Excess Returns

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Jun 2026

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Excess Returns is dedicated to making you a better long-term investor and making complex investing topics understandable. Join Jack Forehand, Justin Carbonneau and Matt Zeigler as they sit down with some of the most interesting names in finance to discuss topics like macroeconomics, value investing, factor investing, and more. Subscribe to learn along with us.

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June 16, 202659 min

Andy Constan on the SpaceX IPO, AI CapEx, and the End of the Buyback Tailwind

In the third episode of First Principles with Andy Constan, Andy breaks down the changing structure of markets as the IPO window reopens, AI CapEx accelerates, and corporate buybacks shift toward new equity supply. We discuss what the SpaceX IPO says about capital markets, whether AI spending can create disinflationary growth, why the consumer is still holding up, and what could challenge the current market bubble.Follow First Principles on SpotifyFollow First Principles of Apple PodcastsTopics covered:Why IPOs are central to the purpose of public marketsHow Andy evaluates whether the SpaceX IPO workedWhy issuers may want IPOs to trade higher after pricingThe shift from stock buybacks to new equity issuanceWhy AI CapEx is changing the supply and demand for sharesHow hyperscaler spending is being funded through cash, bonds, and stockThe economic test for whether AI investment pays offDisinflationary productivity growth versus labor displacementWhy the current economy is still supported by consumptionThe role of wealth effects and consumer dissavingWhy falling oil prices may not eliminate inflation pressureWhat Andy is watching in Fed policy, tariffs, AI CapEx, and equity issuanceHow Kevin Warsh could approach rates, QT, and the Fed balance sheetTimestamps:00:00 Intro and key themes04:18 How Andy reads the SpaceX IPO08:27 Why underwriters and regulators want IPOs to work13:00 Why issuers may want IPOs to trade higher17:05 From stock buybacks to new equity supply21:06 The 600 to 700 billion dollar shift in share supply26:42 The economic test for AI tokens32:09 Can AI create disinflationary productivity growth?38:10 Is AI CapEx holding up the economy?41:00 Wealth effects, dissaving, and the consumer45:52 Oil prices, war, and inflation49:07 Jalen Brunson, incentives, and long-term value52:00 Fed policy, tariffs, and what matters this summer55:36 Kevin Warsh, QT, and the Fed balance sheet58:42 Closing thoughtsNo information on this podcast should be construed as investment advice. Securities discussed in the podcast may be holdings of the firms of the hosts or their clients.

June 13, 20261 hr 8 min

The SpaceX IPO Meets a Huge Options Expiration | Brent Kochuba on What Comes Next

In this episode of The OPEX Effect, Jack Forehand and Brent Kochuba break down the market structure impact of the SpaceX IPO, options expiration, dealer gamma, volatility, and the next major setup for the S&P 500 and Nasdaq. They discuss why SpaceX may trade more on flows than fundamentals, how call buying could create a gamma squeeze, and why June OPEX, VIX expiration, FOMC, oil, Iran headlines, and index inclusion could all collide at once.Subscribe to the OPEX Effect on Spotify⁠⁠⁠⁠Subscribe to the OPEX Effect on Apple PodcastsTopics covered:Why SpaceX is a flows game at the start of tradingHow the SpaceX IPO could affect liquidity across mega cap tech stocksWhy fundamentals may not matter when index flows and forced buying dominateThe role of Nasdaq, Russell, and S&P 500 index decisions in SpaceX tradingHow options could create a gamma squeeze in SpaceXWhy dealer hedging flows can push stocks higher or lowerWhat June options expiration could mean for the S&P 500Why VIX expiration and FOMC create a key market windowHow Core1M signaled the recent volatility spasmWhy expensive calls, not put buying, drove the recent market stressThe key S&P 500 levels Brent is watching into OPEXHow oil, rates, inflation, and Fed policy could affect market volatilityWhy Nasdaq options pricing is diverging from the S&P 500How SpaceX index inclusion could widen the gap between Nasdaq and the S&PWhat would make Brent add protection or look for another short-term market correctionTimestamps:00:00 Opening clips and the SpaceX flow setup05:27 Elon Musk net worth after the SpaceX IPO07:13 SpaceX, liquidity, Mag Seven selling, and index demand12:48 Why SpaceX may trade on flows before fundamentals17:59 What options trading could change for SpaceX22:05 How call buying can create a gamma squeeze28:24 Why June OPEX matters more than a normal expiration33:55 VIX expiration, FOMC, and market path dependency37:20 The Core1M signal and the recent volatility spasm41:22 The S&P 500 gamma map and key risk levels46:25 Why expensive calls drove the market stress50:14 Oil, rates, inflation, and the Fed setup57:03 The JPMorgan collar and the 6900 to 7000 support zone58:32 Nasdaq versus S&P 500 after the SpaceX IPO01:03:14 Brent’s summary, SpaceX gamma squeeze risk, and the next market setup

