2026年5月随想录

All right, hello and welcome to yet another weekly podcast. I'm your host Andrew Walker. It is Wednesday, May 27, and today I am going to do my monthly random ramblings. As always—I say this every time—I feel like it was much more of a ramble than normal, but I am going to ramble on about 5 different topics today.

I am going to start off just talking about the state of the markets. Then we are going to move on to my worries about AI taking our jobs as investors—as, quote-unquote, I don't know if “intellectual” is the right word, but I worry about AI coming for the knowledge economy—and maybe where there is some hope and opportunity. Wrapped inside of all of that will be thoughts on memory stocks and the AI companies just screaming higher constantly.

I do worry when you hear people saying, “Hey, we're done with cycles” in industries that have historically been very, very cyclical. Eventually, there will be a supply response, so we are going to talk about that.

Next, I have thoughts on flexibility. It strikes me that if I knew you had been kind of bearish on the macro for the past 10 years, I probably would have guessed that you were also bearish on AI companies, AI, and everything else. And if I knew that you were really tech-forward, probably long Google because you thought Google was the future, and really into Tesla, I probably would have correctly guessed that you were bullish on AI.

It seems like there is a lack of flexibility there, where how you viewed the world for the past 10 years was going to be how you viewed the world currently. I am going to try to apply that lens to myself. I missed a lot of AI trades, so anyway, that is the 3rd thing.

The 4th thing is preferred equity as it relates to MicroStrategy. My God, it never ends. For disclosure, I have a little position in the MicroStrategy Bitcoin trade.

And finally, some thoughts on company managements and what you think about when you see a company moving from one thing to another—in particular, moving from a bigger company to a smaller company. But we will get there in 1 second. We're going to go to my monthly random ramblings in 1 second, but first a word from our sponsors. Today's podcast is sponsored by fiscal.ai. Fiscal.ai is a modern financial data provider for global equities. In addition to their web-based terminal, Fiscal is one of the leading data connectors for Claude and ChatGPT. With their self-serve API, you can connect in real-time fundamental data directly to your LLM. And look, I said it in podcast before and I'll say it again. I am They're not just an advertiser. I've been doing lots of cool stuff with Claude and Co-worker in particular building all sorts of bots and tools and I needed a API, so guess what? I signed up with my own money, tossed my own credit card down and said, "Hey, fiscal.ai, I I need you guys to plug into my Claude Co-worker for me so I can keep building these cool tools and have access to real-time fundamental data and stock prices and everything." And that includes more than 20 years of financial statements, ratios, filings, segments, KPIs, and all sorts of other things. Unlike other providers, their data updates within minutes of earnings reports, not days. So, whether you want powerful out-of-the-box terminal or the real-time AI connector with the API, you can use my link at That's fiscal.ai/yav to get 15% off. And they'll be a link in the show notes, too. Okay, let's start disclaimer. Nothing on this podcast is investing advice and the podcast full disclaimer full disclaimer in the show notes. Let's hop on into it.

So, the 1st thing I want to talk about is the state of the markets. I am recording this on Wednesday, May 27, in the afternoon. I did a tweet earlier this month that I thought was a banger. I thought it was hilarious. I think all my jokes are funny.

I used to watch this show called Crazy Ex-Girlfriend. I watched about 5 episodes. If you put anything with a musical in it, I watch it. I will sign up. My wife and I watched a few episodes of it, and we enjoyed it. I am not sure why I stopped.

They had this song in it. It is a banger. It is catchy. It is called “We'll Never Have Problems Again.” It is about an on-again, off-again boyfriend and girlfriend who are in a toxic relationship and get back together. The song is them joking and singing, “We'll never have problems again. We're just—it's all sunshine and rainbows from here.”

I just keep thinking about that song as it relates to the stock market recently. It does not matter what is thrown at it. Obviously, the headline of this year would be the war with Iran and energy prices skyrocketing. There are deficits, interest rates rising—whatever you want to talk about. It just does not matter. The stock market just seems to go up and up and up.

