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Thoughts

Longer essays about forces that cut across many companies. Each one names its sources. They are information, not advice (see the disclaimer).

  • What a 5% Treasury yield does to the picks

    The US 10-year Treasury yield rose from 4.44% at the end of June 2026 to 5.22% on October 8, and the Fed raised its rate in September. Most of the rise comes from the term premium and a higher expected Fed path, and inflation expectations stayed near 2.3%. Energy from the Iran war causes most of the gap between headline and core inflation, so a peace deal can reverse the Fed part of the rise. The term premium has other causes, so I expect yields to stay high into 2027. The picks that lose most have high debt, debt that resets soon, or demand that depends on loans. Few picks gain.

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  • Who pays for the AI buildout when tokens become cheap

    If tokens become priced like a commodity, I expect the losses to land on Oracle, the neoclouds and their lenders. I expect Microsoft, Alphabet, Amazon and Meta to absorb the change with little damage. The contracts and the debt support this view. But the trigger has not happened yet, and lab revenue and GPU rents both increased in 2026. I give four scenarios with my odds, the effect of each on the companies on Picks, and a model of the return on one GPU.

    Read the essay: Who pays for the AI buildout when tokens become cheap