June 11, 2026Episode 45543 min

Mike Green on What Happens When Passive Flows Meet the Largest IPO in History

Mike Green joins Excess Returns to explain why passive investing, index construction, SpaceX, AI IPOs and mega-cap concentration may be changing how the stock market actually works. We discuss how passive flows can affect prices, why AI earnings may be more circular than investors think, what could break the current market narrative, and why the economy feels much weaker for many households than the headline data suggests.Michael Green Twitterhttps://x.com/profplum99Simplify Asset Managementhttps://www.simplify.us/Topics covered:Why the SpaceX IPO has turned passive investing into a mainstream market structure debateHow index committees and passive flows can influence individual stocksWhy low float, Nasdaq demand and passive buying could create unusual IPO dynamicsHow new AI-related equity issuance could change the supply-demand balance in the stock marketThe research behind passive flows, market impact and cap-weight concentrationWhy Mike thinks passive buying explains more of mega-cap outperformance than AI fundamentalsThe circular financing risk in AI, including Nvidia, CoreWeave, Google and AnthropicWhy buy-the-dip flows, ETFs, CTAs and vol control funds matter for market directionHow headline economic data can miss household stress, second jobs and lost purchasing powerWhat Mike is watching to see whether the AI trade and market narrative are starting to breakWhy AI may be hugely valuable to consumers before it creates major business productivity gainsHow companies may eventually redesign business models around AI rather than simply automate tasksWhy SpaceX wealth creation could seed the next generation of competitorsHow inflation, gasoline prices, low savings and a K-shaped economy are affecting consumersTimestamps:00:00 Passive indices, AI profits and why this market feels different04:07 Why SpaceX changed the passive investing debate08:01 The research behind passive flows and market impact12:16 Why Mike thinks passive flows explain mega-cap strength16:18 ETF flows, buy-the-dip behavior and bubble dynamics20:28 Why economic data can miss household stress25:13 Bubble warnings, CAPE and what investors may be ignoring29:17 AI as a consumer advice engine versus a productivity revolution33:29 How businesses may redesign themselves around AI37:51 Why IPO wealth may create the next generation of competitors42:06 Mike Green’s upcoming book on passive investing and market structure

June 9, 2026Episode 45448 min

We Asked Vanguard’s Chief Economist Why AI Has Two Huge Tails — And Which One Wins

AI could become the next general purpose technology, reshaping economic growth, inflation, interest rates and portfolio construction. Vanguard Global Chief Economist Joe Davis joins Excess Returns to explain why AI, demographics, fiscal deficits and globalization may define the next decade for investors, and why the biggest market winners may eventually come from outside the technology sector.Coming into View: How AI and Other Megatrends Will Shape Your Investmentshttps://amzn.to/4v8L7OfVanguard Megatrends Research Hubhttps://explore.vanguard.com/megatrends.htmlTopics Covered:AI as a potential general purpose technologyWhy long-term megatrends can affect short-term market returnsThe four forces shaping the next decade: technology, demographics, deficits and globalizationWhy Vanguard believes AI could lift U.S. growth above consensusHow AI could offset aging demographics and rising debtWhy great technology cycles often include major stock market drawdownsThe difference between AI automation, augmentation and new industry creationWhy the next AI winners may be in healthcare, financial services and other service industriesThe risk that AI disappoints and fiscal deficits dominate the outlookHow tariffs, oil prices and AI investment interact in the macro outlookWhat AI could mean for 60/40 portfolios, value stocks, fixed income and international marketsJoe Davis’ lesson for average investors: the power of compoundingTimestamps:00:00 Why every great technology eventually faces a market drawdown04:28 The four megatrends shaping the economy08:56 How megatrends explain short-term S&P 500 moves13:22 Why AI may be in the 1996 or 1997 stage18:29 Where the next AI winners could emerge21:44 AI, fiscal deficits and the danger of kicking the can26:17 Why 2% growth and 2% inflation may be unlikely30:31 How to tell if AI augmentation is really working33:19 AI, globalization and which countries could benefit38:14 Why investors need a multi-factor macro scorecard41:23 What AI means for the 60/40 portfolio44:12 Joe Davis on investing, compounding and Vanguard’s megatrends research

