The Super Intelligence TOP and The I Told You So'ers Celebration

Good Sunday morning…

I am both excited for and dreading this week in the markets.

Every market panic is different in the moment.

Here is a quick video explaining my simple panic rule when it comes to the $VIX both how to panic early and what to do when everyone else is panicked.

Unfortunately, no matter how many panics or deep corrections or bear markets I invest in and through, I have no idea how long they will last.

This panic stems from the selloff in AI stocks and semiconductor stocks which were the most talked about ‘boom/bubble’ since the real estate bubble in 2007 and 2008.

The big question is does the panic spread to stocks that Warren Buffett buys and looking at the price of Coke so fare that is NO. Coke ZERO has ZERO AI. In fact, you are ‘super intelligent’ if you have been hiding out in Coke and Eli Lilly.

In the meantime…

The ‘I told you so’ers’ are doing their victory dances on social media.

This is all part of the circle of life and investing.

We know there were signs to get out because I even spotted them this summer.

Because hindsight investing is easy, the price and chart pathologist in me pinpointed the LAST PERFECT DAY to sell AI and semiconductor stocks and that was September 29th, the day Fat Nixon declared that AI companies/stocks would be renamed ‘Super Intelligence’. Here is the bloodbath that has ensued since for AI and semiconductor stocks…

For those that panicked early…congratulations.

You had until September 29th to do so.

For those that want to panic now I feel for you because I have been there too.

This week we will get an insane amount of information coming at us from people you do not need to listen to. As I like to say…’there is no such thing as information overload..only filter failure’. If you do not have filters for moments like these, start building them.

I think a lot of volatility ahead lies around the Anthropic ( $ANT ( 0.0% ) ) IPO. Will it happen this month? While I would not touch it, I believe it needs to happen. If it does, I hope it is not forced on the public at $1.5 trillion. That is the price being bantered about right now and one that NYU value professor Aswath values it at.

Anthropic is NOT WeWork, but it is not an obvious winner.

The most noise will continue to center on semiconductor stocks. They have led this boom and they are leading the panic. If they keep going down, they will drag the markets with them…

If you want to own them, I do, this week you can start to buy them but do not expect miracles. In fact, be prepared for another 30-40 percent drop and try not to pick the one or two winners. I am focused on the ETF’s $DRAM ( ▲ 6.16% ) and $SMH ( ▲ 3.63% ) . The SMH is heavily weighted to Nvidia so be aware of that.

I always assume that cooler heads will prevail, but after this steep a decline, there are many walking dead hedge funds and investors that need to be cleaned up and that takes time.

The good news is this move has incredibly quickly - historic levels - washed out the weak…

I think demand for AI and compute is growing incredibly fast, but as Brian at AIRbnB ( $ABNB ( ▲ 11.67% ) ) outlined this week, it is still peanuts. Think about how many people still get their news from CNN and Fox.

I hope this helps…have a great Sunday.

I am headed for a ride.