Episode summary
Why the AI Bubble Hasn’t Popped — ft. Josh Brown | Prof G Markets
Prof G Markets
· · 45 min · Hosts: Ed Elson, Scott Galloway · Guests: Josh Brown
Summary
Josh Brown argued that the late-2025 AI panic was mostly a price-action story, not evidence that the trade had already broken. He said investors who focused on valuation, semiconductor strength, and the lack of a real collapse in public-market leaders were better served than those reacting to what he called wish casting around Oracle, OpenAI, and the broader data-center buildout. His core framework was simple: when in doubt, follow price, because prices reflect what real money is actually doing.
Looking ahead to 2026, Brown said the key question is whether fundamentals can justify above-average multiples, and he thinks they can. He pointed to consensus expectations for 8.6% Q4 earnings growth, 25.8% technology earnings growth, and 14.6% full-year S&P 500 earnings growth in 2026 as evidence that the market has room to keep supporting current valuations. He also argued that AI’s return on investment is already showing up in productivity, margins, and new applications across healthcare, financials, and enterprise software.
Brown was far less focused on the Federal Reserve or deficit spending than on earnings and margins. For young investors, he said the right mindset is to welcome corrections, because they accumulate shares at better prices. His career advice was equally blunt: solve the problems of wealthy people and make yourself indispensable to clients or employers with money.
Key takeaways
- Josh Brown said the AI bubble story was overstated because public-market prices never confirmed a true breakdown in the trade.
- Brown thinks 2026 earnings growth can justify roughly a 21x S&P multiple if Wall Street’s forecasts hold.
- He sees AI showing up first in margins, productivity, and enterprise use cases rather than in a single measurable consumer ROI.
- Brown said the Fed is likely a minor market driver this year compared with earnings and capital spending.
- For young investors, Brown wants lower prices, not record highs, because corrections improve long-term accumulation.
Notable quotes
“prices are more important than opinions and prices represent the sum total of people who actually manage money and are voting with their money”
“The only questions that matter for this year. Number one, will the fundamentals continue to justify an above average price earnings multiple”
“I think the Fed this year is a bishop at best”
How the episode opens
Today's number 54. That is the percentage of men who have some form of facial hair, up from 42% 10 years ago. According to surveys, most men don't actually like their beard at first, but then it grows on them.
Okay. — Oh, I was supposed to Oh my god. — No, no. If you don't find it funny, then that that's just what we do. So, — I did, but it was a delay. It was a delayed reaction. I did find it funny.
Welcome to Propy Markets. Scott is still on vacation, but we are back in action and we are kicking off the year with the one and only Josh Brown, co-founder and CEO of Rhett Holtz. Josh, welcome back to the show. It's great to see you.
Great to see you. I apologize for dressing like the great and powerful Oz. I I didn't pick up on it until I saw myself on a video screen. That's That's what I'm That's the energy I came into the year with.
I love it. You're looking good. How was your How was your holiday? How was your new year? — So sick. Oh, yeah. — So great. I You know what? I've been in Florida for 2 weeks. I have a tan. — You look good.
The weather sucks here predictably, but like it's not even bothering me. Um I just uh I had an amazing couple of weeks for the holidays and uh I feel good. Ready for uh 26. ready to rumble, ready for 2026. Okay. Well, let's get right into it. Um, lot of questions I want to ask you. Uh, we haven't had you on since the summer and a lot has happened since then. We had the government shutdown.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- ai bubble
- market outlook 2026
- earnings growth
- federal reserve
- investor advice
Companies and tickers mentioned
- Ritholtz
- Fundstrat
Watch the episode
Watch “Why the AI Bubble Hasn’t Popped — ft. Josh Brown | Prof G Markets” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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