2-minute read
The market keeps going up…so why do I feel so uncomfortable right now?
2026 has been a two-part story so far. Here’s part 1:
And Part 2?
Apples and oranges:[1]
This is dumb. How does the market put a war in the rearview so fast?
In short, the market doesn’t give a hell about wars unless it’s World War III. Stocks are heartless.
So if not war, what would make it fall again?
Probably not the next headline. If this market turns in a meaningful way, it’s likely going to come down to something much simpler: whether companies actually make money from all the AI they’re spending on.
Wait… isn’t AI the reason the market is going up?
Right now, a big driver of the market—especially tech stocks—is the massive amount of money being spent on AI and cloud infrastructure. Companies are pouring billions into data centers, chips, and software. That spending shows up as revenue for other companies. And that revenue helps support stock prices.
So what’s the concern?
At some point, companies are going to ask a basic question: “What are we getting for all this?” It’s one thing to invest heavily in a new technology. It’s another thing to generate a clear return on that investment. If businesses start to feel like the payoff isn’t there—or isn’t coming fast enough—that spending could slow.
And if spending slows?
That’s where things could change. The current trend in stocks likely continues as long as that AI investment cycle stays strong. Along the way, we may see normal pullbacks—10%, maybe a bit more.
What’s a bit more?
A more meaningful downturn probably requires a shift in the story. A slowdown in AI-related spending could be one of those shifts. I find it hard to believe that shift wouldn’t result in a drop of 20% or more.
So what should I take away from this?
Two things. First, not every market decline means something is broken. Corrections happen—even in strong markets. Second, when you’re trying to understand where things might go next, it helps to focus less on headlines and more on what’s actually driving the market underneath. Right now, that driver is AI investment. If that continues, the market likely has support. If it slows meaningfully, the story may change.[2]