Animal Spirits Podcast Buy the Porsche (EP. 426)
81 snips
Aug 20, 2025 The hosts dive into the current stock market's monotony, exploring how AI is influencing valuations. They question if small caps are truly dead and analyze the contrasting performances of fast food versus sit-down restaurants. The conversation shifts to the significant impact of tariffs and the K-shaped recovery, along with the challenges facing entry-level workers. Nostalgia hits as they reminisce about iconic teen movies while weaving in reflections on mentorship and the shifting landscape of streaming services. It's a wild ride through finance, culture, and personal anecdotes!
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AI Concentration Explains Market Boredom
- The market feels boring because gains are concentrated in AI-driven mega-cap stocks while the rest of the market grinds sideways.
- That creates a tension where AI may both transform the economy and inflate a concentrated speculative bubble.
Buybacks Are Propping Up Returns
- Companies are executing record buybacks, with buybacks expected to top $1.1 trillion in 2025.
- That accelerates EPS support and compresses shares outstanding, especially at large caps like Apple.
Healthcare Is A Cheap, Lower-Volatility Sector
- Healthcare historically matched tech returns with lower volatility up through COVID, but has lagged this decade.
- Current healthcare valuations price in a lot of bad news, creating potential contrarian opportunity.
