Speaker · Updated
Alexander 'Alty' Altmann: latest market views
Barclays
Summary
Managing Director and Global Head of Equities Tactical Strategies at Barclays since June 2024, formerly an equity macro portfolio manager at Millennium and head of equity trading strategy at Citigroup for ten years.
Chorus has 29 views from Alexander 'Alty' Altmann across 2 episodes on The Compound and Friends and Odd Lots since October 29, 2026. Their latest calls: bearish on CoreWeave.
Where they stand
Their latest bullish or bearish call on each company.
- CoreWeaveBearish ·
What they talk about most
- AI infrastructure & data centers · 6
- Market sentiment, positioning & volatility · 5
- US stock market outlook · 5
- AI bubble & tech valuations · 3
- AI: overall outlook · 2
- CoreWeave · 1
- Earnings & corporate profits · 1
- US consumer · 1
- US housing · 1
- Consumer AI products · 1
- Credit markets · 1
- Enterprise AI adoption & AI software · 1
The latest views
Newest first. Every quote is checked against the episode's transcript.
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
The Compound and Friends: The Bulls Are Trapped with Alex Altmann ·
Market sentiment, positioning & volatility
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
The Compound and Friends: The Bulls Are Trapped with Alex Altmann ·
Market sentiment, positioning & volatility
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
The Compound and Friends: The Bulls Are Trapped with Alex Altmann ·
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
The Compound and Friends: The Bulls Are Trapped with Alex Altmann ·
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
The Compound and Friends: The Bulls Are Trapped with Alex Altmann ·
Market sentiment, positioning & volatility
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
The Compound and Friends: The Bulls Are Trapped with Alex Altmann ·
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
The Compound and Friends: The Bulls Are Trapped with Alex Altmann ·
Market sentiment, positioning & volatility
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
The Compound and Friends: The Bulls Are Trapped with Alex Altmann ·
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
The Compound and Friends: The Bulls Are Trapped with Alex Altmann ·
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
The Compound and Friends: The Bulls Are Trapped with Alex Altmann ·
AI infrastructure & data centers
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
The Compound and Friends: The Bulls Are Trapped with Alex Altmann ·
CoreWeaveBearish
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
The Compound and Friends: The Bulls Are Trapped with Alex Altmann ·
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
The Compound and Friends: The Bulls Are Trapped with Alex Altmann ·
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
The Compound and Friends: The Bulls Are Trapped with Alex Altmann ·
AI infrastructure & data centers
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
The Compound and Friends: The Bulls Are Trapped with Alex Altmann ·
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
The Compound and Friends: The Bulls Are Trapped with Alex Altmann ·
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
The Compound and Friends: The Bulls Are Trapped with Alex Altmann ·
AI is in the denial phase of a bubble; investors remain overwhelmingly bullish despite financing stress.
Altman describes a bubble chart where the first decline is a denial phase. He says he would not claim the bubble has popped, but argues the market is in denial because nearly everyone is still extremely bullish. He backs this with a survey where only about 60% of investors said AI financing would be a problem, even though recent events should have pushed that to 100%. He reads the gap between the bullish consensus and the financing evidence as denial of a reality already here.
“I'm not gonna say we're at kind of this bubble's popped... we're in the denial phase right now because everyone is still extremely bullish.”at 5:43
Odd Lots: What Wall Street Really Thinks About the AI Trade Now ·
AI infrastructure & data centers
Neocloud financing is the fragile periphery of AI, showing the early stress that preceded the GFC.
Altman says neoclouds are contractually bound to build compute for customers, some of it speculative, and most have little or no operating cash flow. That makes them the riskiest part of AI financing, unlike hyperscalers such as Google and Amazon, which have large cash flows. He compares this to the GFC, which began with subprime vehicles 12 to 24 months before the big banks were hit. He cites Cipher's convertible deal, which hurt its own share price because it could not tap debt markets directly, and says that triggered the CoreWeave bond sell-off. Data center bonds had already been widening for months, so he sees ripple effects starting in the periphery.
