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AI Industry & Chips

Past edition
Oct 11 · 14 voices
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About this edition

26 items · printed Oct 11, 09:35 ET

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The central claim was that AI investment and valuations look vulnerable if growth and revenue fail to accelerate, despite continued enthusiasm for tech exposure.

S&P 500 7,812 +0.6%closes of Oct 9

The period’s AI-and-chips discussion centred on the sustainability of AI investment, with Joseph Wang and Bob Elliott warning that valuations and spending assumptions depend on exceptionally rapid growth 1321. Other coverage focused on infrastructure and corporate developments: data centres are drawing higher rents but also political anger over electricity costs, while Nvidia was reported to be considering an investment in Reflection AI and Microsoft’s Satya Nadella urged stronger safeguards for advanced models 910151820. Elon Musk separately claimed his companies could eventually make chips better than anyone else 3. Several followed topics received no attention in this selected pool, including AI infrastructure, Amazon, Broadcom, DeepSeek, Google, Jensen Huang, Meta, Micron, Oracle, Sam Altman, semiconductors, Taiwan and technology 0.

CM+914 voices

What happened

Joseph Wang warned that AI valuations look fragile and may reflect an earnings bubble because revenue growth and metrics don't justify the scale of AI capital spending.13

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Bob Elliott said the market is effectively a big bet on parabolic AI growth while spending growth appears increasingly linear, which he called troubling.21

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Chris Marcus argued AI will create substantial opportunities for those who adapt, even as he acknowledged risks of job displacement.23

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Show 2 moreShow fewer

Lance Roberts said he took gains and rebalanced his portfolio after big runs in AMD and Nvidia.16

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The Kobeissi Letter reported hedge funds have raised net exposure to major tech and semiconductor stocks to record-high levels.17

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“The market is one big bet on AI based on hope for parabolic growth.”

BE Bob ElliottOct 10 Open the source

Where they disagree

Whether AI valuations and investment are sustainable

AI valuations fragile13

1 voice

Market bets on parabolic growth21

1 voice

CM

AI creates practical opportunities23

1 voice

The desk

How the desk is calling it

15 of 21 voices lean bearish on S&P 500. Next to settle: S&P 500 on Apr 1, David Hunter's call; 5 calls open.

Where they stand · S&P 500

i

Reading the chart

  • bullish
  • bearish

S&P 500 · Google Finance

An arrow is one voice's position on the day they took it. Hover or tap an arrow for who it was and what they said.

