James van Geelen on His Viral AI Doom Scenario

Bullish:

• $INFRA - AI infrastructure remains a strong momentum trade with continued demand for compute capacity and data center buildout, despite concerns about AI disruption elsewhere.

  • “The first piece we ever published was a piece that was very bullish on the AI infrastructure complex.”

    James·5:59

  • “AI infrastructure, it's been a great trade, and it continues to stay tight.”

    James·11:22

  • “the piece also starts out with an S and P that goes to 8,000 because AI infrastructure is a very bullish trade that makes up a lot of the the index, and that's a that's a very strong and very momentum having trade right now.”

    James·12:31

  • “I think valuations right now are reflective of this expectation that we are going to continue adding compute capacity to be able to handle this.”

    James·37:18
• $CAT - Old economy industrial companies like Caterpillar benefiting from massive data center buildout and infrastructure needs.

  • “I remember the last time that I was on Odd Lots, it was about this massive Stargate data center build out. Yeah. And Joe was very surprised to see that Caterpillar was and and I think very happy that the old economy was getting boost.”

    James·6:24

Bearish:

• $SOFTWARE - Software companies face existential threat from AI capabilities that could replace their products and erode pricing power as enterprises can threaten to build alternatives.

  • “We've been seeing the software stock sell off all year”

    Joe·3:38

  • “Software companies have gotten sold off. A lot of fintech companies have gotten sold off.”

    James·6:52

  • “Now the person on the other side of the phone can say, you know, OpenAI called me the other day, even if they're bluffing. Right? So so you do see, like, some potential downside to pricing power.”

    James·40:15

  • “The whole reason people are, like, talking about, oh, are all these software companies that have thrived forever. The reason why there many of them are at all time lows is because it's like, wow. People are very impressed with the capabilities.”

    Joe·45:24
• $FINTECH - Fintech companies vulnerable to AI disruption and already experiencing market selloff as investors price in displacement risk.

  • “A lot of fintech companies have gotten sold off.”

    James·6:54
• $PE - Private equity faces risks from AI disruption to portfolio companies and potential defaults in disrupted industries, with early signs of stress already appearing.

  • “Private equity has sold off.”

    James·6:56

  • “if you were to have a wave of defaults in one of these disrupted industries, what would happen?”

    James·25:37

  • “Apollo reduced their software lending pretty early on. I think it was in in early twenty twenty five.”

    James·26:21
• $NETWORKEFFECTS - Companies built on network effects and intermediation layers face existential threat as AI agents can bypass platforms to find cheapest options directly.

  • “there are all these businesses that have essentially been built up around building a moat based on network effects, payment platforms and so forth and whatever. And so this idea that AI and agentic commerce will fundamentally change the way a lot of these businesses operate and these moats will disappear.”

    Joe·27:59

  • “if you have an AI agent that has the explicit instructions to go out and find the cheapest option, then it doesn't really care about using this thing that has a network effect. It cares about using the thing that's the cheapest.”

    James·30:34

  • “So the idea of, you know, taking half of the delivery fee as the company kinda goes away because your margin is my opportunity.”

    James·31:09