00:00 Josh
We just heard from Big tech, right? And they continue to spend, spend, spend, building out those those AI dreams. Reportedly, they’re going to invest 755 billion. That’s just this year, Alonzo. So basically all of their cash flow from operations. How confident are you, Alonzo, as a tech investor, you’re going to see a really healthy ROI on all this spend.
00:18 Alonzo
uh, everything going on across the globe, chips, the integration of supply chains. But but when we think about big tech and you’re right, we are big tech investors, we’re looking at earnings. And as you know, earnings were spectacular. I mean, Josh, when we look at at Tesla, at Meta, at Microsoft, at at Google, at Amazon, double digit growth across, you know, all the sectors, beats on the top and the bottom line. And so there’s this disconnect where we we’ve talked about AI bubble fears and and and the 2000 bubble.
00:46 Alonzo
That’s just not the case. This economy is completely on fire. These companies are driving uh innovation and change whether it’s it’s software, whether it’s products and services. And and I’ll tell you Josh, one of the things that we’re thinking about is the beneficiaries of these technologies, of the capbacks of this spend are going to be other sectors of the economy.
01:03 Alonzo
We’re moving from that uh builder infra infrastructure stage to the adoption stage and that’s what gets us really excited. This is not our father or our grandfather’s uh market or economy. We’re in a completely uh dynamic, uh ever-changing world and these tech companies are driving us into the future.
01:14 Alonzo
I’ll touch a little bit of on what we’ve seen over the last couple of days with President Trump in China with President Xi. Uh we are in an interconnected world and these companies have to spend in order to keep up in what is now this AI arms race, this tech arms race. If you’re not spending, you’re being left behind and I know you talked to Dan a little bit about the IPO uh Cerebras today. I mean, that was a magnificent, magnificent IPO and the stock, I believe is still roaring uh at this hour prior to the close.
01:37 Alonzo
It’s an arms race and if you’re not spending, you’re falling behind and that’s why there’s some hesitation, investor hesitation, uh and you’re seeing companies like Microsoft and meta lag year to date relative to the index and even relative to their peers, but ultimately, when we look underneath the hood, when we look underneath the surface, these companies are still growing. I mean, their margins are really strong, double digit growth across the board.
01:56 Alonzo
And if they can continue to do so, it only solidifies the fact that we are seeing return on investment, we are seeing returns on this capex, but ultimately, look, we’re eyes wide open about this, Josh, we’re going to be sanguin about the fact that things could change and we have to be uh quick on our feet and nimble in this market. Uh but we’ve been buyers of Big Tech, we were big buyers during the uh beginning of the war with Iran and that’s turned out to be a nice trade so far.
