presentation.

In the meantime, I also sat down with InvestorPlace Editor-in-Chief Luis Hernandez for a special conversation about this private credit situation.

In this second part of our discussion, we talk about the pattern I have seen over and over again in past crises… why some stocks get crushed while others surge… and what kinds of companies I believe are best positioned if private credit stress spreads further.

Click here or the play button on the image below to watch my conversation with Luis.

It’s Time to Move Into “Fortress” Stocks

If this private credit story continues to unfold the way I expect, the biggest winners will be companies with what I call fortress-level fundamentals – strong cash flow, healthy margins, low debt, and the kind of financial strength that becomes even more attractive when investors get nervous.

The question is, which ones will be those fortress-level companies?

That is exactly the question I have been working on – and I’ve been using my proven Stock Grader tool to help me find the answer.

I study data on more than 6,000 stocks every week and use my proprietary algorithm to run the stocks through eight filters. The goal is simple: find stocks with alpha – that is, stocks that deliver a superior risk-adjusted return.

These eight factors sort stocks with no alpha… from stocks with good alpha… from stocks with super alpha.

But don’t let the finance lingo confuse you, because Stock Grader distills all of this info into a simple “grade”… from “A” (Very Strong) all the way to “F” (Very Weak).

That gives us a perfect framework for judging which stocks are likely to suffer from a potential credit crunch… and which will benefit from a flight to quality.

Because in my experience, the best stocks during a crisis are often not the ones everyone is talking about on television.

By then, it’s probably too late.

The real opportunity is to identify and invest in the fundamentally superior companies that are most likely to attract capital as the market gets more selective before the crowd catches on.

In my full presentation, I explain why I believe many companies could be in serious trouble if private credit stress continues to build. More importantly, I also reveal the A-rated “Fortress” stocks I believe are best positioned to benefit as money moves away from fragile balance sheets and toward real financial strength.

If you want to understand both sides of this story – the companies I believe investors should avoid, and the ones I believe could profit from a flight to quality – I strongly encourage you to watch my full presentation now.

Sincerely,

91����

Editor, Breakthrough Stocks

P.S. 91����’s latest presentation goes deeper into this idea of a “flight to quality” — and why certain stocks could attract significant capital if credit conditions tighten. He also outlines the types of companies he believes are most at risk. If you want to see how he’s positioning ahead of a potential shift in the market, I’d recommend taking a few minutes to watch it now while this story is still developing.

The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:

NVIDIA Corporation (NVDA), Royal Caribbean Cruises Ltd. (RCL) and Walmart Inc. (WMT)

The post Every Crisis Has a Hidden Trade: Here’s Where the Smart Money Goes Next appeared first on InvestorPlace.

Could a spark light private credit markets on fire?

According to former Goldman Sachs CEO Lloyd Blankfein, the answer is clear:

Absolutely.

In a Bloomberg Television interview this week, the Wall Street veteran warned that the recent panic around private credit funds could be a signal of more trouble ahead.

“You accumulate tinder on the floor of the forest and eventually a spark will come,” Blankfein said. “We haven’t had a crisis for a long time, that itself is a reason for concern, because… you haven’t had to sell in distress things that accumulate on your balance sheet that might not be marked correctly.”

In other words, a lot of trouble could be hiding within Business Development Companies (BDCs) – the funds that invest in illiquid private firms and sell shares to the public. Their investments are not “marked to market,” so losses can hide in plain sight. It’s the same accounting magic that allowed banks to obscure losses leading up to the 2008 global financial crisis.

It’s hard to overstate how popular these private-market funds are, or how much trouble they might cause. The top 40 publicly traded BDCs were valued at almost $80 billion last year, and this “shadow banking” system is worth as much as $3 trillion once you include private-market deals and other financing vehicles.

Few other places offer the double-digit dividends that retirees and risk-averse investors seek out.

Even fewer allow the “Four Horsemen” of dangerous investing – complexity, concentration, leverage, and illiquidity – to roam so openly.

The opaque structures have now begun to crack. Last September, automotive supply company First Brands filed for Chapter 11 bankruptcy, triggering a selloff in the BDCs that owned shares. One fund with roughly $22.5 million locked up in First Brands saw its stock price plummet 30%.

The trouble has only snowballed. In November, Blue Owl Capital Corp. (OBDC) called off a merger because too many investors were pulling their money out. By late March, at least four major private-market funds had limited how much investors could withdraw – a move that tends to trigger exactly the panic it’s meant to prevent.

After all, every BDC investor knows that these funds can run into trouble even if they’re solvent. When enough panicked investors sell shares, all at once, the resulting decline in stock prices generally prohibits BDCs from raising fresh capital. That can indirectly cause a wider fire-sale if the fund then fails to meet asset-coverage ratios required by the Securities and Exchange Commission.

So, how afraid should we be of a spark that lights the private capital markets on fire?

The Next Credit Crisis

InvestorPlace Senior Analyst 91���� believes we should be very, very concerned. There’s a lot more that can still go wrong in private credit, and he believes that a $3 trillion crisis in this “shadow banking” business is nearing a breaking point.

He identifies June 30, 2026, as the most likely date we’ll see a reckoning, and he explains why in his latest presentation here.

There are three key reasons you should pay close attention… and not only because Louis also predicted the collapses of Enron, Lehman and Silicon Valley Bank.

First, BDCs and other private credit funds have had years of ultralow interest rates and rising asset prices to gorge themselves on questionable deals.

Bought a company for too much?

Don’t worry, someone else will buy it from you for even more next year.

Have a $100 million loan that’s coming due?

Go ahead and refinance it. The Fed’s rate is near zero.

In fact, the First Brands blow-up was a poster child of a bad deal hiding in plain sight. Few funds questioned the aggressive debt-financed growth of the automotive supply firm. And no one bothered asking how a CEO with a history of alleged misrepresentation (and getting sued by former business partners) was able to borrow more than $10 billion to finance his empire.

And if a high-profile company like First Brands got away with it for so long… how many more “cockroaches” could be hiding among lesser-known firms?

Secondly, BDC ownership is overwhelmingly made up of dividend-seeking retail investors. This cohort has a history of panic selling during times of crisis, and global investment firm Cambridge Associates notes that the group was happy to unload BDCs well below net asset value in 2020.

As Louis outlines in his latest presentation, this is something that could well happen again. Fear is contagious, and BDC redemptions could go from “bumping up against limits” to an all-out dash for the exits.

Finally, the agentic AI-instigated bloodbath in the software industry could soon spill into BDC valuations. As Louis explains, software firms are some of the largest borrowers in private credit markets, and all are now facing existential threats from AI automation.

Shares of blue-chip software companies like Salesforce Inc. (CRM) have already plummeted 36% from their peaks, and Louis believes these losses will become apparent by his June 30 deadline.

So, what can investors do? Well, earlier, I mentioned that BDC owners are overwhelmingly retail investors.

I’m not talking about the meme-stock crowd. Most social media users under 40 would never have heard of Ares, Hercules, or Prospect Capital.

Instead, BDC owners are typically older individuals seeking consistent dividend income. They’re the ones looking at Ares Capital Corp. (ARCC) – the world’s largest BDC – and snapping up shares to enjoy a 10.5% dividend yield. Smaller firms like Oxford Square Capital Corp (OXSQ) and Great Elm Capital Corp (GECC) offer yields of 20% or more. (GECC was the $16.5 million investor in First Brands that lost 30%.)

That’s important, because investors rotating out of BDCs will not be reinvesting their cash into low-quality moonshots or speculative growth firms.

Instead, they will be seeking alternative sources of dividend income.

And so, we should expect high-yielding quality stocks to outperform as this rotation gets underway. There could be a lot of cash flowing out of private markets, and investors will be parking it in these types of investments.

Louis talks about this in greater detail in his latest presentation, which you can see here. And in the meantime, I’d like to illustrate his thinking with three companies that fit this bill.

Profiting from America’s Shale Exports

Much of America’s natural gas has historically been “trapped” in the Permian Basin. Older interstate pipelines ran to the wrong places, and so gas was flared, trucked, and even sold to buyers at negative prices. Texas’ Waha Hub prices have often drifted below zero as a result.

That’s where  Energy Transfer LP (ET) comes in.

The company operates one of the largest pipeline networks in America and runs several indirect routes from the Waha Hub in West Texas to the Texas Gulf Coast, where gas is compressed and exported as liquefied natural gas (LNG). Energy Transfer plans to open a more direct Waha-to-Gulf route later this year. ET is also a major player in natural gas liquids (ethane, propane, etc), where it holds a 20% global share of exports. And it’s seen demand surge due to insatiable AI demand and LNG shortages from war in the Middle East.

Best of all, Energy Transfer is a low-leverage, income-earning play that offers a 6.9% dividend yield and plenty of room for growth. Its upcoming Waha-to-Gulf pipeline offers a near-term catalyst, and several more pipelines are planned to come online by 2029.

Analysts expect free cash flows to surge 28% this year, 31% in 2027 and 8% in 2028. Shares trade at just 6.5X forward cash flows, making it my favorite midstream company right now.

A Blue Chip on Sale

Investors exiting BDCs will also be seeking out more traditional dividend plays. And  Kimberly-Clark Corp. (KMB) sits at the perfect intersection of having 1) high dividends, 2) consistent profits, and 3) a defensible business.

Kimberly is a household goods company that owns six key brands: Huggies, Scott, Kleenex, Cottonelle, Depend, and Kotex. Each generates over $1 billion in annual sales, and profit margins are high.

The Dallas area-based company generated 44% returns on capital invested last year, second in its class only to Proctor and Gamble Co. (PG). KMB also plans to acquire Kenvue Inc. (KVUE), Johnson & Johnson’s (JNJ) former consumer health division. That will add brands like Tylenol, Neutrogena, and Band-Aid to Kimberly’s portfolio.

This acquisition has clearly spooked investors. KMB’s shares have plummeted 18% since announcing the acquisition last November, because everyone knows Kimberly’s profit margins will decline in the short term. Kenvue’s lineup is not nearly as profitable as Kimberly’s existing portfolio.

Yet, markets are also forgetting that Kimberly has a long history of building strong brands in commodity-like markets. Despite some stumbles abroad, the firm has managed to convince the world that it’s worthwhile to pay a premium for branded tissue paper.

In addition, the recent selloff now prices KMB’s stock at a 5.3% dividend yield – well above its long-term average of 3.6%. (Lower stock prices mean higher dividend yields.) Shares trade at their most attractive levels since 2012.

So, even though Kimberly lags the industry leader, its high dividend and reasonably defensible business should be enough to tempt conservative investors its way.

The Conservative REIT

As I’ve said before, Realty Income Corp. (O) is the REIT to buy and hold forever.

It is the only Dividend Aristocrat that offers monthly dividends, and it maintains an ultra-conservative profile by favoring “triple-net” leases where the tenants pay for utilities, taxes, and other costs. Realty’s shares have advanced 15% since I wrote about them in mid-2024, compared to a 26% collapse in the BDC index (including dividends), as measured by the VanEck BDC Income ETF (BIZD).

The downside of this conservatism is slower growth. Management will often sacrifice higher rental income to secure better clients, making Realty Income the opposite of hypergrowth data center plays like Digital Realty Trust Inc. (DLR) or CoreWeave Inc. (CRWV).

However, “slower” doesn’t mean “zero.” The company has grown its Adjusted Funds From Operations (AFFO) per share by 4.6% annually over the past decade  – outpacing most of its triple-net rivals. Analysts expect another 4.1% growth this year, and its 5.3% dividend yield is especially attractive.

For conservative investors, Realty offers a way to help savings grind higher over time.

Buying Quality

Energy Transfer, Kimberly-Clark, and Realty Income all have this in common:

They are high-earning companies that clearly explain how their dividends are made.

The companies will face no surprise revaluations… no sudden withdrawal limits… no financial blowups that threaten BDCs. Instead, they will be pumping gas, selling Kleenex, and renting retail space while sitting on their strong balance sheets.

Meanwhile, BDCs are looking increasingly at risk. Bloomberg reports that around $5 billion of capital is now trapped in the private credit industry – stuck behind redemption limits. More asset managers are expected to impose curbs in the coming weeks.

That could create a feedback loop that spirals out of control.

“I don’t see anything systemic,” Lloyd Blankfein conceded in that same interview. “But by the way, I didn’t necessarily see anything systemic in the run-up to the [2008] crisis, which is why that’s the nature of bubbles. Everyone sees it in hindsight, but no one sees it in prospect.”

That’s why you’re going to want to hear what Louis has to say in his new free presentation. In it, he explains why a new wave of bankruptcies could rock the U.S. stock market, and how the shake-up will create devastating losses for some investors… and riches for others.

Click here to sign up for the event.

I’ll be out for travel next week, so I’ll see you back here in two weeks.

Regards,

Thomas Yeung, CFA

Market Analyst, InvestorPlace

Thomas Yeung is a market analyst and portfolio manager of the Omnia Portfolio, the highest-tier subscription at InvestorPlace. He is the former editor of Tom Yeung’s Profit & Protection, a free e-letter about investing to profit in good times and protecting gains during the bad.

The post Three Stocks to Buy as Investors Flee This $3 Trillion “Shadow” Market appeared first on InvestorPlace.

AI stocks have pulled back sharply over the past few weeks, caught in a broader risk-off move tied to geopolitical tensions in the Middle East.

But at the same time, the companies powering the AI boom have been reporting some of the strongest numbers – and issuing some of the most aggressive forward guidance – we’ve yet seen in this cycle.

Historically, these kinds of gaps between price action and underlying fundamentals don’t last very long.

Because they can’t both be right.

What will be left when the smoke clears?

A set of AI tailwinds that are still intact, still accelerating – and now trading at a discount after a fear-driven correction.

AI Infrastructure Data Is Telling a Different Story

So let’s talk about those fundamentals. Because I have five major transcripts from the last few weeks sitting in front of me – Broadcom (AVGO), Marvell (MRVL), Oracle (ORCL), Micron (MU), and Nvidia (NVDA) CEO Jensen Huang’s GTC keynote – and they’re all pointing to the same conclusion: the AI infrastructure supercycle is only compounding.

We’ll start with the companies’ forward guidance revisions.

Forecasts Are Moving Higher Fast

Back in September 2025, Marvell told investors that fiscal 2027 revenue would be ~$9.5 billion. By December, it was revised upward to $10 billion. Last week, it hit $11 billion – with fiscal 2028 now targeting $15 billion. That is a 30%-plus upward revision to the forward revenue outlook, all in six months. Marvell’s projected 2027 growth rate is roughly double what it told the Street at the September investor day.

That kind of revision in six months would be a headline in any other environment.

Here, it’s part of a broader pattern across the stack.

Across the AI supply chain, companies aren’t just reporting strong demand – they’re adjusting expectations higher as that demand shows up faster than planned.

Scale Is Expanding Across the AI Infrastructure Stack

Broadcom’s latest results reflect that same shift, just at a different scale. The company reported $8.4 billion in AI semiconductor revenue in a single quarter, up 106% year-over-year, and guided to $10.7 billion next quarter – implying 140% growth.

Then CEO Hock Tan added a longer-term datapoint that’s hard to ignore: Broadcom now has visibility into more than $100 billion in AI chip revenue by 2027. Not total revenue. Just chips.

If Broadcom highlights the scale of what’s building, Oracle offers a view into how far ahead customers are already committing.

Oracle’s remaining performance obligation (RPO) – essentially a signed backlog (contracted demand that still needs to be delivered) – now stands at $553 billion. AI Infrastructure revenue grew 243% year-over-year, while MultiCloud Database revenue grew 531%. 

Supply Constraints Are Already Showing Up

And in some parts of the stack, demand is already running into supply constraints.

Micron reported the largest sequential revenue increase in company history and projected that next quarter’s revenues will exceed the company’s entire annual revenue for every year through fiscal 2024 – with gross margins rising from 75% to 81% in a single quarter.

Those margins reflect how tight supply has become.

Step back, and all of these data points start to line up with what Nvidia is seeing at the system level.

At March’s GTC event in San Jose, Jensen Huang said: a year ago, he saw $500 billion in high-confidence demand through 2026. Today, he sees at least $1 trillion through 2027. And then, just to make sure nobody was getting too comfortable, he added: “We are going to be short.”

Why AI Demand Is Compounding at an Exponential Rate

Individually, those numbers are impressive. Together, they describe a demand curve that’s starting to bend upward.

Jensen Huang explained what’s driving that shift at GTC.

In the last two years, computing demand has increased by approximately 1 million times. That’s the product of two separate multipliers: 

• First, the compute required per inference session increased roughly 10,000x as AI evolved from simpler chatbots into reasoning models (o1, o3) and then into increasingly agentic systems. 
• Second, usage itself has grown roughly 100x. 

Multiply those drivers, and you get a million-fold increase in demand.

The Shift From Training to Inference Is Driving AI Infrastructure Demand

AI no longer just responds. It acts. The critical development Jensen highlighted at GTC is the inference inflection. For the first two years of the generative AI era, most compute demand was training. Now, with reasoning models that think before they respond – and agentic systems like Claude Code that can autonomously read files, write code, test, and iterate – inference is the dominant and rapidly growing workload. 

Every action requires tokens. Every token requires inference, and every inference requires compute, memory, bandwidth, and power. The demand engine has fundamentally shifted from a one-time training cost to a perpetual inference tax on every activity that AI performs.

This is a structural change. And it explains why every company in this stack is not just growing – but growing faster than they were six months ago.

AI Bottlenecks Are Shifting – And So Is the Opportunity

When demand starts compounding like this, something has to give.

In AI infrastructure, that ‘something’ shows up as bottlenecks – and they don’t stay in one place for long.

GPUs and other accelerators were the first constraint, and that part of the market is now well into a phase of sustained hypergrowth.

From Compute to Connectivity

From there, the pressure moved into interconnects – the systems that link all of that compute together.

Marvell’s results make that shift clear. Its interconnect business, which was previously expected to grow in line with overall capital spending, is now growing at more than 50% – much closer to the pace of the accelerators themselves.

Now the bottleneck has moved again.

The AI Infrastructure Bottleneck Has Shifted to Memory

Memory is the current constraint, and Micron’s numbers show just how tight things have become.

The company is only able to meet roughly 50% to 66% of customer demand, as both AI workloads and traditional server demand compete for limited DRAM and NAND supply.

That imbalance isn’t resolving anytime soon.

High-bandwidth memory (HBM4) is only just beginning to ship, the next generation (HBM4E) doesn’t ramp until 2027, and new fabrication capacity takes years to build.

In the meantime, pricing power is doing the adjusting.

Micron’s gross margins jumped from 75% to 81% in a single quarter – an unusually sharp move that reflects how constrained supply is relative to demand. Its CFO Mark Murphy was explicit: this is not a cycle. Memory has been “recast as a defining strategic asset in the AI era.”

Demand Is Getting Locked In Early

As supply tightens, customers aren’t waiting around.

They’re committing earlier – and at larger scale – to secure what they’re going to need.

We can see that shift clearly in Oracle’s numbers. Its $553-billion RPO may be the single most underappreciated number in technology right now. 

Three years ago, Oracle was a legacy database vendor fighting for relevance. Today, it is the preferred infrastructure for large-scale AI training and inference workloads. Nvidia confirmed this at GTC, noting Oracle as its first AI customer and pointing to Cohere, Core, Fireworks, and OpenAI as tenants. Oracle’s bring-your-own-hardware model – $29 billion in new contracts since the last earnings call – allows it to grow without a corresponding free cash flow drag. 

Demand is accelerating. Bottlenecks are shifting. Capacity is getting locked in.

Now the buildout itself is starting to change.

The Rise of Custom Silicon In AI Infrastructure

Both Broadcom and Marvell are seeing the same shift from different angles: hyperscalers are increasingly building their own custom AI chips.

Broadcom is directly exposed to that trend.

The company now serves six XPU customers: Alphabet (GOOGL), Anthropic, Meta (META), ByteDance, Fujitsu, and OpenAI. And importantly, these are multi-year partnerships tied to each company’s long-term AI roadmap.

OpenAI alone has signed a 10-gigawatt agreement through 2029 and plans to deploy more than 1 gigawatt of its first-generation XPU in 2027.

The reason for this shift is straightforward.

As AI models become more specialized – whether for reasoning, inference, or sparse architectures – general-purpose GPUs can’t always deliver the same efficiency as chips designed for a specific workload.

That’s where Broadcom has an advantage. Its decades of experience in custom silicon design, combined with advanced packaging and manufacturing scale, make it one of the few companies capable of delivering these chips at volume.

Marvell sits in a different position – but benefits from the same trend.

Every XPU that gets deployed still needs networking, memory expansion, and high-speed connectivity. Marvell’s portfolio – network interface cards (NICs), CXL-based memory expansion, and switching – supports that layer of the buildout.

