Maggie Lake Talking Markets Episode 90: Why AI and K spell trouble. With Peter Boockvar.
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Oct 1, 2025 Peter Boockvar, Chief Investment Officer of Bleakley Financial Group and author of the Boock Report, dives into the economic landscape. He discusses how government shutdowns barely rattle markets while AI infrastructure reshapes the economy, highlighting a stark K-shaped recovery. Tariffs are not just inflationary but prolong a manufacturing recession. Peter also addresses rising competition from China, the implications of youth unemployment due to AI, and the potential of distressed sports assets like Manchester United. His insights are sharp and reveal the intricate balance of current market dynamics.
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Shutdowns Rarely Move Markets
- Peter Boockvar says government shutdowns rarely have lasting economic impact because reopenings are guaranteed and back pay follows furloughs.
- Markets shrug because the $30 trillion economy absorbs short political standoffs with little lasting damage.
A Mixed, Uneven Economy
- Boockvar describes the economy as mixed and uneven, with AI-related data center spending booming while much else is sluggish.
- He warns tariffs and private credit excesses are creating stress and prolonging manufacturing weakness.
Markets Are All-In On AI CapEx
- The economy and markets are effectively riding on the AI/data-center capex cycle, which inflates valuations and spending at the top.
- If the build-out stops, lower rates won't recreate that spending because cost of capital isn't the binding constraint.