Episode summary
Liz’s 2026 Outlook: AI, Stocks, Gold, and What Investors Should Watch | The Important Part
The Important Part
· · 31 min · Hosts: Liz Thomas
Summary
Liz Thomas opens 2026 with a broadly optimistic outlook: she thinks the odds of a Fed hike are low, rates should drift slightly lower, and policy is still loosening rather than tightening. She points to cooling inflation, a weakening labor market, and the Fed’s December move to buy Treasuries again at $40 billion per month as signs that the central bank is not preparing to raise rates soon.
She argues that the market can still do well after three years of more than 80% S&P 500 upside, but returns are likely to be more muted and less broad. AI-related capex and earnings strength remain central, yet she expects more bifurcation across stocks and some rotation out of the most crowded names. Her base case is to stay constructive on big tech while adding diversifiers such as healthcare, materials, and cash-rich companies.
On precious metals, Thomas still likes gold and thinks central-bank demand and geopolitical stress support the trade, while she is more skeptical of silver after its parabolic run. She also sees midterm-year volatility as a real risk, but not a reason to become defensive. Internationally, she says the bigger Japan-related issue is not a carry trade unwind but the potential impact of higher Japanese bond yields on U.S. Treasury demand.
Key takeaways
- Liz Thomas says the probability of a Fed rate hike in 2026 is quite low because inflation has cooled and the labor market is weakening.
- She expects the S&P 500 to post more muted returns after more than 80% upside over the last three years, but not necessarily negative ones.
- Thomas thinks AI capex still has runway and expects technology to remain the top earnings-growth sector in 2026.
- She favors diversification into healthcare, materials, and cash-rich names, and says value may beat growth this year.
- She still likes gold for 2026, but calls silver much more speculative after its sharp run-up.
- She sees Japan’s bigger market risk as higher Japanese bond yields reducing demand for U.S. Treasuries, not just a carry-trade unwind.
Notable quotes
“I would say the probability is quite low. We have inflation that yes is still above the Fed's target, but it has cooled substantially”
“the Fed does not necessarily see a reason to hike rates. Also, it's important to note the Fed continues to be in a place of loosening monetary policy”
“our mindset in 2026 is to befriend the bubble. And what we're saying is number one, I can't declare whether or not this is a bubble”
“the spending will continue as long as that spending continues to produce revenue, meaning it's producing earnings growth”
“I still believe gold has opportunity and I still believe it deserves an allocation in portfolios”
How the episode opens
If your New Year's resolution is to become a better and more well-informed investor, you are in the right place. I'm Liz Thomas, head of investment strategy at SoFi, and this is the important part. Hello everyone and happy 2026.
We are starting off the year with a bonus episode of the podcast. We're answering some of your most burning questions. Thank you so much to everybody who submitted questions on social media.
I have to say I think this year's set of questions has been the best one yet. There were some real stumpers in there. So, we're going to cover all kinds of topics, big things like interest rates, precious metals, technology stocks, and we're going to talk about what the last three years of really strong returns might mean for this coming year.
Now, let's get to it. This podcast is sponsored by SoFi to help you get your money right and it's forformational purposes only. Nothing in this program is a recommendation from SoFi.
You should not rely on this program for financial, legal or tax advice or recommendations. The views expressed do not necessarily reflect the institutional views of SoFi or its affiliates.
Okay. So the first big question and a good one to frame this discussion was about interest rates and that was such a huge topic through 2025 and frankly a huge topic through 2024 and even 2023 but the reasons changed. So the question was odds of a rate hike in 2026 and then what is your short-term and long-term outlook on rates?
Okay, let's start with the probability of a hike in 2026. I would say the probability is quite low. We have inflation that yes is still above the Fed's target, but it has cooled substantially.
And the main problem with inflation continues to be the housing market, which makes up a big portion of that number.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- 2026 outlook
- ai in stocks
- interest rates
- gold and precious metals
- tech stocks
Companies and tickers mentioned
- SoFi
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Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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