As more custom chips are deployed, that “attached” market grows alongside them.

Marvell expects that portion of its business to reach roughly $1 billion by fiscal 2027, with a path to more than $2 billion by 2029 in networking and memory-related products alone.

It doesn’t need to design the winning chip.

It supplies the infrastructure that connects and supports all of them.

Short-Term Noise vs. Long-Term AI Demand

None of the demand trends we’ve just walked through have been driven by geopolitics.

They’ve continued to build in the background.

What the U.S.-Iran conflict has done is introduced a layer of macro uncertainty – pushing energy prices higher, tightening financial conditions, and triggering a broad risk-off move across equities.

The key question is how durable that overhang is.

Right now, the rhetoric remains elevated, and negotiations have been uneven. But the underlying incentives on both sides point in a different direction.

Sustained escalation carries meaningful economic costs – through energy markets, trade flows, and domestic financial conditions – that neither side is well-positioned to absorb for long.

That doesn’t guarantee a clean or immediate resolution. But it does suggest that the current level of geopolitical risk premium is more likely to stabilize or gradually fade as those pressures build.

When that happens, the market’s focus will shift back to underlying fundamentals.

And in this case, those fundamentals have continued to strengthen while attention has been elsewhere.

The stocks that get hit hardest in risk-off moves in a sector with intact fundamentals are typically the same stocks that recover fastest and furthest when the risk-off catalyst resolves. 

What Happens When Price Catches Up to Data

Jensen Huang now sees at least $1 trillion in AI infrastructure demand through 2027 – and expects supply to fall short.

Broadcom is scaling custom silicon programs tied to multi-gigawatt deployments.

Oracle has already locked in hundreds of billions of dollars in future demand.

Micron is operating in one of the tightest supply environments in its history.

The data is already on the table. 

The AI infrastructure buildout is still accelerating. As more compute comes online, the companies positioned on top of it – turning it into products, platforms, and recurring revenue – will begin to take a larger share of the upside.

That layer is coming into view.

And one company, in particular, sits right at the center of it.

The post $1 Trillion In AI Demand, and the Market Is Looking the Other Way appeared first on InvestorPlace.

Last Sunday evening, The Economist ran an article comparing the U.S. president’s strategy in Iran to the weather in his home state of Florida:

If you don’t like it, then wait five minutes.

Sure enough, early Monday morning, the president posted on social media that his threats to obliterate Iranian power plants “STARTING WITH THE BIGGEST ONE FIRST!” would be delayed, thanks to “PRODUCTIVE CONVERSTATIONS REGARDING A COMPLETE AND TOTAL RESOLUTION OF OUR HOSTILITIES IN THE MIDDLE EAST.”

Crude futures fell as much as 13%, before rebounding after Iranian officials said no such negotiations had taken place. They ended this week almost where they started.

These wild swings highlight why Eric and I have avoided trying to predict the exact contours of energy markets. A handful of individuals are now dictating where oil prices go, and even they don’t seem to know what’s coming next.

This is a dangerous combination.

However, there is logic behind a buy-and-hold strategy in energy and commodity stocks.

So today, I’d like to share our thoughts on this wild market, and how we’re continuing to invest.

Then I’ll show you how to apply our winning strategy to your own portfolio.

Let’s jump in…

Oil Moves on Every Headline

So far, we believe price discovery has been superb in oil’s spot markets – meaning prices for immediate delivery are reacting quickly and efficiently to new information.

It’s like sitting at a poker table filled with professional “sharks.” Every new piece of geopolitical news has affected oil and gas prices in exactly the way you would expect, making it virtually impossible for anyone to earn risk-adjusted returns. (This is why we’re not making bets here.)

Meanwhile, oil’s longer-dated futures markets appear less well-priced. (If we were commodities traders, this is where we would make bets.)

There’s significantly less trading in these forward financial contracts – agreements to buy or sell oil at a set price in the future. And so, prices are likely depressed right now because oil producers are selling these contracts to lock in profits, effectively adding supply to the futures market.

There are still some sharks at this table… but far fewer.

There’s also a global macro case for higher prices further out on the curve. As the same Economist article notes, there are four ways the United States can now proceed in the Middle East conflict:

Yet futures prices – what traders expect oil to sell for in the months ahead – are only reflecting some combination of the first and second option… and assuming that Iran will agree to play along. That means there’s some opportunity to make money in the futures market.

But the opportunity to beat the market through oil futures inefficiencies is smaller compared to the clear mispricing we’re seeing in energy stocks. Here, analysts have been glacially slow in updating their company-level forecasts.

So, we remain most interested in high-quality energy stocks.

Like these…

The Better Way to Play Energy Right Now

Most professional investors love low price-to-earnings (P/E) stocks. The lower the number, the “cheaper” a company is. All else equal, Nvidia Corp. (NVDA) at 20X earnings is a better deal than Nvidia at 50X.

Now, this creates an obvious problem. P/E ratios generally go down because the “P” (i.e., price) has fallen. And that usually signals some other trouble with the company.

But what if a P/E ratio declines because the “E” (earnings) goes up instead? And what if I told you I could almost guarantee that it would happen?

That’s exactly what’s now happening in U.S. oil companies.

For instance, one of the leading producers in West Texas’s Delaware Basin is well-positioned to benefit from structurally improving pricing trends in the region.

However, only eight out of the company’s18 Wall Street analysts have updated their 2026 earnings estimates forthis company since the U.S.-Iran war began. That means more than half of all “E” estimates are too low! (They will obviously catch up once model updates happen.)

When the other 10 analysts eventually revise their numbers, this company will see its P/E ratio drop… even though its price might not have changed. It’s among the many reasons why Eric recommends this stock in his Fry’s Investment Report portfolio.

And it’s not the only company out there like that.

Eric recommends two other high-quality energy companies at Fry’s Investment Report that are now trading cheaper than what they are expected to earn.

In other words, the market price hasn’t caught up to their true (or updated) earnings outlook, so investors can buy them at big discounts relative to those expected profits.

When analysts update their estimates, these companies will suddenly look even cheaper because their earnings are higher. That will likely attract a wave of buying.

Now, we are not pounding the table with a bullish oil and gas take. Prices move faster than the fundamentals, so a sudden end to conflict in the Middle East will see an immediate selloff in energy markets.

However, if you do invest in energy, high-quality energy stocks provide security and upside that spot oil prices and oil futures simply do not.

Click here to learn more at Fry’s Investment Report.

Regards,

Thomas Yeung, CFA

Market Analyst, InvestorPlace

The post Why We’re Ignoring Oil Prices and Buying Energy Stocks Instead appeared first on InvestorPlace.

For nearly a thousand years, the Theodosian Walls of Constantinople (modern-day Istanbul) stood as one of the most formidable defenses ever constructed.

The strength of the Theodosian Walls didn’t come from a single imposing barrier, but from a carefully engineered system built in layers.

A wide moat stretched across the front, slowing invaders before they could even reach the structure. Beyond it stood an outer wall, and behind that, a much taller and thicker inner wall.

Towers were spaced at regular intervals along the walls, giving defenders visibility and the ability to strike from multiple angles. Even if attackers managed to breach one layer, they found themselves exposed in the open space between walls, vulnerable before they could press forward.

Underneath it all was a solid foundation, designed to endure for centuries, supported by constant maintenance and reinforcement.

These walls had depth, redundancy, and strength beneath the surface. They weren’t built for appearance but for endurance.

That’s exactly the kind of strength today’s market is demanding.

The Headlines You May Be Missing

Operation Epic Fury has created significant uncertainty in the markets. But while investors are focused on the immediate headlines, a quieter risk is building beneath the surface – and it has the potential to do far more lasting damage to long-term wealth.

That’s why today’s environment needs a different kind of portfolio – one built like a fortress.

The burgeoning crisis in the private credit market is flying under the radar of most investors. If not for the war, these headlines would be creating a lot more anxiety.

From Bloomberg:

From CNN:

The private credit industry – valued at about $1.8 trillion – is suffering from significant defaults and fears that AI disruption could hurt software companies, which account for about 30% of its loans, according to JPMorgan.

Earlier this week, Apollo Global Management and Ares said they are limiting shareholder withdrawals in their private credit funds amid a surge in investor requests across the industry.

Meanwhile, Moody’s downgraded the credit rating of a private credit fund run by KKR and Future Standard, sending it into “junk” territory after more of its borrowers stopped paying their loans.

Investing legend 91���� has been calling out this danger for more than a year.

In December, during our semi-annual Omnia roundtable with all the analysts, Louis was bullish on the market’s prospects in 2026, but he called out this problem as one to watch.

If you want to be scared, private credit is a problem.

Dodd-Frank created the private credit industry because banks won’t lend to people unless they’re perfect. So, if your credit score isn’t above 800, you’re 798, they kick you out to private credit, they mark up the loans, and they pay 11% yields to investors because they leverage those loans. Well, now the default rate is rising, there’s a problem.

JP Morgan lost 170 million with Tricolor. BlackRock’s got a problem with the Utah bundler of loans; they might lose half a billion dollars.

Since then, the negative headlines have come fast.

Now, you might be thinking…

“Why should I care about private credit? I don’t own any of these funds.”

Even if you’ve never invested a dollar in private credit… many of the companies you do own depend on it.

As Louis has been saying, this $1.8 trillion market has quietly become the go-to funding source for thousands of businesses that couldn’t qualify for traditional bank loans. This is especially true in areas such as software, where easy money helped fuel rapid growth.

For years, that system has kept weaker companies alive, helped others expand faster than fundamentals would justify, and allowed investors to ignore the weaknesses.

But that environment has changed.

Interest rates are higher. Defaults are rising. And lenders are starting to pull back.

Many of the companies leveraging that cheap money are about to lose access to the very thing that’s been keeping them afloat. And when that happens, the impact won’t stay contained inside private credit funds – and ripples will extend throughout the stock market.

You can probably guess what we’ll see.

Companies miss earnings. Debt becomes harder to refinance. Layoffs begin.

Then, stock prices fall fast.

So, you don’t have to be in the private credit market to start to feel the effects.

You just have to own the wrong stocks.

Can your portfolio withstand the pressure?

Just like the Theodosian Walls weren’t defined by a single layer of stone… the strongest companies today aren’t defined by a single metric.

They’re built in layers.

And that’s exactly what 91����’s system is designed to identify.

Every week, Louis runs a quantitative analysis on more than 6,000 stocks—grading them from A to F based on the same kind of structural strength that made those walls so effective.

Not surface-level traits like hype or recent price momentum, but the deeper layers that determine whether a company can endure real stress.

We’re talking about stocks with superior fundamentals:

• Strong, consistent cash flow
• High return on equity
• Expanding profit margins
• Low debt relative to assets

And, of course, whether institutional investors are quietly accumulating shares.

When all of those layers are in place, stocks get an “A” in Louis’ Stock Grader system.

These are the market’s true fortress companies.

On the other hand, stocks with weak fundamentals, such as high debt, deteriorating margins, and negative cash flow, are the ones leaning on today’s private credit system to survive.

And if that system continues to crack, there isn’t a second wall behind them.

The DNA of a Fortress Company

In Louis’ Breakthrough Stocks service, he recommends smaller companies with superior fundamentals … the ones few have heard of that can explode higher over time.

In September, he recommended Tutor Perini Corp. (TPC), a full-service construction company.

That’s not a flashy AI darling. Instead, it’s a company known for large-scale transportation and civil construction. In late February, the company posted blowout earnings, proving why Louis’ system identified it as a strong buy.

Fourth-quarter adjusted earnings surged to $1.07 per share, compared to a loss of $1.49 per share in the same quarter a year earlier. The consensus estimate called for adjusted earnings of $0.92 per share, so TPC posted a 16.3% earnings surprise. Fourth-quarter revenue increased 41.1% year-over-year to $1.51 billion, beating estimates of $1.35 billion.

Even amid recent market volatility, the stock has held up well, rising more than 20%.

The stock is below Louis’ buy price of $90, so there is still time to get into this trade.

Louis just released a deep dive into the growing cracks in private credit that details not only how to protect your portfolio, but how to benefit as this crisis redirects enormous currents of capital through the financial system.

As I noted above, he identified this risk months ago, and has been putting his subscribers in the best position to protect themselves – and even profit – when the market starts to show cracks.

Maybe you’re in a credit fund, or maybe just exposed to the collateral damage without even realizing it – either way, you should make time to watch Louis’ free presentation that explains the risks and can help position you to profit.

Enjoy your weekend,

Luis Hernandez

Editor in Chief, InvestorPlace

The post This $1.8 Trillion Risk Could Hit Your Portfolio appeared first on InvestorPlace.

Early in my career, I worked as a banking analyst. It was the 1980s, and the savings and loan crisis was in full swing.

At the time, we were restructuring failing institutions – merging balance sheets, reworking loan portfolios, and doing everything we could to make them appear stable.

Simply put, it was my job to “put lipstick on a pig.”

It didn’t fix the underlying problem. It just delayed it.

That’s part of the reason I very rarely recommend financial-sector stocks – especially banks.

There’s just too much funny business that goes on.

Here is another one of the most important lessons I learned during my time as a banking analyst:

Financial crises do not start when the headlines hit.

They start months earlier. Sometimes years.

The first cracks show up quietly. Loans stop performing the way they should. Cash flows weaken. Institutions start adjusting their exposure. And most investors do not notice until the story is already much bigger.

I saw that during the savings and loan crisis.

I saw it again ahead of the 2008 financial collapse.

And I saw the same pattern emerge before the regional banking failures in 2023.

This time around, the risk has been building for years in private credit.

In fact, I’ve been warning my followers about this since mid-2024.

If you want the full story on what is happening inside private credit, and what I believe investors should do before this gets more obvious, you can learn more in my full presentation here.

But what matters today is that the pressure inside that system is getting harder to hide.

Tricolor, a subprime auto lender, collapsed last year amid fraud allegations.

First Brands, an auto-parts company backed by private credit, filed for bankruptcy after struggling under its debt load.

And more recently, large private-credit funds have started limiting withdrawals as investors ask for their money back faster than these illiquid portfolios can provide it…

• The Ares Strategic Income Fund capped redemptions after investors sought to withdraw about 11.6% of fund shares.
• Apollo’s private-credit fund also enforced a 5% withdrawal cap amid heavy redemption requests.
• Blackstone’s $48 billion BCRED posted its first monthly loss since 2022 in February 2026, driven in part by markdowns on certain loans, while first-quarter redemptions reached 7.9% of assets.

It seems like every morning we see a new headline about troubles in the private credit world.

Frankly, if it weren’t for the conflict in Iran, I think this would be a much bigger story right now.

That is why I recently sat down with InvestorPlace Editor-in-Chief Luis Hernandez for another part of my special interview series.

In this conversation, we discuss why the first warning signs in private credit matter so much, what I believe they are telling us now, and why investors should not wait until the broader market fully catches on.

Click the play button on the image below to watch my conversation with Luis.

Why You Need to Prepare Now

Now, here’s what you really need to understand.

All of this is building toward a single moment: June 30, 2026.

That’s when BDCs (Business Development Companies) and private credit funds are required to file their semiannual reports and mark their holdings to fair value.

That will give us a crystal clear picture of just how ugly this mess is, folks.

No internal estimates, no rosy outlooks, no vague assurances.

And when that happens, the losses that have been building beneath the surface may finally be exposed.

If history is any guide, this could unravel pretty quickly.

In March 2023, concerns around banks involved in lending in the cryptocurrency industry escalated into a full-scale regional bank crisis within just days.

But this time, the risk is spread across thousands of companies tied to the $3 trillion private credit system.

That’s why, in my latest presentation, I call these vulnerable businesses “zombie companies” – firms that appear stable on the surface but rely on constant access to credit to survive.

Many are already showing signs of strain – weakening cash flow, rising debt burdens, and increased sensitivity to even small changes in credit availability.

That’s why identifying these companies now – before the broader market fully reacts – is so important. And I’ve generated a full-blown research report dedicated to 10 stocks I think you should avoid. It’s called The Shadow Banking Blacklist.

Some are directly involved with lending in the private credit industry. Others are simply companies that my system is flagging for their weak fundamentals.

If you own any of them, I recommend taking a closer look now before it’s too late.

Go here to learn more about this report now.

Sincerely,

91����

Editor, Breakthrough Stocks

The post Why June 30 Could Trigger a Private Credit Reckoning appeared first on InvestorPlace.

Right now, most investors are watching oil, rates, and geopolitics. 91���� is watching something else entirely: private credit.

It’s a $3 trillion market that has grown largely out of sight – and one that is now starting to show signs of strain as higher rates work their way through the system.

In today’s piece, Louis explains why he’s been focused on this risk since 2024… what’s changed recently… and why this may matter more for equities than most investors expect.

He’s also just put together a detailed presentation walking through the full setup – how this market grew so quickly, where the pressure is building now, and what it could mean for investors if conditions tighten further. If this is a developing fault line in the market, it’s worth understanding before it becomes obvious.

You can watch that presentation here.

Now, here’s Louis.

Back in the summer of 2024, it felt like you couldn’t escape the noise.

• The countdown to the Paris Olympics had begun.
• Taylor Swift’s Eras Tour was everywhere.
• And the U.S. presidential election was heating up fast.

Investors were focused on their own headlines.

• Every inflation report created market moves.
• The Federal Reserve’s next move dominated the conversation
• And AI felt like the only trade that mattered

Everyone was focused on those big, obvious stories.

Meanwhile, I was warning my readers about one of the biggest risks building in the financial system.

It was happening quietly in the background. Hardly anyone was talking about it.

Now, I’ve never considered myself an alarmist. In fact, my critics and my fans would probably agree that I tend to be more of an eternal optimist.

So, when I raised the red flag, it caught a lot of people off guard.

But as I explained back then, if there was anything that could derail the bull market… any kind of “black swan” event… my money was on this.

I’m talking about the private credit market.

For the past year and a half, I’ve been warning that this market deserved a lot more attention than it was getting.

Back then, private credit was being pitched as a safer, steadier corner of finance. The trouble is, it was also a place where risk could build up out of public view.

Now, more people are finally starting to pay attention.

In just the past few weeks, we’ve seen a wave of headlines that suggest Wall Street is starting to wake up to the same risks I’ve been flagging since 2024:

• The Wall Street Journal: “Private-Credit Warning Signs Flash After Blue Owl Unloads $1.4 Billion in Assets” 
• Financial Times: “Flagship Blackstone credit fund posts first monthly loss since 2022” 
• Bloomberg: “Ares, Apollo Cap Private Credit Withdrawals as Exodus Grows” 
• MarketWatch: “Just a spark may light private credit on fire, warns ex-Goldman CEO Blankfein” 

In today’s Market 360, I’m going to explain what’s going on in this $3 trillion “shadow” banking sector – and why you should care. 

And because this unfolding situation could potentially unravel and impact the entire market, I’ll also explain how you should prepare…

How Private Credit Became ‘Shadow’ Banking

Before I go any further, let me explain what private credit actually is…

Private credit is lending that happens outside the traditional banking system. These are not loans from JPMorgan or Bank of America. They are loans made by private funds, asset managers, insurers and other nonbank lenders operating in what many now call the “shadow banking system.”

This market exploded after the 2008 financial crisis. Regulators clamped down on traditional banks, making it harder for them to make the same aggressive loans they once extended to smaller, weaker and more speculative borrowers.

But the demand for credit did not disappear. It simply moved.

Private lenders stepped in, and private credit grew from about $300 billion in 2010 to nearly $3 trillion today.

The problem is that a lot of that money flowed to borrowers that were never especially strong to begin with. Then interest rates surged, financing costs jumped and many of those companies were left trying to survive in a much harsher environment.

For a while, Wall Street has been able to paper over some of that stress by extending loans, restructuring terms and pushing problems into the future.

But that kind of “extend and pretend” strategy only works for so long.

That is why I believe the private credit market is approaching a real moment of truth.

It’s also why I just finished putting together a new presentation on this entire private credit situation – which you can view here. 

But to give a brief overview of the situation, I recently sat down with InvestorPlace Editor-in-Chief Luis Hernandez to talk through what is happening, why it matters and what investors need to understand now.

Click here or the play button on the image below to watch my conversation with Luis.

What the Private Credit Risk Means for Investors

Now, there is a lot more to say about the private credit markets – including how we got here, the risks it presents to the market, and what investors can do to prepare. 

I’ll have more to say soon about where I believe investors should look as this situation develops.

In the meantime, I put this special presentation together to walk you through the full private credit story in plain English – how this market grew so large, why the pressure is building now and what I believe smart investors should be doing before June 30. 

During that presentation, I’ll also tell you more about five Fortress Companies that have the balance-sheet strength, operating momentum and institutional appeal to attract capital when investors become more selective. And about 10 stocks to avoid… ones caught in the crosshairs of the growing private credit crisis.

I encourage you to watch it now while there is still time to get ahead of the crowd.

