Episode summary
14% for Tech. 1% for Everyone Else | The Weekly Wrap – 3/14/2026
Excess Returns
· · Hosts: Jim Paulsen · Guests: Vitaliy Katsenelson, Joseph Shaposhnik
Summary
The episode argues that investors need more humility because AI, geopolitics, and policy shifts have widened the range of possible outcomes. One guest says that uncertainty has pushed him from a roughly 20-stock portfolio to about 30 holdings, not because he is more certain, but because he is less certain. That same logic shows up in the repeated emphasis on survival, diversification, and staying flexible when the world changes quickly.
A second major theme is AI disruption in software. One guest says the software sector is only in the “first inning” of meaningful disruption and that decentralized, learning-oriented management teams are better positioned than top-heavy organizations. The discussion also highlights how a company like Constellation Software has adapted by changing capital allocation and leaning into public software investments.
The macro backdrop is framed as a split economy: a small “new era” segment is growing far faster than the rest, while the broader economy remains sluggish. The episode closes by connecting that divide to defense spending, with one guest arguing NATO rearmament could create a roughly trillion-dollar tailwind over the next 10 years, even as short-term headlines continue to create noise.
Key takeaways
- One guest says humility matters more now because the range of outcomes has widened across AI, geopolitics, and macro policy.
- A guest says he shifted from about 20 stocks to 30 holdings because he has less confidence in individual stock forecasts.
- The software business model looks less secure, and the episode argues that learning cultures and decentralized management are better positioned to adapt.
- Jim Paulsen’s framework says the “new era” is only 11% of private GDP but is now driving a disproportionate share of growth.
- A guest sees defense as a structural opportunity, and expects NATO defense spending could rise by about $1 trillion over 10 years.
- The episode argues that investors should be “least wrong,” survive first, and let the right tail stay open.
Notable quotes
“you need a lot of humility because in the world that's changing so fast, the range of possible outcomes at anything you look at got wider”
“I have less confidence in my decisions today for many stocks than I ever had before”
“Real newer era spending is up 14 times faster than the rest of the economy”
“We think that over the next 10 years spending on um defense could increase by a trillion dollars”
How the episode opens
You need a lot of humility.
And you need a lot of humility because in the world that's changing so fast, the range of possible outcomes at anything you look at got wider. Real newer era spending is up 14 times faster than the rest of the economy. There's 14% growth in real new era spending and there's 1% growth in the remaining 89% of real spending.
One of the long-term growth opportunities that that I see that we see uh is is the growth in spending by uh by NATO countries in in the area of defense. We think that over the next 10 years spending on um defense could increase by a trillion dollars.
I would suggest 90% of the economy is already in recession. So if if we bring the policy juice finally, it probably won't be that out of character from other times. What makes this interesting is that's generally the description of a brand new bull market.
Welcome to the excess returns weekly recap. I'm Jack Fehand and I'm I'm joined here by a man who is literally repping both Banksy and DA on his wall as as I found out last time.
Thanks to the YouTube commenters who noticed. I want to give a shout out to my my Peanuts J Dilla back there too. Just like you know round out the collection on top of my Wolsberry Scranton Red Baron's hat.
Vintage from the right era before the Yankees stole them stole them from us and replaced us with their farm team. Well, I was trying to figure out, should I be impressed with myself that I actually know what those things are, or should I be embarrassed that I've done like a hundred episodes with you and I did not realize you were rubbing either one of those things on your wall and like a YouTube commenter picked it up right away.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- ai disruption
- investing humility
- policy juice
- defense spending
- valuation headwinds
Watch the episode
Watch “14% for Tech. 1% for Everyone Else | The Weekly Wrap – 3/14/2026” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
More from Excess Returns
-
An AI Bubble Could Hit Stocks. Inflation Could Hit Bonds. How Do You Diversify and Keep Both? -
Tech Is Priced for a Boom. 86% of the Economy Grew 0.7%. What If AI Slows? -
Tech Is the Cheapest Since 2022. Walmart Is 46 Times Earnings. Where Is the Bubble? -
This $1.5 Trillion Manager Expects More Fed Hikes. So Why Is He Still Bullish? -
AI Stocks Cracked. Margins Could Be Peaking. So Why Is a Liquidity Expert Watching the Debt Wall? -
The AI Trade Is Cracking | Peter Boockvar on What to Own Instead
Excess Returns, this episode and its artwork belong to Excess Returns. Octagon is not affiliated with the show; this page is an independent summary.