I keep sitting here, and I am sure I am not the only one. I see all these geopolitical issues and all this stuff. I do not see stress across the board in valuations, but market-wide, I think valuations are more stressed, and we are just screaming through all-time highs every day.

I keep thinking, “We'll never have worries again.” I know it is interesting. I have had a lot of people talk to me about the energy situation—not asking if I am worried, but just saying that they are worried about it. It really is interesting to think about the energy situation.

Again, I am recording this on May 27. Maybe the Strait of Hormuz is open tomorrow; maybe it is not. I do not know. They are worried that prices are going a lot higher, and they are worried about the knock-on effects of that and what is happening in emerging markets.

My counter to that would be that there are always worries about energy prices and all this sort of stuff. When the Strait of Hormuz situation happened, you heard people saying, “If this isn't open by the beginning of April, it is going to be a disaster.” Then it was the end of April, and it was, “Oh, it is mass destruction. It is the middle of May.” Now it is just like, I do not know.

Oil is one thing where demand destruction and adjustment happen. You can have shocks, but there is a real incentive, and there is a lot of energy outside of the market that can come online. When oil was at $100, there was a lot of energy that was not economic at $60 or $70, and there is a lot of demand destruction.

I just do not know, man. I do not know on energy. But I do see a lot of risks, and the market just keeps powering ahead.

The reason it is powering ahead is not lost on anyone who is following the market. The number-one headliner would be the AI play and all the tech knock-on effects. The number 2 would be all of the space plays over the past—particularly—the past 10 days, as we geared up for the SpaceX IPO.

You would hear people a month or 2 ago saying, “Hey, you want to buy some of these to get ready for the SpaceX hype.” I was very dismissive of that because I thought, “Oh, the markets aren't that easy.” It turns out I guess the markets are that easy, because my God, everything space-related has to be up 50% in the past 10 days. Jesus.

Anyway, the market is really powering ahead largely because of the AI plays, and the secondary effect would be the space-related plays. The reason I think that is interesting is 2-fold.

Number 1, things that are not in the AI trade—things that are not clearly in the AI trade—are trading very differently. I saw 1 statistic that I do not think is quite accurate, but if you are an AI play, you are at all-time highs, have perfect multiples, and are priced for perfection. Anything else is trading like there are a lot of consumer staples trading at global financial crisis levels.

I know some consumer staples companies that are not growing and are probably struggling a little bit, but they are trading for about 7 times free cash flow. It is not like the earnings are about to fall off a cliff. Yes, there are GLP-1 issues and all this sort of stuff, but it is just really interesting.

The other thing is the AI trade. Bubble, not bubble—I do not know. You have probably heard me talk a thousand times about how intrigued I am by AI, all the interesting AI tools I am finding, and all this sort of stuff. I am an AI optimist.

But on the valuations, you start looking at these things, and the past month or 2 has been driven a lot by the semiconductor indices and the memory indices. You look at these things and you look at the valuations, and there is going to be—right now, we are in a supply crunch. There is no question about it. Prices are going up. These companies are going to make money. There is no doubt about it.

But there is going to be a supply response at some point. You look at some of the memory players, and they are trading for about 20 times tangible book. They are probably going to earn, you know, if their tangible book is $50, they are probably going to earn $150 over the next 2 years.

They are still trading at 4 to 5 times 2-years-forward tangible book value after this huge profit cycle. It is just not sustainable. There is going to be supply coming online, whether that is from the Chinese fabs or elsewhere.

Memory supply is an oligopoly, but eventually they always break, and they always bring supply online. If prices stay up here, you are going to see the hyperscalers themselves and the AI companies themselves start building out memory supply, because it is just too much.

It's a bottleneck. It always gets built. Supply always comes online, or they're going to start engineering around memory in some way. I know there's a profitable cycle here, but a lot of these—and I'm not an AI skeptic—valuations look really, really stretched to me.