June 6, 202656 min

The SpaceX IPO… What Happens When $1.75 Trillion Meets 4% Float

On the latest Click Beta, Matt Zeigler, Dave Nadig and Cameron Dawson discuss what could happen when SpaceX goes public and why this IPO may be as much a market structure problem as a valuation problem.They break down the potential impact of a $1.75 trillion IPO, 100 times sales, a small free float, forced index buying, passive fund flows, options trading, bubble dynamics and what advisors should tell clients who want SpaceX exposure.Subscribe to Click Beta on Spotify⁠⁠Subscribe to Click Beta on Apple PodcastsDave Nadighttps://x.com/davenadigCameron Dawsonhttps://x.com/CameronDawsonTopics Covered:Why the SpaceX IPO could create a chaotic first 30 days of tradingHow 100 times sales, no earnings and a $1.75 trillion valuation change the discussionWhy pre-IPO access, lockups, fees and vehicle structure matter for investorsHow Palantir and Tesla frame the debate over extreme growth stock valuationsWhy SpaceX could create unusual supply and demand pressure in the public marketHow options trading, Nasdaq 100 inclusion and accelerated index rules could affect price discoveryWhy free float matters and how a 4 percent float could become a 12 percent index adjustmentHow much passive demand might chase SpaceX shares after the IPOWhat the bubble triangle says about technology, speculation, money and creditWhy real earnings do not disprove a technology-driven bubbleHow liquidity, private credit gates, IPO supply and buybacks could shape the next phase of the marketWhy advisors need to help clients think through sizing, exit plans and safe accessPeak season travel, TikTok monoculture, Ocean City, Coheed and Cambria, and the lost art of CDs and mixtapesTimestamps:00:00 Why the first 30 days could be chaotic04:00 Why everyone is talking about the SpaceX IPO09:23 The market structure problem behind SpaceX13:00 Options trading, small indexes and forced buying17:18 How much passive demand could chase SpaceX21:27 Why real earnings do not disprove a bubble25:43 Liquidity, IPO supply and why bubbles can keep going29:13 What advisors tell clients who want SpaceX33:17 Fake SPVs, scams and safe access37:39 Ocean City, peak season and Jersey Shore memories41:39 Coheed and Cambria opening for Shinedown45:44 Summer concerts, Bikini Kill, Weezer and The Shins46:25 Cleaning out old cars and rediscovering CDs50:10 Old iPods, underwater MP3 players and forgotten playlists53:20 Mixtapes, liner notes and physical music culture55:08 Where to find Dave Nadig and Cameron Dawson

June 4, 20261 hr 1 min

Tech Spending Has a Cash Problem | Jim Paulsen on the Two Signals That Could Trigger a Correction

Jim Paulsen returns to Excess Returns to discuss why he is increasingly concerned about a meaningful stock market pullback, even though he does not expect a bear market. We cover the extreme divide between AI-driven “new era” stocks and the rest of the market, what oil and inflation could mean for the Fed, why tech earnings and market leadership have become so concentrated, and what investors should watch as the economy potentially shifts from inflation fears to growth fears.Subscribe to the Jim Paulsen Show on Spotify⁠⁠⁠⁠Subscribe to the Jim Paulsen Show on Apple PodcastsJim Paulsen on Xhttps://x.com/jimwpaulsenPaulsen Perspectiveshttps://paulsenperspectives.substack.com/Topics CoveredWhy Jim thinks the economy could weaken into the summer and fallThe risk of a sharp stock market pullback without a full bear marketHow inflation, oil prices and geopolitical conflict are affecting the marketWhy the Fed may face a difficult decision under Kevin WarshThe extreme divide between new era tech stocks and old era stocksWhy AI and innovation need to benefit the broader economy to be sustainableHow tech earnings have become concentrated in only two S&P 500 sectorsWhy small-cap tech and unprofitable tech leadership may be a warning signWhat past oil price peaks suggest about stock market correctionsWhy investor focus may shift from inflation risk to growth riskHow this bull market has been driven by a series of booms in Mag 7, Bitcoin, gold, oil and AITimestamps00:00 Why AI has to benefit more than the tech sector05:18 Inflation, oil prices and the impact of geopolitical conflict10:54 New era stocks versus old era stocks15:43 Corporate cash, AI spending and pressure on tech investment20:17 Policy tightening and why economic momentum may slow25:31 Why AI must spread beyond the companies building it31:42 Why this tech boom is different from the 1990s36:51 Why market breadth keeps fading back into large-cap growth42:06 Small-cap tech and unprofitable tech start leading46:15 Why the damage from oil shocks often comes after oil peaks50:15 How the market could shift from inflation fear to growth fear54:40 The bull market of booms in Mag 7, Bitcoin, gold, oil and AI59:46 Jim’s main takeaway for investors nowFollow the Excess Returns podcasts:https://excessreturnspod.com/Contact us:excessreturnspod@gmail.com/No information on this podcast should be construed as investment advice. Securities discussed in the podcast may be holdings of the firms of the hosts or their clients.

