Heartland Advisors, an investment management company, released its third-quarter 2025 investor letter for its “Heartland Opportunistic Value Equity Strategy.” A copy of the letter can be downloaded here. In Q3, trends from Q2 continued, with rising optimism about the AI boom and increased electricity demand driving large- and mid-cap growth stocks to new highs, regardless of business model quality or valuation. The strategy returned 4.65% in the quarter, compared to a 5.63% return for the Russell 3000 Value ...

Let's talk first of all, Bill, to you about the global state of macro right now and just what it means for the Fed, central banks writ large and interest rate policy. >> Well, Dom, I don't think there's any debate at all that the Fed is going to be easing. The real debate is how fast is it going to ease and when is it going to start the next phase of easing.uh and the December uncertainty is there because the more hawkish members of the FOMC are are clinging to the notion that well we don't have a lot of da ...

Core Insights - Michael Burry has shifted focus from investing to writing, launching a paywalled Substack called "Cassandra Unchained" to share his analytical insights on stocks, markets, and historical patterns [1][2] - Burry's initial posts address the AI boom, which he critiques as a "glorious folly" and plans to explore in depth over several entries [2][3] Industry Analysis - Burry compares the current AI boom to the dot-com bubble, arguing that despite the perception that today's companies are profitable, the underlying issues of overbuilt supply and insufficient demand remain similar [3] - He identifies the leading companies in the current AI landscape as the "five public horsemen" — Microsoft, Google, Meta, Amazon, and Oracle — alongside emerging startups like OpenAI [3] - Burry draws a parallel between Cisco during the dot-com crash and Nvidia in the current market, suggesting Nvidia is central to the AI boom despite its potential risks [4] Company Developments - Burry has closed Scion Asset Management's SEC registration, indicating a shift away from managing outside capital [5] - His recent return to social media includes commentary suggesting that the AI boom may be a bubble, advising caution in investment strategies [5]

Market Overview - The current market is perceived as overvalued, with the S&P 500 trading at approximately 2.5 standard deviations above its 50-month moving average, indicating a potential for correction [1][5] - The S&P 500 is heavily concentrated, with 40% of the index in the top 10 stocks and over 35% in the technology sector, raising concerns about future returns [5][10] Historical Context - The comparison to the dot-com bubble of 1999/2000 is significant, as the S&P 500 fell at an annual rate of 14.5% from 2000 to 2002, while the NASDAQ experienced a decline of over 32.6% [4][6] - During the 2000-2002 bear market, alternative assets such as gold, commodities, and certain sectors like healthcare and energy provided positive returns, contrasting with the overall market decline [6][7] Current Investment Landscape - Currently, large-cap value stocks are trading at nearly 17 times 2026 earnings, which is cheaper than the overall index but still not historically low [8] - US high-quality small-cap value stocks are more reasonably priced at about 13 times forward earnings, with mid-cap stocks slightly higher at 14 times [9] - International developed stocks are trading at 15 times forward earnings, with international value stocks at just 11 times, indicating potential investment opportunities outside the US [10] Sector Performance - Recent performance shows that sectors such as healthcare, consumer staples, energy, and real estate have outperformed the S&P 500 and NASDAQ during the recent market correction [11] - Specific ETFs in healthcare and consumer staples have shown positive total returns, while technology and consumer discretionary sectors have underperformed [12][14] Future Considerations - The potential success of AI technology is a key factor for companies that have heavily invested in AI infrastructure, with the risk that current stock prices may already reflect anticipated gains [19] - The market may be experiencing a shift as the initial hype around AI begins to fade, with notable declines in stocks like Meta and Microsoft since their peaks [18][19]

Without an AI boom, there need not be a recession. But, plagued by tariffs, debt and a growth slowdown, there would not be much left to celebrate about the world economy in 2026 https://t.co/21KJ8DOR4n ...

Group 1 - Aswath Damodaran, a finance professor, warns that Nvidia and Tesla are the most irrationally valued companies in the current market [1][2] - Nvidia's market capitalization is projected to exceed $5 trillion by 2025, but Damodaran argues that the expectations for its stock price are unrealistic [2][3] - Tesla's valuation issues stem from a lack of clarity about its business direction, leading to fundamental incoherence [3] Group 2 - Damodaran expresses concern that the top 10 tech stocks, which represent about 40% of the S&P 500's market cap, could lead to a broader market downturn during a correction [3][4] - He identifies Alphabet and Amazon as the least overvalued companies among major tech firms, suggesting they have clearer paths to monetization [4][5] - Damodaran is shifting parts of his portfolio into cash and collectibles, indicating a drastic change for a value investor, as he finds it difficult to identify undervalued tech stocks [5] Group 3 - Tesla's stock was down 0.38% in premarket trading, closing at $408.92, with a year-to-date increase of 7.81% [5][6] - Nvidia's stock closed at $186.60, down 1.88%, with a year-to-date increase of 34.91% [7]

Core Insights - The article emphasizes the importance of momentum in navigating the technology landscape, particularly in the context of past market events such as the dot com bubble, the credit default crisis of 2008, and the recent AI boom [1] Group 1: Market Context - The author has over two decades of experience in the market, focusing on technology, media, and telecommunications (TMT) sectors [1] - The article highlights the significance of risk mitigation strategies employed during various market cycles [1] Group 2: Investment Focus - The primary focus of the service is on momentum, suggesting that it plays a crucial role in investment decisions within the technology sector [1]

Without the AI boom, the American economy would be left looking as it did earlier this year: threatened by tariffs, beleaguered institutions and increasingly fractious politics https://t.co/n5VOnjSZA9 ...

Core Insights - Berkshire Hathaway has reduced its stake in Apple while significantly increasing its investment in Alphabet, indicating a strategic shift in its portfolio management [1][3][5] Investment Moves - Berkshire Hathaway trimmed its Apple stake by approximately 41-42 million shares, representing over a 15% reduction, bringing its total to 238.2 million shares valued at nearly $60 to $61 billion, which still accounts for 23% of its total stock holdings [5][6] - The firm established a new position in Alphabet, acquiring nearly 17.85–17.9 million Class C shares, valued at approximately $4.3 to $4.4 billion, making it one of Berkshire's top-10 holdings and representing almost 1.4% of its total stock portfolio [4][5][8] Strategic Implications - The shift from Apple to Alphabet raises questions about Berkshire's perspective on the AI boom and the high valuations in Big Tech, suggesting a balancing act between opportunity and concentration risks [2] - The timing of these moves is particularly notable as Warren Buffett prepares to hand over CEO responsibilities to Greg Abel, making the strategic pivot feel more significant [2]

Competitive Landscape - Silicon Valley's two largest AI startups, Anthropic and OpenAI, exhibit diverging financial strategies amidst the AI boom [1] - Anthropic is on track to achieve profitability at a faster rate compared to its competitor, OpenAI [1]