The post The Private Credit Time Bomb Is Ticking appeared first on InvestorPlace.

But according to my legendary investor, 91����, one of the biggest risks in today’s market has been quietly building in the background.

In today’s Friday Digest takeover, Louis pulls back the curtain on the $3 trillion private credit market – often referred to as the “shadow banking system.” He explains why rising rates are beginning to expose cracks that Wall Street is only now starting to acknowledge.

This isn’t a story about an obvious crash or a sudden shock. It’s about risk that builds slowly…out of sight…until it reaches a tipping point.

Below, Louis walks through what’s happening under the surface of the market, why it matters for your portfolio, and what investors should be watching next.

He also lays out his full game plan – including where he sees risk and opportunity – in a new presentation you can watch right here.

If this situation unfolds the way Louis expects, getting ahead of it will be important for your portfolio.

I’ll let him take it from here.

Have a good evening,

Jeff Remsburg

Back in the summer of 2024, it felt like you couldn’t escape the noise.

• The countdown to the Paris Olympics had begun.
• Taylor Swift’s Eras Tour was everywhere.
• And the U.S. presidential election was heating up fast.

Investors were focused on their own headlines.

• Every inflation report created market moves.
• The Federal Reserve’s next move dominated the conversation
• And AI felt like the only trade that mattered

Everyone was focused on those big, obvious stories.

Meanwhile, I was warning my readers about one of the biggest risks building in the financial system.

It was happening quietly in the background. Hardly anyone was talking about it.

Now, I’ve never considered myself an alarmist. In fact, my critics and my fans would probably agree that I tend to be more of an eternal optimist.

So, when I raised the red flag, it caught a lot of people off guard.

But as I explained back then, if there was anything that could derail the bull market… any kind of “black swan” event… my money was on this.

I’m talking about the private credit market.

For the past year and a half, I’ve been warning that this market deserved a lot more attention than it was getting.

Back then, private credit was being pitched as a safer, steadier corner of finance. The trouble is, it was also a place where risk could build up out of public view.

Now, more people are finally starting to pay attention.

In just the past few weeks, we’ve seen a wave of headlines that suggest Wall Street is starting to wake up to the same risks I’ve been flagging since 2024:

• The Wall Street Journal: “Private-Credit Warning Signs Flash After Blue Owl Unloads $1.4 Billion in Assets”
• Financial Times: “Flagship Blackstone credit fund posts first monthly loss since 2022”
• Bloomberg: “Ares, Apollo Cap Private Credit Withdrawals as Exodus Grows”
• MarketWatch: “Just a spark may light private credit on fire, warns ex-Goldman CEO Blankfein”

In today’s Market 360, I’m going to explain what’s going on in this $3 trillion “shadow” banking sector – and why you should care.

And because this unfolding situation could potentially unravel and impact the entire market, I’ll also explain how you should prepare…

The $3 Trillion “Shadow” Banking System

Before I go any further, let me explain what private credit actually is…

Private credit is lending that happens outside the traditional banking system. These are not loans from JPMorgan or Bank of America. They are loans made by private funds, asset managers, insurers and other nonbank lenders operating in what many now call the “shadow banking system.”

This market exploded after the 2008 financial crisis. Regulators clamped down on traditional banks, making it harder for them to make the same aggressive loans they once extended to smaller, weaker and more speculative borrowers.

But the demand for credit did not disappear. It simply moved.

Private lenders stepped in, and private credit grew from about $300 billion in 2010 to nearly $3 trillion today.

The problem is that a lot of that money flowed to borrowers that were never especially strong to begin with. Then interest rates surged, financing costs jumped and many of those companies were left trying to survive in a much harsher environment.

For a while, Wall Street has been able to paper over some of that stress by extending loans, restructuring terms and pushing problems into the future.

But that kind of “extend and pretend” strategy only works for so long.

That is why I believe the private credit market is approaching a real moment of truth.

It’s also why I just finished putting together a new presentation on this entire private credit situation – which you can view here.

But to give a brief overview of the situation, I recently sat down with InvestorPlace Editor-in-Chief Luis Hernandez to talk through what is happening, why it matters and what investors need to understand now.

Click the play button on the image below to watch my conversation with Luis.

The Time to Prepare Is Now

Now, there is a lot more to say about the private credit markets – including how we got here, the risks it presents to the market, and what investors can do to prepare.

I’ll have more to say soon about where I believe investors should look as this situation develops.

In the meantime, I put this special presentation together to walk you through the full private credit story in plain English – how this market grew so large, why the pressure is building now and what I believe smart investors should be doing before June 30.

During that presentation, I’ll also tell you more about five Fortress Companies that have the balance-sheet strength, operating momentum and institutional appeal to attract capital when investors become more selective. And about 10 stocks to avoid… ones caught in the crosshairs of the growing private credit crisis.

I encourage you to watch it now while there is still time to get ahead of the crowd.

Sincerely,

91����

Editor, Breakthrough Stocks

The post The $3 Trillion Market More Investors Are Starting to Worry 91���� appeared first on InvestorPlace.

That’s natural. After all, the media loves to juice ratings and clicks by giving you a good scare.

But after nearly five decades of doing this, I can tell you that every crisis on Wall Street has another side.

Opportunity.

Just look at what happened in past market shocks:

• In the 2008 financial crisis, capital fled weak financial institutions and rotated into stronger, more resilient companies like Walmart Inc. (WMT) and Dollar Tree Corp. (DG). And as the panic cleared, long-term winners like Amazon.com Inc. (AMZN) and Netflix Inc. (NFLX) emerged from the wreckage stronger than ever.
• In the 2020 pandemic crash, the biggest winners were the companies powering the stay-at-home economy: e-commerce, cloud computing, digital payments and remote-work stocks all surged as the world changed almost overnight.
• In the 2023 regional banking panic, money again rushed toward stronger names. As Silicon Valley Bank and Signature Bank collapsed, my system identified companies like Nvidia Corp. (NVDA), Meta Platforms Inc. (META), and Royal Caribbean Cruises Ltd. (RCL) as major beneficiaries of that flight to quality.

When a crisis emerges, wealth moves away from weak companies with too much debt, weak cash flow, and no margin for error. And it moves toward fundamentally superior businesses that can keep growing even when the market gets more selective.

That is the pattern I saw in 2008. And it is the pattern I saw again in 2023, when Silicon Valley Bank and Signature Bank collapsed.

In both cases, fear did not hit every stock equally. Money moved quickly toward companies with strong balance sheets, superior fundamentals, and the ability to stand on their own.

That is why, during a crisis, I spend my time thinking about where the smart money is likely to go next.

I’ve been concerned about this $3 trillion “shadow” banking sector for over a year now. But in today’s Market 360, I want to focus on the opportunity that can emerge when fear takes hold and investors start moving toward stronger companies.

Now, if you want the full story on what is happening in private credit – and what I believe investors can do to prepare and potentially profit– you can learn more in my full presentation.

In the meantime, I also sat down with InvestorPlace Editor-in-Chief Luis Hernandez for a special conversation about this private credit situation.

In this second part of our discussion, we talk about the pattern I have seen over and over again in past crises… why some stocks get crushed while others surge… and what kinds of companies I believe are best positioned if private credit stress spreads further.

Click play button on the image below to watch my conversation with Luis.

It’s Time to Move Into “Fortress” Stocks

If this private credit story continues to unfold the way I expect, the biggest winners will be companies with what I call fortress-level fundamentals – strong cash flow, healthy margins, low debt, and the kind of financial strength that becomes even more attractive when investors get nervous.

The question is, which ones will be those fortress-level companies?

That is exactly the question I have been working on – and I’ve been using my proven Stock Grader tool to help me find the answer.

I study data on more than 6,000 stocks every week and use my proprietary algorithm to run the stocks through eight filters. The goal is simple: find stocks with alpha – that is, stocks that deliver a superior risk-adjusted return.

These eight factors sort stocks with no alpha… from stocks with good alpha… from stocks with super alpha.

But don’t let the finance lingo confuse you, because Stock Grader distills all of this info into a simple “grade”… from “A” (Very Strong) all the way to “F” (Very Weak).

That gives us a perfect framework for judging which stocks are likely to suffer from a potential credit crunch… and which will benefit from a flight to quality.

Because in my experience, the best stocks during a crisis are often not the ones everyone is talking about on television.

By then, it’s probably too late.

The real opportunity is to identify and invest in the fundamentally superior companies that are most likely to attract capital as the market gets more selective before the crowd catches on.

In my full presentation, I explain why I believe many companies could be in serious trouble if private credit stress continues to build. More importantly, I also reveal the A-rated “Fortress” stocks I believe are best positioned to benefit as money moves away from fragile balance sheets and toward real financial strength.

If you want to understand both sides of this story – the companies I believe investors should avoid, and the ones I believe could profit from a flight to quality – I strongly encourage you to watch my full presentation now.

Sincerely,

91����

Editor, Breakthrough Stocks

The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:

NVIDIA Corporation (NVDA), Royal Caribbean Cruises Ltd. (RCL) and Walmart Inc. (WMT)

The post The Hidden Opportunity Inside a $3 Trillion Credit Crunch appeared first on InvestorPlace.

The target moved through the Tehran night, exactly as predicted.

Thousands of miles away, in a secure operations center, AI systems were processing data at a speed no human could match – analyzing intelligence, identifying patterns, and modeling outcomes in real time.

The margin for error was zero.

On February 28, 2026, Operation Epic Fury achieved its objective. Ayatollah Ali Khamenei – the architect of Iran’s nuclear ambitions – was killed in a joint U.S.-Israeli strike.

When The Wall Street Journal later reported that Anthropic’s Claude AI had been used for intelligence assessments, target identification, and battle simulation, it confirmed something far more important than the operation itself: artificial intelligence is already shaping the most consequential decisions on Earth.

And yet, there’s a critical detail most investors are missing.

All the companies behind that intelligence are still private.

The AI reshaping history?

You don’t own it. The venture capitalists and founders do.

Until now, there was very little you could do about that.

Why Most Investors Still Don’t Own the AI Companies That Matter

Think about the last time you used AI. Maybe you asked ChatGPT a question, got Claude to help edit a document, or read Grok’s take on the news. Those models are among the most powerful AI tools in the world – and you can’t invest in them directly

OpenAI, Anthropic, xAI – not a share available on any exchange. 

And those are just the consumer-facing names. Beneath the surface, the opportunity is even bigger. For example, a little-known company called Anduril is building the future of defense, centered on advanced autonomous systems. And, yes, it is private, too. 

AI is changing the world – but you don’t really own the AI that matters. 

Sure, many investors own shares of Nvidia (NVDA); maybe Microsoft (MSFT) or Amazon (AMZN). But none of them fully control the intelligence layer itself. 

Nvidia makes the chips those models run on. Microsoft distributes OpenAI’s technology under license. Amazon sells cloud compute. 

These are picks-and-shovels plays in the AI gold rush – excellent investments, but still indirect exposure. 

That means most investors have been participating in the AI revolution from the bleachers. But the insiders, founders, and venture capitalists… They have the field-level seats. They are the ones who will get phenomenally rich when these companies – the real AI pioneers like OpenAI, Anthropic, xAI, Anduril, etc. – go public.

And for most investors, there’s never really been a way in.

But that’s starting to change fast.

AI IPO 2026: The Biggest Tech Listings In a Generation

2026 is shaping up to be one of the most consequential years for technology IPOs in decades. Not because one great company is going public – but because several of them are.

Leading the charge is OpenAI, which is preparing for an IPO that could potentially value it near the trillion-dollar mark – making it one of the largest technology IPOs ever attempted. The company generates over $20 billion in annualized revenue, growing at triple-digit rates, with 810 million monthly active users and 1 million enterprise customers. It just closed a funding round valued at $730 billion with backing from Amazon, SoftBank (SFTBY), Nvidia, and Microsoft. 

OpenAI is targeting a listing as early as Q4 2026. Close behind, Anthropic – the AI safety-focused lab backed by Google and valued at $380 billion – is also widely expected to explore a public listing in that same window.

The SpaceX–xAI Mega IPO and the Rise of AI Defense

But OpenAI and Anthropic are only the beginning.

Elon Musk has assembled the most audacious corporate structure in modern tech. In February, he merged SpaceX – his aerospace company – with xAI to create a trillion-dollar conglomerate that combines the world’s leading orbital launch provider, a frontier AI lab, and the social media platform X. The combined entity was originally targeting an IPO as early as June, at a valuation some sources put as high as $1.5 trillion. 

Now that timeline may be accelerating.

According to recent reporting from CNBC, SpaceX could file IPO paperwork as soon as this week – with Bloomberg indicating the company may seek a valuation north of $1.75 trillion, potentially making it the first 10-figure IPO in market history.

And if you’re investing in the SpaceX IPO, you’re also buying xAI and X. It is, by design, the most vertically integrated technology company ever to approach public markets.

Then there’s the sleeper in this lineup: Anduril Industries. 

Founded in 2017 by Palmer Luckey – the same wunderkind entrepreneur who founded Oculus and sold it to Facebook at age 21 – Anduril builds systems traditional defense primes struggle to replicate: AI-native, software-first autonomous systems. Its Lattice OS platform serves as the operating system for autonomous military operations, integrating sensor data across every domain and coordinating weapons systems in real time. 

Revenue is racing toward $2 billion. Its valuation has jumped from $14 billion to more than $60 billion in under two years.

With a $1 billion advanced manufacturing facility coming online in Ohio – and a CEO who has publicly said an IPO is ‘definitely’ coming – Anduril’s debut looks less like a question of if, and more a question of when.

The 2026 AI IPO Bonanza is imminent. And it is going to be one of the most talked-about investment moments of our lifetimes.

But there’s a critical dimension to this story that most investors haven’t heard yet – one that makes getting in early not just attractive but urgent.

The $48 Billion IPO Squeeze Wall Street Isn’t Thinking 91����

New reporting from Bloomberg Intelligence fundamentally changes the calculus here. 

S&P Global, FTSE Russell, and Nasdaq are all actively considering “fast-track” rules that would add SpaceX, OpenAI, and Anthropic to their major indices within days of their IPO – bypassing the traditional 12-month seasoning requirement that currently blocks newly public companies from immediate index inclusion.

If those rules are adopted – and Bloomberg’s analysts suggest they’re being taken seriously – the implications are massive.

Here’s the math. Roughly $12 trillion in index-tied assets – passive funds mirroring the S&P 500, Russell 1000, and Nasdaq 100 – would effectively become forced buyers of these IPOs within days of listing. Bloomberg estimates $24- to $48 billion in automatic passive demand representing approximately 20% of shares offered. If active fund managers benchmarked to those same indices simultaneously move to neutral weights, index inclusion could require buying up to 55% of the public float within five trading days of the IPO.

Now consider the supply side. These companies are expected to go public with free floats of just 5- to 10% of total market value – deliberately tiny, to avoid flooding the market with shares. A 5% float of a $1.5 trillion SpaceX means about $75 billion in publicly available shares absorbing tens of billions in forced institutional demand within the first week.

That is a structural supply/demand imbalance of historic proportions.

The Bloomberg report also identified 37 publicly listed funds already holding SpaceX exposure. Of those, the ERShares Private-Public Crossover ETF topped the rankings by portfolio weight at nearly 37% SpaceX exposure – more than Baron Capital, Fidelity’s Contrafund (which holds over $6 billion in SpaceX in dollar terms), ARK Invest, and Neuberger Berman. Bloomberg’s independent analysis confirms what we’ve been telling you: concentrated pre-IPO vehicles exist, they are accessible right now, and they are already sitting on extraordinary unrealized gains.

On that note: Bloomberg’s data on estimated SpaceX returns by fund shows Baron sitting on gains of approximately 864%, Fidelity at 715%, and Neuberger Berman at 733% from their initial entry prices. ARK, which was slower to build its position, shows an estimated 291% return. The message is unambiguous: time of entry is everything, and the gap between early investors and late ones is measured not in percentage points but in multiples.

Why IPO Day Is Usually Too Late for the Biggest Gains

When these companies arrive, the combination of genuine investor enthusiasm and $48 billion in mechanically forced passive buying will almost certainly produce one of the most violent opening-day pops in stock market history.

But there’s a darker flip side to this golden coin. We’ve seen this all before.

Think back to the first wave of internet IPOs in the late 1990s. It produced some of the most spectacular opening-day pops ever recorded. 

Yet, for most post-IPO investors, the years that followed were brutal. The insiders and venture capitalists who invested at pre-IPO valuations captured the overwhelming majority of the gains. The retail investors who piled in after the bell, swept up in the excitement, often held stocks that subsequently fell 50%, 70%, 90%.

The lesson wasn’t about the technology. It was about when you got in.

Now apply that pattern here, and add the Bloomberg dynamic: if $48 billion in forced passive buying hits a 5% float in the first five trading days, the post-IPO price could reflect an extraordinary one-time structural premium that has nothing to do with fundamental value. Once that forced buying is absorbed, what happens next? 

Pre-IPO holders get to sell into the most structurally bid-up IPO market in history. Post-IPO buyers are the ones providing the exit liquidity.

How to Invest In AI Companies Before Their IPO

Here’s what most investors still haven’t fully processed: the investment landscape has genuinely changed over the last few years.

A new category of investment vehicle has emerged. And it allows ordinary investors – not just hedge funds, accredited millionaires, or Silicon Valley venture insiders – to gain pre-IPO exposure to the world’s most transformational private companies. 

These vehicles trade like stocks. All you need are a ticker symbol and a brokerage account – no $250,000 minimum check, VC connections, three-year lockup period, or complex special purpose vehicle (SPV) paperwork required.

And most importantly, there are specific vehicles in this category that provide direct exposure to OpenAI, xAI, SpaceX, and Anduril right now, before they go public. 

These are not futures bets or derivatives or synthetic products. They are investment funds with actual positions in these private companies, wrapped in publicly traded structures and available to any investor with a standard account.

For the first time, you don’t have to be Sequoia Capital or Andreessen Horowitz to join the founding shareholder class of the most important technology companies being built today. 

The democratization of pre-IPO investing has arrived, without fanfare – which is exactly why most retail investors haven’t discovered it yet.

The Bottom Line

Artificial intelligence is rapidly becoming the foundational technology of the next economic era.

The companies building the core models, platforms, and autonomous systems that power it are still largely private.

But that window is beginning to close – quickly.

The venture capitalists who bet on these companies early are preparing to cash out at valuations that will make them unimaginably wealthy. And the founders are about to see their net worth go vertical. 

For the first time, ordinary investors have a legitimate way to stand alongside them.

Before the IPO circus arrives, institutional allocations are spoken for, and the opening-day pop happens without you.

The 2026 AI IPO Bonanza is the financial story of the decade. And Bloomberg makes one thing clear: this is not a “wait and see” moment. The time to get positioned is before the index funds are forced to act – not after.

If you want to get in before these IPOs hit – and before billions in forced buying distorts prices – you need to see this. 

I just put together a full presentation on this topic, including a deep-dive analysis of each vehicle, the risks every investor needs to understand, and our specific recommendations. 

Click here to watch it now.

The post The AI IPO Gold Rush Is Coming – And You’re Not In It Yet appeared first on InvestorPlace.

The top arm of the ‘K’… represents the top 20% of high-income households—but nearly half of them could be walking on eggshells…

That line comes from a Fortune article earlier this week. And it hints at something quietly shifting beneath the surface of what we thought we understood about who’s doing well financially today.

Here’s the short version: today’s K-shaped economy, where asset owners thrive while wage-dependent households struggle, has developed a new fracture – a divide forming within the “haves” themselves.

Back to Fortune:

The wealthy who are at financial risk are “high earners whose lack of budgeting and profligate spending has them overleveraged and exposed…

While they appear to be doing well from the outside, they are only a step away from real financial trouble.”

According to Fortune, those wealthy enough to be insulated from this “real financial trouble” have a new name – the “secure elites.”

Now, there’s a fascinating parallel playing out in today’s stock market. But before we explore that, let’s start with the market’s equivalent of the K-shaped divide…

AI versus everything else.

Get ready for the K-shaped stock market to widen

Longtime Digest readers know this story well.

On one side of the market, we have “yesterday’s economy” stocks (minus oil recently) – companies that haven’t kept pace with rapid technological advances.

On the other side, we have AI and the companies powering it, marching higher on the back of massive capital investment and explosive earnings growth.

To illustrate the performance gap, the chart below shows the Equal Weight S&P 500 up roughly 40% over the past two years while the Global X Artificial Intelligence & Technology ETF (AIQ) has surged more than 100% over the same period.

To be clear, “non-AI” stocks haven’t done poorly – they’ve just lagged. And that divide has defined this market.

According to hypergrowth expert Luke Lango, editor of Innovation Investor, this lag isn’t going away. If anything, he believes the current macro uncertainty will make it more pronounced:

Yes, the war will end. But, no, everything won’t go back to ‘normal’.

