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Feb 18, 2026
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LONG
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Japanese bond yields are hitting records, and inflation is rising, yet the stock market is surging. Contrary to the fear that rising rates will break Japan, this signals the end of financial repression. The economy is normalizing, allowing for inflation and growth, which is driving equity performance (outperforming the S&P 500 over the last 5 years). Bullish on the structural changes in the Japanese economy. A rapid spike in yields could cause short-term volatility or currency instability. |
The Compound News
Is AI a Mistake? | Animal Spirits 452...
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Feb 17, 2026
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LONG
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"We are looking at the worst start to the year for US stocks versus MSCI World since 1995... European stocks, Pacific stocks... are just smoking the S&P." A combination of a potentially weakening dollar, "Sell America" sentiment due to political/AI risks, and attractive valuations abroad is driving capital overseas. The momentum is now self-reinforcing as these markets hit multi-year highs. LONG International Equities (Developed and Emerging) to chase the momentum and valuation gap. A sudden strengthening of the US Dollar or global geopolitical instability. |
The Compound News
“Unrealized” Capital Gains Tax is Economic Su...
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Feb 17, 2026
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LONG
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"The Mag 7 is down over 6% this year. The 493 is up almost 4%... the equal weight S&P, that's RSP, is up almost 6%." The market is broadening. Investors are no longer waiting for Tech to recover; they are actively diversifying into the "average" stock. If this spread continues, it will force passive flows and advisor allocations away from market-cap weighted concentration into broader exposure. LONG Equal Weight S&P 500 to capture the rotation into the broader market. A resurgence of Mag 7 dominance reversing the rotation. |
The Compound News
“Unrealized” Capital Gains Tax is Economic Su...
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Feb 11, 2026
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LONG
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The ratio chart of International Developed stocks (EFA) divided by US Total Market (VTI) flatlined, puked, recovered, and is now accelerating upwards. This technical pattern looks like a "real bottom" after years of false starts. A weakening US Dollar and the "broadening out" trade support international assets. International stocks are finally set to outperform US stocks. US Dollar strengthens again; US tech dominance resumes. |
The Compound News
What Would You Do With $3 Million? | Animal S...
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Feb 11, 2026
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AVOID
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Walmart trades at 46x PE; Costco at 54x PE. The forward PE of the Consumer Staples sector is now at parity with the Tech sector. Investors are rushing into "safety" (Staples) as an "anti-AI trade," pushing valuations to nonsensical levels. Paying 50x earnings for low-growth staples is historically dangerous. While momentum is strong, the valuation risk is extreme ("crazy"). Momentum continues as investors flee volatility in tech. |
The Compound News
What Would You Do With $3 Million? | Animal S...
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Feb 11, 2026
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LONG
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C.H. Robinson is a logistics company using AI to match drivers with trucks more efficiently. The stock chart has gone "parabolic." Unlike companies just talking about AI, CHRW is demonstrating actual "AI-driven economic gains." It is a real-world beneficiary of the productivity boom. Long momentum in companies proving AI ROI. Cyclical downturn in shipping/logistics. |
The Compound News
What Would You Do With $3 Million? | Animal S...
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