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People are calling me a software bear, and I don’t think that’s fair or true All I would say is…I see where the corporate spend is going, and it is not going to the incumbents. You can see this too. Look at the growth rates of these startup. See the lack of acceleration in the app layer incumbents I see what the stock prices are doing, and that does not benefit the incumbents, either What the incumbents have going for them is that their customers are prisoners, and these prisoners have learned to appreciate their captors. They *want* their current vendors to figure this out. The current vendors have probably 12-24 months to figure this out IMHO all we’ve had so far is a valuation reset. Uncertainty goes up, multiples come down. Anthropic and OpenAI are actively antagonistic toward the app layer…so valuations have to come down to account for that. There are so many other bear cases, many of which are credible. Multiples have to come down to account for that. There is no valuation support. Most software management teams are still selling shares What I do hear from people is: Each week the future for incumbent software becomes less clear, not more clear. Valuations are pricing in that uncertainty. This is all to say: This feels healthy and pretty normal to me. Software valuations have always been about the vibes, and right now the vibes aren’t great

I think we are close to megacaps announcing pause in AI capex. When it happens we will see US memory stocks drop 50% (Korea 30%), like silver few weeks ago. This is a Trumped up market of rolling bubbles (quantum cmp, rare earths, tether-gold, crypto, nuclear, AI capex ...)