The consumer, already struggling… faces a sustained energy cost premium and a credit environment that stays restrictive longer than pre-war expectations suggested.

These are real headwinds for real businesses. The broad market…faces genuine pressure from the lingering war aftermath that doesn’t disappear on ceasefire day. 

But Luke says it’s different for the AI sector.

Hyperscaler capex decisions are made on 5 to 10-year return horizons – irrespective of glum consumer sentiment surveys…

Microsoft and Google aren’t cutting AI data center budgets because American workers haven’t gotten a raise recently…

And Brent crude settling at $75 instead of $65 won’t influence Nvidia’s $1 trillion in confirmed orders.

Luke concludes:

Sophisticated capital with perfect industry information is making decade-scale [AI] commitments in the middle of a war.

That is the revealed preference of people who know more than the macro noise suggests…

Buy AI infrastructure into the chop. Stay cautious on the consumer-exposed broad market.

Stepping back, the takeaway is familiar – but important…

We still have a K-shaped market. And based on Luke’s analysis, today’s macro uncertainty will likely only reinforce that outperformance of technology versus “the rest.”

But here’s the new wrinkle…

Even within AI, a new divide is forming.

Let’s return to that Fortune framing for a moment…

Within the upper K of the economy, we have the “secure elites” – households with strong balance sheets, low debt and genuine financial resilience. Yet there are also the high earners who look financially healthy but are “only a step away from real financial trouble.”

There’s a similar dynamic playing out within AI.

On the “secure elite” side are the companies at the center of the AI buildout – the chipmakers, the data center suppliers, the infrastructure players. These companies are seeing enormous, visible demand. Orders are locked in. Capital is committed. Revenues are surging.

Whether consumer-facing AI products ever make one dime in profit won’t matter for the revenues of the “secure elite” over the next three-to-five years, as the hyperscalers pour billions into the rollout of AI infrastructure.

But move one step away from that core and the picture starts to change…

How much are people willing to pay for AI?

That’s the question the market is only now beginning to ask seriously.

Let’s start with the obvious…

The purpose of all that AI infrastructure isn’t just “to exist” – it’s to power applications that people and businesses are willing to pay for. But this is where the story starts to break down.

The part of AI that consumers actually use – the part they’re expected to pay for – is software. Models. Interfaces. Tools that help users write, design, analyze and automate.

But while the physical infrastructure of AI is generating real profits today, the software running on top of it is running into economic headwinds. And the evidence is starting to accumulate…

Since late October, the iShares Expanded Tech-Software Sector ETF (IGV) has fallen 30%.

Meanwhile, companies like Salesforce (CRM), Workday (WDAY) and UiPath (PATH) have each suffered double-digit drops as investors reassess their place in the AI story.

What makes this shift notable is that, until very recently, many of these same companies were viewed as core AI beneficiaries – not fringe players, but the “AI upper K,” central to the trade.

Investors grouped them alongside the infrastructure names, assuming they’d ride the same wave of demand and monetization.

That assumption is cracking.

Axios recently highlighted a study from MIT researchers examining hundreds of AI initiatives. Their conclusion: despite tens of billions of dollars in spending, the vast majority of organizations have yet to see a meaningful return.

That doesn’t mean AI won’t deliver. But it does mean the timeline – and the economics beyond today’s physical AI rollout – remain genuinely uncertain.

The clue that tells us this is real – private credit

Now, a software true believer might say, “Jeff, a 30% drawdown in IGV is just froth coming out of the market. It doesn’t mean software isn’t a secure elite.”

Fair.

So, let’s shift our focus away from stock prices to operational cash flows.

We’ll do this by looking at the private credit market. This is a corner of the financial system we’ve been tracking in the Digest alongside legendary investor 91���� – and it’s worth understanding, because it connects directly to what’s happening in AI software.

Private credit is, in simple terms, lending that happens outside traditional banks. Instead of a company borrowing from JPMorgan, it borrows from a private fund – often at higher interest rates, with fewer public disclosures and less liquidity for investors who put money in.

For years, major private credit funds – including Blue Owl Capital (OWL), Blackstone (BX) and Ares Management (ARES) – poured billions into software companies, betting that steady subscription revenues would make them safe, reliable borrowers.

But in recent months, what some are calling a “SaaS-pocalypse” has cast doubts about AI’s real winners and losers.

Many of these software companies are finding that actual cash flows from their AI products aren’t strong enough to cover their debt obligations. Customers are building their own tools, questioning expensive software upgrades or simply not renewing. The numbers are sobering.

Here’s Business Insider:

The specter of AI disruption of the software sector could send defaults in private credit soaring to their highest level since the pandemic, Morgan Stanley said…

Defaults in the direct lending space could soar to 8%, the strategists estimated, nearing the peak default rate seen during the pandemic.

The trend will largely be driven by the disruptive effects of AI on software companies, they added.

That cash flow strain is rippling through the funds that financed these companies – and investors are feeling the heat.

As we highlighted in yesterday’s Digest, some credit funds have begun “gating” withdrawals. In other words, investors who assumed their money was accessible are now being told they may have to wait months or longer to get it back.

Louis believes the worst is yet to come:

For the past year and a half, I’ve been warning folks about one of the biggest risks in the financial system – one that has been hiding in plain sight.

Private credit.

Wall Street has been able to paper over some of the stress – extending loans, restructuring terms and pushing problems a little further into the future. But that kind of “extend and pretend” strategy only works for so long.

Sooner or later, the market is forced to confront which assets are sound, which loans are impaired and which borrowers were never built to make it through a tighter credit cycle.

I believe the private credit market is approaching a real moment of truth.

Now, it’s not all bad. Louis argues that in every crisis, money doesn’t disappear – it just moves from weak balance sheets into high-quality, cash-rich, low-debt “fortress” stocks.

He’s just released a deep dive into the growing cracks in private credit that details not only how to protect your portfolio, but how to benefit as this crisis redirects enormous currents of capital through the financial system.

Bottom line: If you’re in a credit fund that has software exposure, I hope you’ll make time to watch it.

Coming full circle

At the top of this Digest, Fortune described the financially vulnerable wealthy as “high earners whose lack of budgeting and profligate spending has them overleveraged and exposed…only a step away from real financial trouble.”

The private credit funds that financed the AI software boom were, in their own way, lending to that exact profile: companies that looked like stable, subscription-driven businesses on the outside…but were quietly burning through cash and over-leveraging under the surface.

Today, both groups are in trouble – the software borrowers who aren’t generating returns sufficient to repay their loans, and the funds that bet they would.

So, just as we now have a new “secure elite” within the upper tier of households, we’re seeing a similar divide within AI itself. We see it in the strength of infrastructure names…the weakness across software…and the increasing stress in the private credit markets that financed that growth.

It’s all the same story – just showing up in different places.

This leaves us with a simple but important shift in how to think about this market…

We can no longer just “own AI” – and certainly not blindly lend to it.

After all, in a K-shaped market, the difference between being in the “secure elite” versus everything else can have profound consequences for your portfolio.

One last thought before we go…

If the world is paying trillions to build AI…but AI is struggling to pay back its loans, at what point do we ask whether the hyperscalers will ever see a real return on that investment?

And perhaps more unsettling: what if the honest answer to “how much will the world actually pay for AI” turns out to be far less than investors currently assume?

Have a good evening,

Jeff Remsburg 

The post Are You Invested in AI’s “Secure Elite”? appeared first on InvestorPlace.

• The countdown to the Paris Olympics had begun.
• Taylor Swift’s Eras Tour was everywhere.
• And the U.S. presidential election was heating up fast.

Investors were focused on their own headlines.

• Every inflation report created market moves.
• The Federal Reserve’s next move dominated the conversation
• And AI felt like the only trade that mattered

Everyone was focused on those big, obvious stories.

Meanwhile, I was warning my readers about one of the biggest risks building in the financial system.

It was happening quietly in the background. Hardly anyone was talking about it.

Now, I’ve never considered myself an alarmist. In fact, my critics and my fans would probably agree that I tend to be more of an eternal optimist.

So, when I raised the red flag, it caught a lot of people off guard.

But as I explained back then, if there was anything that could derail the bull market… any kind of “black swan” event… my money was on this.

I’m talking about the private credit market.

For the past year and a half, I’ve been warning that this market deserved a lot more attention than it was getting.

Back then, private credit was being pitched as a safer, steadier corner of finance. The trouble is, it was also a place where risk could build up out of public view.

Now, more people are finally starting to pay attention.

In just the past few weeks, we’ve seen a wave of headlines that suggest Wall Street is starting to wake up to the same risks I’ve been flagging since 2024:

• The Wall Street Journal: “Private-Credit Warning Signs Flash After Blue Owl Unloads $1.4 Billion in Assets”
• Financial Times: “Flagship Blackstone credit fund posts first monthly loss since 2022”
• Bloomberg: “Ares, Apollo Cap Private Credit Withdrawals as Exodus Grows”
• MarketWatch: “Just a spark may light private credit on fire, warns ex-Goldman CEO Blankfein”

In today’s Market 360, I’m going to explain what’s going on in this $3 trillion “shadow” banking sector – and why you should care.

And because this unfolding situation could potentially unravel and impact the entire market, I’ll also explain how you should prepare…

The $3 Trillion “Shadow” Banking System

Before I go any further, let me explain what private credit actually is…

Private credit is lending that happens outside the traditional banking system. These are not loans from JPMorgan or Bank of America. They are loans made by private funds, asset managers, insurers and other nonbank lenders operating in what many now call the “shadow banking system.”

This market exploded after the 2008 financial crisis. Regulators clamped down on traditional banks, making it harder for them to make the same aggressive loans they once extended to smaller, weaker and more speculative borrowers.

But the demand for credit did not disappear. It simply moved.

Private lenders stepped in, and private credit grew from about $300 billion in 2010 to nearly $3 trillion today.

The problem is that a lot of that money flowed to borrowers that were never especially strong to begin with. Then interest rates surged, financing costs jumped and many of those companies were left trying to survive in a much harsher environment.

For a while, Wall Street has been able to paper over some of that stress by extending loans, restructuring terms and pushing problems into the future.

But that kind of “extend and pretend” strategy only works for so long.

That is why I believe the private credit market is approaching a real moment of truth.

It’s also why I just finished putting together a new presentation on this entire private credit situation – which you can view here.

But to give a brief overview of the situation, I recently sat down with InvestorPlace Editor-in-Chief Luis Hernandez to talk through what is happening, why it matters and what investors need to understand now.

Click the play button on the image below to watch my conversation with Luis.

The Time to Prepare Is Now

Now, there is a lot more to say about the private credit markets – including how we got here, the risks it presents to the market, and what investors can do to prepare.

I’ll have more to say soon about where I believe investors should look as this situation develops.

In the meantime, I put this special presentation together to walk you through the full private credit story in plain English – how this market grew so large, why the pressure is building now and what I believe smart investors should be doing before June 30.

During that presentation, I’ll also tell you more about five Fortress Companies that have the balance-sheet strength, operating momentum and institutional appeal to attract capital when investors become more selective. And about 10 stocks to avoid… ones caught in the crosshairs of the growing private credit crisis.

I encourage you to watch it now while there is still time to get ahead of the crowd.

Sincerely,

91����

Editor, Breakthrough Stocks

The post The Cracks in the $3 Trillion “Shadow” Banking System Are Getting Harder to Ignore appeared first on InvestorPlace.

My colleague 91���� flagged it early as a potential “black swan.”

That risk is the private credit market — a $3 trillion corner of finance where problems can grow out of sight.

Now, the cracks are starting to show, and Wall Street is finally paying attention.

A wave of recent headlines suggests the cracks are beginning to show, and that the concerns Louis raised two years ago are becoming harder to ignore today.

Louis is joining us today to walk you through what’s happening inside the private credit market, why it matters right now, and what it could mean for your portfolio.

He also just released a new presentation where he details this entire private credit situation. You can view that here.

Take it away, Louis…

Back in the summer of 2024, most investors were focused on inflation, the Federal Reserve, artificial intelligence and the election.

Meanwhile, I was warning my readers about one of the biggest risks building in the financial system.

It was happening quietly in the background. Hardly anyone was talking about it.

Now, I’ve never considered myself an alarmist. In fact, my critics and my fans would probably agree that I tend to be more of an eternal optimist.

So when I raised the alarm, it caught a lot of people off guard.

But as I explained back then, if there was anything that could derail the bull market… any kind of “black swan” event… my money was on this.

I’m talking about the private credit market.

For the past year and a half, I’ve been warning that this market deserved a lot more attention than it was getting.

Back then, private credit was being pitched as a safer, steadier corner of finance. The trouble is, it was also a place where risk could build up out of public view.

Now, more people are finally starting to pay attention.

In just the past few weeks, we’ve seen a wave of headlines that suggest Wall Street is starting to wake up to the same risks I’ve been flagging since 2024:

• The Wall Street Journal: “Private-Credit Warning Signs Flash After Blue Owl Unloads $1.4 Billion in Assets”
• Financial Times: “Flagship Blackstone credit fund posts first monthly loss since 2022”
• Bloomberg: “Ares, Apollo Cap Private Credit Withdrawals as Exodus Grows”
• MarketWatch: “Just a spark may light private credit on fire, warns ex-Goldman CEO Blankfein”

In today’s Market 360, I’m going to explain what’s going on in this $3 trillion “shadow” banking sector – and why you should care.

And because this unfolding situation could potentially unravel and impact the entire market, I’ll also explain how you should prepare…

The $3 Trillion “Shadow” Banking System

But before I go any further, let me explain what private credit actually is…

Private credit is lending that happens outside the traditional banking system. These are not loans from JPMorgan or Bank of America (or your neighborhood credit union). They are loans made by private funds, asset managers, insurers and other nonbank lenders operating in what many now call the “shadow banking system.”

This market exploded after the 2008 financial crisis. Regulators clamped down on traditional banks, making it harder for them to make the same aggressive loans they once extended to smaller, weaker and more speculative borrowers.

But the demand for credit did not disappear. It simply moved.

Private lenders stepped in, and private credit grew from about $300 billion in 2010 to nearly $3 trillion today.

The problem is that a lot of that money flowed to borrowers that were never especially strong to begin with. Then interest rates surged, financing costs jumped and many of those companies were left trying to survive in a much harsher environment.

For a while, Wall Street has been able to paper over some of that stress by extending loans, restructuring terms and pushing problems into the future.

But that kind of “extend and pretend” strategy only works for so long.

That is why I believe the private credit market is approaching a real moment of truth.

It’s also why I just finished putting together a new presentation on this entire private credit situation – which you can view here.

But to give a brief overview of the situation, I recently sat down with InvestorPlace Editor-in-Chief Luis Hernandez to talk through what is happening, why it matters and what investors need to understand now.

Click here or the play button on the image below to watch my conversation with Luis.

The Time to Prepare Is Now

Now, there is a lot more to say about the private credit markets – including how we got here, the risks it presents to the market, and what investors can do to prepare.

I’ll have more to say soon about where I believe investors should look as this situation develops.

In the meantime, I put this special presentation together to walk you through the full private credit story in plain English – how this market grew so large, why the pressure is building now and what I believe smart investors should be doing before June 30.

During that presentation, I’ll also tell you more about five Fortress Companies that have the balance-sheet strength, operating momentum and institutional appeal to attract capital when investors become more selective. And about 10 stocks to avoid… ones caught in the crosshairs of the growing private credit crisis.

I encourage you to watch it now while there is still time to get ahead of the crowd.

Sincerely,

91����

Editor, Breakthrough Stocks

The post The $3 Trillion Time Bomb Is Ticking Beneath the Market appeared first on InvestorPlace.

In September 2022, the British government broke its own bond market with one simple budget announcement. Then-Prime Minister Liz Truss’ now-infamous “mini-budget” sent U.K. gilt yields into freefall so violent that the Bank of England was forced to intervene within days or risk a potential collapse of the U.K. pension system.

Thirty-year gilt yields spiked more than 1% in three days. Pension funds that had loaded up on liability-driven investment strategies (considered the safest, most boring allocation in institutional finance) were hit with margin calls they couldn’t meet. The financial press dubbed it a “doom loop.” A “systemic threat” is how the Bank of England chose to label it. 

Most investors called their brokers in a cold sweat and said two words: “sell everything.”

But those who looked at the carnage, noting that U.K. gilts had briefly hit unsustainable yields, might have recognized something the panicking crowd couldn’t: mispricing at scale is just opportunity wearing a very ugly mask.

The question, as always, was whether anyone had the nerve to step in. That was three years ago. Today, history is offering the same question again.

A few weeks ago, swaps markets were confidently pricing in two-plus Fed rate cuts for 2026. Then the Iran conflict started, oil exploded, inflation fears reignited, and U.K. gilt yields surged past the levels seen during the 2022 crisis – hitting highs not seen since 2008.

Now oil spikes one day as tensions rise in Tehran again. The next day, Trump sends a Truth Social post about “productive talks” and crude crashes 10%. What’s more…

The S&P bleeds 200 points overnight, claws back 60 at the open, then drifts lower by close as institutional money desperately harvests volatility instead of building real positions…

Even the so-called safe havens have stopped making sense with gold down 15% from its all-time highs… during an active Middle East conflict.

This high volatility, low conviction, headline-sensitive market is less a market and more a hostage negotiation. And most investors are responding exactly the way hostage negotiators are trained not to: with panic, paralysis, and a desperate retreat to cash while they wait for “clarity.”

Clarity, however, doesn’t come at the bottom. It comes at the top… after the opportunity has already passed you by.

Investors who compound generational wealth don’t wait for the all-clear signal. They recognize something most people still refuse to accept: chaos and opportunity are the same thing, dressed in different clothes.

The question isn’t whether this market is dangerous. It obviously is. The question is whether you know which dangers to step over, and which ones to step through.

That’s exactly what we’re going to show you today.

Turning Market Chaos Into Opportunity

1. Sell Volatility to Generate Income

When markets whipsaw with this kind of violence, options premiums get rich. The volatility index (VIX) has been elevated for weeks. That means one thing to a perceptive investor: the market is effectively paying you to be the house.

Covered calls on positions you already own. Cash-secured puts on names you’d love to own at lower prices. Iron condors on rangebound assets. These strategies generate yield from the very volatility that is destroying directional investors who insist on picking a side.

The discipline: keep your strikes wide, durations short (weekly or monthly, not quarterly), and size conservatively. This regime can produce violent one-directional moves before snapping back. 

You want to harvest the chop, not get run over by it.

2. Position for De-Escalation Rebounds

This is the single most important trade in the current environment, and it flows directly from the regime itself. 

The U.S.-Iran conflict is the dominant uncertainty. Trump’s track record is to de-escalate whenever markets get stressed enough. We’ve already seen previews of this dynamic – in real time.

When Trump floated “productive talks” and delayed further strikes, oil reversed hard and stocks surged, adding trillions in market value almost instantly.

Even smaller signals – comments about limiting escalation or nearing objectives – have repeatedly stabilized markets and pulled energy prices lower after spikes.

That’s the entire trade: escalation creates the dislocation, but even the hint of de-escalation unwinds it fast. And it all happens in a very tight window.

When the de-escalation trade does fully materialize, oil will crash, rate-cut expectations will be revived, and long-duration growth assets – specifically AI infrastructure – will rip. That’s not a prediction so much as a function of how these regimes unwind. When rate-cut expectations snapped back in late 2023 after inflation cooled, long-duration tech and AI infrastructure names surged in a matter of weeks. The same dynamic played out after the regional banking crisis in early 2023, when macro fear gave way to liquidity and growth expectations – and capital rushed straight back into AI leaders.

The question isn’t whether that trade happens. The question is whether you’re positioned before the market fully prices it.

The AI infrastructure names that have been indiscriminately dumped in the war-risk selloff are precisely the de-escalation trade. The war dip is the entry. 

Build the position now – while it still feels uncomfortable – not after the resolution is obvious

3. Trade Market Rotations, Don’t Fight Them

This regime has revealed a repeating, legible pattern: escalation headlines hit → sell growth, buy defense and energy → de-escalation signals emerge → sell defense and energy, rotate back into growth. That rotation is the trade, once you recognize it for what it is.

So the actionable version is simple:

• On escalation spikes: add to the AI infrastructure and growth names getting indiscriminately dumped.
• On de-escalation rips: trim the energy and defense names that have overshot.
• Never chase either leg fully: the regime will reverse before you feel comfortable. That’s the point.

The key insight is that the rotation is mechanically driven by a small, trackable set of variables – Strait of Hormuz status, Trump statements, oil price trajectory, and Fed rhetoric. 

You’re essentially trading geopolitical headlines, which tend to be binary and fleeting. 

Learn the pattern. Ride it in both directions.

