Below are some of the most interesting things I came across this week. Click here to subscribe to our free weekly newsletter and get this post delivered to your inbox each Saturday morning.
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Many people are wondering how, with everything going on in the world, the stock market could be making record highs. Kyla Scanlon explains, “The markets are showing the single lesson that the past 40 years have taught them. It will always be saved. Markets are not properly pricing risk, because they really don’t have to.”
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There is also a great deal of enthusiam around the AI boom. However, as John Authers writes, “Several unicorns, led by SpaceX and OpenAI, are planning initial public offerings this year. As ever when insiders at a company decide to sell, IPOs can signal trouble ahead. Two of this century’s biggest IPOs marked the top for entire markets and asset classes.”
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And, as Ed Zitron notes, there are, “signs that the AI bubble is bursting: Anthropic’s services and economics are decaying, AI demand is inflated, more than 50% of data centers under construction are for two companies, and NVIDIA is warehousing $150bn+ of GPUs.”
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Meanwhile, the world is changing in ways that have important ramifications for markets. As one market strategist tells Bloomberg, “I suspect a lot of people are still in denial that the world has changed. Covid-19 and Russia-Ukraine were wake-up calls, but we seem to have hit the snooze button. The alarm has gone off again now.”
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One of those changes involves energy security. “The past decade has brought a rapid succession of global energy crises, driven by military conflict, extreme weather and supply-chain snarls. As today’s highly interconnected oil and gas markets become more fragmented and the low-carbon transition accelerates, recurring shocks may be becoming the norm,” writes Ron Bouso.
BONUS
I discussed these topics and more this week with Mining Stock Daily. Watch the interview on YouTube.
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