Episode summary
The Big Squeeze: High Bond Yields Becoming A Problem For Stocks | Jan van Eck
Thoughtful Money
· · Hosts: Wolf Richter · Guests: Jan van Eck, Christian
Summary
Jan van Eck argues that the biggest near-term market change is the rise in bond yields, which is making fixed income attractive enough to compete with equities and is starting to pull capital out of stocks. He says this “bond squeeze” is already showing up in fund flows, with fixed income taking a larger share of inflows at VanEck, and he sees it as a portfolio-level shift rather than a collapse in risk assets.
On AI, Jan says the mega-trend remains intact even as the trade becomes more selective. He thinks investors should expect continued demand growth, especially as the industry moves from training toward inference and from simple supply shortages toward modeling actual usage. He also stresses that public-market AI leaders still have pricing power and strong execution, while some adjacent trades like utilities, power names, and certain compute providers have already seen sharp repricing.
Christian adds that the private market tells a similar but more speculative story: usage is shifting toward cheaper open models, but most revenue still sits with frontier models because enterprise customers value security, capabilities, and switching costs. He also says private AI valuations can get stretched quickly, even as the broader opportunity set in private markets remains large and increasingly important for long-term investors.
Key takeaways
- Jan van Eck says rising 10-year yields are now competing with equities and causing a portfolio shift toward fixed income.
- VanEck sees AI demand as still early, with inference increasingly becoming the bigger driver versus training.
- Christian says token usage is moving toward open models, but frontier models still capture most revenue because enterprises pay for capability and security.
- Jan argues the public AI trade still has discipline, while some adjacent winners like utilities and power names have already been repriced.
- Christian says private AI markets are booming, but valuations can be aggressive and require caution.
Notable quotes
“the rise in in interest rates especially the 10-year and uh that to me is squeezing the rest of client portfolios”
“we think training held flat is a conservative assumption”
“token consumption is increasingly shifting to these more generic open models that are quote unquote good enough and they're good enough and they're also substantially cheaper”
“what we're seeing is the valuations of these inference clouds just skyrocketing”
How the episode opens
Uh the the one thing that happened in the third quarter just before I start sharing slides is obvious not obviously but to me the rise in in interest rates especially the 10-year and uh that to me is squeezing the rest of client portfolios because now yields are getting to be relatively attractive especially you know like high yield munis and things like that are are in the high single digits that's competing with annualized equity returns of 8% % a year. Welcome to Thoughtful Money. I'm Thoughtful Money founder and your host, Adam Tagert.
Welcome you here for one of our quarterly updates from Yan Vanek, the CEO of Van Eek. Uh Yan's getting really tired of seeing my face because he's been um giving us a lot of time to the Falfa Money audience. He just spoke at great depth at the this past weekend's conference about what's going on with higher bond yields.
Uh he then came in for Q&A and he's back again this week again to give this quarterly outlook and uh give us a sense of what's going on in AI. It's very interesting though. It's going to be both on the public side which is you know what most of us see and read about um but also we're going to be talking about what's happening in the private markets related to AI and Yan has brought one of his esteemed colleagues in for that.
So Yan, thanks so much for joining us today.
Thanks, Adam. And and just to remind people that, you know, what I try to do is I sit with our investment personnel here at Van in in Midtown, New York, and we see thousands and thousands of charts and slides and data points. Uh, and what I try to do is consistent with our, uh, our firm's outlook, select slides that maybe are somewhat unique or hopefully provide an interesting perspective on the markets.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- bond yields
- ai demand modeling
- open vs closed ai models
- private markets valuations
- gold and bitcoin
Companies and tickers mentioned
- NVDA
- ACN
- VanEck
- Nvidia
- Accenture
- CoreWeave
Watch the episode
Watch “The Big Squeeze: High Bond Yields Becoming A Problem For Stocks | Jan van Eck” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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Thoughtful Money, this episode and its artwork belong to Adam Taggart | Thoughtful Money. Octagon is not affiliated with the show; this page is an independent summary.
