The Bulls Are Trapped with Alex Altmann

CoreWeave

Across the shows: 56 speakers in other episodes, 14 bullish and 54 bearish calls, past 30 days

• Alexander 'Alty' Altmann · BarclaysBearish

  CoreWeave is an early crack: levered neocloud compute plays face real AI financing limits.

  Alex says the market is already showing cracks, and CoreWeave is the clearest example. Neocloud stocks reflect AI financing limits: they are levered plays on forward compute and need to keep raising debt, and their credit is being repriced. Hyperscalers are still cash-generative and not yet affected, but the stress is already visible in levered neocloud names. Josh Brown adds that the market priced CoreWeave's weakness before it hit Alphabet, which is the efficient outcome.

  “we're seeing, like, cracks already. That's what CoreWeave is about... AI financing does have limitations. It may not apply today to hyperscalers who still are cash volcanoes, but it is certainly applying to... levered, sort of plays on forward compute.”at 50:02

US stock market outlook

• Alexander 'Alty' Altmann · Barclays

  Structural household inflows and buybacks create a large, valuation-insensitive bid under US stocks.

  Alex estimates a structural bid for US equities from several sources: home-equity-funded down payments diverted to stocks (about $200-300B a year), 401(k) contributions (about $800-900B a year), and buybacks (about $1T, haircut to roughly $750B for lower execution). He argues this flow is automated and valuation-insensitive because it follows retirement plans, so it keeps supporting the market as long as people keep their jobs. He cites a median household income of $88,000 and a 12% contribution rate in the calculation.

  “Plus you got the [401(k)] money that comes in every year. That's between 8 and $900,000,000,000 on our estimation.”at 25:06

• Josh Brown · Ritholtz Wealth Management

  Buybacks, 401(k) money and fee-based wealth management create a relentless bid that dampens volatility.

  Josh revisits his 2014 'relentless bid' thesis. Three forces drive it: buybacks shrink the float, 401(k) money keeps coming in, and brokers have shifted from commission trading to fee-based ETF allocation. The fee-based shift puts trillions into the same large stocks on a recurring basis. He argues this is why the VIX evaporates quickly after each spike, since flows arrive within a couple of weeks.

  “I argued it's a volatility dampener. There's more guaranteed money into the same 500 stocks every time people allocate to their wealth accounts.”at 27:26

• Michael Batnick · Ritholtz Wealth Management

  Stock correlations have broken down this year, with a negative-beta effect driving narrow index moves.

  Michael cites a SocGen chart showing about 40% of possible S&P 500 stock pairs are currently negatively correlated, far above the historical average. He says the index often moves one way while the average stock goes the other, a negative-beta effect. Drivers have rotated through energy, rates-sensitive sectors such as staples, REITs and utilities, Apple, and AI- and software-driven days. He notes that on the day he is discussing, equal-weight rose 98 basis points while the S&P fell 53.

  “There are a lot of days where the stock market does X and the average stock goes the other way. So there's this weird negative beta effect.”at 33:14

• Alexander 'Alty' Altmann · Barclays

  US equity net issuance turns positive in 2026, the first time in years, and competes with debt for capital.

  Barclays' modelling has 2026 as a positive net-issuance year, after years of net negative issuance (buybacks exceeding issuance by about $400–600bn a year). That is a swing of several hundred billion dollars. Equity issuance now competes with record debt issuance and government borrowing, and buybacks are roughly flat, so issuance is offsetting the buyback bid that used to support stocks. Alex compares this to the dot-com era, when too much paper hitting the market broke equities.

  “So 2026 on our modeling numbers will be a positive net issuance year. Which is basically gonna be from what we can tell essentially the first time.”at 46:20

• Alexander 'Alty' Altmann · Barclays

  Tactically bearish on US stocks through year-end, on quant risk-off signals and crowded long positioning.

  Barclays' BETTI quant framework has signalled risk-off since late May. A summer momentum unwind followed, and the AI revenue gap prompted a more bearish fundamental view from late August. The quant model still says be very bearish tactically. CTAs and vol-control and QIS funds are extremely long equity risk, retail is extremely long, real rates are high and spot-vol correlation is high. Alex sees no specific catalyst needed, because the financing pressure is already catalysing the move and CapEx commitments won't change before January results.

  “So our quant model is tell... Still telling us be very bearish tactically.”at 1:04:39

• Alexander 'Alty' Altmann · Barclays

  S&P 500 could fall to 7,100–7,200, about 17.5x forward earnings, a reset he sees as healthy.

  The largest 2026 pullback so far, around Iran, was only about 8.5%, which is not enough to reset valuations. Alex's target is 7,100–7,200, around the 200-day moving average, which equals about 17.5x forward NTM P/E. He wants the clearing price of risk to fall, which he thinks would be healthy even with some near-term damage, and sees the market able to rally again after a repricing.

