Pietari Laurila
United Arab Emirates
3m
ᴡᴇᴇᴋʟʏ ᴜᴘᴅᴀᴛᴇ 15 ꜱᴇᴘᴛᴇᴍʙᴇʀ 2025 US technology stocks are extending their extraordinary run, outperforming every other sector over the past six months. The question for investors is whether this marks the early stages of a multi-year melt-up powered by artificial intelligence, or the final stretch of a bubble that is close to bursting. The bullish narrative rests on robust earnings and unprecedented investment. TSLombard notes that the largest tech firms spent nearly $90bn in the last quarter alone on data centres and AI infrastructure. That capex is already flowing through the revenues of their suppliers, fuelling what looks like a self-reinforcing cycle of demand for the picks and shovels of the AI age. Unlike the late 1990s, today’s mega-caps are hugely profitable, entrenched in their markets and trade on 25–50 times earnings, far below the 40–500 multiples of the Dotcom era. The bear case begins with the technology itself. Scaling large language models appears to deliver diminishing returns, while reliability, energy intensity and data demands remain unresolved. That raises doubts about whether the financial pay-off from vast investment will keep pace with expectations. Profits across the value chain are flattered by circularity: what the hyperscalers spend shows up as revenue for their vendors. At the top of a cycle this flatters earnings, but it leaves the system exposed to any pause in spending. The collapse of Cisco after 2000 was not about the internet’s failure but about the abrupt halt in infrastructure build-out once hype outstripped demand. The fundamentals of the technology sector look stronger than in 2000. Today’s leaders are profitable, dominant and cash-rich. But macro conditions are far less forgiving than they were a quarter-century ago. De-globalisation, recurring supply shocks and structurally looser fiscal policy are keeping inflation sticky and bond yields high. That makes it harder for investors to justify extreme valuations on growth stories whose profits lie years in the future. In the near term, looser Fed policy may keep technology buoyant. But a bubble on the scale of 1999-2000 looks unlikely. My core conviction instead echoes Bank of America’s Michael Hartnett: “ABD”, or Anything But the Dollar. That should mean stronger performance from gold, crypto and international equities in the years ahead. www.investing.com/news/stock-market-news/2025-to-mark-the-start-of-the-new-abd-trade-bofas-hartnett-4236632 𝟮𝟬𝟮𝟱 𝗽𝗲𝗿𝗳𝗼𝗿𝗺𝗮𝗻𝗰𝗲 YTD +30.3% 𝗣𝗼𝗿𝘁𝗳𝗼𝗹𝗶𝗼 𝗰𝗵𝗮𝗻𝗴𝗲𝘀 None 𝗖𝗼𝗻𝘁𝗮𝗰𝘁 www.triangulacapital.com 𝘛𝘩𝘪𝘴 𝘤𝘰𝘯𝘵𝘦𝘯𝘵 𝘪𝘴 𝘧𝘰𝘳 𝘪𝘯𝘧𝘰𝘳𝘮𝘢𝘵𝘪𝘰𝘯 𝘰𝘯𝘭𝘺. 𝘐𝘵 𝘪𝘴 𝘯𝘰𝘵 𝘢𝘯 𝘰𝘧𝘧𝘦𝘳 𝘰𝘳 𝘳𝘦𝘤𝘰𝘮𝘮𝘦𝘯𝘥𝘢𝘵𝘪𝘰𝘯 𝘵𝘰 𝘣𝘶𝘺, 𝘩𝘰𝘭𝘥 𝘰𝘳 𝘴𝘦𝘭𝘭 𝘢𝘯𝘺 𝘪𝘯𝘷𝘦𝘴𝘵𝘮𝘦𝘯𝘵, 𝘯𝘰𝘳 𝘭𝘦𝘨𝘢𝘭, 𝘵𝘢𝘹, 𝘰𝘳 𝘧𝘪𝘯𝘢𝘯𝘤𝘪𝘢𝘭 𝘢𝘥𝘷𝘪𝘤𝘦. 𝘗𝘢𝘴𝘵 𝘱𝘦𝘳𝘧𝘰𝘳𝘮𝘢𝘯𝘤𝘦 𝘪𝘴 𝘯𝘰𝘵 𝘪𝘯𝘥𝘪𝘤𝘢𝘵𝘪𝘷𝘦 𝘰𝘧 𝘧𝘶𝘵𝘶𝘳𝘦 𝘳𝘦𝘴𝘶𝘭𝘵𝘴.
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