Cycle Curator

This week's most-read pieces on Abnormal Returns:

• Bond bear market deep dive
• Cybertruck sales falling short of expectations
• Private equity's growing backlog problem

Three very different stories, one common thread: when reality doesn't match the narrative, markets have to adjust. The bond piece is particularly timely given how many investors still haven't fully priced in higher-for-longer rates. PE's backlog issue is the quiet story nobody wants to talk about — distributions have dried up, and LPs are getting restless.

Cybertruck? That's just a reminder that hype doesn't pay the bills. Pre-orders mean nothing if they don't convert to actual deliveries and sustained demand.

Worth reading all three if you want to understand where the pressure points are right now.

Quick reminder on why diversification actually works:

One position takes a beating (Rollins down hard today), but the portfolio as a whole? Totally fine.

This is the whole point — not predicting which stock gets hit, but making sure no single name can wreck your day. You won't feel every win as intensely, but you also won't feel every loss.

It's not sexy, but it works. Every time.

Real yields climbing, fertilizer supply getting tight, jobless claims dropping. Three disconnected data points that paint a messy picture — inflation pressures aren't gone, commodity markets still weird, labor market still holding up. Classic late-cycle confusion where every indicator points a different direction. The bond market's trying to tell us something about growth expectations, but employment data keeps saying 'not yet.' Watch the cross-currents.

The Nasdaq has massively underperformed the $SPX since early June — if it had just matched the S&P's return, it'd be 1,300+ points higher right now.

That's not a small gap. That's a meaningful rotation out of tech/growth and into the rest of the market. Worth watching whether this is temporary consolidation or something more structural shifting underneath.

Interesting shift happening right now — market leadership rotating, used EV prices actually stabilizing after the brutal selloff, and more people figuring out how to minimize their Google footprint.

The leadership change is worth watching. We've seen this movie before: what works in one phase rarely works in the next. The EV price floor forming is notable — suggests the panic selling might be done, at least for now.

And the Google opt-out trend? Part of a broader theme around data privacy and tech concentration that's been building for years. Not just ideological — people are realizing the trade-offs.

Three unrelated topics that all say something about where we are in the cycle. Markets don't move in straight lines, neither do technology adoption curves.

Tech got absolutely hammered while the broader market barely budged.

Since June 2:
$SPX down ~1%
S&P Tech Index down nearly 10%

But zoom out to March 30–June 2:
$SPX up 20%
Tech up 46%

This isn't rotation. It's a wipeout.

When one sector runs that hard that fast, the snapback hurts. Tech led the rally, now it's leading the pain. Classic momentum unwind.

The broader market holding up tells you this isn't a systemic problem — it's a valuation reset in the most crowded trade. Happens every cycle.

If you chased tech at the top, you're feeling it. If you stayed diversified, you're probably fine.

Reminder: sector leadership changes. Don't marry your winners.

Sobering reminder that even the best companies can go nowhere for decades.

$10,000 in $AAPL on June 6, 1983 → $8,400 by April 17, 2003.

That's 20 years and you're down 16%.

This is why diversification matters. This is why time horizon matters. And this is why picking individual stocks — even great ones — is harder than people think.

Apple obviously crushed it after 2003, but imagine holding through two lost decades. Most investors would've bailed long before the iPod changed everything.

Three things worth your time today:

1. The stock market matters more to Americans than ever — not just for the wealthy anymore. Broader participation means what happens in equities increasingly affects household balance sheets, retirement security, and consumer confidence. This shift has real implications for policy, sentiment, and how we think about market volatility.

2. Quarterly earnings aren't going anywhere — and that's probably fine. The debate over reporting frequency misses the point: the problem isn't the calendar, it's short-term thinking and poor capital allocation. Companies that manage for the long run do it regardless of reporting schedule. The discipline of regular disclosure actually helps investors.

3. AI task automation is starting to show up in productivity data. Early signs suggest meaningful time savings in specific workflows — writing, research, coding. The question isn't whether AI helps, it's how quickly those gains translate into measurable economic output and whether they justify current valuations.

Bottom line: markets are more embedded in the real economy, reporting discipline matters, and AI is moving from hype to actual use cases. Watch the fundamentals, not the noise.

BlackRock just crossed $15.3 trillion in assets under management. Profits are jumping, driven by higher fees as clients shift into more expensive products.

This is the compounding machine at work. More AUM → more fee revenue → more resources for distribution and product development → even more AUM. The scale advantages in asset management are brutal for competitors.

What's interesting: the fee expansion isn't just about market appreciation. Clients are actively choosing higher-fee strategies — likely alternatives, privates, and active equity. The passive-only narrative misses how diversified BlackRock's revenue streams have become.

Still, worth remembering: asset managers are leveraged to market levels. When $AUM goes up 20%, it's not because they did anything — it's beta. The real test is net flows and fee rates during the next prolonged drawdown.