S&P 500, 2026-09-09 to 2026-10-09, where the desk's voices took positions7,6007,7007,800Sep 15Oct 1The Kobeissi Letter · Sep 15 · up — Historically the S&P 500 dips after the first Fed hike but recovers and gains over 6-12 months, making hikes good buying opportunities.Robin Brooks · Sep 16 · down — The S&P 500 is flat to slightly down after the hike and hawkish press conference.The Kobeissi Letter · Sep 16 · up — The AI boom is providing substantial support for the S&P 500, and a resolution to the energy crisis would open the way for it to rise well above 8,000.Jurrien Timmer · Sep 22 · down — Timmer sees no catalyst for the bull market's next up leg, with the index churning without lasting progress since early June.Fawad Razaqzada · Sep 24 · down — Razaqzada sees a deeper correction in the S&P 500 as increasingly credible, with the index likely to head lower.Keith McCullough · Sep 24 · down — He expects parts of the market to crash before a full-blown 2022-style downturn, with 2027 worse than 2022.Michael Lebowitz · Sep 26 · down — The S&P may fall or trickle off given extreme dispersion and narrow leadership.Robin Brooks · Sep 26 · down — Brooks says the S&P 500 is the worst hedge and falls when oil prices rise.Adam Taggart · Sep 27 · down — He thinks the odds of the stock market continuing to deliver strong gains over the next couple of years are low.Bill Smead · Sep 27 · down — Smead expects the S&P 500 to be lower a decade from now, calling the odds of it being higher almost zero.David Hunter · Oct 1 · up — Hunter targets the S&P 500 at 10,000, roughly 30% higher, within three to six months.Ed Zitron · Oct 1 · down — The S&P 500 is far too weighted toward big tech and the rest of its constituents lack cash flows.Patrick Ceresna · Oct 1 · down — Ceresna sees broad equity correction risk, with the median S&P 500 stock 16% off highs and breadth collapsing.The Kobeissi Letter · Oct 1 · up — Seasonality is turning more favorable for stocks, with history pointing to stronger equity returns ahead.David Hay · Oct 2 · down — Expects terrible market breadth to lead to a very severe bear market.Eric Balchunas · Oct 2 · up — Expects the S&P 500 to hit a new all-time high.Ted Oakley · Oct 2 · down — Expects the downside in the market to be wrapped up only when the big names are sold off, which he suspects happens in 2027.Lance Roberts · Oct 3 · up — Expects the next move in the markets to be higher over the course of the year.James Stanley · Oct 5 · up — Expects the S&P 500 to keep melting up, treating pullbacks as buy-the-dip opportunities.The Kobeissi Letter · Oct 5 · down — Expects further weakness in the S&P 500 given historically weak October market breadth.Gareth Soloway · Oct 6 · up — Expects the S&P 500 to reach 8,000 by year end, staying bullish above 7,575.Todd Horwitz · Oct 6 · down — Sees a major meltdown coming and is looking to get short, though not until the market signals a top.Fiona Cincotta · Oct 7 · up — Expects the S&P 500 to break above 7,840 and target 7,900 and 8,000.Jonny Matthews | SuperMacro · Oct 7 · down — Expects rising equity supply to act as a headwind, or at least a brake, on the S&P 500.Mike McGlone · Oct 8 · down — Expects the S&P 500 to break and drop 10-20%, calling it a matter of when, not if.James Stanley · Oct 9 · up — Expects S&P 500 bullish continuation, with pullbacks seen as opportunistic buying.Lance Roberts · Oct 9 · up — Expects the cap-weighted S&P 500 to be flat to modestly higher into year-end, with the strongest gains in the equal-weighted index.
S&P 500, 2026-09-17 to 2026-10-09, where the desk's voices took positions7,7007,800Oct 1Jurrien Timmer · Sep 22 · down — Timmer sees no catalyst for the bull market's next up leg, with the index churning without lasting progress since early June.Fawad Razaqzada · Sep 24 · down — Razaqzada sees a deeper correction in the S&P 500 as increasingly credible, with the index likely to head lower.Keith McCullough · Sep 24 · down — He expects parts of the market to crash before a full-blown 2022-style downturn, with 2027 worse than 2022.Michael Lebowitz · Sep 26 · down — The S&P may fall or trickle off given extreme dispersion and narrow leadership.Robin Brooks · Sep 26 · down — Brooks says the S&P 500 is the worst hedge and falls when oil prices rise.Adam Taggart · Sep 27 · down — He thinks the odds of the stock market continuing to deliver strong gains over the next couple of years are low.Bill Smead · Sep 27 · down — Smead expects the S&P 500 to be lower a decade from now, calling the odds of it being higher almost zero.David Hunter · Oct 1 · up — Hunter targets the S&P 500 at 10,000, roughly 30% higher, within three to six months.Ed Zitron · Oct 1 · down — The S&P 500 is far too weighted toward big tech and the rest of its constituents lack cash flows.Patrick Ceresna · Oct 1 · down — Ceresna sees broad equity correction risk, with the median S&P 500 stock 16% off highs and breadth collapsing.The Kobeissi Letter · Oct 1 · up — Seasonality is turning more favorable for stocks, with history pointing to stronger equity