Hi Multis
Tuesday afternoon, I got back home from Omaha (and fell asleep on the couch within 15 minutes of my arrival; jetlag is real).
That’s also the reason you didn’t get an Overview Of The Week last week, so this is one for two weeks. Shoutout to Mark for always being there to assist me with the OOTW!
An OOTW of two weeks means we’ve got a lot to cover, so let’s dive in right away!
Articles In The Past Weeks
Last week, I published my article on Celsius and you can expect a new one soon, as the new results are already out.
This week, this is already the fourth article.
The first one was about Omaha, Berkshire and 5 lessons. I hope to see you next year in Omaha, the festival for investors.
The two other previous articles were on earnings, both of stocks that have seen big declines recently.
On Friday, you got a deep dive into Duolingo’s earnings. And yesterday, I published my theory about the battle The Trade Desk is waging.
Memes Of The Week
Multi Flo is the Meme King, as we all know. And he proved that again this week by sharing this, asking what stage of the cycle we are in?
And Flo knows his classics.
I also had to laugh with this one. I sent it to some value investors. :-)
We all know about the Hanta virus by now. But we don’t have to worry about it, haha.
Markets are not the same anymore. Or are they?
Multi Dheeraj shared this funny one.
I laughed out loud with this one.
This is the last one of the rich harvest this week. You need some reading but it’s worth it.
Interesting Podcasts Or Books
I read Atomic Habits on the plane to and from Omaha. It’s a classic and maybe that’s why I had expected a bit more of it, but it’s still a good read.
The markets in the past week
As you can see, the Nasdaq was up 5.68%, the S&P 500 by 3.26% and the Russell 2000 by 2.66%.
More thoughts about this later in the article.
I don’t think it’s a big surprise that the Greed & Fear Index is in Greed territory.
It actually feels more like extreme greed.
Quick Facts
1. Are We Near The Top?
This is what I wrote two weeks ago:
This is a weird market. Despite Iran and the ensuing energy crisis, the indexes are at all-time highs. The fact that this is exceptional can be seen in this Bank of America chart.
I want to point out a few other elements to show how exceptional this market is, and probably not in a good way.
While the S&P 500 is at all-time highs, just 42 of the 500 stocks contribute to the upside performance. Usually, that’s around 100. That means that the average stock in the S&P 500 has been struggling.
Just look at this chart.
Based on the following metrics, US stocks appear expensive or very expensive right now. This is a Charles Schwab table.
And this is another one that shows markets are expensive.
As you can see, only Health Care trades at a normal level vs the 30-year trend. All the rest is expensive. As for the last decade, Materials, Health Care, Energy and Financials are more or less around the 50% mark. Again, everything else looks pretty expensive.
Now, we all know AI could boost productivity a lot and that could mean that what looks expensive could be reasonably priced in hindsight. But I think AI will need a breakthrough moment for that like DeepSeek was one. With the AI-related stocks, especially semis, going vertically, the stock market keeps frontrunning AI efficiency gains. That’s normal, but it also means the expectations could be inflated too much. But even if that is the case, it could mean there is another leg up.
Someone asked Grok a good question.
Someone asked an intelligent follow-up question, though. And that shows how hard market-timing is.
Something else that might illustrate the forming bubble is this.
As you can see, the defensive sectors have the lowest market cap ever, even smaller than in 2000. And that is with Walmart at a forward PE of 45 and Costco at a forward PE of 49.
Michael Burry, who has predicted 27 of the last 3 bear markets, said that the markets feel like the last months of the 1999-2000 bubble. I don’t agree and this guy on X pointed out that Burry is often bearish.
This starts to feel like 2021, though. I even got questions from some Multis on “why I missed AI completely” while I’m long AMD, TSMC, Nvidia, ASML, Cloudflare, CrowdStrike, Broadcom, BESI, and others. I also pointed out the opportunity for Micron about 400% ago.
In 2021, the rise of meme stocks led me to make my worst investment ever: Skillz. It was a tiny position in my portfolio (less than 0.1%), but it still stings that I was fooled into believing the market conditions were normal.
But back to the market.
This is the Schiller CAPE ratio:
At the same time, even if you only poured all of your money into the Nasdaq 100 exactly at the top of the tech bubble (which would be a pretty awful strategy), you would still have averaged a yearly return of 8.2% at this moment.