“these are tip of the spear. These businesses don't have operating cash flow today or minimal operating cash flow today in many cases.”at 7:32
Odd Lots: What Wall Street Really Thinks About the AI Trade Now ·
Debt issuance has decoupled from rates in 2026; AI competes for finite capital, with $1.1T net IG and HY issuance forecast.
Barclays' data since 1995 shows net issuance across IG, high yield, Treasuries and equities normally rises when rates fall. In 2026 that link has broken down, with issuance far above what rates would suggest, which he calls almost biblical. He says this matters for AI because AI is not issuing debt in a vacuum and other sectors also need financing, so capital is finite. He also says the idea that AI was immune to higher rates is not true; the Meta results showed financing does have limits. He forecasts net IG and high yield issuance of $1.1 trillion this year and argues the casual use of trillions in headlines ignores those limits.
“AI is not issuing debt in a vacuum. There are other verticals that need to tap financing too... And there is a finite amount... So IG issuance and a high yield this year on a net basis, we forecast to be $1,100,000,000,000.”at 13:41
Odd Lots: What Wall Street Really Thinks About the AI Trade Now ·
AI revenue lags the spending story: tech TAM claims are overstated and token spending is levelling off near term.
Altman argues that the trillion-dollar AI TAM claims need checking. He cites Barclays research showing that the cumulative inflation-adjusted revenue of Microsoft and Apple since 1990 was under $10 trillion, while SpaceX's addressable market is pitched at about three times that. He then sets S&P 500 revenue of about $17 trillion against $11-12 trillion of expenses, leaving net profit of roughly $5-5.5 trillion as the pool that AI spending has to come out of. Ramp and OpenRouter data show token spending has begun to level off, at least near term.
“But last time I checked, we all look at the ramp data or the open router data, and we can clearly see that that token expenditure has kind of begun to level off a bit. Right? At least near term.”at 21:07
Odd Lots: What Wall Street Really Thinks About the AI Trade Now ·
Open-weight models have grown from about 20% to up to 80% market share, with token costs deflating fast.
Altman says the data across several sources shows open-weight models rising from about 20% market share to as much as 80%. Token costs are a fraction of closed-model prices, which he calls one of the fastest deflating assets in history. He calls this a contradiction to the bullish frontier-model narrative. He also notes GPU rental rates have risen, so the debate is two-way rather than a one-way train.
“the data is the data you can evidently see on a whole bunch of different sources that open weight has kind of gone from a 20% market share to anything up to about an 80% market share.”at 23:15
Odd Lots: What Wall Street Really Thinks About the AI Trade Now ·
AI infrastructure & data centers
Efficiency gains let locally run models handle everyday tasks without massive data center compute.
Altman argues the leading question is not just open-weight models but locally run ones. He compares today's phones to the iPhone of 2007, saying the compute gain would have seemed impossible then with the same battery size. He says there is no need to run Hopper or Vera Rubin chips in an Ohio data center just to manage email. Multi-billion parameter models can already run on laptops, Meta has released one, and the market is moving along an efficiency curve. That shift affects the revenue question for frontier models, which he doubts will discover new drugs.
“the idea that we necessarily need to ping a bunch of Hoppers or Vera Rubins in an Ohio data center just so that we can sort of get our, you know, agent... Manage my email for me.”at 24:07
Odd Lots: What Wall Street Really Thinks About the AI Trade Now ·
A consumer killer app is needed to re-ignite AI; 100-IQ agentic workflows could be ubiquitous within 12 to 18 months.
Altman says he would get more constructive on AI once a killer consumer application emerges, because the consumer is the economy. He argues that the consumer does not need frontier models for everyday tasks such as managing email or handling disputes with a rental company. He expects the 'good enough' agentic workflow to become almost ubiquitous within 12 to 18 months. Creative application of existing technology, rather than new advanced technology, is where he thinks the next upswing in AI will come from.
