Hedgeye Podcasts Japan Dreams & Data Center Reality Checks | Protect the Pile: Episode 4
Dec 19, 2025
David Salem, a portfolio manager with expertise in macro research and Japan, joins Sam Rotman, who focuses on technology investment themes. They dive deep into Japan's rising rates and corporate governance, highlighting its implications for international investments. The duo also explores the profitability landscape of data centers and the emerging challenges of AI infrastructure spending, comparing current trends to the dot-com bubble, all while discussing the dynamics of global liquidity and capital allocation.
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Episode notes
Market Broadening After Long Concentration
- The US market's decade-long concentration in large-cap tech may be cracking as small- and mid-caps broaden in December.
- International markets, notably Europe, are outperforming the US month-to-date, signaling possible rotation.
Japan: Rates, Rearmament, And Selective Equity Upside
- Normalizing Japanese rates and rearmament could strengthen Japan economically and geopolitically.
- Japan's equities contain compelling long opportunities in industrials and robotics despite pockets of overvalued, China-exposed names.
Carry Trade Is Fragmented And Less Dangerous
- The classic yen carry trade narrative is outdated and fragmented into many country-specific carry trades.
- Past unwind episodes (e.g., Aug 2024) were manageable, suggesting a large-scale unwind is unlikely to be systemically disruptive.