00:00 Speaker A
For me, Dave, one of the most interesting dynamics is what’s going on in Big Tech these days in the market, right? We saw a backlash from Big Tech. We’ve seen some kind of uneven recovery, but there’s also a recognition that there’s going to be this turnover within Big Tech, or at least some change in leadership. Well, I’d like to know what you think about that.
00:30 dave
I think there are two catalysts happening at the same time. So, to your point, November saw a significant reversal from technology to defense in the broader environment. In fact, HealthSka’s healthcare division outperformed its IT division by the largest spread in the past 20 years. Well, I think you can emphasize such a huge change in momentum. And much of the driver for such macrorotation was the possibility of rate cuts.
01:00 dave
So, it had been baked into the market to some degree, but it fell very hard when some Fed directors took a stand against it, and then it came back very hard again and we saw the technology recover. But at the same time, there’s been a leadership change internally, and Nvidia and I kind of call it Team Open AI. So the Google news happened just as Microsoft and other companies and suppliers in the space continued to make profits.
01:30 dave
And when it comes to generative AI, Google has a triple whammy. They were considered retarded. Um, but they’re hyperscalar themselves, they’re making chips, they’ve got large language models. So now investors are saying, “Wait a minute, we’re so focused on open AI and those kinds of circular investments that we seem to have forgotten about all the other players. Now we’re seeing investors kind of turn the tables and say, who are the winners at this stage going forward?” Even yesterday’s news about Amazon’s chips gave them a leadership not seen in a while.