4. Reduce Duration Risk In Volatile Markets

In an environment where the market has flipped from pricing two rate cuts to pricing rate hikes in three weeks, long-duration assets are structurally disadvantaged. The discount rate is unstable, which means any asset whose value depends heavily on distant future cash flows is inherently mispriced on a daily basis. That’s a lot of mark-to-market pain for very little fundamental reason.

The practical implication:

• Avoid: high-multiple growth stocks with profits five-plus years out, long-dated Treasuries, dividend-growth names with thin current yields.
• Favor: companies generating significant free cash flow today, short-dated T-bills (you’re being paid 4%-plus to wait), energy producers printing cash at current oil prices.

In this regime, duration is risk – full stop. Don’t let anyone tell you otherwise.

5. Use Cash as a Strategic Advantage

Holding cash sounds defensive. It is, in fact, deeply offensive. 

In a high-volatility regime, cash isn’t hiding – it’s loading the gun. Every violent down day this environment produces is a gift to the investor who has capital ready to deploy. The ones who thrive in chaotic markets are the ones who had dry powder at the ready when everyone else was panic-selling.

Target 20- to 30% cash instead of your normal 5- to 10%. 

The regime guarantees more dislocations are coming. Have the capital to buy them.

6. Focus on Relative Trades, Not Big Bets

If you want to express a view without taking full market-level risk, pairs trades are the cleanest option. Strip out the beta. Own the relative trade.

A few that make sense structurally right now:

• Long AI infrastructure/Short traditional utilities: Private capex winners vs. regulated rate-base losers in the Shadow Grid buildout.
• Long domestic energy producers/Short international refiners: The U.S. is energy self-sufficient. Europe is structurally exposed. That divergence isn’t going away soon.
• Long defense tech/Short legacy defense primes: Drone and autonomy beneficiaries vs. cost-plus contractors with supply-chain exposure.

When the macro direction changes with every headline, owning the relative trade is far more durable than owning the outright directional one.

Volatility Is the Opportunity, Not the Risk

Here’s the uncomfortable truth about chaotic markets: they are the single greatest wealth-creation environments that exist – for the investors who are mentally prepared to navigate them.

The chaos we’re experiencing right now – the gold paradox, the oil whipsaws, the rate-hike-to-cut-to-hike yo-yo, the intraday reversals, the illogical headline-driven volatility – is not a reason to hide. 

The market is creating mispricings every single day – opportunity in disguise. And the investors who thrive are the ones who stop trying to predict direction and start harvesting the volatility itself: selling premium, trading the rotation, shortening duration, maintaining dry powder, and positioning patiently for the resolution trade before the resolution is obvious.

The market mayhem will not last forever. Regimes like this end – usually violently and in one direction – when the dominant uncertainty resolves. In this case, that’s the U.S.-Iran conflict. 

When we reach a resolution, the market will have one of its sharpest, fastest one-directional moves in recent memory. The investors who were hiding in cash, waiting for clarity, will watch it happen from the sidelines.

Those who embraced the chaos, traded the regime, kept their powder dry, and built their de-escalation positions during the dip will already be positioned for the biggest move of the year.

When this geopolitical overhang clears – and it will – capital won’t just drift back into the market. It will surge back into growth, into AI, into the companies at the center of this entire cycle.

And there may be no company more central to that shift than OpenAI.

Because while the market debates oil, rates, and war headlines… the AI buildout hasn’t slowed at all. 

Capital is still being deployed. The infrastructure is still being built. The next wave is already forming.

And when that rotation hits, investors won’t be asking whether to own AI leaders… They’ll be asking which ones they should have owned before the move.

That’s exactly what this new presentation breaks down.

It walks through how the OpenAI IPO could unfold…

Why it may become one of the most important public listings of this cycle…

And how to position before that capital rotation becomes obvious.

You can watch the full briefing right here.

The post How to Trade a Volatile Stock Market Without Guessing Direction appeared first on InvestorPlace.

The market is trying to price the end of a war, while the people involved can’t even agree on whether a deal is actually taking shape.

If that sounds confusing, it is.

Let’s back up…

If you’re feeling whiplash trying to follow the Middle East right now, you’re not alone.

On the one hand, as of this morning, markets are acting as if a resolution is right around the corner. On the other hand, the headlines are contradictory at best.

Here’s the reality as we understand it today, reflecting the progression over the last several days:

• President Trump says the U.S. and Iran are engaged in “very, very strong talks.”
• He’s delayed planned strikes and signaled that diplomacy is underway.
• Multiple countries – Pakistan, Turkey, Egypt, Saudi Arabia – are reportedly working behind the scenes to broker peace.
• The U.S. has reportedly sent a multi-point proposal to end the war.

But…

• Iran publicly denies that any negotiations are happening
• Even basic facts – like who initiated contact – remain disputed
• And as of this morning, Iran said it will not accept a ceasefire and remains far from any agreement

So, what do we do with this?

First, we stop expecting a clean negotiation.

Instead, we recognize this for what it is: a messy, early-stage process where proposals are being floated, rejected, and reshaped in real time – often through intermediaries, and often with public messaging that doesn’t match what’s happening behind the scenes.

It’s classic geopolitical theater, where both sides are testing terms, rejecting them publicly, and continuing to engage privately – all at the same time.

But here’s the key for you and me…

Markets don’t trade on official statements. They trade on perceived progress or failure.

Right now, that perception keeps shifting – swinging between progress toward de-escalation and renewed fear.

As I write on Wednesday morning, markets are cheering perceived “progress” (Trump’s ceasefire proposal) while ignoring “failure” (Iran’s rejection of that plan).

Let’s accept that this could change by tomorrow…or even later this afternoon – and then look beyond the immediate price swings.

The path forward

To understand where this goes next, let’s turn to hypergrowth expert Luke Lango.

In his recent Innovation Investor Daily Notes, he stressed that the key to ending the war is for both sides to have a plausible case for declaring some sort of victory:

Trump needs to be able to say: we destroyed Iran’s nuclear program… and we came home having made America and the world safer.

Iran needs… to say: the Islamic Republic endured the greatest military assault in its history… and then exercised its sovereign decision to end the conflict on terms that preserved… dignity and existence.

In other words, this doesn’t end with “winning” or “losing.” It ends with a deal both sides can spin as a win.

Here’s Luke outlining what that deal likely looks like:

A mutual cessation of hostilities… Iranian suspension of the Hormuz closure… IAEA-verified acknowledgment that Iran’s weapons-grade enrichment capability has been dismantled… partial release of frozen Iranian assets…

Now, while this could be the case, in recent days, the market hasn’t fully believed it – even as the headlines increasingly suggest something may be happening beneath the surface.

One moment, oil is spiking, and stocks are falling on fears of escalation. The next, that move reverses just as quickly on hints of diplomacy.

But looking at volatile asset prices isn’t the best gauge of diplomatic progress. It’s the tail wagging the dog.

For example, yesterday, The Washington Post reported that Egypt, Pakistan, and Turkey have been serving as intermediaries between U.S. envoy Steve Witkoff and Iranian Foreign Minister Abbas Araghchi. Meanwhile, The Wall Street Journal reported that Arab officials helped open channels with Iranian power centers and pitched a five-day halt in hostilities to build momentum toward a ceasefire.

It wouldn’t be surprising if this conflict were moving along two tracks at once: a very public track of threats, denials, and propaganda…and a quieter track of indirect diplomacy through regional intermediaries.

The headlines from the last 24 hours only reinforce that possibility.

So, looking beyond the market’s manic price swings, Luke believes the real story is that a plausible endgame is taking shape: one where both sides can claim some version of victory, step back from the brink, and eventually give markets the clarity they’re still missing today.

What this means for investors

The day-to-day market action may stay ugly over the coming days.

For example, the U.S. has called up 3,000 Army paratroopers for potential deployment to the Middle East. Any escalation toward “boots on the ground” could quickly shift sentiment from relief back to fear.

Oil would likely spike again… stocks would sell off again… and yields would keep climbing as traders worry about a lasting energy shock.

But if Luke is right that this ultimately ends with a face-saving off-ramp for both sides, then this volatility is just part of the process – not evidence that no resolution is coming.

That’s why we separate short-term volatility from the likely medium-term path.

And importantly, Luke doesn’t just describe how this ends – he puts a timeline on it:

Our best estimate: a formal ceasefire framework within 10-14 days.

Hormuz… reopening within 21 days. Oil back toward $75 within 30 days…

We’ll keep tracking this.

Now, while investors are focused on a very visible risk overseas, there’s a quieter risk building much closer to home…

The cracks are spreading

I’m sorry, you won’t be able to get your money back right now.

Imagine hearing that as you try to withdraw money from one of your investment funds.

You were looking for steady income. Months ago, you were told about a fund offering a relatively safe way to earn 9%, 10%, even 11%.

But today, even after your request, the fund won’t give you all of your cash back.

Meanwhile, the value of the underlying loans in your fund could be slipping – and you’re stuck watching from the sidelines.

This is the uncomfortable reality facing some private credit investors right now.

Yesterday, news broke that Apollo (APO) – one of the biggest names in the space – has limited redemptions after a surge in withdrawal requests. In plain English: investors are asking for their money back…and aren’t getting all of it.

Here’s CNBC:

Apollo…told investors in its flagship private credit fund that it will limit withdrawals this quarter to just under half of requests, the latest sign of stress in the asset class.

That wasn’t the only headline…

Also yesterday, The Wall Street Journal ran a piece titled “Big Banks Are Playing Both Sides of the Private-Credit Meltdown,” noting:

Private-credit managers are facing a continuing reckoning as individual investors stampede out of private-credit funds, worried about a downturn in software, a number of high-profile defaults and restrictions on accessing their money. 

And it doesn’t stop there.

Also yesterday, Moody’s Ratings downgraded a major KKR-linked credit fund to junk status.

From Bloomberg:

The fund’s non-accrual rate, which measures soured loans, rose to 5.5% of total investments…one of the highest percentages among peers.

Three separate stories. Same message…

Something is starting to strain beneath the surface in private credit

Let me clarify up front – we’re staring at an imminent credit crisis. But what we’re seeing today marks a clear shift.

For years, private credit has been one of Wall Street’s hottest trades – a fast-growing, high-yield alternative to traditional lending. Money flooded in. Returns looked steady. Risks stayed largely out of sight.

But as we’ve been flagging in the Digest for over two years at this point, that stability came with trade-offs:

• Less transparency
• Less liquidity
• And in many cases, more leverage than meets the eye – and might be safe when market conditions change

Those trade-offs don’t matter much – until they do. And right now, they’re starting to matter.

If you’re a longtime Digest reader, none of this feels entirely new

We’ve highlighted the explosive growth in private credit… the layering of leverage… and the increasing ties between this “shadow” lending system and the broader financial world.

We’ve also shared repeated warnings from legendary investor 91����, editor of Growth Investor. For years, Louis has warned that if something were going to crack in this cycle, it would likely start here.

For example, here he is from updates last July and October:

If the private credit industry ever blew up because of economic weakness or whatever, or them just trying to out-leverage each other to outdo each other, the Fed would have to start slashing rates to save the economy…

Leveraged debt created the 2008 financial crisis, so we want to keep a good eye on this…

If private credit breaks, commerce breaks.  

What’s new today is the frequency of the red flag stories coming out of private credit, as well as their tone.

It’s no longer about potential risk – it’s about early signs of real stress with real-world consequences.

Now, this doesn’t automatically translate into a broader economic problem. As we’ve noted before, the system today is structured very differently from 2008.

But it does suggest that one of the fastest-growing corners of modern finance may be entering a more fragile phase – one that increasingly overlaps with traditional banks, corporate lending, and even the financing behind today’s AI buildout.

And that’s exactly where Louis has been digging in.

He’s been tracking this risk for years. But recently, his focus has sharpened – not just on where the pressure is building, but on how it could ripple outward, creating clear winners and losers as conditions tighten.

We’ll be bringing you more of what he’s seeing – and how he’s thinking about positioning around it – in the days ahead.

For now, just know that one of the most stable-looking corners of the market is starting to show stress. And historically, that’s how bigger stories begin – quietly, then all at once.

More on this to come…

Have a good evening,

Jeff Remsburg

P.S. Quick heads-up: 91����’s FutureProof 2026 presentation comes down at midnight tonight.

Longtime Digest readers know that Eric is one of the sharpest macro minds we have, with 41 separate 1,000% winners to his name. And right now, he’s focused on a critical shift in the AI story that most investors still aren’t seeing.

He believes the next phase of the AI boom won’t be decided by software…but by the real-world infrastructure struggling to keep up. And, he says, that realization could start reshaping the market as soon as April 24.

Eric lays it all out — including the specific sectors and companies tied to this shift — in this free presentation. If you’re going to watch it, do it before it’s gone tonight.

The post One Path for How This War Ends (And What Markets Are Missing) appeared first on InvestorPlace.

Working hard, or hardly working?

This tongue-in-cheek “dad joke” is meant to lift spirits when kids are doing homework or coworkers are “in the weeds” trying to be productive.

It typically gets you a comradely laugh. Or maybe an obligatory chuckle.

But thanks to AI, we can now pose it as a genuine question to Silicon Valley CEOs.

Case in point: Mark Zuckerberg.

According to The Wall Street Journal, the Meta Platforms Inc. (META) CEO is building his very own AI “CEO agent” to help him with the job. That’s right – AI is moving from supporting employees to taking on CEO-level responsibilities.

The agent is still in development, but Zuckerberg is already using it in limited ways. It helps him retrieve information quickly, a task that would typically require going through multiple teams or layers of people. It’s meant to speed up decision-making and act like a high-level internal assistant.

So, Zuck: Working hard or hardly working?

As Meta’s CEO pushes deeper into AI agents, the implications go far beyond that social media company

In today’s Smart Money, we’ll unpack how this shift is redefining Meta’s broader AI strategy and further examine the widespread deployment of AI agents.

Then, before AI agents enter every C-suite, I’ll reveal how the best course of action is not to invest in the firms developing those agents… but in the companies powering them.

Let’s dive in…

Zuckerberg’s New Right-Hand “Man”

Meta, like many companies worldwide, already uses AI to speed up its operations.

In addition to using AI to complete employee performance reviews (I think everyone’s doing this), it’s encouraging its workers to create their own AI tools to assist with everyday tasks. The tech giant recently acquired Manus, a Singapore-based agentic AI startup, which is already being used by Meta employees to do just that.

But that’s just the beginning. The company’s goal is for every employee and, eventually, every Facebook, Instagram, and WhatsApp user to have a personal AI agent.

The reason for this widespread adoption, up to and including the CEO himself, is simple: to remain competitive with AI startups that rely heavily on automation, have smaller staffs, and move faster as a result.

From Susan Li, Meta’s chief financial officer:

Making sure that we don’t – for a company at the size and scale that we are – that we don’t work any less efficiently than companies that are AI native from the start, that’s something that I think about a lot.

Meta is far from alone in striving for AI-powered efficiency.

In an interview last week with MIT Technology Review, OpenAI Chief Scientist Jakub Pachocki discussed the company’s ongoing project to build a fully automated researcher, which aligns with CEO Sam Altman’s timeline of its models acting as research interns by 2028.

These efforts from OpenAI show that AI is redefining what organizations are capable of producing in the first place, expanding the frontier of what’s possible.

AI is being built to cover responsibilities from intern level to CEO level. It’s only a matter of time before it comes for the “dad jokes.”

Of course, large scale AI implementation has serious consequences, especially for job security. Meta’s AI-related layoffs began in 2022, when it cut around 13% of its workforce. And it looks like that may be ramping back up. The Information reported earlier this week that Meta is chopping a few hundred more jobs today.

But here’s the thing: As the company’s workforce shrinks and its AI use grows, that means so, too, is its capital spending.

The Paradox of AI Efficiency: It Isn’t Cheap

Over the last three years, Meta has spent roughly $140 billion on AI infrastructure and plans to spend up to $135 billion this year alone. By 2028, it expects to have spent $600 billion on AI data centers.

Additionally, just this month, Facebook’s parent company announced its $27 billion acquisition of cloud provider Nebius Group NV (NBIS) to meet its compute needs.

Of course, Zuckerberg isn’t alone in spending more… in the hopes of ultimately spending less.

Last week, multiple outlets reported that Jeff Bezos aims to raise $100 billion for a new fund that would purchase manufacturing companies in the chipmaking, defense, and aerospace sectors, “and seek to use AI technology to accelerate their path to automation.”

AI has become essential for these tech giants to reach their ambitions. But that also means the physical building blocks behind AI – like raw materials, energy, and memory – are just as essential. AI agents in particular have massive need of these components.

But, as we’ve been sounding the alarm on, these resources are increasingly in short supply. And shortages of these key physical components are creating bottlenecks that are rapidly reshaping the entire investment landscape.

I believe Main Street investors have a narrow window to act before it’s too late.

That is why I detail these building bottlenecks – and the early actions to take – in my FutureProof 2026 presentation. 

When supply is tight, companies controlling these materials can see their profits soar. That flips the workplace wisecrack on its head.

Forget working hard or hardly working. That’s working smarter.

I’m tracking several companies that sit directly at the center of these shortages – which Wall Street still hasn’t fully priced it in. During the free presentation, I reveal 15 companies poised to reap the benefits of the memory, raw materials, and energy bottlenecks.

But there’s not much time left to tune in. The video will be taken down at midnight tonight.

As AI and AI agents infiltrate every ring of the corporate ladder, it’s only prudent to profit from the demand they create.

Click here for all the details.

Regards,

91����

P.S. To show my appreciation to all of you Smart Money readers, I’ve put together a brand-new, free special report: Meet the Mag 7 Killers: 3 Heavy Assets Crushing Al Hyperscalers in 2026.

And it’s available to you today. You can read the full report here.

The post Before AI Takes Over the C-Suite, Follow the Money Behind It appeared first on InvestorPlace.

Everyone is worried that Amazon (AMZN), Microsoft (MSFT), Meta (META), and Alphabet (GOOGL) are spending too much on AI. 

As much as Jensen Huang, Mark Zuckerberg and others keep pushing the “AI changes everything” narratives – and as much as Sam Altman keeps signing multi-billion-dollar deals – these once-loved tech titans can’t seem to catch a break from Mr. Market. 

The bear thesis – that these companies overinvested in AI and will pay the price – sounds convincing enough. After all, $700 billion-plus in yearly AI-related capex is a staggering amount, the likes of which we’ve never seen before. 

But that still doesn’t mean the bears are right. 

In fact, I’d argue that the recent weakness in Big Tech stocks may be the best buying opportunity in the group that we’ve seen in almost three years… 

Why Investors Are Worried 91���� Magnificent 7 Stocks

The bears aren’t wrong about the facts, just the conclusion.

Start with free cash flow. Amazon, Microsoft, Alphabet, and Meta are projected to post combined free cash flow of roughly $94 billion this year – down from $205 billion in 2025 and $230 billion in 2024. That is a $136 billion deterioration in a single year. 

When a group of companies burns through more than a hundred billion dollars in incremental cash, the question of “where is all that money going?” is entirely legitimate.

Then there’s the Iran War overhang. Operation Epic Fury has injected genuine macro uncertainty into markets, with oil prices spiking, risk premiums rising, and investors rotating hard into international equities and defensive sectors. From October 2025 through February 2026, the Bloomberg “Magnificent 7” index fell 7.3% while the S&P 500 Equal Weight index climbed 8.9%, led by energy and materials. That kind of divergence doesn’t happen unless the market is making a real call about the near-term risk/reward of owning high-capex tech.

And then there is Nvidia (NVDA), the poster child for the entire AI saga. At the company’s recent GTC event, Jensen Huang forecasted $1 trillion in data center sales through 2027 and announced Chinese government approval to resume AI chip sales. Yet, the stock still ended the week down 4.1%. 

When the most bullish possible catalysts still produce a down week, the market is sending a clear message: it doesn’t trust the numbers.

AI Capex Is Building Long-Term Advantage

But this is where the narrative breaks down.

It’s not like that $136 billion in free cash flow just evaporated. It was invested in GPU clusters, hyperscale data centers, fiber networks, and cooling infrastructure – the AI economy’s physical backbone. And those assets are already generating returns. 

Google is already seeing AI Overviews drive more than 10% additional queries in the searches where they appear. Meta’s AI-powered ad machine is working, with price per ad up 6% and impressions up 18%. AWS just posted 24% growth – its fastest in 13 quarters – while Bedrock has become a multibillion-dollar run-rate business. And Microsoft 365 Copilot has already crossed 15 million paid seats, embedding itself into enterprise workflows across the Fortune 500.

The fundamental error in the bear case is that it treats AI capex as an expense rather than an investment. When your AI infrastructure is making your core businesses more efficient, accelerating cloud revenue growth, and cementing competitive moats that no startup can realistically breach in the next decade – that’s not waste. That’s the most consequential capital allocation in corporate history.