That is the power of long-term investing.
There are many warnings out there now. Look at this one, for example.
As everyone knows, correlation is not causation, but there are quite a few signs pointing in the same direction.
This is another one.
But this doesn’t mean you should time the market. There’s also this.
If so many people are hedged, that can have the opposite effect and there could be a gamma squeeze. When you buy a call, market makers (think of Citadel) sell it to you, but they have to buy the underlying stock or ETF. That drives up the prices, causing more calls and Citadel and others buying more stocks. That causes the gamma squeeze.
But at the same time, such high call volumes have often marked tops. And a lot of the calls are zero-day calls, which are the most volatile of them all. It’s not particularly a sign that the markets are healthy, but that there is a lot of speculation. But you probably didn’t need this explanation to know that. You can also see that in this chart. It shows that high-beta stocks hit an all-time high relative to the S&P 500. The “safest” stocks hit all-time lows.
But there are counterindicators as well. If you look at the IPOs, for example, you don’t see a boom there yet. At the same time, I have already said multiple times I believe there is a bubble in private markets, with companies like SpaceX, Anthropic, OpenAI, Loveable, Stripe and other companies mostly linked to AI. That could explain why there is no surge in IPOs.
But with SPACs, NFTs, web3 and other crazy stories in 2021, it went pretty wild. I don’t have the feeling we are there yet.
But you can’t really know and the best thing is to keep investing. But if you are worried about the markets, you might have some bigger cash cushion now.
2. ServiceNow Dead? Nvidia Doesn’t Think So.
At ServiceNow Knowledge 2026 in Las Vegas, Nvidia CEO Jensen Huang went on stage with ServiceNow CEO Bill McDermott to show how the two companies want to partner to make enterprise AI more than just some chatbots.
ServiceNow launched Project Arc, an autonomous desktop agent. The system can figure out tasks, write code, use enterprise apps, access files and terminals, and adapt when workflows change. Instead of using rigid automation scripts, the agent works more like a human employee who has to deal with unexpected situations.
Nvidia’s Jensen Huang said software is moving into a big new market. Factories, logistics, warehouses, and supply chains will all be automated with AI. He said that the entire factory will be a robot and it will be managed by AI agents. The partnership between Nvidia and ServiceNow is based on that vision. ServiceNow will take of the rules, approvals, and workflow management for AI agents, while Nvidia provides the chips and secure software environment that lets the agents run safely.
ServiceNow CEO Bill McDermott said many companies are deploying AI without proper controls, creating major security risks. The Project Arc platform is a safer way to scale agentic AI across the enterprise.
Huang also said agentic AI requires about 10x more compute than earlier generative AI systems because agents must reason, use tools, and execute tasks continuously in real time. Of course, that’s a huge driver for Nvidia chips.
FedEx was there as well. The company served as a real-world example of this. The company already runs millions of ServiceNow workflows monthly while building AI-driven digital supply chain systems.
This is interesting, as we all see the limitations of current AI applications at the enterprise level.
3. 1 In 8 Americans Now Use GLP-1 Drugs
I saw this graph this week.
12.4% of Americans are already on GLP-1. That’s wild if you think that just over a year ago, in February 2025, that number was 5.8%. I think we are just at the beginning of this trend.
As usual, Fiscal ai has the data precisely.
This shows that Eli Lilly is winning the battle with Novo Nordisk. And with retatrutide, a so-called triple G receptor agonist (GLP-1, GIP, and glucagon) in Phase 3 trials and label expansions (think of alcoholism, for example), I think the stock is interesting here. “Reta,” as it is already known, showed even greater weight-loss effects (up to 28.7% of body weight), as well as type 2 diabetes (not surprisingly) and knee osteoarthritis.
Retatrutide may be even a bigger blockbuster than Zepbound and Mounjaro. Novo Nordisk might look much cheaper, I wouldn’t want it in my portfolio. Look at the revenue growth projections for the next two years.
Compare that to Eli Lilly:
And I think that the 2027 estimates will be way too low if the company can release retratrutide in 2027, which is expected.
If you are a free reader, it stops here for you. There is a ton more if you become a paid subscriber.