returns ahead.David Hay · Oct 2 · down — Expects terrible market breadth to lead to a very severe bear market.Eric Balchunas · Oct 2 · up — Expects the S&P 500 to hit a new all-time high.Ted Oakley · Oct 2 · down — Expects the downside in the market to be wrapped up only when the big names are sold off, which he suspects happens in 2027.Lance Roberts · Oct 3 · up — Expects the next move in the markets to be higher over the course of the year.James Stanley · Oct 5 · up — Expects the S&P 500 to keep melting up, treating pullbacks as buy-the-dip opportunities.The Kobeissi Letter · Oct 5 · down — Expects further weakness in the S&P 500 given historically weak October market breadth.Gareth Soloway · Oct 6 · up — Expects the S&P 500 to reach 8,000 by year end, staying bullish above 7,575.Todd Horwitz · Oct 6 · down — Sees a major meltdown coming and is looking to get short, though not until the market signals a top.Fiona Cincotta · Oct 7 · up — Expects the S&P 500 to break above 7,840 and target 7,900 and 8,000.Jonny Matthews | SuperMacro · Oct 7 · down — Expects rising equity supply to act as a headwind, or at least a brake, on the S&P 500.Mike McGlone · Oct 8 · down — Expects the S&P 500 to break and drop 10-20%, calling it a matter of when, not if.James Stanley · Oct 9 · up — Expects S&P 500 bullish continuation, with pullbacks seen as opportunistic buying.Lance Roberts · Oct 9 · up — Expects the cap-weighted S&P 500 to be flat to modestly higher into year-end, with the strongest gains in the equal-weighted index.
S&P 500, 2026-07-13 to 2026-10-09, with 21 desk voices' positions7,4007,6007,800Aug 1Sep 1Oct 1The Kobeissi Letter · Sep 15 · up — Historically the S&P 500 dips after the first Fed hike but recovers and gains over 6-12 months, making hikes good buying opportunities.Robin Brooks · Sep 16 · down — The S&P 500 is flat to slightly down after the hike and hawkish press conference.The Kobeissi Letter · Sep 16 · up — The AI boom is providing substantial support for the S&P 500, and a resolution to the energy crisis would open the way for it to rise well above 8,000.Jurrien Timmer · Sep 22 · down — Timmer sees no catalyst for the bull market's next up leg, with the index churning without lasting progress since early June.Fawad Razaqzada · Sep 24 · down — Razaqzada sees a deeper correction in the S&P 500 as increasingly credible, with the index likely to head lower.Keith McCullough · Sep 24 · down — He expects parts of the market to crash before a full-blown 2022-style downturn, with 2027 worse than 2022.Michael Lebowitz · Sep 26 · down — The S&P may fall or trickle off given extreme dispersion and narrow leadership.Robin Brooks · Sep 26 · down — Brooks says the S&P 500 is the worst hedge and falls when oil prices rise.Adam Taggart · Sep 27 · down — He thinks the odds of the stock market continuing to deliver strong gains over the next couple of years are low.Bill Smead · Sep 27 · down — Smead expects the S&P 500 to be lower a decade from now, calling the odds of it being higher almost zero.David Hunter · Oct 1 · up — Hunter targets the S&P 500 at 10,000, roughly 30% higher, within three to six months.Ed Zitron · Oct 1 · down — The S&P 500 is far too weighted toward big tech and the rest of its constituents lack cash flows.Patrick Ceresna · Oct 1 · down — Ceresna sees broad equity correction risk, with the median S&P 500 stock 16% off highs and breadth collapsing.The Kobeissi Letter · Oct 1 · up — Seasonality is turning more favorable for stocks, with history pointing to stronger equity returns ahead.David Hay · Oct 2 · down — Expects terrible market breadth to lead to a very severe bear market.Eric Balchunas · Oct 2 · up — Expects the S&P 500 to hit a new all-time high.Ted Oakley · Oct 2 · down — Expects the downside in the market to be wrapped up only when the big names are sold off, which he suspects happens in 2027.Lance Roberts · Oct 3 · up — Expects the next move in the markets to be higher over the course of the year.James Stanley · Oct 5 · up — Expects the S&P 500 to keep melting up, treating pullbacks as buy-the-dip opportunities.The Kobeissi Letter · Oct 5 · down — Expects further weakness in the S&P 500 given historically weak October market breadth.Gareth Soloway · Oct 6 · up — Expects the S&P 500 to reach 8,000 by year end, staying bullish above 7,575.Todd Horwitz · Oct 6 · down — Sees a major meltdown coming and is looking to get short, though not until the market signals a top.Fiona Cincotta · Oct 7 · up — Expects the S&P 500 to break above 7,840 and target 7,900 and 8,000.Jonny Matthews | SuperMacro · Oct 7 · down — Expects rising equity supply to act as a headwind, or at least a brake, on the S&P 500.Mike McGlone · Oct 8 · down — Expects the S&P 500 to break and drop 10-20%, calling it a matter of when, not if.James Stanley · Oct 9 · up — Expects S&P 500 bullish continuation, with pullbacks seen as opportunistic buying.Lance Roberts · Oct 9 · up — Expects the cap-weighted S&P 500 to be flat to modestly higher into year-end, with the strongest gains in the equal-weighted index.

