RenMac

RenMac breaks down why Thursday's tech wipeout looks like forced liquidation rather than a bottom, with semis and hardware stuck at 20-day lows, shorts covered but not yet reloaded, and credit stress creeping up the quality ladder. The team also discusses why a Fed likely on hold in October still points to a December hike, Charlie Cook's midterm map, a cautious consumer facing high mortgage rates, France's blowing-out CDS spreads, and the week ahead in the FOMC, September core inflation, and Alphabet, Microsoft, and KLA earnings.

Ramp's Ara Kharazian joins RenMac to unpack what actual corporate spending data reveals about the AI boom, including why 1% of companies account for 80% of enterprise AI spending and why rising usage isn't translating into higher spending or broad productivity gains. The team discusses evidence that intensive AI adopters are growing employment rather than replacing workers, how competition between OpenAI and Anthropic is driving prices lower, and what that means for valuations and the massive infrastructure buildout. They also examine the inflationary implications of AI investment, emerging divisions within the semiconductor and software trades, and widening credit spreads beneath an equity market still near its highs.Check out Ara here: https://substack.com/@arakharazianSubscribe to our newsletter: https://go.renmac.com/newsletterRequest a trial of our research (for professional money managers): https://start.renmac.com/trialSign up for our research (for individual investors): https://renmacaccess.com/Get merch at https://renmacmerch.comTimestamps0:00 – Welcome, Disclaimer & Intro1:41 – Meet Ara Kharazian: Ramp AI Index4:40 – Corporate AI Spending & Adoption Trends9:04 – AI Spending: The Top 1% vs. the Median Firm10:34 – AI Adoption Across Industries13:15 – AI’s Impact on Employment & Hiring19:14 – AI Productivity & Return on Investment21:38 – Where Businesses Are Investing in AI24:38 – AI Valuations & Market Expectations25:41 – Cracks in the AI Thesis: Slowing Spending Growth26:46 – OpenAI vs. Anthropic: Competition & Pricing29:50 – AI Stocks, Semiconductors & Software32:16 – AI Data Centers & Washington Policy34:11 – Is AI Spending Inflationary or Deflationary?40:37 – Mailbag: Crypto vs. Equities44:54 – Week Ahead: Washington & Geopolitical Risks46:28 – CPI, PPI & the Fed Outlook49:19 – Ramp AI Index: Token Usage & Spending50:47 – Will AI Become a Commodity?54:54 – Bank Earnings, Credit Spreads & Market Risks56:54 – Treasury Demand & U.S. Fiscal Concerns58:03 – U.S. vs. Europe: Rising Interest Rates59:36 – Closing Remarks

RenMac breaks down the breakout in long-end Treasury yields, why tighter monetary policy rather than fiscal concerns may be driving the move, and how higher real rates are beginning to bite. The team also discusses widening CCC spreads and signs of stress at the lowest end of credit, why the Fed’s former doves are turning more hawkish with additional hikes ahead, the growing disconnect between resilient economic data and weakening market internals, and why 39 relative-strength highs versus 350 lows in the Russell 1000 may be signaling what comes next.

RenMac breaks down stubborn inflation and why the Fed may be forced to hike as higher real yields reshape markets beneath the surface. The team discusses weakening momentum and the rotation out of tech, opportunities in TIPS, escalating Middle East energy risks, and why the recent momentum crash may be entering a critical “separation” phase that reveals the market’s next leaders.