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Momentum Monday - Leverage Remains Undefeated and The Leopold Bottom of 2026?

Also...I survived Alpe D'Huez... barely...

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Howard Lindzon
August 04, 2026

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Good afternoon…

I am headed back to New York after a great trip to The French Alps and Paris.

My friend Michael Kinsbergen who got me hooked on crazy cycling rides ten years ago, wanted to go ride the famous Alpe D' Huez right after The Tour de France finished passing through. The roads are fixed up so it will be pleasant ‘he said’….NOT!

Long story short, I passed NOBODY on the climb ( I was passed by hundreds of people of all ages, shapes and sizes) and as if I was standing still, a runner passed me. I had bike problems (rental) which messed with my head as well, but got though it.

I managed a smile as we stopped a few times on the descent…and yesterday took a hotel bike to ride around Paris (more dangerous than the Alps)…

Onward…

How about them markets!!!!

Last week I wrote the following on this newsletter as semiconductor stocks were crashing…

Yesterday, I actually waded back into the semiconductor index and added some back to my portfolio. If you follow me on Stocktwits you see these updates in real time.

How the semiconductors and AI stocks behave after the inevitable relief rally will be important. The era of Nvidia’s CEO Jensen moving markets with their ‘partner’ and investment announcements seems to be over.

If you own the S&P you don’t have a care in the word right now…

We found out a few days later that a 25 year old named Leopold - who graduated from Harvard when he was 11 or something - lost $30 plus billion leveraged to said semiconductors.

When I was in school at Arizona State University (The Harvard of The West), we had a term for these people…’putz’s!!

If you give a 25 year old $45 billion, what would you expect them to do other than to believe their own bullshit and implode.

When will we learn that getting a Harvard or Columbia degree is not as impressive as a Devry degree when it comes to investing.

While I had no idea why the markets were getting liquidated last week, I knew enoug to buy stocks while being passed and shamed while climbing Alpe D’Huez.

So now we have the relief rally …and as I said last week and reshared above, if you own the S&P you do not have a care in the world.

If you own AI stocks, today is a better day to panic.

There is just so many grifters, posers, leveraged ETF’s, perps and global retail newbies in the market right now that stocks like Microsoft, Google and Apple are swinging trillions of dollars a day. The Megacaps trade like Microcaps in this ‘degenerate economy’. The illusion of liquidity continues to be ‘bug’ as the law of large numbers and grift intertwine.

I am pleased to be indexed for the most part, riding out this insanity with some good trades around the edges as volatility shows itself. It feels almost too easy which keeps me on edge.

My ‘FREE’ ‘degenerate economy index’ is hitting all time highs today again and that is without ever using leverage, doubling the returns of the Nasdaq 100 the last three years since inception. You can follow along here. Today, I added the biotech ETF ( $XBI ( ▲ 2.68% ) to the index and last week added more semiconductor exposure and sold down some Philip Morris. I share these in real time on Stocktwits.

Leopold will be back in the hedge fund world (or straight to podcasting) because he is famous and the Citadel’s and Jane Street’s of the world love guys like this as much as Vegas casinos like a ‘mush’.

Leverage is undefeated unless you blow up spectacularly!

In the meantime, enjoy the all-time highs - which are thick right now across financials, biotech, select tech like $AMZN ( ▼ 1.8% ) and industrials. This weeks ‘Momentum Monday’ show is below (thanks Ivanhoff for going it alone while I was overseas)….

Welcome back to Momentum Monday!

In today’s episode of Momentum Monday, Ivanhoff and I discuss the following:  

  • Hedge Fund Liquidation & AI Stocks Decimation

  • Fed Meeting, Inflation Targets, and Treasury Selloff

  • Earnings Rescues: $AMZN ( ▼ 1.8% ) and $MSFT ( ▲ 1.65% ) Shift Sentiment

  • Geopolitical Headlines and Impact on Crude Oil

  • Relative Strength in Software & Cyber Security

  • Leading Stocks Setup Analysis & Earnings Season Outlook

In This Episode, We Cover:

  • Hedge Fund Liquidation & AI Stocks Decimation (0:00)

  • Fed Meeting, Inflation Targets, and Treasury Selloff (2:54)

  • Earnings Rescues: $AMZN ( ▼ 1.8% ) and $MSFT ( ▲ 1.65% ) Shift Sentiment (5:02)

  • Geopolitical Headlines and Impact on Crude Oil (7:26)

  • Relative Strength in Software & Cyber Security (8:21)

  • Leading Stocks Setup Analysis & Earnings Season Outlook (10:05)

Here are Ivanhoff’s Thoughts

Last week brought plenty of action to the tape. First, one of the most prominent highly levered in AI hedge funds was basically liquidated, losing 85% in a month. Then Jim Cramer urged people who bought data center stocks on margin to “sell it all, no matter what”. This message came after most of those stocks were down 50%+ from their recent highs. It is not necessarily bad advice; people should always use some type of stops, but it is a reflection of extreme sentiment, and the market likes to mean-revert every time there’s too much optimism or pessimism. This is probably why we saw a big gap and rally on Thursday. A rip within a downtrend, many would say, but then again, we have seen too many quick V-shaped recoveries to dismiss it easily. We had a similar start to the rally back on March 31st. The difference is that back then, there were quite a few AI stocks that had beautiful, strong setups and were ready to break out. Right now, we have a few software stocks that are looking decent, but they don’t have the same powerful growth story behind them – CRWD, DDOG, SNOW, OKTA, etc. More volatility and choppiness is the more likely scenario in August. 

The silver lining from last week was the reactions to MSFT and AMZN earnings. Both of the crushed earnings estimates, as they usually do. They did it by a huge margin, which means that either the analysts who follow them have no clue what they are doing, or that it is not that hard to manipulate their accounting and come up with almost any number they want. This is not the place to dive deeper into that. What matters to me as an active market participant is the positive reaction. Both MSFT and AMZN gapped up and finished strong. This is a clear shift in sentiment, as up until recently, any report related to AI has been punished with selling.

And here are the charts discussed:

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