Is Wall Street Wrong About AI? | Prof G Markets

Boring stocks are winning in 2026 because investors have rotated away from the AI-heavy MAG 7 and into consumer staples, energy, materials, and other defensive names. The host argues the market is not necessarily fleeing equities, but instead shifting into cheaper, lower-growth businesses that look safer after tech’s huge run-up. The guest agrees the move reflects a real change in sentiment, but says the so-called safe stocks now look expensive too, with consumer staples, utilities, and energy trading at historically high multiples.

Both hosts argue that the market has flipped its narrative in a matter of weeks. They also push back on the idea that AI will destroy enterprise software, noting that switching costs are high and that Microsoft and Amazon are not cleanly on the losing side because they own major stakes in OpenAI and Anthropic. The guest says software may actually be more recession-resistant than consumer staples because companies cannot easily rip out core systems like Salesforce or ServiceNow.

The wealth tax debate centers on fairness versus feasibility. The guest says the ultra-wealthy are under-taxed, but argues a wealth tax would be administratively messy, easy to evade, and likely ineffective. A better approach, in the guest’s view, would be taxing borrowing against assets, eliminating carried-interest treatment, and changing capital-gains rules. On AI, both hosts say the political backlash is growing fast as higher electricity bills, data-center opposition, and distrust of billionaires turn AI into a mainstream political issue.