The Compound and Friends Stay Bullish on America With Nick Colas, Everyone’s Building AI Chips, Ringing the Bell
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Dec 18, 2024 
Nick Colas, co-founder of DataTrek Research, shares his insights on the current market landscape and its parallels with the dot-com bubble. He dives into the U.S. stocks' performance, revealing their dominance over global counterparts. Colas elaborates on the importance of Return on Equity in evaluating companies like Apple and NVIDIA. The conversation touches on the bullish market sentiment fueled by substantial investments and the competitive dynamics in the semiconductor sector, especially regarding NVIDIA and AMD.
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Large-Cap Dominance
- The US stock market performed well in all four quarters of 2024, regardless of rising, falling, or stagnant interest rates.
- This suggests that large-cap stocks were the preferred trade, almost irrespective of interest rate movements.
Interest Rate Sensitivity
- The performance of international stocks and small-cap stocks are linked to falling interest rates.
- Large-cap US stocks are less sensitive to interest rate fluctuations.
Persistent US Outperformance
- US stocks have consistently outperformed international stocks for an extended period.
- This trend is reflected in the increasing weight of US stocks in global indices.