Also, as we explored in yesterday’s issue, the U.S.-Iran War seems likely to be a fading headwind rather than a permanent condition. 

And here’s the irony the bears may be missing: the flight to international equities and defensive sectors that punished Big Tech over the past several months? That trade is now becoming dangerously crowded – and crowded trades have a habit of unwinding violently. 

As geopolitical risk subsides, the most obvious beneficiary of capital returning to U.S. equities is exactly what everyone has been selling: Big Tech.

Big Tech Earnings Support the Bull Case

The numbers that cut through all the noise is the earnings growth. 

The Magnificent 7 is expected to grow profits 19% in 2026, compared with 14% for the other 493 companies in the S&P 500. That 500-basis-point gap reflects something structural and durable: these companies have monopolistic positions in the highest-growth industries on the planet, and they are compounding into those positions with every dollar they spend on AI.

Over long enough time horizons, as go earnings, so go stocks. You can have a narrative war about capex efficiency, ROI timelines, and geopolitical risk premiums. But at the end of the day, the company growing earnings the fastest wins. And right now, that’s still Big Tech – by a wide margin.

These aren’t companies that need to prove themselves; they’ve over-delivered quarter after quarter for a decade. Their businesses are entrenched, their balance sheets are fortress-grade, and their management teams have compounded capital through a pandemic, a rate spike, a bear market, and now a war. 

The idea that heavy AI spending is somehow going to break Alphabet or Meta or Microsoft might be amusing if it weren’t so fashionable.

We’ve Seen This Setup Before – and It Was Bullish

Now for the timing aspect.

The correlation between the Magnificent 7 and the equal-weighted S&P 500 turned negative on February 23 and has continued falling since. In other words, Big Tech and the rest of the market are moving in opposite directions. That’s unusual. In fact, it’s only happened at this extreme level once before in the past decade – the first quarter of 2023.

At that time, ChatGPT’s debut ignited AI excitement, and Big Tech surged while the rest of the market languished in bear-market mud. The correlation broke negative for the same structural reason it is today: Big Tech was marching to a different drummer than the broader economy. 

What happened next? From the start of 2023 through February 2026, the Mag 7 index soared more than 300% while the equal-weight S&P 500 rose just 42%.

Now, it’s worth acknowledging that the mechanism is different this time. In 2023, the decoupling reflected Big Tech surging while the rest lagged. Today, the decoupling reflects Big Tech falling less than the broader market in a risk-off environment. The signal is relative defensiveness, not pure euphoria. But the underlying structural story is identical: Big Tech is operating on a different fundamental plane than the rest of the market, and the correlation breakdown is the market’s early signal that it’s starting to figure that out.

A Valuation Reset Could Be an Opportunity

Six months ago, you could make a reasonable argument that Big Tech was priced for perfection. The Magnificent 7 was trading at roughly 33 times estimated earnings last October. Today it trades at under 25x – below its own 10-year average of 29x and at the lowest level since the “Liberation Day” tariff tantrum last April.

Think about that for a moment. Investors are being offered the best earnings compounders in the world – companies with dominant market positions, fortress balance sheets, and superior earnings growth – at a below-average multiple. 

The bull case from here doesn’t require Nvidia to print another 1,100% return or for AI to achieve AGI this year. It just requires that these companies keep doing what they’ve been doing for a decade – growing earnings faster than everyone else – and that the market, eventually, notices the discount.

The Bottom Line

AI capex is eye-watering. Markets are noisy. Wars are unpredictable. The bears have real, compelling data on their side.

But zoom out. In 2026, the Magnificent 7 is growing earnings 19% compared to 14% for the rest of the S&P 500. 

Their capex is converting into deeper moats and higher long-run terminal values, not evaporating into thin air. 

Their valuations have been reset to below-average levels after months of underperformance. 

The correlation between Big Tech and the broader market has broken down to a level we’ve only seen once in the past decade – and the last time it happened, it marked the beginning of a 300%-plus run.

The doom and gloom around Big Tech right now is real. But it may also be the setup for the next great buying opportunity.

Prepare for a Major Capital Rotation

When everyone is scared of the best business models in the world, at below-average valuations, with superior earnings growth and AI compounding into their monopolies – that’s an invitation.

Big Tech is starting to look interesting again.

If de-escalation holds, capital could rotate back into the Magnificent 7 — just as it has in past risk-off → relief cycles.

But whether money is flowing into Big Tech… or getting pulled out of it during periods of volatility… the hundreds of billions being spent on AI still have to go somewhere.

That “somewhere” is the physical backbone of the AI economy – exactly where my colleague 91���� is focused right now.

In his FutureProof 2026 briefing, he breaks down what he calls AI’s “Golden Rivets” – the critical materials, energy systems, and components that the entire AI buildout depends on.

And here’s the key: those companies don’t need perfect sentiment around Big Tech to win. They just need the spending to continue – and it already is.

That means they could benefit not only from the AI boom itself…

But from the massive reallocations of capital that tend to happen as cycles like this evolve.

You can watch the full presentation here – but hurry. It’s only available until midnight tonight.

The post Everyone Thinks Big Tech Is In Trouble. The Data Disagrees. appeared first on InvestorPlace.

Three weeks…

That’s our make-or-break window.

In yesterday’s Digest, we highlighted two opposing market influences…

On one hand, there was the President Trump-inspired relief rally built on shaky geopolitical footing…on the other hand, there was the S&P’s technical damage after it broke below its 200-day moving average (MA).

As I write on Tuesday, the S&P is trying to build upon yesterday’s rally, but – at least for the moment – it hasn’t successfully retaken its 200-day MA.

Historically, this moment tends to separate routine shakeouts from something more serious.

Let’s go to hypergrowth expert, Luke Lango, from yesterday’s Innovation Investor Daily Notes:

The next few weeks are critical…

When the market retook its 200-day and then continued the rally over the next 3 weeks and didn’t look back, that almost always led to a really strong 12-month rally for stocks.

But when the market…fell back below its 200-day within the next 3 weeks, that almost always led to underperformance…

So, the next 2–3 weeks will be crucial.

This analysis aligns with the framework we discussed in yesterday’s Digest.

The last four weeks have pushed the S&P below its 200-day MA and to a fresh six-month low – two red flags that Editor Brian Hunt identified as fingerprints warning of a potential more serious drawdown.

Yesterday’s rebound (and our budding rebound today) didn’t erase that risk – rather, it simply started the three-week countdown that Luke identified.

Luke believes the chances are good that the market is leaning the right way, driven by a fast-moving geopolitical shift:

Path A — Successful Off-Ramp: 85-90%. The highest confidence we’ve had at any point in this three-week conflict…

Here is the signal that matters above all others today: it isn’t just stocks.

Every major asset class is simultaneously pricing the same conclusion. That is not sentiment. That is conviction.

So, the setup is clear…

If a rally holds, builds, and drives the S&P above its 200-day MA over the next few weeks in a V-shaped rally, the recent volatility will likely be remembered as a shakeout as we push higher into summer.

If it doesn’t, the technical damage we flagged yesterday will reassert itself and drive us lower.

This is the binary we’ll be tracking with you here in the Digest.

Now, stepping back, what happens over the next three weeks will tell us a lot about the market’s near-term direction – but it won’t change the market’s ultimate destination.

Because regardless of how this 200-day MA drama resolves, one trend continues to dominate the long-term investment landscape…

AI isn’t just a boom – it’s a wealth transfer

History suggests that transformative technologies create enormous value – and much of that value accrues to the companies that build and deploy them, and to the investors who own them.

That “Thanks, Captain Obvious” quote comes from BlackRock CEO Larry Fink in his annual letter to shareholders.

He went on to highlight a point we’ve made repeatedly in the Digest:

There’s a real risk that artificial intelligence could widen wealth inequality if ownership does not broaden alongside it.

Fink’s overall message was that if AI is going to reshape the economy – and potentially displace jobs – the best defense isn’t fear…it’s investing in this revolutionary technology.

Now, yes – Fink saying “buy stocks” is a bit like a casino owner telling a gambler that the best way to win big is to bet even more…

Still, we agree with the overall message.

After all, if a technology threatens your income, one of the few moves you have is to align your wealth with that technology.

Own the companies. Own the infrastructure. Own the upside.

One of the risks today is how much investors are paying for that upside

Many of the obvious AI stocks have already been bid up to levels that, historically, underperform over a longer-term timeline.

Let’s go to our macro investing expert 91���� for more details:

Markets are cyclical – always and forever.

Share prices oscillate between low valuations and high ones… then back again.

Lowly valued stocks, generally speaking, tend to treat investors well, while richly valued ones tend to treat them poorly.

The lesson is almost insultingly simple: Buying stocks at low valuations tends to work out better than buying them at high ones.

That’s the tension investors face right now.

Yes, you want exposure to AI. But no, you don’t want to overpay at the top of a cycle – especially if the next three weeks bring a failed rally.

And there’s an even bigger wrinkle emerging beneath the surface…

AI isn’t just creating new winners – it’s actively destroying parts of the market.

We’re already seeing this play out in software. AI tools are compressing pricing, automating workflows, and threatening entire categories of recurring revenue. Business models that once looked durable are suddenly looking vulnerable.

This points toward one fundamental question that investors should ask today when evaluating a stock…

Will AI destroy this company’s future cash flows…or accelerate them?

The answer is everything.

It’s the difference between overpaying for a stock where AI weighs on revenue and intensifies valuation pressure…and owning a business whose earnings are about to accelerate thanks to AI, easing the strain of a sky-high multiple.

And this is where Eric’s recent Investment Report issue – highlighting the HALO framework – becomes incredibly useful.

Focus on where AI demand is exploding – not eroding

To make sure we’re all on the same page, HALO stands for “high-assets, low obsolescence.”

Here’s Eric with more:

The HALO trade is the straightforward idea that you can protect your wealth through buying assets that cannot be replaced by artificial intelligence.

Instead of chasing the most obvious AI winners – many of which are already priced for perfection – you look for businesses tied to physical assets… real-world constraints… and irreplaceable infrastructure.

These are areas where AI isn’t replacing businesses – it’s relying on them.

One of the clearest examples today is memory. As AI demands shift from software to infrastructure, the memory industry has transitioned from a cyclical commodity into a strategic, capital-intensive asset that is critical to AI hardware.

One of the poster children for the memory trade is Micron (MU). Here’s Eric speaking about Micron and our broader point in last Friday’s Digest takeover:

Micron’s memory sits at the heart of AI, data centers, and virtually all modern computing systems

In a world without enough DRAM, the AI Revolution hits a hard ceiling because it runs out of space to think.

No memory means no intelligence.

In other words, memory is not a “nice to have.” It’s a critical bottleneck.

But what about its valuation?

If you keep a pulse on the markets, you might think, “Jeff, Micron is up more than 300% over the last year. Isn’t this exactly what Eric warned about?”

That’s a fair question. On price alone, it does look like a “buy high” situation.

But here’s where digging deeper matters…

Given Micron’s positioning as a critical HALO stock within the wider AI supply chain, demand for its products – and therefore its earnings – have exploded alongside its stock price.

Let’s look at the resulting impact on MU’s valuation.

For context, the S&P’s current price-to-earnings ratio is 28. Meanwhile, over the last 10 years, Micron’s price-to-earnings ratio has fluctuated between 13 and 20, with a median of around 15.

So, what is MU’s forward price-to-earnings ratio, which includes analysts’ forecasts of 12-month forward earnings?

Roughly 7X – 8X.

In other words, what appears expensive based on “yesterday’s” earnings and the recent price runup may actually be attractive if MU’s future earnings materialize as forecasted.

Eric isn’t our only analyst who has flagged MU recently. Legendary investor Louis Navelleir just sounded off on the memory giant in yesterday’s Growth Investor Flash Alert:

Micron is a great buy at this moment.

They had spectacular results, but their sales are forecasted to be up over 236%.

Last quarter it was 196%.

So, the sales growth is just ridiculous, really due to the data centers.

Own the bottlenecks, not the hype

Zooming out, memory is just one example of how bottlenecks are creating opportunities in HALO stocks.

As Eric has been emphasizing, beyond memory, the AI boom is running headfirst into real-world constraints in energy, raw materials, and semiconductor capacity.

Each of these pressure points reflects the same underlying dynamic: demand is accelerating far faster than supply can respond. And when that happens, opportunity follows.

That’s the bigger takeaway: You don’t have to chase the most obvious AI winners or pay peak valuations for the market’s favorite names.

In fact, with the market in a make-or-break period over the next three weeks, this is a time to take fewer risks, not more.

But keep your eye out for stocks that AI cannot function without – the areas where demand is inelastic, supply is constrained, and pricing power is building. If the coming weeks bring sale prices, consider establishing positions.

For more on these bottleneck stocks, Eric went into far greater detail last week in his FutureProof 2026 event. He walked through the specific pressure points forming across the AI economy and, more importantly, highlighted the companies positioned to benefit.

Bringing this back to Fink, that’s really the more actionable version of his message

Yes, investors need exposure to AI. But the how matters.

It’s not about blindly buying whatever has “AI” attached to it. It’s about owning the parts of the ecosystem where AI is driving demand, strengthening margins, and accelerating future cash flows.

That’s how you align your wealth with this technology – and do it without falling into the trap that history has punished time and again: overpaying for the most crowded trades at exactly the wrong time.

We’ll keep tracking this here in the Digest.

Have a good evening,

Jeff Remsburg

(Disclaimer: I own MU.)

The post The Next Three Weeks Could Determine Your Investing Year appeared first on InvestorPlace.

Today, I have Thomas Yeung here to answer that question. If you don’t know him, Tom writes the Sunday edition of InvestorPlace Digest and plays a key role in our AI Revolution Portfolio and Power Portfolio 2026 services. He also works closely with my colleague 91���� across several premium services.

In the essay below, Tom explains why the most popular way to play oil right now could actually be working against investors – even if prices rise. More importantly, he shows where the attention should be going instead.

That’s where Eric’s recent FutureProof 2026 event comes in, where he reveals the true bottlenecks shaping the next phase of the AI boom.

Go here to check it out.

Now, here’s Tom with how you should play the oil trade right now…

***

Hello, Reader.

In the 1930s, Australian farmers attempted to control a sugarcane pest problem by using a strategy that had failed before:

Importing a foreign predator – in this case, the South American cane toad.

It soon became apparent that cane toads were adept at eating everything except the scarab beetles they were meant to control.

They couldn’t climb the sugarcane to reach the adult beetles or burrow underground to find the larvae. Instead, they devoured everything else — small mammals, other amphibians, snails — and even poisoned potential predators with their natural toxin.

By the time biologists realized their mistake, it was too late.

Like the farmers, investors are also notoriously forgetful when it comes to using bad strategies in new situations.

Here are a few examples:

• Real estate bubbles. From Miami to China’s Ordos City, speculators have piled into housing at nonsensical prices, saying, “No one ever made more land…”
• Chasing “easy” profits overseas. Investors piled into foreign markets for higher returns… and got burned when conditions changed.
• Betting on calm markets. Hedge funds assume things will stay stable — right before volatility spikes.

And now, the same error is happening in the energy market with retail investors buying up oil ETFs like the United States Oil Fund LP (USO).

Since the U.S. attacked Iran on February 28, investors have poured a net $685 million into USO alone, reversing a negative $682 million outflow since 2024.

This rush into USO – and the way retail investors are playing oil in general – is likely a mistake.

Your attention should be pointed elsewhere. It’s an investing approach you won’t regret.

Let’s dive in…

How to Play Oil… the Wrong Way

Most investors assume that when they buy an oil fund, they’re buying oil.

They’re not.

Instead of holding actual barrels, these funds are buying futures contracts – bets on where oil prices might go next.

And that’s where the problems begin:

• They don’t keep up when oil prices rise. Even when oil prices jump suddenly, these funds often lag behind the move.
• Investors tend to pile in too late. By the time the headlines hit, much of the upside has already happened.
• The structure works against you over time. These funds constantly reset their positions — and often end up buying high and selling low.

Here’s the key issue: These funds aren’t designed to track oil perfectly, but to manage a series of short-term bets on where prices are going next.

And over time, those small mismatches add up.

It’s a bit like trying to follow a moving target by constantly jumping ahead of it… and missing slightly every time. Eventually, those small misses turn into big losses.

Most importantly, oil itself hasn’t been a great long-term investment.

Every time prices spike, the world finds ways to increase supply — new drilling, new technology, or alternatives that eventually push prices back down.

That’s why, since launching in 2006, USO has lost about 80% of its value — even though oil has gone through multiple booms along the way. In other words, even when oil wins, investors using this approach often don’t.

Almost every oil price spike in history has been followed by a reversal. In commodities, high prices tend to fix themselves.

We’ve seen this play out again and again.

Most recently, oil surged above $120 in 2022 during the Russia-Ukraine conflict — only to fall back below $70 within months as supply adjusted and demand cooled.

The pattern is consistent: The higher prices go, the more pressure builds for them to come back down.

That’s why chasing oil here can be a distraction.

Instead, there are two smarter ways to play oil right now.

The first is to buy specific energy companies that can perform well even if oil prices fluctuate. These low-cost producers are making money, regardless of whether oil is at $150 or $50.

In fact, Eric’s most recent oil and gas recommendation is already up 36% in about a month. And he recently booked more than 300% gains on an “accelerated” oil trade.

The second smart way to play the oil trade is to ignore it completely — and avoid using the wrong tool for the job.

Because while many investors are focused on oil, the real opportunity is shifting elsewhere — toward the physical infrastructure powering the AI boom.

How to Play AI… the Right Way

That’s where Eric’s “Golden Rivets” come in: the real-world components needed to build and run AI systems.

The biggest winners in past technology booms weren’t always the most visible companies.

They were the ones supplying what made the boom possible.

That’s why Eric believes AI’s “Golden Rivets” — raw materials, energy, and memory — will be some of the biggest winners this time around.

In his FutureProof 2026 event, he breaks down exactly how this is playing out — and shares 15 companies already positioned to benefit.

Click here to watch Eric’s new FutureProof 2026 event.

Until next time,

Thomas Yeung

Market Analyst, InvestorPlace

The post The Oil Trade Everyone’s Getting Wrong appeared first on InvestorPlace.

Oil surged. Volatility spiked. The S&P 500 broke below its 200-day moving average.

The narrative quickly followed: escalation risk, retaliation scenarios, the potential for a much broader conflict.

For a moment, it looked like the market was pricing in something much bigger than a single military operation.

But markets trade on outcomes, not headlines. And within days, the story started to shift.

Reports suggested back-channel communication had begun. Back-channel became front-channel. The geopolitical temperature dropped from ‘thermonuclear’ to ‘tense but manageable.’ Oil started to give back its war premium. 

And the S&P 500, after spending exactly two trading days below its 200-day moving average, retook the line on March 23 as if the market was beginning to price this as a contained event rather than an escalating conflict.

That kind of movement is what happens when a worst-case narrative starts getting repriced in real time. And there’s a clear playbook for how these moments tend to unfold.

The Market Is Following a Familiar Playbook

If you were in the markets back in April 2025, then this script will feel familiar.

That’s when President Trump’s “Liberation Day” tariffs sent markets into freefall – sending the S&P 500 down nearly 5% in two days and pushing the market toward a 10% correction within a week.

But that move didn’t stick.

The pause that came 90 days later was due to what financial analysts have dubbed TACO: Trump Always Chickens Out – a pattern where aggressive policy threats are used to force concessions, but ultimately get dialed back before causing lasting economic damage.

Markets, which had spent weeks pricing in a full-blown trade war, suddenly had to reprice an entirely different world. The S&P 500 ripped higher. AI stocks went parabolic. It was one of the fastest relief rallies in recent memory.

That sequence – sharp drawdown, policy reversal, violent relief rally – created a recognizable rhythm for investors.

The Iran situation is following the same playbook – at least so far.

The strike appears to have been designed to produce leverage rather than prolonged conflict. Maximum pressure. Maximum optics. Maximum negotiating leverage. Iran, despite its rhetoric, faces strong economic and strategic incentives to avoid prolonged escalation – including strained domestic conditions, limited export flexibility, and the risk of overwhelming military response. 

That suggests the TACO logic applies here too: when the cost of not blinking exceeds the cost of blinking, you blink. If that logic holds, Iran may ultimately choose de-escalation over escalation.

What De-Escalation Would Mean for Markets

If de-escalation continues – and early signals suggest that may be the direction – a plausible path forward looks like this: oil could retreat to the $65 to $70 range, the inflation pulse from the war premium would likely wash through the data within two to three months, and the Federal Reserve may find itself with the window it has been waiting for. 

Rate cuts resume. The economy exhales. And stocks – particularly the AI infrastructure complex that got caught in the geopolitical crossfire – move higher.

In prior TACO-style episodes, once the overhang lifts, capital tends to flow back into leadership. And right now, leadership has already been reset.