  “In my head, I've got between seventy one and seventy two hundred, which is around the two hundred day moving average. Right? That gets us down to about 17 and a half times forward NTMPE.”at 1:05:53

Market sentiment, positioning & volatility

• Alexander 'Alty' Altmann · Barclays

  Competitors' hedge fund net exposure data is misleading, since market-neutral funds barely move net exposure.

  Prime-broker data showing very low hedge fund net exposure is often read as a sign that everyone is bearish and has sold tech. Alex argues this overlooks that many hedge funds are relative-value or market-neutral shops with little market sensitivity. Their net exposure only moves in a narrow band, for example 48% to 55% and back to 48%, so the signal is weak. His desk instead uses positioning from retail, mutual funds, vol-control, CTA and QIS strategies, which carry real equity length.

  “The range of net exposure changes by hedge funds is minimal. It'll go to... From 48% to 55% back to 48%.”at 18:19

• Michael Batnick · Ritholtz Wealth Management

  Retail dip-buying has been right this cycle and has outperformed institutional portfolios.

  Michael challenges the 'dumb money' label for retail investors. He argues retail has been right this cycle by buying dips, and that retail portfolios would have outperformed institutional portfolios. Alex then credits this to retail's greater holding power.

  “I feel like they've been pretty damn right the past this this cycle with buying dips. Vast majority of retail would... Our portfolios would have outperformed institutional portfolios.”at 19:35

• Alexander 'Alty' Altmann · Barclays

  Retail investors have more holding power than hedge funds, so they tend to hold through drawdowns.

  Alex says retail's most important trait is holding power. Hedge funds run tight drawdown limits and answer to committees, while retail accounts are unobserved and sold only after a margin call or job loss. He cites retail share of volume (about 25%) and cash and margin balances as the signal to track, and says the 2022 selling was short-lived. Retail has kept buying since 2023 regardless of economic wobbles.

  “It tells us a few things. First and foremost is they have more holding power.”at 19:54

• Alexander 'Alty' Altmann · Barclays

  Levered and overwriting ETFs and vol-selling products are suppressing market volatility.

  Alex adds to Josh's point about structural flows dampening volatility. He says levered ETFs, covered-call overwriting ETFs and other deliberate vol-selling products supply gamma and vega to the market. That further suppresses volatility on top of the steady buying from retirement plans.

  “You've got the levered... You've got the cool overwriting ETFs. You've got kind of the very deliberate vol selling products that are further suppressing or supplying gamma and vega.”at 27:58

• Alexander 'Alty' Altmann · Barclays

  Multi-manager hedge fund crowding is pushing risk into hidden exposures, amplifying unwinds across stocks.

  Multi-manager AUM has roughly tripled since 2019 to about $1tn. Multi-managers run high gross, low net books and all use the same risk models, so they neutralise size, value, growth, sector and market exposure in the same way. The stock universe has shrunk (about 3,000 names, down from about 10,000) because of fewer IPOs and more buybacks, which crowds the remaining names. Hedging one factor only pushes the crowding into other parts of the portfolio, so when many funds unwind at once the hit to stocks is several times larger.

  “And everyone will say, oh, okay. Hang on a second. It doesn't matter because I've neutralized everything. No. All you've done is push the crowding into other aspects of your portfolio that you are either aware of or unaware of.”at 38:01

AI infrastructure & data centers

• Alexander 'Alty' Altmann · Barclays

  AI data-centre debt is being absorbed but at a rising price, with spreads set to keep widening.

  An equal-weighted index of data-centre bond spreads, measured against 20-year Treasuries (about 17-year average duration), has widened steadily. Net IG and high-yield issuance of about $1.2tn in 2026 plus government borrowing is competing with AI capex for capital. Equities have offset buybacks with issuance, so the debt is still being absorbed, but at a higher price. Alex expects spreads to keep widening to the point where they test or break the market.

  “The chart before, the the IG, chart of data centers debt is telling you you can't ignore it because spreads are widening. And they're gonna continue widening to the point where it's effectively going to either test or break the market.”at 49:45

• Alexander 'Alty' Altmann · Barclays

  Hyperscaler AI capex has reached a terminal plateau, at about $1.2tn next year and $1.4tn after.

  Barclays has been to Asia and laid out its roadmap for AI capex: $1.2tn next year and $1.4tn the year after. The CapEx number can't go much higher, though it might move by $100bn here and there. Alex therefore thinks capex is at a terminal point, and that the revenue to justify it has to come from elsewhere.

  “The CapEx number can't go any higher, 1,200,000,000,000 for next year, 1.4 for the year after. Like, maybe it moves by a 100,000,000,000 here and there, but we're kind of at terminal point now.”at 1:02:41

AI bubble & tech valuations

• Alexander 'Alty' Altmann · Barclays

  Hyperscalers are not immune to an AI unwind; the assumption of immunity is unrealistic.