S&P 500 rose from 7,515 to 7,812 since Jul 13. The desk's voices, as each stands now: 6 bullish, 15 bearish.

Their record

○AI companies to generate ~$3.5 trillion in annual revenue by 2032: The Kobeissi Letter.
○OpenAI+Anthropic together to reach $1trn in ARR by 2045: Bob Elliott.
○Oracle downgraded to junk: steph pomboy.

What settles next

Near the mark

○ Open · by Dec 31

Gareth Soloway: “S&P 500 to 8,000 by year end”

S&P 500 with Gareth Soloway's target ≥ 8,0007,2507,5007,7508,000Aug 1Sep 1Oct 1target ≥ 8,000Gareth Soloway · Oct 6 · up — Expects the S&P 500 to reach 8,000 by year end, staying bullish above 7,575.
They said
Oct 6: Expects the S&P 500 to reach 8,000 by year end, staying bullish above 7,575.
Distance
7,812 now, +2.4% to go by Dec 31.
source ↗
○ Open · no deadline

Fiona Cincotta: “S&P 500 to reach the 8,000 psychological level”

S&P 500 with Fiona Cincotta's target ≥ 8,0007,2507,5007,7508,000Aug 1Sep 1Oct 1target ≥ 8,000Fiona Cincotta · Oct 7 · up — Expects the S&P 500 to break above 7,840 and target 7,900 and 8,000.
They said
Oct 7: Expects the S&P 500 to break above 7,840 and target 7,900 and 8,000.
Distance
7,812 now, +2.4% to go.
source ↗
1 AprS&P 500 · Thu 2027
David Hunter: “S&P 500 to 10,000 within three to six months” (Oct 1). S&P 500 is at 7,812, +28.0% to go.Settles on the close of Apr 1 (S&P 500).
27 SepS&P 500 · Sat 2036
Bill Smead: “S&P 500 lower in 10 years” (Sep 27). S&P 500 is at 7,812.Settles on the close of Sep 27 (S&P 500).
No date6-month check
Mike McGlone: “S&P 500 to drop 20%” (Oct 8) · S&P 500 ≤ 6,212No deadline was given, so each is judged six months after it was said.

The voices

Bloomberg

Nvidia is in talks to invest in Reflection AI and data centres are drawing higher rents even as voters fret about electricity costs ahead of midterms.91820

Michael Every

Morning note: geopolitics and global risks are elevated across the Middle East, shipping and supply lines, and defence spending is rising.2

Joseph Wang

AI revenues aren't growing fast enough to justify the scale of CapEx, per-token costs are falling, and there's jitteriness that makes valuations fragile.13

LR

Lance Roberts

We took gains and rebalanced our equity portfolio, trimming fast-rising tech names like AMD and Nvidia and reallocating to target weights.16

The Kobeissi Letter

Hedge funds' net US exposure to the Magnificent 7 has surged to a record 22%, showing extreme bullishness on Big Tech and higher semiconductor exposure.17