The last thing I'll point out is the stretch. I think, as an investor, I'm not going to say I know what it felt like to be investing in the dot-com bubble, because in the dot-com bubble, value stocks were going down 10% to 20% every year while no-revenue, crazy dot-com startups just attached “.com” to the name and they'd be up 50% a day, right?

That's not the current market, but you kind of get the feeling of what it was like when all you had to do was say, “I think memory is short,” buy memory, and it just goes up 20% every week—and that might be conservative—or say, “Hey, there's a lot of semiconductors in AI. Let's buy any semiconductor stock.”

If you're doing any detailed work on a value stock, no one cares. You kind of get the feeling. I put up a post today about how concentrated the market is. The S&P is up roughly 10% so far this year. Five percentage points of that are from Google, Nvidia, Micron, and AMD. That's half the gains from these five stocks.

If you expand it to 20 stocks, more than all of the S&P's gains have come from these 20 stocks so far this year. This is a hyper-concentrated market on one specific bet. If you were not in that bet at all, you're underperforming, basically. Yes, you could have bought a biotech that's going up 200%, but pretty much, if you had any underexposure to these specific themes, you're massively down. Everything outside of it is flat, down, or getting hit for the most part.

Again, it's not the extremes of the dot-com bubble. I'm not saying it's a bubble. It's just that, as an active investor, it is very frustrating and a weird market to be involved in when you see one pocket priced for perfection, continuous, constant growth, and every other pocket getting left behind.

Speaking of AI, just sticking with AI, the other thing I think about a lot—and I get a lot of inbounds from people—is that I'm very bullish on AI, but I'm very nervous as an investor. Again, this is my random rambling, so I'm just rambling here. That probably felt pretty unscripted, but sticking with AI, in my former life, I was a consultant.

AI—I’m worried it is coming for all of our jobs. To use the kids' term, I am worried that we are cooked by AI. I get a lot of people emailing me and saying, “Hey, Andrew, why are you so worried about AI?” “Oh my God, Andrew, I can't even remember what the term is. Are you AI-pilled?” I don't know what it is. “AI psychosis?” I can't remember, but people accuse me of AI psychosis.

People ask why I'm so worried. As an investor, your job is one of 2 things. You could say your job is pattern recognition, right? I recognize that this is a good setup to buy the stock. These are 2 sides of the same sword: I've studied the markets, I've studied a lot, and I know when I see a good pattern, and I invest in the pattern. That's 1.

Or you could say it's analysis. I read a lot on these companies, I read a lot on these events, and I do analysis and find something that the market is missing, and that presents a risk-adjusted opportunity. I think I've seen the same thing with the 2.

Why am I worried about AI? If you think of AI, I can read 4 10-Ks in a day, maybe. AI can read 400 10-Ks in 4 seconds. I can pattern-match based on what I've seen. At this point, I'm starting to get the gray hairs—20-ish years of investing experience. AI can have all the investing experience in history, do all the backtesting, and test almost instantaneously, right?

If I'm saying that you, as an investor, are a pattern-recognition machine or an analytical machine, AI has got you beat on both of those fronts, right? Yes, maybe the AI we're dealing with today has too many flaws and too many hallucinations, but the AI we're dealing with 3 years from now, 5 years from now, I don't know. It feels very much like we're cooked.

I know one pushback people would make is, “Hey, Andrew, if you were doing quantitative investing, that's been beaten by machine learning for decades.” The answer is yes, that's true, but I'm worried it's going to start coming for qualitative investing more and more, or the edge diminishes. I don't know—there's less alpha for everyone.

There is 1 interesting counterpoint I've been thinking about today. If you just listen to me, I basically said, “Hey, I'm worried that AI is smarter and faster than all of us.” What happens when you build an AI that is the equivalent of a 200-IQ human, a 300-IQ human, or a 400-IQ human?