  Investors assume hyperscalers' strong operating cash flow makes them immune to an AI unwind. Alex calls this unrealistic. He draws an imperfect analogy with subprime, where the equity tranche and the AAA tranches both went to zero. He does not claim hyperscalers will go to zero. His point is that AI is in almost everything, and a prolonged AI unwind would hit everything, because nothing is immune and you are either long or short AI.

  “you assume that these businesses have got fantastic operating cash flow that they're gonna be completely immune from any AI unwind, and I think that's a very unrealistic proposition.”at 54:36

• Alexander 'Alty' Altmann · Barclays

  AI capex needs about $1tn of revenue by 2028; he sees run-rate near $400bn, so the gap is unfunded.

  Committed AI capex needs roughly $1tn of revenue by the end of 2028 to pay off. Alex's run rate for then is around $400bn, so there is a large gap to fill. He cannot see where the revenue will come from, and by comparison the cumulative revenue of Apple and Microsoft since 1990 is only about $9.8tn inflation-adjusted. That gap drove Barclays' shift to a more bearish fundamental view on AI at the end of August.

  “We need a trillion dollars of revenues, basically, by the end of twenty twenty eight to pay for all of this CapEx... And right now, our run rate for then is gonna be somewhere around about 400 [billion]. ... I just don't see where the revenue's gonna come from.”at 1:02:18

AI: overall outlook

• Alexander 'Alty' Altmann · Barclays

  Investor surveys contradict the prevailing narrative that everyone is bearish on AI.

  Alex polled about 200 Wall Street investors and found sentiment on AI overwhelmingly not bearish, even though the market had just been through a financing scare. Only 60% of respondents said there was a financing problem, which he finds implausible given the recent financing episode. He treats this gap between the survey and the prevailing narrative as the start of a trade idea, and checks it against positioning data.

  “It's a high quality survey, and the feedback was overwhelmingly not bearish on AI.”at 17:47

US housing

• Alexander 'Alty' Altmann · Barclays

  US housing is in a recession-like slump, with unaffordable mortgages and falling sales.

  Alex argues that since 2020-2022 mortgages have become unaffordable, new and existing home sales have plummeted, and home prices have barely moved. He calls this a housing market recession. Because home equity is no longer a main wealth channel, younger savers are putting money into stocks instead, which links housing weakness to the equity flows he describes.

  “Really, '20 since '22, mortgages have been completely unaffordable. ... new homes and existing home sales have plummeted. The housing market's basically been dead... It's a housing market recession.”at 24:12

US consumer

• Alexander 'Alty' Altmann · Barclays

  A financialized economy makes stock declines hit consumer spending fast, creating a real vulnerability.

  Alex says retail's stock-market exposure creates a real economic risk. When the S&P fell 20% during last year's tariff shock, consumption visibly dropped over the following two months, a negative wealth effect. Because investors see their balances in real time, unlike the dot-com era, the feedback to spending is fast and strong.

  “Retail is the scary one in the sense that because we've got such a financialized economy. Even last year during the tariffs when the S and P fell 20%, there was a visible drop in consumption over the subsequent two months.”at 28:58

US growth & recession risk

• Josh Brown · Ritholtz Wealth Management

  A prolonged two-year bear market is impossible without a recession, because household wealth is tied to stocks.

  Josh argues that stock market and economy are now closely linked. Retirement plans, high-income households' 401(k)s and pay tied to recently listed stock all depend on share prices. Because household spending depends on account values, a long bear market would drag the economy into recession, so a two-year bear market without a recession is not possible.

  “You can't have a prolonged two year bear market without a recession. It's impossible because everybody's wealth effect and everyone's mentality is based on how much money their accounts are worth.”at 31:02

US rates & the Fed

• Josh Brown · Ritholtz Wealth Management

  The Fed reacts to equity drawdowns and reverses policy when markets overstep, as in 2018.

  Josh says the Fed monitors the stock market, through financial conditions indicators and trend measures like the ten-month moving average. In 2018, after the market fell into a roughly 20% drawdown, the Fed reversed course on Christmas Eve and within a month was talking about cutting rates again. He takes this as evidence the Fed knows when it has tightened too far.

  “I think they know when they've overstepped. I watched that play out in 2018.”at 31:36

Earnings & corporate profits

• Alexander 'Alty' Altmann · Barclays

  Earnings season is landmines; a single call comment can swing a stock 20%, so tactical trading stays out.

  Earnings season is a difficult environment for tactical trading because a single comment on a conference call can swing a stock from up 10% to down 10%, and that cannot be modelled. Barclays' macro thematic team therefore largely stays out, though it does scrutinise hyperscaler results closely. Alex notes the recent Google and Microsoft results were all about AI, and that AI and its CapEx drive a large share of economic growth, so those results matter for markets.

  “So for for me, earning season is an environment where It's landmines... Look. Can't model that.”at 41:34