June 2, 2026Episode 4531 hr 3 min

He Quantified 200 Years of Disruption | Kai Wu on Separating Software Survivors from Value Traps

Kai Wu of Sparkline Capital joins Excess Returns to break down his latest research on AI disruption, software stocks, value traps, and intangible moats. We discuss why software valuations have collapsed, why traditional value investing can fail during technological disruption, and how investors can separate potential AI winners from companies whose business models may be permanently impaired.AI Disruption: Moats and Value Trapshttps://www.sparklinecapital.com/post/ai-disruptionKai Wu on Xhttps://x.com/ckaiwuSparkline Capitalhttps://www.sparklinecapital.com/Topics Covered:Why software stocks are trading at a historically unusual discount to the marketHow AI disruption can create both real opportunities and dangerous value trapsWhy Blockbuster, Borders, RadioShack and newspapers offer lessons for today’s software selloffHow patent data and natural language processing can measure technological disruptionWhy disruption has helped explain the poor performance of traditional value investingWhy value investing may still work in sectors insulated from technological changeHow intangible assets like brand, human capital, intellectual property and network effects can protect companiesWhy Walmart and The New York Times survived disruption while other incumbents did notHow David Teece’s complementary assets framework applies to AI, software and moatsWhy AI adoption and intangible value together may help identify software survivorsWhy high dispersion in disruption-scare stocks creates a potential opportunity for stock pickersTimestamps:00:00 Software stocks now trade at a historic discount04:26 What makes a cheap stock a value trap08:25 Measuring disruption using patents, filings and natural language processing13:23 Is AI the biggest disruptive wave in history?14:55 Why disruption keeps stacking on retailers17:10 How technological change disrupted traditional value investing21:20 Why value investors need to know when not to apply old metrics25:06 Why more of the market is exposed to innovation than ever before27:07 What Walmart and The New York Times teach about surviving disruption32:40 The four intangible moats that can protect companies35:02 Why intangible value works better in disrupted industries38:50 Apple, Amazon, Macy’s and the difference between disruptors and value traps42:58 Applying intangible value to beaten-down software stocks47:05 Why AI adoption alone is not enough48:23 How AI could improve margins for surviving software companies50:09 Which industries are adopting AI fastest52:14 The software sweet spot: AI adoption plus intangible moats53:53 Why disruption-scare stocks have extreme return dispersion57:40 What happens when intangible value is applied to high-disruption stocks01:01:42 Why “code is not the moat” for many software companies

May 30, 20261 hr 8 min

The Three Cracks in the AI Trade | Ben Hunt, Brent Kochuba and Aahan Menon on What Could Derail the Market's Biggest Bet

In this episode of Last Call, we break down one of the most confusing market backdrops in years: AI-driven earnings optimism, rising oil and inflation risk, stretched options positioning, and the market impact of a potential SpaceX IPO. Jack Forehand and Matt Zeigler are joined by Aahan Menon, Ben Hunt, and Brent Kochuba to examine what macro data, political narratives, options flows, and index mechanics are saying about where markets could go next.Follow Last Call on Spotify⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Follow Last Call on Apple Podcasts⁠Topics Covered:Why markets are looking through war, oil shocks and valuation concernsHow earnings estimates are driving sector performance in the AI tradeAahan Menon on growth, inflation, oil prices and macro regime signalsWhy demand destruction from higher energy prices can take longer than investors expectWhat a rising growth and rising inflation regime can mean for stocks, commodities and bondsBen Hunt on World War AI and the collision between AI market optimism and political backlashWhy opposition to AI data centers could become a major market and election issueBrent Kochuba on call buying, implied volatility and signs of options market frothWhy CORE 1M and skew signals may be warning of a downside spasmHow the SpaceX IPO could affect index flows, active managers and mega-cap stocksTimestamps:00:00 Intro: AI, inflation and options risk in one market05:40 Earnings estimates, AI optimism and why fundamentals still matter10:31 Aahan Menon on a difficult macro backdrop15:29 Why energy shocks and demand destruction take time20:24 Why inflation can persist even if the oil shock eases24:47 Ben Hunt on World War AI and the AI resource build-out30:00 AI CapEx as the pillar holding up market optimism34:00 The political backlash against AI data centers38:00 Why data center opposition matters for markets42:09 Why price action can distort the AI narrative47:48 CORE 1M, stretched call prices and downside spasm risk52:00 Why Nasdaq options are priced for upside crashes56:11 Index rules, human judgment and the SpaceX IPO01:00:34 The free float problem and rebalancing pressure01:05:22 Space data centers, valuation and the size of the AI opportunity

