I got up early to discuss the melt-up in the semiconductor stocks that have that dot.com energy. And even if we believe the oil situation in Iran gets solved and inflation goes lower by year end (it's possible!), you have to have more than 20 AI stocks that will not beat and raise quarterly earnings guidance forever. Remember - AI won't stop, but this massive buildout will eventually slow. How markets react to that has a lot to do with valuations.
What we are doing at my firm is increasing duration in our bond portfolio through a US 30 year Treasury position to hedge both a gradual lowering of inflation and the rapid growth from the AI buildout. Then on the stock side, keep a healthy dose of old economy stocks that actually benefit and profit from higher productivity. Because longer term, if AI works out, it will benefit more than just a few semi manufacturers.