“I said, when we figure out that killer consumer application layer. Because at the end of the day, the consumer is everything. It's the economy.”at 31:41
Odd Lots: What Wall Street Really Thinks About the AI Trade Now ·
Enterprise AI adoption & AI software
Enterprise AI revenue will not close the gap within the time frame the market wants to see ROI.
Altman says enterprise AI revenue will probably get there eventually, but it cannot close the revenue gap on the timeline the market wants to see returns. Because of this, he argues AI needs to break into the consumer layer. He sees this as the main revenue question for the sector and ties it to his view that consumer adoption is the missing piece.
“To the point about revenues, like, enterprise revenues, I just don't think is gonna plug that gap.”at 31:52
Odd Lots: What Wall Street Really Thinks About the AI Trade Now ·
AI infrastructure & data centers
A hyperscaler capex cut would be the key spooking signal, but it is probably too early for this week's results.
Asked what would spook investors, Altman names some level of capex being reined in by one of the hyperscalers as the most likely trigger. A client had asked him whether this could appear in this week's results. He says it is probably still premature for that to show up now, and he suspects investors may have to wait until the new year for a real change in enthusiasm. He notes that Google set off the last wave on the capex side.
“I would say it would be some level of CapEx being reined in by one of the hyperscalers.”at 35:11
Odd Lots: What Wall Street Really Thinks About the AI Trade Now ·
Market sentiment, positioning & volatility
Crowding from multi-manager funds suppresses index volatility while AI-factor rotations stay violent.
Multi-manager fund AUM rose from about $300B in 2020 to over $1T today. Long-short funds deploy gross capital and leverage it through prime brokers, while the number of tradable securities has stayed flat or shrunk. The result is crowding. Funds try to neutralise style factors, but everyone does this, so the crowding just shows up as different kinds of crowding. That is why realised volatility and the VIX look benign at the index level while individual stocks rotate violently. The AI factor is the hardest to map because its betas change with the narrative (shorting software was an AI-factor trade at the start of the year, and software is now near 12-month highs). Altmann's bottom line is that you are either long AI or short AI.
“The problem is that you've effectively tripled... More than tripled the AUM plus, obviously, leverage, and the number of securities you can trade has stayed roughly the same or actually shrunk over time. So that creates crowding out.”at 39:16
Odd Lots: What Wall Street Really Thinks About the AI Trade Now ·
AI infrastructure & data centers
Hyperscaler AI capex is roughly 12% of GDP, the largest capital experiment in US history.
Taking the forward capex consensus at face value, Altmann puts AI spending at about 12% of GDP, roughly two Netherlands. He says that exceeds the Louisiana Purchase, the railroads, and the pyramids and the Great Wall in scale and speed. He hedges that the consensus numbers will change. His point is that companies with strong legacy cash-generating businesses are embarking on the largest capex experiment in American history.
“If you believe the CapEx numbers in the terms of the forward, and I'm sure that they're gonna change from what the consensus looks like now, but on face value, it's about 12% of GDP.”at 43:12
Odd Lots: What Wall Street Really Thinks About the AI Trade Now ·
AI ecosystem, led by semiconductors, will supply about 75% of S&P 500 earnings growth next year.
Altmann argues the S&P 500 is becoming concentrated in AI-linked earnings. He expects about two-thirds of next year's S&P earnings growth to come from semiconductors, and about 75% once the broader AI ecosystem is included. That concentration is why he says the S&P 500 is becoming a Kospi-style index dominated by one theme, and why the index has been hard to beat.
“It's about two thirds from semiconductors, and then the broader AI ecosystem gets you to around about 75%.”at 44:49
Odd Lots: What Wall Street Really Thinks About the AI Trade Now ·
Shows
- The Compound and Friends · 1 episode
- Odd Lots · 1 episode
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