Here's the interesting thing: Buffett famously said that if you're an investor with 60 IQ points, you should go and sell 30 IQ points, because being too smart can be a liability in the market. If you've got all these AIs that are investing with a 200 IQ, does that actually create opportunity for investors? I don't know, because I think people are too dismissive of AI when they're saying this.

I could imagine a world where you have all these 200-IQ computers going around and investing. There's a Suits thing where Wharton MBAs come and talk to the lawyers and say, “We went to Wharton. We learned all of your tricks in college, in grad school, or something, in business school,” right?

I'm worried people think, “As a human, I can create these traps that will lure AI into investing in the stock and create an overvaluation or something.” I think AI is probably going to have seen all your tricks. It's going to be that smart.

What I wonder is, if you think about what happens with AI and machine learning, it optimizes. It keeps optimizing. I wonder if AIs are already really involved in investing—maybe we're already there, I don't know. You could say the same thing about indexing, but I wonder if, as AIs get really involved in investing, the increase in optimization actually makes markets more fragile, right?

The world is filled with fat tails. The 1 thing you learn when you see these quantitatively really smart guys, really smart hedge funds, blow up is that it tends to be a left-tail event that gets them. The classic example would be Long-Term Capital Management, right? They had this perfect thing, and if they could have held through and never gotten a margin call or anything, they probably would have made a fortune.

But there were margin calls, and there was what did they say? A 17-standard-deviation move that blew them up, once every 10,000 years. In markets, you kind of get a 17-standard-deviation move once every 3 years, once every 5 years—I don't know. I know that by definition that's a paradox, but markets just have fat tails. There is no such thing as that.

I wonder if, as AIs start investing more, the system gets more optimized, so in the short term there's less alpha, but it gets more fragile. If you're the person who can wait out markets and wait for the fragility, wait for the left tail, I wonder if there's more alpha there.

Again, I'm rambling. I don't know, but it's something I've been thinking about. I am very worried about humans—consulting, investing, everything—because AI is coming. It's fast, it's here, and it's only going to get better. But I do wonder if there's something on the other end where there is light at the end of the tunnel, at least for investors who are able to take care of that.

Speaking of AI, 1 thing I've been thinking about for me personally is flexibility. I was going to say I don't mean flexibility in the can-you-touch-your-toes way, but I actually do mean that. For the past 2 years, I've had a mobility project. As you get older, the joints get creakier and all that, but neither here nor there.

I've been thinking about flexibility in terms of this: if I've known an investor for 10 years, or I've read their investor letters from, let's say, 2016 to 2023, I can guess pretty well what their take on AI is going to be. A lot of famous short sellers are short CoreWeave, and a lot of these guys are saying, “Hey, the depreciation doesn't make sense, the economics don't make sense, this is a bubble, this is a cycle.”

I'm not saying they're right or wrong. This is a bubble. This is circular: Nvidia invests in CoreWeave, and then CoreWeave buys the Nvidia GPUs. Maybe Nvidia invests in the customer that's running the GPUs from CoreWeave. A lot of people accuse it of circularity.

If I had read your letters from 2016 to 2023, I would have been able to guess if you were kind of short AI on that thesis and claiming it was a bubble. I probably would have been able to guess if you were a really tech-forward person and thought this was a memory cycle higher for longer. We should talk about the memory cycle 1 more time in a second.

I probably could have guessed if you thought AI was going to revolutionize the world, drive 5% GDP growth going forward, buy everything AI, and maybe sell everything else. I could probably guess just based on how you were as an investor and your mindset.

I've been thinking about that. The fact that so many people—everyone who was doing macro—instantly said Nvidia is a bubble, Nvidia and AI and everything is a bubble, watch out, get ready.

The fact that everybody who was more into the tech weeds was instantly saying, “Hey, AI is the future—the memory cycle’s over, the semiconductor cycle’s over, higher for longer, it’s going to take over the world, and we’re going to have AGI within 4 years,” just seems weird to me. I’ve been wondering, “Where’s the mental flexibility?” I’m talking about other people, but I’m also projecting: “Am I being mentally flexible enough in everything?”