Big Tech has gone through a sentiment washout and valuation compression, even as its earnings outlook hasn’t materially changed.

That combination is rare – and we’ll break it down in our next issue.

This is where the weight of the evidence points right now.

Of course, that path depends on continued de-escalation – something that remains fluid and far from guaranteed. But based on current signals, we believe this is the most likely outcome here.

Now let’s look at what the charts are telling us.

A Key S&P 500 Signal Just Turned Bullish

The technical picture just gave us a constructive signal – with an important condition attached.

We reviewed every trading day in the S&P 500 since 1950 and identified 91 instances of the following setup: the index briefly dips below its 200-day moving average (no more than five trading days), retakes the line, and does so while the 200-day slope remains positive. 

This is a precise signal – it filters out the genuine bear markets, where the 200-day starts rolling over and the dips below it become extended breakdowns. What’s left are periods where the market had a brief breakdown – and then resumed its prior trend.

The aggregate forward returns are bullish. After all 91 occurrences, the S&P 500 averaged +3.5% over the next three months, +5.0% over six months, and +8.3% over 12 months – with a 72.5% win rate at three months. Solid, but not spectacular.

But when we segmented the data further, the results split dramatically. In 30 of those 91 cases – about one-third of the time – the S&P 500 retook its 200-day and simply kept going, staying above the line for the next 15 consecutive trading sessions. We called these the V-Shape events. The other 60 cases involved the market retaking the 200-day but then battling with it – falling back below within 15 sessions, churning around, testing investors’ patience. We called these the Choppy events.

The performance difference between the two groups is not subtle.

V-Shape events produced an average three-month return of +6.5% with an 87% win rate. Six months out, the average return was +9.9%. Twelve months: +13.0%. These are some of the cleanest forward return profiles in the historical record – better than the all-period baseline at every horizon, by a meaningful margin.

The Choppy events resulted in +1.9% on average at three months, with a six-month win rate of just 52%. That’s a coin flip. This group is where the early-stage breakdowns lived — the 2000 distribution top, the 2007–2008 rollover. Strong slopes masked deteriorating internals, and the 200-day kept getting tested until it finally gave way.

The distinction is everything. And the classification window is the next 15 trading sessions, from today through roughly April 15, 2026.

The Path Forward for Stocks From Here

So now we have two signals – one from the macro, one from the market. 

Here is the synthesis.

The fundamental case suggests a path where Iran ultimately de-escalates, oil falls, inflation cools, the Fed cuts, and the AI bull market resumes from where it left off before Operation Epic Fury interrupted it. The technical case says the 200-day retake is historically a powerful signal – but its power is almost entirely concentrated in the V-Shape outcome, which requires the market to hold this line over the next few weeks.

If that path plays out, the market holds above the 200-day. A deal gets done, the relief rally kicks in, and the S&P 500 spends the next two to three weeks building a base above the 200-day. That’s the V-Shape scenario. And history shows that if that’s how things shake out, the next 12 months could look very good indeed.

The parallel to April 2025 is not just rhetorical. That TACO moment gave us a 20%-plus rally in AI infrastructure names over the subsequent six months. The setup here – lifting geopolitical overhang, a reengaged Fed, intact hyperscaler capex spending, accelerating AI adoption – is, in some ways, even cleaner (though still dependent on geopolitical follow-through).

The data leans bullish. The macro suggests the overhang is lifting. And the playbook says we’ve seen this before.

But stepping back, this isn’t just about one geopolitical event or one technical signal.

It’s about understanding how markets behave in this new environment: one where policy, positioning, and capital flows are driving outcomes faster than traditional fundamentals alone.

The playbook that worked for the past decade is changing – and the investors who recognize that early are the ones who tend to capture the biggest opportunities.

We’ve outlined those new rules – and how we’re positioning around them – right here.

The post Stock Market Outlook: Why This Pullback May Already Be Over appeared first on InvestorPlace.

As I write on Monday, mid-morning, stocks are ripping higher on what sounds like a sudden turn toward peace in the Persian Gulf… but the reality is a bit murkier.

Earlier today, President Trump wrote on Truth Social that the U.S. and Iran had held “very good and productive conversations regarding a complete and total resolution of our hostilities.”

Trump then ordered a five-day pause on planned strikes against Iranian energy infrastructure.

This is exactly what our hypergrowth expert Luke Lango had predicted, as he saw parallels between this Middle East volatility and the market turbulence surrounding Liberation Day.

When the economic damage from Liberation Day began showing up in bond markets and consumer confidence, Luke says Trump’s political calculus shifted. On Friday, Luke suggested that we’d see the same thing here.

From his Innovation Investor Daily Notes:

When oil hits $120, consumer sentiment craters, and midterm polling turns ugly, the political calculus shifts.

TACO incoming.

If you’re less familiar with “TACO,” it stands for “Trump Always Chickens Out.”

Sure enough, as I write, TACO is behind soaring stocks and crashing oil prices.

There’s just one problem…

Iran says none of it is true.

State-linked media and officials flatly denied that any talks – direct or indirect – have taken place, with one report insisting there have been “no negotiations” at all.

From that report:

With this kind of psychological warfare, neither the Strait of Hormuz will return to its pre-war conditions nor will there be peace in the energy markets.

So, what’s driving markets right now isn’t a confirmed breakthrough – it’s a narrative built on Trump’s assertion that diplomacy is underway, despite Tehran’s equally firm insistence that it isn’t.

For now, Wall Street is choosing to believe the version that lowers oil prices and reduces geopolitical risk. But if that story cracks, today’s rally could prove just as fragile as the “talks” themselves.

So, where does this leave us?

As I write, this rally feels like a reprieve – a sudden release of pressure after weeks of mounting geopolitical stress.

But as we just pointed out, this rally is based on a contested narrative. And that distinction matters because just 72 hours ago, the market was telling a very different story – one anchored in mounting technical damage beneath the surface.

Even with today’s surge, that damage isn’t fully repaired – it’s simply being papered over by headlines that may or may not hold up. And that means we can’t ignore what the market was signaling as of Friday afternoon.

In fact, it’s precisely in moments like this – when optimism returns quickly and perhaps prematurely – that discipline matters most.

So, let’s briefly rewind to what the market was telling us on Friday and update it based on where we stand today.

As of last week’s close, the market was sending a very different message

The S&P 500 had broken below its 200-day moving average (MA) – a key long-term trend line that institutional investors watch closely.

As I write, stocks are rallying and the index is climbing back toward that level…

But that doesn’t erase what happened.

A break below the 200-day MA is a clear warning sign. It suggests a market that’s losing momentum – one that may be growing more vulnerable to sharper downside moves if conditions deteriorate.

And importantly, these kinds of technical cracks don’t get “fixed” in a single morning. They either heal over time – or they widen.

That’s why moments like this demand discipline.

Not a reaction. Not a prediction.

A framework.

After all, when headlines are driving sharp swings – as they are right now – it’s easy to get whipsawed by emotion instead of guided by a plan built in calmer conditions.

Fortunately, we have exactly that kind of framework.

What the A, B, C framework is telling us today

Last fall, veteran analyst Brian Hunt laid out a simple, remarkably effective system for identifying when a bull market is truly breaking down.

Not wobbling… not correcting… but actually transitioning into something more dangerous.

What makes Brian’s approach so useful is that it doesn’t demand that we accurately predict anything. We don’t need to guess about interest rates, AI valuations, or geopolitics. We simply watch what the market is doing.

As Brian put it, you just need “a basic knowledge of stock trend health.”

That “trend health” boils down to three signals – what we’ve come to call Brian’s A, B, C framework here in the Digest.

So, what exactly are we looking for?

Well, in the lead-up to the 2008 financial crisis, the market began flashing warnings months before the worst of the damage. First came a breakdown below key prior lows. Then the long-term trend rolled over. Finally, the market began carving out a pattern of persistent weakness.

Here are the mile markers (they don’t always appear in perfect order):

• A six-month downside breakout (A)
• Trading below a declining 200-day moving average (B)
• A new series of lower highs and lower lows on the way to a new 12-month low (C)

From Brian:

All major negatives by themselves. Combined, they were hugely negative.

That was the time to get out.

Most importantly – and highly relevant today – Brian wasn’t identifying this in hindsight. These were real-time signals that proved invaluable.

To me, this horrid action is not obvious only in hindsight. It was obvious at the time.

The majority of one of the worst bear markets in history could have been avoided by using basic technical analysis.

So, where are we today?

As we noted at the top of today’s Digest, the S&P broke below its 200-day MA, yet is trying to retake it as I write.

In Brian’s system, that corresponds to “B.” It’s one of the earliest signs that a market’s long-term trend may be weakening.

Now, to be precise, Brian’s signal calls for a declining 200-day moving average, not just a brief dip below it – and we’re not there yet.

But Friday’s break still matters. It marks the first meaningful deterioration in the market’s structure since last year’s Liberation Day volatility. This is weakness that deserves our attention, even if today’s rally is obscuring it.

What makes this moment more consequential, however, isn’t just “B.” It’s how close we are to triggering “A.”

As you can see below, on Friday, the S&P 500 hit a new six-month low at 6,515.

Yes, we’re seeing a bounce today. But let’s be clear about what that bounce represents…

We’re not comfortably above support – we’re leaning up against it.

This means this market is still walking a very fine line.

If the apparent progress with Iran proves real, the market will stabilize and hindsight will likely view the last few weeks as a routine shakeout.

But if that narrative unravels, we could see signals “A” and “B” triggered in quick succession – a combination that would significantly raise the odds that something more serious is unfolding beneath the surface.

What about “C”?

This is where things get more nuanced.

In Brian’s original work, “C” is defined as the moment the market breaks to new 12-month lows. But in practice, that kind of breakdown doesn’t come out of nowhere.

It’s preceded by a clear shift in behavior – the pattern of “lower highs” and “lower lows” that Brian identified as a thumbprint of a bear market. And if you look at the S&P since January, you can reasonably argue that this process may already be underway.

Below is the S&P 500 chart again.

Notice the clear sequence of lower highs and lower lows. It’s too soon to declare this the new dominant trend – but it’s certainly not bullish.

So, rather than thinking about “C” as a single moment, it’s more helpful to think of it as a progression. The series of lower highs and lower lows is the setup. The break to a 12-month low is the confirmation.

Altogether, if the weeks ahead bring:

• A decisive break below the 6-month low (A)
• A clearly declining 200-day moving average (B)
• And an ongoing pattern of lower highs and lower lows as we fall toward a 12-month low

…then the market is no longer just “at risk.” At that point, it’s behaving exactly the way it has ahead of past major declines.

In that situation, you could say that the market will have its finger on the trigger – even if the final confirmation (a 12-month low) hasn’t yet arrived.

But here’s why we’re still optimistic

Today, we’re seeing a relief rally that we’re not sure will hold.

That said, even on Friday, the bond market wasn’t fully confirming the bearish story that stocks were telling us.

Credit spreads – the extra yield investors demand to own riskier corporate debt – have widened modestly in recent months. Investment-grade spreads have moved from 0.81% in December to about 0.90% today.

That tells us risk is rising but not spiking.

High-yield spreads remain relatively contained, suggesting bond investors haven’t been pricing in a full-blown crisis.

At the same time, Treasury yields have been elevated – not for bullish reasons (money flooding into risk assets) but because of sticky inflation and a Fed that’s in no rush to cut rates.

The overall takeaway is that the bond market was signaling rising risk, but not distress – a cautious environment, not a crisis.

So, even as stocks hit the panic button at the end of last week, the bond market stayed comparatively calm. And given the bond market’s reputation as “the smart money,” that was encouraging.

Which market will be right going forward?

That’s the question we’ll be answering in the weeks ahead.

If the bond market is correct, then the last few weeks of selling pressure was likely a shakeout – not the start of a sustained breakdown.

In that case, we’d be looking for the S&P to continue stabilizing, reclaim its 200-day MA, then push back toward recent highs.

But if stocks were right to flash warning signs – and the bond market is simply late to react – then conditions could deteriorate quickly.

Credit spreads would begin to widen more aggressively, liquidity would tighten, and the path toward Brian’s “C” signal would become much clearer.

Right now, the market’s direction is balancing on a tightrope, and this morning’s news about talks with Iran may determine which way we fall.

If the current narrative holds, if diplomacy is real and tensions genuinely ease, then today’s rally could mark the beginning of a sustained push higher.

But if that narrative cracks, today’s gains will disappear just as quickly as they arrived. And in that scenario, the technical damage we saw last week would come rushing back into focus.

Put it all together, and we don’t have an “all clear” – but this isn’t a full retreat either

This is a make-or-break moment.

So, rather than trying to predict the next headline, we’re better served by preparing…

Know what you’ll hold if this today’s gains fizzle… know what you’ll sell and at what price… and know what you’ll buy if this rally accelerates.

Most importantly, stay anchored to a process that removes emotion from your decisions, and follow that plan.

That way, if this does evolve into something more serious, you won’t have to guess what to do – you’ll already know.

Have a good evening,

Jeff Remsburg

The post Relief Rally or False Signal? appeared first on InvestorPlace.

But investors saw some relief today. The major indices opened higher after President Trump announced that attacks on Iran’s power plants would be postponed, following what he called “very good and productive” talks.

However, uncertainty still remains. The Strait of Hormuz is still closed, and even after it reopens, it could take months for energy shipments to return to normal levels.

That kind of environment can make many investors hesitant and unsure of what to do next.

So, in this week’s Navellier Market Buzz, I explained why I’m not nearly as concerned as many investors right now – and where I’m seeing opportunity instead. I broke down three stocks that I believe are well-positioned for this environment, including a defense name, a gold play and one infrastructure company that I think is the most interesting one out of all three.

Click the image below to watch now.

To see more of my videos, click here to subscribe to my YouTube channel.

Plus, the grades in Stock Grader (subscription required) have been updated this week! Click here to plug in your own stocks and see how they’re rated.

The Bigger Shift Taking Shape Right Now

Now, those three stocks I mentioned might seem completely unrelated. But I don’t see three separate ideas. I see the same pressure showing up in different places…

The defense name reflects a surge in demand that supply chains aren’t fully prepared to handle.

Gold is responding to a steady loss of confidence in currencies.

And that infrastructure company is tied to the AI boom – and the major restraints involving power, materials and capacity.

That bigger shift is what my InvestorPlace colleague 91���� focused on in his FutureProof 2026 presentation last week.

In it, he explained why he sees significant downside in the mega-cap tech names. In fact, he thinks some of the world’s most powerful tech companies, including Google, Amazon, Meta and Microsoft, could have a day of reckoning in less than a month from now.

On the other hand, he sees huge potential in a new class of small, asset-heavy stocks that supply these mega-cap tech companies with the physical goods they need.

He even shared over a dozen names on his watch list in his presentation. But it won’t be available for much longer.

Go here to watch Eric’s briefing now.

Sincerely,

91����

Editor, Market 360

The post 3 Stocks Smart Investors Are Buying Right Now appeared first on InvestorPlace.

This Week’s Ratings Changes:

Upgraded: Strong to Very Strong

Downgraded: Very Strong to Strong

Upgraded: Neutral to Strong

Downgraded: Strong to Neutral

Upgraded: Weak to Neutral

Downgraded: Neutral to Weak

Upgraded: Very Weak to Weak

Downgraded: Weak to Very Weak

To stay on top of my latest stock ratings, plug your holdings into Stock Grader, my proprietary stock screening tool. But, you must be a subscriber to one of my premium services.

To learn more about my premium service, Growth Investor, and get my latest picks, go here. Or, if you are a member of one of my premium services, you can go here to get started.

Sincerely,

91����

Editor, Market 360

The post Morgan Stanley Upgraded, Tyson Foods Downgraded: Updated Rankings on Top Blue-Chip Stocks appeared first on InvestorPlace.

This morning, we got word that a “complete and total resolution of our hostilities in the Middle East” is in the works between the U.S. and Iran.

Plus, there will be a five-day postponement on U.S. strikes against the country.

Oil and gas prices fell immediately and stock prices jumped, as Wall Street interpreted the delay as a step toward deescalation.

Iran, on the other hand, says there is “no dialogue between Tehran and Washington.”

Meanwhile, the International Energy Agency (IEA) warns that the global economy faces a “major threat,” describing the current energy crisis as more severe than the oil shocks of the 1970s.

The Iran conflict belongs to a category of risk called “known unknowns.” 

Everyone wants to know if this conflict will catapult oil prices toward $150 a barrel… or crater the stock market… or both?

Neither is also a possibility.

Despite claims of “productive conversations” from the administration, no one knows the answer – which is why I hesitate to add my commentary to the pile.

Instead, I will simply remind readers that good things tend to happen to cheap stocks, while bad things tend to happen to pricey stocks – no matter how serene or chaotic the world might be.

To illustrate this point with a bit of history, let’s roll back the calendar…

Any investor who purchased a basket of U.S. stocks shortly after the Japanese bombed Pearl Harbor would have been wading into the most uncertain geopolitical waters of their generation.

On the other hand, those investors would have been buying their stocks at bargain-basement valuations of roughly 10 times earnings.

Over the next three years of worldwide chaos, U.S. stocks advanced more than 50%. In other words, even though World War II was raged in both Europe and the Pacific, U.S. stocks managed to deliver annualized gains of more than 15%.

Similarly, any investor who purchased a basket of U.S. stocks shortly after the Pentagon doubled its troop deployment to Vietnam in 1966 would have been stepping into one of America’s most uncertain and contentious military adventures, both at home and abroad.

On the other hand, those investors would have been buying their stocks for less than 13 times earnings. Over the next three years, the S&P 500 advanced more than 40%.

U.S. stocks were trading for nearly 20 times earnings when America effectively exited Vietnam – the draft ended in late 1972 and U.S. combat troops came home soon after. But the waning days of that war did not bestow any sort of “peace dividend” on America’s pricey stock market. Instead, the S&P 500 slumped 15% over the ensuing three years.

These contrasting examples corroborate a decades-long stock market tendency…

Cheap stocks tend to fare better than pricey ones, no matter what else is going on in the world.

I get into where I am looking for these cheap stocks below.

But before we dive into that, let’s take a look at what we covered here at Smart Moneyover the past seven days…

Smart Money Roundup

The Hidden Consensus Forming on Wall Street – and How to Get In

March 17, 2026

I came across a piece of high-end research that’s not publicly available, and it confirmed something important: I’m not the only contrarian voice discussing AI’s emerging bottlenecks – there’s a growing chorus behind Wall Street’s closed doors. That tells me something bigger is already underway.

No Memory, No AI – How to Play the Shortage

March 18, 2026

Memory companies could be among the next wave of AI stock winners, and already, Micron seems to be one of the main beneficiaries. In Wednesday’s issue, I discuss the current memory chokepoint in AI and how it’s actually setting the scene for a smaller set of asset-heavy companies to become the biggest winners. Here’s how to play the memory shortage.

This Oil Trade Looks Smart — But Isn’t

March 19, 2026

Investors are notoriously forgetful when it comes to using proven bad strategies in new situations. That’s exactly what we’re seeing as retail investors rush into oil ETFs like the United States Oil Fund LP (USO). In this issue, Tom Yeung explains how that could be a mistake and where investors should be looking instead.

My “Kick It and Pick It” Strategy for the AI Age

March 21, 2026

Time’s biggest technological changes are happening right now – and it’s all thanks to artificial intelligence. We’re watching the leap from AI chatbots to AI agents happen in a fraction of the time it took to develop the models themselves. That acceleration is where the biggest opportunities are forming.

AI Isn’t Peaking – It’s Entering Its Most Profitable Phase

March 22, 2026

Despite rising doubts about spending, demand, and sustainability, the AI buildout is not slowing – it’s expanding, evolving, and, in short, transitioning. The shift toward autonomous AI is happening faster than most investors realize, and it’s reshaping where the biggest opportunities lie. 91���� goes into more detail in Sunday’s guest essay.

Finding Opportunity in the Unknown

Known unknowns like the Iran conflict deserve consideration – but they should not induce paralysis. Investing entails risk – forever and always.

Achieving investment success is not easy, even when analyzing known factors. It becomes close to impossible when trying to analyze unknowable ones.

The goal is not to crawl into a hole and hide, but to seek the best asymmetric bets you can find: stocks that offer significantly more upside potential than downside risk.

Right now, I believe that mega-cap tech stocks hold enormous downside risk. That’s because they are highly overvalued and spending an exorbitant amount of money on technological upkeep. Four hyperscalers alone are set to spend a combined $635 billion on AI infrastructure this year.

Here’s where I see upside potential: a new class of small, asset heavy stocks that supply these mega-cap tech companies with the physical goods they need.

I detail this coming capital rotation in my new FutureProof 2026 presentation. In the video, I also share over a dozen names with upside potential, for free.

Therefore, to the question, “How should one invest in the aftermath of the Iran conflict?” my answer is simple: exactly the same way you would invest during the prelude to it.

