AI Super Cycle or Dot-Com Deja Vu? $700B in Capex Says This Time Is Different
Sentiment is terrible, Iran is (maybe) making a deal, and AI capex is eating the world — a lot is happening at once
Ticker Ratings
Here's the paradox nobody's talking about: the market is sitting near all-time highs while sentiment indicators like the Michigan Consumer Survey are scraping near all-time lows. Fundstrat flagged this in a recent YouTube deep-dive, and their point is sharp — real market tops look euphoric, not paranoid. When a 2-3% dip turns retail investors into full-blown doomers, that's not a topping signal. That's a wall of worry, and markets famously climb those.
Meanwhile, The Traveling Trader is sounding the alarm on an AI infrastructure super cycle backed by something the dot-com era never had: actual revenue. $NVDA, $MSFT, $META, $AMZN, and $GOOGL are collectively deploying over $700 billion in capex, and Goldman Sachs projects the AI optical networking market alone is set for explosive growth. The wealth transfer is already flowing downstream to photonics, memory, and data center plays.
Macro wildcard: a potential Iran deal — 60-day ceasefire, Strait of Hormuz reopening — could kneecap oil prices short-term and ease inflation pressure. Bearish consumer data (Americans paid $2 billion more for gas this Memorial Day vs. last year, with new car payments averaging $753/month) is real, but if sentiment is the contrarian indicator Fundstrat thinks it is, the bears might just be the market's most reliable fuel source.