I think I’ve been experimenting with AI in particular, but I haven’t really invested in anything AI-related. I’m looking at it and saying, “Hey, Andrew, you were playing around with these tools, but you didn’t short any SaaS companies.” I don’t do a lot of shorting, but you didn’t short any SaaS companies. Shouldn’t you have seen that based on the play?

I think I was reasonably early to using Cowork and all this sort of stuff as an investor. I was kind of early on that, but I didn’t think, “Oh, this has bigger legs than people think. Maybe we should be buying—pick your semiconductor stock. I don’t know.” Or on the power trade: I looked at a lot of power. I have a history of investing in bankrupt power companies, and I didn’t make any money buying power trades.

I’ve just been thinking, “Hey, Andrew, were you too wedded to the idea that, in 2016, when you thought, ‘All power is a commodity,’ you didn’t see what could happen and what became a bottleneck?” I’ve been thinking about how strange it seems that, having read someone’s letters for 5 years in a completely different market environment, you could have predicted how they would think about AI. Shouldn’t there have been people who did macro from 2016 to 2020 who, in 2023, were saying, “AI is going to be revolutionary”?

Or shouldn’t there have been someone who was investing in Google, investing in Facebook, and all this sort of stuff who, when AI started coming out, said, “Hey, actually, I think all of this is overhyped”? I feel like there should have been some, but I don’t know of anything, and it seems strange.

Sorry for rambling, but back to the state of the market: one thing that has worried me is that there are a lot of really sharp VCs, market historians, stock market guys, and tech guys whom I have a lot of respect for and learn a lot from. It worries me that so many of them are saying the cycles are over—not economic cycles, but memory cycles and semiconductor cycles. We’ve gone from cyclical to structural. There’s just permanent demand forever. I feel like I’ve heard this before about a lot of different things, and it always comes right before the cycle hits even harder.

I think the famous example would be 2006 or 2007, when people started saying, “Hey, macro cycles are dead. With the Fed and our tools, we can engineer the economy to avoid recessions.” Maybe they were right, because we basically had a depression instead of a recession after they were saying that, but I really worry. I hear you: the demand for memory is huge, the demand for semiconductors is huge, and AI is just pulling everything in.

But you just do not have these businesses where it is a commodity at its core; billions of dollars get pumped in. It’s just impossible to avoid. Eventually, people are going to have a supply response. They’re going to build, and eventually the demand is going to tick down a little—or even if it doesn’t tick down a little, the rate of change needs to come down a little.

But even if that doesn’t happen, eventually you just overbuild the crap out of it, and eventually you’re going to have a cycle. Eventually you’re going to be overbuilt, and eventually the marginal price can’t be 5,000 times the marginal cost forever. It’s going to happen. We’re going to have a cycle, and I feel pretty confident in saying that.

Let’s go to the last 2 things. I’ll keep these quick, because I don’t even know how long I’ve been rambling, to be honest. [Laughter.] One thing I’ve been obsessed with is—full disclosure—I’ve got a little bit of the long Bitcoin, short MicroStrategy trade on, and I’ve had it on and off for a while. I’ve just been obsessed with this trade.

Last year, I wrote a lot about the digital asset companies and how silly I thought they were. MicroStrategy is the largest, and they’re very creative in finding ways to finance themselves, but ultimately you’re financing a financial asset with 10% preferred equity and all these things. To me, it doesn’t add up.

One thing I’ve been thinking about is this: I encourage anyone who’s interested in the markets to read MicroStrategy’s Q1 earnings call and look at their Q1 slide deck. It’s crazy. MicroStrategy was 8% of the equity issuance in 2025. They’re 10% of the equity issuance so far in 2026. I’m sure that will go down as you have the SpaceX IPO and the Anthropic IPO, but these guys are hitting the capital markets at a scale that we’ve never seen.