Bob Elliott

The market is one big bet on AI predicated on parabolic growth while spending growth looks increasingly linear, which is troubling.21

CM

Chris Marcus

AI will produce huge opportunities for those who adapt—entrepreneurs can apply tools across industries to scale services—even as displacement risks rise.23

Peter Berezin

Earnings estimates outside tech and energy have not risen on average this year.19

5 of this desk's 18 voices spoke · Quiet: Adam Tooze, Arnaud Bertrand, Ben Carlson, Brent Johnson, Dan Nathan, Ed Zitron, Eric Balchunas, Erik Townsend, Evan, Grant Williams, Kaiser Kuo, Max Wiethe, Michael Liebreich - @MLiebreich.bsky.social

More from the desk

AI valuation, revenue and capexJoseph Wang said AI companies may not be generating revenue growth quickly enough to justify their capital expenditure, citing falling per-token costs, doubts about Anthropic’s growth and disputes over how OpenAI revenue is measured. Bob Elliott similarly argued that markets are pricing in parabolic AI growth while spending growth is becoming more linear.

Joseph Wang said AI companies may not be generating revenue growth quickly enough to justify their capital expenditure, citing falling per-token costs, doubts about Anthropic’s growth and disputes over how OpenAI revenue is measured 13. Bob Elliott similarly argued that markets are pricing in parabolic AI growth while spending growth is becoming more linear 21.

Infrastructure and electricity constraintsWang warned that the US may not have enough electricity to operate all the promised data centres because power expansion is slow. Bloomberg coverage said data centres are attracting voter anger because they can raise electricity costs, while separate items described office conversions into data-centre capacity and higher rents than conventional offices.

Wang warned that the US may not have enough electricity to operate all the promised data centres because power expansion is slow 13. Bloomberg coverage said data centres are attracting voter anger because they can raise electricity costs, while separate items described office conversions into data-centre capacity and higher rents than conventional offices 151820.

Chip competition and corporate movesElon Musk said his companies could probably make chips better than anyone given their ability to build customised equipment. Nvidia was reported to be in early negotiations to acquire or invest further in Reflection AI, an American open-weight-model developer.

Elon Musk said his companies could probably make chips better than anyone given their ability to build customised equipment 3. Nvidia was reported to be in early negotiations to acquire or invest further in Reflection AI, an American open-weight-model developer 9.

AI governance and opportunityMicrosoft CEO Satya Nadella said powerful models should be treated as potential insider threats, with companies assuming compromise and creating emergency brakes for agentic systems. Chris Marcus argued that individuals who learn to apply AI tools to specific industries could find substantial business opportunities.

Microsoft CEO Satya Nadella said powerful models should be treated as potential insider threats, with companies assuming compromise and creating emergency brakes for agentic systems 10. Chris Marcus argued that individuals who learn to apply AI tools to specific industries could find substantial business opportunities 23.

Market positioning remains highly bullishThe Kobeissi Letter reported record hedge-fund net exposure to the Magnificent Seven and elevated exposure to semiconductor stocks.

The Kobeissi Letter reported record hedge-fund net exposure to the Magnificent Seven and elevated exposure to semiconductor stocks 17.

Earlier editions

Oct 15 AI demand was still described as powerful, but financing, valuation and growth concerns drove a clear split be › Oct 14 The central dispute was not whether AI demand exists, but whether infrastructure profits and semiconductor pri › Oct 13 The central dispute was whether AI earnings and infrastructure demand can justify continued optimism despite r › Oct 12 The central dispute was whether AI’s powerful market and infrastructure momentum reflects durable demand or a › Oct 10 AI demand was portrayed as powerful but increasingly vulnerable to revenue opacity, infrastructure constraints › Oct 9 The central dispute was whether AI’s enormous infrastructure buildout reflects durable demand or an increasing › Oct 8 AI infrastructure enthusiasm is colliding with rising leverage, concentration and bubble concerns. › Oct 6 AI investment and infrastructure momentum remained strong, but financing, demand, valuation and cybersecurity ›