Episode summary
Guy Adami: The Market Is Pricing In "Great Expectations"
On The Tape
· · 32 min · Hosts: Danny Moses, Guy Adami
Summary
The host and the guest argued that the market is being pulled between strong seasonality and a growing list of policy and valuation risks. They said the S&P 500 looks resilient on the surface, but beneath it the leadership in semiconductors and other AI-linked names has weakened, raising questions about whether the AI trade can keep carrying broader equities. The guest called the setup a massive inflection point, with investors forced to weigh inflation, higher rates, and a possible slowdown in data-center spending all at once.
A major focus was CoreWeave and Anthropic. The guest said CoreWeave’s model depends on expensive GPUs staying valuable for years, while its debt load and depreciation assumptions may be too generous. On Anthropic, the guest argued the amended S-1 suggests a valuation around 1.4 to 1.5 trillion, but also shows slowing revenue growth and circular financing, with hyperscalers and chip companies effectively funding the ecosystem that depends on them.
They also discussed Nvidia’s central role, including the possibility that regulatory or reputational issues could affect its ability to support the broader AI complex. On the macro side, both said rising two-year yields, a higher cost of capital, debt and deficit concerns, and a possible 50bp Fed hike are still not priced in. The guest said he remains a buyer of energy and gold on weakness.
Key takeaways
- The host and the guest think the S&P 500 is masking a real fight beneath the surface as semiconductor leadership fades and AI-related names wobble.
- The guest said CoreWeave’s economics depend on GPU prices staying elevated and questioned whether its chips should be depreciated faster than six years.
- The guest said Anthropic’s amended S-1 implies a roughly 1.4 to 1.5 trillion valuation, but revenue growth is slowing and the deal structure is circular.
- They said rising two-year yields and a possible 50bp Fed hike raise the cost of capital and are not fully reflected in current prices.
- The guest said he is still a buyer of energy on weakness and remains constructive on gold over the longer term.
Notable quotes
“the price of GPUs is going to remain elevated. maybe it will for a prolonged period of time, more than seven years in order to make this model potentially work”
“revenue growth is actually slowing for anthropic. They're dependent on token prices. We know those are getting crushed”
“the one thing that hasn't that has changed since the election, the stock market might be flat, but yields are higher, especially the two-year yields are higher”
“I feel like when these energy companies get whacked on commodity prices moving sharply lower for a day or two and they get, you know, oil goes down 5 to 7% and these stocks go down 20, you buy them”
How the episode opens
Welcome to the On the Tape podcast. I'm your host Danny Moses and in this episode we are going old school as Guy Adami and I sit down for a live episode of Market Call and discuss what's happening in the markets. We discuss the latest in the AI trade which not only never has a dull moment but now has added a new soap opera element as well.
While this time of year, especially post a midterm election, tends to be less volatile and bullish for the markets, there's a lot to digest, and we discuss what lies ahead in both equity and bond markets. Lastly, we put out a note on our what are we doing contrarians at the gate subsack this week, which takes a look back at all the interventions we have seen from the Fed and Treasury since 2008 to deal with financial shocks to the economy and how these previous acronyms like TAP could be resurrected in the future if need be. Please enjoy our lively conversation.
A special market call for a number of reasons. Um, in no particular order, you can see the man, the handsome man there with a tremendous backdrop. Is that the Williamsburg Bridge?
I'm not exactly sure what that is.
That would be the 59th Street Bridge. — 59th Street Bridge made famous by uh Simon and Garfuncle for those Simon and Garuncle fans out there. That of course is the great Danny Moses. Danny Moses of the On the Tape podcast and of course Friday Night. Welcome Danny.
Great to be with you guy. — Danny will echo this following statement uh on the 11th day 11th hour of the 11th month. This is I believe in 1919. Don't at me if I'm off by a year, but basically it was called Armistice Day when the hostilities in World War I ended.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- ai trade
- nvidia pullback
- chip depreciation math
- fed rates cost of capital
- energy and gold buyers
Companies and tickers mentioned
- NVDA
- Nvidia
- CoreWeave
- Anthropic
Watch the episode
Watch “Guy Adami: The Market Is Pricing In "Great Expectations"” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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On The Tape, this episode and its artwork belong to RiskReversal Media. Octagon is not affiliated with the show; this page is an independent summary.