May 28, 2026Episode 45249 min

Cheap Is a Warning, Not a Thesis | Adam Parker on What This Market Is Really Pricing

Adam Parker returns to Excess Returns to explain why the market may be trading more on future fundamentals than investors think, how AI is reshaping stock selection, and why traditional valuation signals may be less useful than they once were.We discuss AI revenue exposure, software vs. semiconductors, Mag Seven positioning, gross margins, estimate achievability, spinoffs, and Adam’s highest-conviction contrarian sector idea.Adam Parker on Xhttps://x.com/Adam_Parker_TriTrivariate Researchhttps://trivariateresearch.com/Trivector Researchhttps://www.trivectorresearch.comTopics covered:Why “sell in May” and other calendar-based market rules often lack statistical supportWhy Adam thinks the stock market leads the economy, not the other way aroundHow to think about whether today’s AI market is a bubbleWhy the market may be trading on 2030 or 2031 fundamentalsWhen investors may start demanding returns on AI capital spendingWhy AI could create new jobs rather than simply destroy existing onesHow large AI-related IPOs like SpaceX could affect index mechanics and portfolio flowsWhy gross margin expansion is one of Adam’s most important stock selection factorsWhy Adam remains cautious on software and prefers semiconductors over softwareHow valuation, quality, and other traditional factors may have changed since COVIDWhy estimate achievability and incremental margins matter more than simple beats and missesHow to think about the Mag Seven, Nvidia, and market concentrationWhy spinoffs may become more important in an AI-driven marketWhy healthcare is Adam’s highest-conviction contrarian sector ideaTimestamps:00:00 Why the market may be trading on future fundamentals04:37 Is today’s stock market an AI bubble?08:45 When AI capex needs to show real returns13:00 How trillion-dollar IPOs could reshape index mechanics19:00 Why gross margin expansion is such a powerful factor23:00 Why software companies face AI-driven margin pressure27:21 Where AI semiconductor exposure goes next31:54 Why valuation does not work for stock picking35:03 What has changed in markets since COVID39:22 Estimate achievability and incremental margins43:06 How to think about the Mag Seven and Nvidia47:55 Why healthcare could be the biggest AI opportunity

May 26, 2026Episode 4511 hr 6 min

He Built the Fund He'd Hold 30 Years | Eric Crittenden on What Investors Pick When Labels Come Off

Eric Crittenden joins Matt Zeigler and Jason Buck for a deep dive into trend following and managed futures.They discuss why systematic macro trend investing works, how risk transfer creates a return premium, and how trend can fit inside a diversified all-weather portfolio.Standpoint Fundshttps://www.standpointfunds.com/Topics covered:Why trend following can struggle during fast reversals and thrive after regime shiftsHow systematic investors manage whipsaws, drawdowns, and emotional pressureThe trade-offs between short-term, medium-term, and long-term trend signalsWhy Eric prefers simple, durable systems over complex models and constant tinkeringWhen it makes sense to remove a futures market from a systematic portfolioWhy trend following may earn a risk transfer premium from hedgers and commercial usersHow copper producers, options markets, and insurance help explain trend following returnsWhy rising interest rates and short bond positions can benefit managed futuresHow trend following can pair with global equities in an all-weather portfolioWhy smoothing a trend strategy can reduce its value when investors need convexity mostThe behavioral challenge of holding diversifiers that look wrong at the wrong timeWhy investors and advisors often want alternatives but struggle to stick with themTimestamps:00:00 Why trend following opportunities appear under pressure04:39 Pro-growth positioning before the whipsaw09:32 Short-term vs long-term trend signals13:46 The danger of tinkering with systematic strategies18:43 What actually changes in a durable process23:27 Rising rates, short bonds, and collateral yield28:00 Copper hedging and why trend followers buy rising prices32:00 Options, insurance, and risk transfer through time36:28 Regime shifts and supply-demand imbalances41:00 What investors choose when asset classes are anonymized45:11 Building a portfolio for 30-year terminal wealth50:06 Why portfolio construction is different than judging individual strategies56:15 Why trend following and value investing require faith01:00:42 Reducing errors vs chasing highlight-reel winners01:05:36 Where to follow Eric and Standpoint