The one that really blows my mind is that they are 60% of the equity issuance in preferred equity so far this year. I think they were 33% of the equity issuance in preferred equity last year. Preferred equity as a market is basically MicroStrategy’s preferred equity market right now, and that is crazy to me.

I wonder if the MicroStrategy trade ever goes sideways. There are ways it happens. It generally involves Bitcoin going to $50,000, and they get into the kind of perpetual-motion machine where their stock trades above NAV: they issue stock above NAV to buy Bitcoin, and that increases their NAV, so they keep doing that.

Guess what happens when you’ve issued $10 billion-plus in preferred equity that pays a 10% dividend per year and Bitcoin trades from $75,000 to $50,000? That cycle does not look good on the other side. They can say, “Oh, we’ll sell,” or, “We don’t have tons of...” It does not look good on the other side.

If there is that other side, I do wonder: is MicroStrategy going to blow up preferred equity? Preferred equity was a very small corner of the market, generally tapped by banks and financial companies. But if MicroStrategy, let’s say, does this for another 18 months and they’re 60% of the preferred issuance for another 18 or 24 months and something negative happens, they’re going to blow up the preferred equity class. It’s just wild to think about the scale, the size, and all that sort of stuff.

I really want to say this because, if you have not read these Q1 calls, go read them. As someone who’s financially sophisticated, on the one hand you’re going to be like, “Wow, this is a really interesting way of thinking about it.” Then you’re going to think about it for a second and be like, “Wait, what? They’re talking about issuing preferred to go buy Bitcoin at 10%, and they think they’re going to make money because Bitcoin’s going to go up 20% per year. It’s free. It’s just so crazy what they’re doing.”

I could go on for hours and hours. The last thing I want to talk about: my friend Artem Fokin—I’ll give him credit for this, though we’ll see if he’s listening all the way through. I won’t disclose the company we’re talking about. We’re talking about a company, and let’s just say it’s a $100 million company.

They hired a new CFO who came to them from a company that was, let’s call it, a $500 million company. The new CFO was the CFO at that company. We were talking about that, and that is so rare. If they had hired the chief accounting officer of the $500 million company to come be their CFO, that would make sense. You go from a larger company to a smaller company, but you get a promotion.

To go from a larger company to a smaller company in the same role is super unique. I’ve just been thinking about that signal. I’ve been into the corporate dark arts recently. That’s management teams finding ways to say their stock is undervalued and get more exposure to the stock.

Here you’ve got a CFO or C-suite member, whatever it is, calling their shot. You go from a $500 million company to a $100 million company, you’re probably getting paid less. You’re really calling your shot in terms of, “Hey, I see the growth potential here. I see the equity value here.”

The counter to that would be, “Hey, this CFO might have been overmatched at the $500 million company. Maybe they saw they weren’t long for that $500 million company. Or maybe they saw the $500 million company was in for a very rocky ride, and they wanted to get into a steadier boat.”

I very rarely see it, and I’m not trying to trade it. I have no position in either of the companies where that happened. It’s just one of those things where I’ve been thinking about the signal in a C-suite person moving from one company into another, and how you view that signal as an investor.

Is it a mark on the management team? Is it a mark on the company they join? Is it a mark on the company they’re leaving? It probably is very situation-dependent, and it’s probably some combination of all 3.

But it’s just a really unique example that’s been stuck on my mind. Really unique examples are some of the things I like to look at, think about, and invest in the most, and increasingly, they’re what I’m really focused on. That’s one that’s just kind of stuck in my brain, just played in my brain over and over.

Anyway, I’ve been rambling—probably 30 minutes, I don’t know, 45 minutes. I wasn’t keeping track of the clock. This has been great. It is, again, May 27th, the end of May. We’ve got some good podcasts coming up. I’ll talk to you guys for another random rambling at some point, and we’ll go from there. Have a good one. A quick disclaimer. Nothing on this podcast should be considered investment advice. Guests or the hosts may have positions in any of the stocks mentioned during this podcast. Please do your own work and consult a financial advisor. Thanks.