The Fat Pitch For Bears | Animal Spirits 465

Summary

In Animal Spirits 465, Michael Batnick and Ben Carlson discuss market risks including a potential bearish setup, sticky inflation, high yields, and AI infrastructure oversupply. They also cover the difficulty of market timing, the early stage of AI adoption, and behavioral finance topics like wealth inequality and gratitude. The show includes personal stories about soccer tournaments and frugality.

• Discussion of a possible bearish setup due to inflation, rates, and AI capex memory bubble.
• Ben Carlson argues that long-term yields at 5% are not a crisis and have historically been higher.
• Michael Batnick highlights how hard it is to time the market, using Aswath Damodaran's wrong call as an example.
• The hosts note that AI adoption is still very early with only 10 basis points of population using models.
• Potential oversupply of data centers compared to the telecom bubble is raised as a risk.
• Small-cap earnings growth is surprisingly strong but its source is unclear.
• Wealth inequality is discussed through the lens of new vs. existing homeowners.
• The show ends with personal finance anecdotes and entertainment recommendations.