RiskReversal Pod Is The AI Spending Bus Heading Towards A Cliff?
20 snips
Nov 4, 2025 A lively discussion kicks off with insights into the OpenAI-Amazon cloud partnership, illustrating the risks and rewards of the AI boom. CapEx spending is expected to slow down, raising concerns for 2026. They dissect the ISM manufacturing index and its implications, while debating bond market reactions to economic data. The conversation shifts to Bitcoin's surprising underperformance and the fluctuating gold market. Finally, they touch on Berkshire Hathaway's hefty cash reserves and close with humor over the Packers' latest game.
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AI Spending Growth Faces A 2026 Reality Check
- Liz Young Thomas warns that CapEx growth will slow in 2026 and investors will demand clear revenue and productivity proof.
- She notes many companies already show productivity gains but revenue evidence will become critical next year.
Manufacturing Weakness Still Matters
- The ISM manufacturing index at 48.7 signals contraction and a notable drop in prices-paid.
- Liz says manufacturing weakness matters despite a services-heavy economy because it still employs many and affects exports.
Bond Market Sends A Conflicting Message
- Guy Adami expected bonds to rally after weak ISM but they didn't, creating a conflicting signal with equities.
- Liz argues the bond market reflects institutional views and may better signal future economic direction.