What Comes After The 'Stone Age' Rally? More AI, More Grift, More Degenerate Economy.

Good morning everyone…

I have a few VIP passes for the May 4 Cashtag Awards (see above) for my readers here, so hit me up if you want to attend.

Before I get started on the markets, AI and the grift…

I love this chart from the A16z newsletter titled Railroad GPT. We have been here (AI boom/bubble) before. And, as you think about shorting Amazon, Google, Nvidia and the internet leaders of today, know that Union Pacific and CSX railroads are at all-time highs right now 150 years later!

Onward, to the markets…

On April 6th here in my newsletter, I speculated there could be a ‘stone age’ rally.

The ‘greens’ showed up, specifically AI related stocks and semiconductors.

I missed one big clue a rally was coming. A week earlier, as Trump was threatening Iran with annihilation, Open AI confirmed they had finally circled nearly $100 billion (there is a lot of fine print associated with the raise).

That day, I speculated (follow me on Stocktwits for these real time notes and ideas) that Softbank $SFTBY ( ▲ 7.26% ) was the stock to watch. I follow it as a proxy for Open AI because they are the public company most levered to it’s need to IPO. Unfortunately for me, I just kept an eye, I didn’t buy because you know…’annihilation’. It is up 60 percent in the three weeks since. Woops…

Not to worry, I have had a hot hand in the markets since the war started. I have been sharing my trades/investments as always on Stocktwits and you can easily follow along.

The momentum community is having a field day off our ‘trending ticker’ screens. In the last week, I followed a group of our users into $POET ( ▲ 28.84% ) (AI related) and it has doubled. I sold some Friday.

Stocks are not supposed to double in a week in case you did not know 😀 .

This two week ‘stone age’ rally has been spectacular. Semiconductor stocks (I own the $SMH ( ▲ 5.1% ) ) have had their best month EVER.

By Friday, investors were chasing stocks…

Humans chase stocks like dogs chase bones. I have been guilty of that myself over the the last 40 years, but much less so since I started journalling here almost 20 years ago.

When silly stuff like this happens in my favor, I get the heebiie jeebies!

Yesterday, Joe Weisenthal shared a funny chart (fake) of the semiconductor index going forward…

Most Americans are not following along this closely. Most Americans that invest, index. Thank goodness because that means they own some semiconductor stocks. But, based on last weeks surge in semiconductor stocks, it looks like they have FOMO and the chase is on.

Unfortunately, the ‘degenerate economy’ is very aware of the day to day fluctuations and the disease of ‘get rich quick’ is spreading fast.

This short essay by Nic Carter titled ‘Prediction markets have an inescapable insider trading problem’ highlights the current state of betting and degeneracy.

Trump, the man leading the wold in grift and casino expansion… and the man winking as his sons ‘advise’ both Polymarket and Kalshi in the betting arms race said the quiet part out loud…

The grift inside The White House and the Trump family continues unabated..this week Eric milked some more favors…

Every week I share a few signs that the ‘degeneracy apocalypse’ is upon us. This weeks…

The ETF arms dealers have created and the SEC has blessed these ridiculous three times levered single stock and ETF products.

As people chase AI, semiconductor and energy stocks related to AI, one thing to remember, is a growing amount of the country is pissed off about all of this ‘growth’. Not quite page 10 yet news is that an AI data center moratorium has an 85 percent chance of passing this year - according to Polymarket.

If this moves closer to ‘page 1’ news, we could see a nasty selloff in AI related stocks.

In the meantime, as I like to say, know your field position!

Finally…

Let me end with some good reads and watches….

I enjoyed the Rory documentary on Amazon Prime.

I also enjoyed the Peter Crouch documentary, I had no idea who he was, on Amazon Prime.

Software Ate The World - Charts of the Week from A16z…was very good.

Long Term Money from Morgan Housel.

‘Be Retar**d To Win At Life’ by Elisha Long is enlightening and funny. I sent to my kids.

Have a great Sunday.