Unpredictable outside events will certainly make a mess of things from time to time. But investors who maintain a disciplined focus on asymmetric bets – and who refuse to overpay, even when the world seems calm – tend to sleep better during the storms.

And we profit more when they pass.

Regards,

91����

The post The Market Is Distracted. You Shouldn’t Be. appeared first on InvestorPlace.

They come from spotting the next constraint before it shows up in the data… before it hits earnings calls, before it becomes consensus.

That’s exactly what we’re starting to see right now coming out of Nvidia’s GTC conference.

In today’s issue, I’ve invited 91���� to break down a subtle but important shift inside the AI stack… one that could define where capital flows in the next phase of this boom.

It’s the same pattern we’ve seen play out again and again: AI runs into a bottleneck… and the companies solving that constraint become the next big winners.

Eric has built a career around identifying these inflection points early. And right now, he believes a new set of constraints is forming… ones most investors aren’t paying attention to yet.

He walks through the full thesis, and the specific opportunities tied to it, in his FutureProof 2026 presentation, now streaming.

You can watch it here.

Now, take it away, Eric…

Where will the next big gains in AI stocks come from?

That’s the question every investor is trying to answer right now. And some of the most important clues for anyone tracking artificial intelligence stocks are emerging this week — not on Wall Street, but in Silicon Valley.

At Nvidia’s GTC 2026 conference.

Every year, thousands of engineers, developers, and executives gather to hear Nvidia Corp. (NVDA) CEO Jensen Huang outline what’s coming next. But GTC has evolved into something much bigger.

It’s where the AI industry telegraphs its next move — and where investors hunting for the best AI stocks often get their earliest signals.

This year, one message is coming through loud and clear.

While NVDA stock built its dominance on GPUs, Nvidia is now turning its attention to something far less glamorous… but potentially far more important to the future of AI infrastructure.

The central processing unit — or CPU.

It may not sound exciting. But this shift could define the next wave of leadership in artificial intelligence stocks to watch.

The Chip That Built the AI Boom

For the past several years, GPUs have been the backbone of the AI boom — and the driving force behind the surge in AI stocks.

These chips excel at parallel processing, making them ideal for training and running large AI models.

That advantage created one of the biggest supply squeezes in semiconductor history.

Tech giants raced to secure GPUs. Data centers expanded at breakneck speed. And NVDA stock became the single biggest winner in the artificial intelligence trade.

In its most recent quarter, Nvidia generated more than $60 billion in data-center revenue — up roughly 75% year over year.

Its market cap surged past $4 trillion, cementing its place at the center of the AI economy.

But the next phase of AI — and the next leadership group in AI stocks — may require something different.

The Rise of Agentic AI

Until recently, most AI applications behaved like chatbots.

You ask a question. The system responds.

But the next evolution — agentic AI — is already here.

These systems don’t just answer prompts. They coordinate tasks, retrieve data, make decisions, and collaborate across networks of AI agents.

In other words, they don’t just respond.

They act.

And that shift is reshaping the demands placed on AI infrastructure.

GPUs still handle the heavy lifting of model training and inference.

But in an agentic AI world — where multiple systems are communicating, coordinating, and moving data in real time — something else becomes critical.

General-purpose compute.

That’s where CPUs come in.

GPUs run the models.

But CPUs increasingly run the system that manages the models.

And that distinction could matter a lot for investors looking beyond today’s winners in AI stocks.

Nvidia’s Quiet Pivot

Nvidia clearly sees this shift coming.

Years ago, it introduced its Grace CPU platform. Now, its next-generation system — Vera — is moving toward broader deployment.

The company recently signed a multiyear deal with Meta Platforms (META) to deploy Grace CPUs at scale inside its data centers.

And Nvidia-powered CPU systems are already running at major research institutions.

Why does this matter for AI stocks?

Because the explosive growth in GPUs has exposed a new bottleneck.

CPUs.

In today’s AI data centers, racks are filled with incredibly expensive GPUs.

But if the CPUs feeding those GPUs can’t keep up…

Those GPUs sit idle.

And idle GPUs are unacceptable in a world where demand for AI infrastructure is still accelerating.

A Quiet Supply Crunch

We’re already seeing early signs of strain.

Server CPU delivery times are stretching toward six months. Prices are rising. And chipmakers are warning about tightening supply.

91���� has described demand as “unprecedented.”

Intel has warned inventories could fall to unusually low levels.

The problem is straightforward.

Semiconductor capacity takes years to expand.

And as demand for AI infrastructure surges — driven by both traditional models and agentic AI systems — supply is struggling to keep up.

Some analysts now expect the global CPU market to more than double by 2030.

That’s a major shift — and one that could reshape the landscape of artificial intelligence stocks to watch.

The Next Opportunity in AI Stocks

Right now, most investors are still focused on the obvious winners.

Names like NVDA stock dominate the headlines — and for good reason.

But the biggest gains in AI stocks rarely come from what’s already obvious.

They come from bottlenecks.

Because when a system hits a constraint, capital flows toward the companies solving it.

We’ve seen this before.

In the early internet era, the biggest gains didn’t just come from software companies. They came from the firms supplying the raw materials behind the buildout.

Companies like Freeport-McMoRan (FCX), Cameco (CCJ), and others delivered massive returns as supply struggled to keep up with demand.

Today, the same dynamic is emerging in AI.

Because artificial intelligence doesn’t just require software.

It requires infrastructure:

• Chips
• Energy
• Memory
• Data centers

And across this entire stack, new constraints are forming.

That’s why the next wave of winners in artificial intelligence stocks may look very different from the first.

Preparing for the Next Phase

When bottlenecks emerge, money moves.

Often quickly.

And the investors who recognize those shifts early are the ones who tend to outperform.

That’s exactly what I break down in my new presentation, FutureProof 2026.

Inside, I explain why multiple constraints are forming across the AI economy — and highlight several AI stocks positioned to benefit as the next phase of AI infrastructure investment unfolds.

If you’re looking for the next generation of best AI stocks, this is where to start.

You can watch it here now.

The post GPUs Built the Boom, But the Next Great AI Stocks Aren’t What You Think appeared first on InvestorPlace.

Despite rising doubts about spending, demand and sustainability, the latest signals from industry leaders suggest something very different: the AI buildout is not slowing – it’s expanding, evolving and embedding itself deeper into the global economy.

In yesterday’s Smart Money, I wrote about how the next phase of AI won’t look like the last. The shift toward autonomous AI is happening faster than most realize. And it’s reshaping where the biggest opportunities now lie.

My InvestorPlace colleague 91���� agrees: AI is not contracting. It is transitioning.

He is joining us to share down why the “peak AI” narrative may be missing the bigger picture… and why the biggest profits in the next phase of this boom may go not just to the household names.

Take it away, Louis…

For one weekend in August 1969, Woodstock looked like the start of something big.

Sure, it was messy. It was loud. It was far from polished. But the vibe people felt was unmistakable.

It felt like the future had arrived. The possibilities were endless.

Then, later that year, came Altamont.

What was supposed to be another landmark concert turned into something much darker. So dark, in fact, that many historians still call it “the day the 1960s died.”

Every great boom has skeptics waiting for a moment like that. The moment when the dream cracks. The moment when the hype gives way to disappointment.

For the past year or so, plenty of doubters have been looking for that moment in artificial intelligence. They have called it a bubble. They have warned that spending on chips and data centers has peaked. They have argued that the AI boom is already running out of road.

I bring this up because NVIDIA Corporation’s (NVDA) annual GTC conference has been referred to as the “Woodstock of AI.”

And this week, the company delivered a very strong message to the doubters.

Instead of showing cracks in the AI story, NVIDIA showed that the buildout is getting bigger, broader and more deeply embedded in the economy than most investors realize.

Founder and CEO Jensen Huang used the event to make a simple point: The next phase of AI will not be smaller than the first. It could be much bigger, especially as inference and so-called agentic AI begin to scale.

Today, I’ll explain why the “peak AI” crowd still has this story wrong, why NVIDIA remains one of the great companies of our time, and why the biggest profits in the next phase of this boom may go not just to the household names, but also to the companies controlling the key bottlenecks.

Why the “Peak AI” Crowd Is Wrong

The “peak AI” crowd is looking at the wrong thing.

They are still focused on training. They are still asking whether the Big Tech hyperscalers will keep spending at the same pace to build the next giant model. For the record, they are. Estimates peg their spending to amount to somewhere between $600 billion and $750 billion this year alone.

But that is yesterday’s question.

This is why Huang went on to deliver a prediction that would sound absolutely shocking if it came from anyone else (or any other company).

NVIDIA says it sees at least $1 trillion in revenue from its Blackwell and Rubin chips through 2027.

Why? Because, at GTC, NVIDIA made clear that the new battleground is inference. In plain English, that means running AI models in the real world, at scale, over and over again.

So, NVIDIA did not just show off a faster chip. It rolled out the Vera Rubin platform as a full AI factory, with racks for GPUs, CPUs, storage and networking. It talked about AI as a complete system, not a single product.

That is not the language of a company preparing for a slowdown. It is the language of a company that believes demand is still accelerating.

The company is pushing deeper into inference, enterprise software and networking. It is also locking up key parts of the next supply chain through multiyear optics partnerships with companies like Lumentum Holdings Inc. (LITE) and Coherent Corp. (COHR).

The Rise of Agentic AI

Now, GTC also highlighted something else.

One of the biggest themes at GTC was agentic AI.

This is the idea that AI will not just answer a question and stop. It will take a goal, break it into steps, use tools, make decisions, monitor results and keep working in the background.

An open-sourced AI assistant called OpenClaw is leading the way.

It has become wildly popular among the tech community, allowing users to create and deploy AI agents – digital assistants that can do more than answer a single prompt.

Jensen Huang put it this way: “Every company in the world today needs to have an OpenClaw strategy, an agentic system strategy. This is the new computer.” He also said OpenClaw “made it possible for us to create personal agents” and that “the implication is incredible.”

That is a big statement. But it helps explain why NVIDIA is so bullish. They are giving you a glimpse of the future.

The company introduced NemoClaw as a way to help the fast-growing OpenClaw ecosystem become more useful and more secure for business users. NVIDIA says NemoClaw adds privacy and security controls for those always-on agents.

That may sound like a software story.

And it is, in the long run. But right now, it is really an infrastructure story.

Because AI agents are hungry. They do not just answer one question and stop. They keep running. They pull data. They make decisions. They trigger follow-up actions. They create a much larger and more persistent inference load.

So, if agentic AI takes off the way NVIDIA believes it will, then demand for compute, storage, networking and reliable power could rise a lot further from here.

Preparing for the Next Phase of AI

The big takeaway here is that GTC was not AI’s Altamont moment.

It was another reminder that this boom is alive and well.

But it was also a reminder that the next phase may not look exactly like the first. NVIDIA will remain one of the great winners. But as this buildout spreads, investors should keep a close eye on the chokepoints – the places where demand is exploding, supply is tight and pricing power can shift in a hurry.

That is often where the real money gets made.

Because AI runs on more than just GPUs. It runs on electricity, memory, networking, cooling, interconnects and raw materials. And the parts of that supply chain that cannot be scaled overnight may become some of the most profitable places to invest.

You can throw money at a problem. But you cannot instantly create more grid capacity. You cannot magically eliminate networking constraints. You cannot wish away shortages in memory, optics, cooling equipment or other critical inputs.

Those bottlenecks matter because they can shape who wins, who loses and where the next outsized profits show up.

That is exactly why I want to point you to a special presentation from my InvestorPlace colleague 91����.

Eric believes the next wave of AI profits may not go where most investors expect. Instead, they could flow to a handful of companies tied to the hidden bottlenecks that every major AI player now depends on.

In his presentation, Eric lays out the full case for where these chokepoints are forming, why they matter and how investors may be able to profit from them.

To watch Eric’s special presentation now, click here.

Sincerely,

91����

Editor, Market 360

The post AI Isn’t Peaking – It’s Entering Its Most Profitable Phase appeared first on InvestorPlace.

Last week, I wrote about two “future-proof” stocks to help shield your portfolio against the threats of AI. Artificial intelligence was causing mayhem in the software industry, and former SaaS superstars like Salesforce Inc. (CRM) and SAP SE (SAP) were suddenly looking less shiny. Shares of these firms have fallen 40% or more from their peaks. 

I offered fertilizer company The Mosaic Co. (MOS) and Australian whiskey maker Lark Distilling Co. Ltd. (LRK) as defenses from the disruption. 

But what about having a good AI offense as well? 

That’s more of a challenge. The best time to buy AI chip makers was six months ago when prices were still reasonable. 

Since then, memory-chip maker Micron Technology Inc. (MU) has risen 262%, while energy storage firm Fluence Energy Inc. (FLNC) has jumped 111%. The “obvious” plays are now trading at valuations that would make venture capitalists uneasy.  

So, it’s challenging… but not impossible. 

In a new special presentation, InvestorPlace Senior Analyst 91���� says there’s still time to get in on a second AI wave. These are smaller companies that are building the “Golden Rivets,” which are the essential components that power first-wave firms like Micron and Fluence. Without them, it’s like trying to run a race car without fuel. 

During the presentation, Eric reveals a whole host of AI bottlenecks – raw materials, digital memory, energy – and identifies the specific companies that are now seeing unprecedented demand thanks to being in the right place at the right time. 

You can click here now to watch his FutureProof 2026 event.

Now, to give you a sense of these “Golden Rivet” makers, I’d like to highlight two companies at the forefront of the AI bottlenecks… and that have been overlooked by Wall Street almost entirely so far. You’ll quickly see why I’m so excited for Eric’s picks. 

A Dominant Company in the Background 

Few people have ever heard of copper sulfate plating – the technology that creates the ultrathin wiring in modern chip packages. 

Even fewer people have heard of JCU Corp (TYO:4975), the under-the-radar Japanese firm that dominates that industry.  

In 2019, the Tokyo-based firm estimated it had a 70% global market share in copper sulfate plating for smartphones and tablets. That figure has likely grown, as shown by JCU’s sky-high operating margins that continue to rise. It’s now on track to earn 40% operating margins this year, up from 27% in 2019. 

That level of profitability is rare in manufacturing. It’s even more remarkable given Japan’s traditionally low-margin corporate environment. To give you a sense, JCU earns higher profit margins than Apple Inc. (AAPL) does from selling premium iPhones. 

That’s because JCU’s products sit inside a crucial, failure-sensitive part of chipmaking. Here’s a simplified version of how it works… 

A chip package starts as a specialized insulating material with tiny holes drilled into it with lasers. The material is then cleaned, chemically treated, and dipped into a copper sulfate bath to deposit an ultrafine copper layer exactly where it’s needed. (This is the step JCU allows.)  

After that, the package is sent through an etching process, where excess copper is removed, and the finished piece has silicon components-attached in a die-bonding process. And if a package needs multiple layers, the process starts over again.  

This matters because packaging defects can ruin an entire chip. If copper wiring is defective, the final product could perform poorly, degrade over time, or simply not work at all. Data centers would end up with expensive paperweights. 

That’s where JCU’s technology comes in. The company offers a precise recipe and control system for copper sulfate plating used to create wiring of 0.8 micrometers and less –almost 10 times finer than what conventional methods can achieve.  

In addition, JCU’s historical dominance means that it’s baked into the process of its customers. Chipmakers know how to precisely etch the copper from JCU’s recipe for the right outcome each time. Why should they risk rolling the dice on a new copper sulfate plating system when the current system works so well?  

Two factors are now putting JCU on a high growth path. 

The first is the rise of 2.5D and 3D chips. Stacked chips require multiple rounds of copper plating. They also have connection areas called “vias” that send electrical signals between layers, which requires a specialized form of plating. JCU has launched a brand called TIPHARES to deal specifically with stacked chips and anticipates strong demand. 

The second is that AI data centers have created a shortage in virtually every computer component. GPUs, hard drives, NAND flash memory, and DRAM have seen their prices rise uncontrollably, and some makers have already sold out their entire 2026 inventory. 

That means we should expect a ramp-up of production across the entire semiconductor industry, benefiting JCU at every turn. Virtually every modern semiconductor requires packaging of some kind, which all feeds into the demand for this Japanese firm. JCU is a natural bottleneck because the company is so dominant in its niche. 

That’s why I believe estimates for JCU’s growth are far too conservative. Analysts are currently estimating just 31.5 billion yen in 2027 revenues (a 5% annual growth rate), which is roughly what JCU was guiding for in 2024… well before the semiconductor shortages began. 

To put that into perspective, revenues already rose 14% in 2025 and operating profits surged 31%. 

It’s also noteworthy that markets have not yet fully recognized JCU’s value. Shares trade at just 16X forward earnings, which is already ludicrously low for a company with 40% operating margins. Though shares may be difficult for American investors to buy, JCU’s dominance of its industry could make them worth it. 

Rolling the Dice 

Those seeking a higher risk/reward “Golden Rivet” company will find one in Cohu Inc. (COHU). 

Cohu is a semiconductor test and inspection equipment maker that competes directly with industry giants Teradyne Inc. (TER) and Advantest Corp. (ATEYY). The two larger firms control over 80% of the overall chip testing equipment market and spend roughly as much on research and development (R&D) annually as Cohu generates in total sales. 

Traditionally, that’s left Cohu with scraps. The San Diego-based firm focuses on the less desirable midrange market and on test handlers – the robots that physically transport the chips being tested. Margins in both are lower and far more cyclical, because customers can delay purchases without fear of technologically falling behind.  

Since 2000, Cohu has posted 16 years of positive operating income and 10 years of negative income. Automotive, industrial, and mobile manufacturers are notoriously tough customers. 

COHU operating margin %

Source: Refinitiv

This cyclicality means Cohu’s shares now trade 40% below their 2021 peak. Revenues have shrunk 48% since 2022 on a cyclical downturn, and net income turned negative starting in 2024. In an earnings call last year, CFO Jeffrey Jones admitted that customers were delaying shipments, forcing the firm to cut 2025 forecasts.  

However, insatiable demand for AI chips is changing that picture. Last month, Cohu’s management announced that annual revenue growth had turned positive again, and that margins were on the rise. This was driven by both a cyclical uptick in mid-end customers, as well as strong demand from customers working with AI data centers, high-bandwidth memory, and physical AI applications. System orders (the higher-margin type) rose 47% quarter-on-quarter, and analysts now expect net income to flip positive again this year. Wall Street forecasts profits to double again in 2027. 

Cohu has also seen some early success with its new Eclipse platform, which is designed specifically to test AI data center chips. Two major customers have now adopted Eclipse for AI testing, and Cohu’s management recently said they now expect to achieve the “upper end” of revenue forecasts for their high-performance computing (HPC) segment this year. They foresee Eclipse shipments accelerating in the second and third quarters. 

This is all excellent news for this traditionally cyclical firm. Hyperscalers like Microsoft Corp. (MSFT) and Amazon.com Inc. (AMZN) are projected to spend trillions of dollars through at least 2030 building out AI data centers, and these big spenders have already triggered shortages in the AI chip testing market. In January, Advantest said it was speeding up its expansion plans to keep up and boosted its profit forecast by 21%. Teradyne has reported similarly bullish outlooks. 

This is particularly bullish news for Cohu, since its larger rivals are now having trouble keeping up with demand. Customers may switch to the smaller supplier simply to access the AI chip testing they need. 

That makes Cohu’s stock worth considering. The lows of cyclical companies might be very low, but that also makes their highs almost stratospheric. 

The Golden Rivets 

The two companies I mentioned here both have some downsides. JCU is potentially a value trap, because it receives virtually no Wall Street coverage and is difficult for American investors to buy. Meanwhile, Cohu is a cyclical play with far higher downside risks. Only active traders should consider such investments. 

That’s why I want to make sure you tune in to Eric’s latest presentation, where he talks about 15 separate “Golden Rivet” picks before homing in on his top choices. These are companies like Nvidia Corp. (NVDA), Advanced Micro Devices Inc. (91����) and Broadcom Inc. (AVGO) that have solved AI bottlenecks… except Eric’s new picks have yet to see the 10X gains those companies have because they’re still early in the cycle. 

But don’t wait long. We’ll only be replaying this free presentation until midnight on Wednesday, so be sure to watch his special talk before then. 

Until next week, 

Thomas Yeung, CFA 

Market Analyst, InvestorPlace 

P.S. I will be revisiting my top picks for 2026 in the coming weeks as we enter the second quarter. In the meantime, Larimar Therapeutics Inc. (LRMR) is added to that list. 

Thomas Yeung is a market analyst and portfolio manager of the Omnia Portfolio, the highest-tier subscription at InvestorPlace. He is the former editor of Tom Yeung’s Profit & Protection, a free e-letter about investing to profit in good times and protecting gains during the bad.

The post 2 Companies Tackling the AI Bottlenecks  appeared first on InvestorPlace.