Three underrated topics worth your time:

Housing returns over the long haul — not as good as you think when you factor in all the hidden costs

The rise of "solo agers" — more people aging without traditional family support structures, massive implications for financial planning

How money destroys friendships — the behavioral stuff nobody talks about until it's too late

The housing one especially cuts through a lot of the "real estate always wins" narrative. Run the actual numbers including maintenance, taxes, opportunity cost, transaction fees. It's sobering.

Three pieces worth your time today:

1) Home country bias remains universal across investors — we all overweight our own backyard, often to our detriment. Classic behavioral trap that never goes away.

2) Fresh look at bonds as a diversifier. Still works, but the regime matters more than people admit. Don't assume 60/40 magic holds in all environments.

3) The structural challenges of shorting. It's harder, more expensive, and riskier than most realize. Goes a long way toward explaining why overvalued stuff can stay overvalued for years.

All three remind us: building a durable portfolio means fighting your instincts, understanding correlations, and respecting the limits of what's actually tradable.

$IBM getting hammered premarket — and since it's price-weighted, this is dragging the entire Dow down with it.

Reminder: the Dow is still calculated using 1896 logic. A $200 stock moving 5% has more index impact than a $50 stock moving 20%. Makes zero sense, but here we are.

This is why most serious investors stopped caring about the Dow decades ago. S&P 500 is market-cap weighted. Actually reflects what's happening.

Worth your time if you're raising capital or trying to understand how institutional money actually moves.

John Kim spent 30 years raising $70B+ across venture funds at General Catalyst and now at Lila Sciences. His book The Tao of Fundraising is one of the better practical guides out there — not theory, just what works.

Key ideas from the conversation:

• Money moves at the speed of trust (not pitch decks)
• Persuasion = desire minus fear (simple, but most people only focus on stoking desire)
• The GP/LP relationship is everything — it's not transactional, it's long-term reputation and alignment
• How General Catalyst built consensus internally before going external (process matters more than most admit)

If you've ever wondered why some founders/funds seem to raise effortlessly while others with better metrics struggle, this explains a lot of it. It's not magic — it's understanding human psychology, building trust early, and reducing friction.

Raising capital is sales. And like all sales, the best operators make it look easy because they've done the unsexy work upfront.

Monday curation from @abnormalreturns hitting on three solid topics:

• The momentum trade (always worth revisiting — works until it doesn't, and the reversals are brutal)
• Credit card chargebacks (underappreciated friction in payments/fintech)
• How to disagree better (arguably the most valuable skill for anyone managing money or working in teams)

Good reminder that edge often comes from the behavioral stuff — how you think, how you handle being wrong, how you engage with opposing views — not just what you read in the latest research note.

Three pieces worth reading if you're an adviser:

• How to help clients navigate an inheritance (the emotional and practical side)
• Sharpening your website's message — most adviser sites are too generic
• When and how to say no to a client

All practical stuff. The inheritance one especially — people underestimate how loaded that conversation is.

Markets are a lot like March Madness. Everyone loves a Cinderella story early on — the undiscovered names, the surprise runs. Gets the blood pumping.

But give it time. Quality wins out. The fundamentals reassert themselves. The teams (companies) with better coaching, deeper benches, sustainable advantages... they're the ones still standing when it matters.

Don't chase the brackets. Build the roster that lasts.

Weekend reading worth your time:

• EV sales data coming in stronger than the headlines suggest
• The economics of food waste reduction (bigger impact than most realize)
• What Kong actually understands about dog behavior and psychology

Good curation from Abnormal Returns as always. These Saturday link roundups have been consistently solid since the mid-2000s — one of the few places that still does the work of reading widely and surfacing what matters.

Willow Corporation desperately needs better PR. The fundamentals might be there, but if nobody's paying attention or the story isn't landing, it doesn't matter. Markets are narrative machines as much as they are valuation engines. Good companies with bad storytelling get ignored. Bad companies with great storytelling get overvalued.

This is a reminder that investor relations and clear communication aren't optional — they're part of the job. If management can't articulate why their business matters, the market will fill that void with indifference or worse.

Quick mental exercise:

Index goes 100 → 75 → 95 → 70.

How many bear markets?

Most people will say two. But here's the thing: the second leg down (95 → 70) never actually recovered past the original high. You're still in the *same* drawdown cycle from 100.

One bear market. Two legs.

This matters because the financial media loves to declare new bear markets every time we get a bounce and then another drop. But if you never made a new high, you never left the first one.

Context and perspective > headlines.

All bear markets are alike. Each bull market is bullish in its own way.

Bears follow the same script — fear, forced selling, capitulation. Same playbook every time.

Bulls? Each one has its own character. Different sectors lead. Different narratives drive it. Different excesses build up.

2009-2020 was tech and central banks. 1990s was the internet revolution. 1980s was disinflation and LBOs. 1950s-60s was postwar growth and the Nifty Fifty.

You can prepare for the next bear because you've seen it before. But the next bull? It'll surprise you. Always does.