Jeffrey Stewart

A $470 million Buffett disciple just closed his fund and declared stock picking is dead. This is literally the most BULLISH SIGNAL for active management I've seen in years. Guy Spier ran Aquamarine Fund for 28 years out of Zurich. Returned 1,186% since 1997. Won a charity lunch with Buffett in 2007. And he just gave up. His reason is that AI is making research obsolete. Everyone has access to the same data. The edge is gone. I've heard this EXACT argument before. In 1999, they said the internet eliminated information advantages. In 2007, they said quant models had solved investing. In 2012, they said passive indexing made stock picking pointless. Every single time, the obituary for active management was written at PRECISELY the wrong moment. Here's the data Wall Street doesn't want you to focus on: In the first half of 2025, 46% of large-cap active managers BEAT the S&P 500. Only 22% of small-cap managers underperformed their benchmark. That's the best showing for small-cap stock pickers in over two decades of SPIVA data. The moment everyone is giving up on active management is the moment active managers are performing BETTER than they have in years. Meanwhile, investors yanked $640 billion from active mutual funds in 2025. Passive funds now control 55% of total US fund assets. This is textbook contrary indicator territory. When money floods mindlessly into index funds, it creates the EXACT inefficiencies that skilled stock pickers exploit. Passive funds don't analyze balance sheets. They don't question management. They don't distinguish between a company trading at 8x earnings and one trading at 80x. They just buy whatever's in the index regardless of price or fundamentals. You can't call that investing. And I'm not done here yet: The Mag 7 stocks that drove the S&P 500 for two years are now spending $700+ billion annually on AI infrastructure with NO measurable productivity returns for most companies deploying it. As valuations continue to compress, passive investors own every single one of those overpriced names by default. Active managers can CHOOSE not to. That's literally a superpower. Spier said the Buffett-and-Munger approach of finding overlooked, high-quality companies at reasonable prices no longer works because "everybody is looking everywhere." With respect - no, they're NOT. Everybody is looking at the SAME 7 stocks. The same mega-cap tech names. The same AI narrative. Nobody is looking at small-cap energy companies trading at 5x earnings. Nobody is looking at commodity producers with fortress balance sheets. Nobody is looking at emerging markets trading at historic discounts to US equities. THAT'S where the edge lives. The best opportunities in my entire career have come when the consensus said a strategy was dead. Active management isn't dying. The lazy version of it is. And for those of us willing to do the work, ignore the noise, and think independently? We HAVE entered the GOLDEN AGE of stock picking. The herd is running in one direction. I'm going the other way.

We lent money in emerging markets using AI. I can confirm AI is really, really good at spotting fraud. "30% of FINES levied" is going to be a gold mine for a claw bot with the right human mentor.

Nice to see @TxDOT has a plan for eVTOLs in Texas ruralairmobilitynews.com/texas-txdots-m…

@FundamentEdge Could not agree more "there is no better time to be starting a careers as an investor". AI is lowering the friction to go public AND to analyze equities.

AI won't kill fundamental investing because more information doesn't kill alpha. We have decades of priors here (Excel, Bloomberg, alt data...all democratized analysis & information gathering, and didn't kill alpha). As measured by factor volatility, stocks are less efficient and more alpha-rich than ever (and empirically, the ability of multi-eight figure market neutral multi-managers to consistently grind out 10-15% returns in an idio-maximized way proves this point...15 years ago a $10bn hedge fund was considered to be impossibly large). Innovations in investment process have shifted alpha pools, for sure, and systematic investors have arbitraged many old, reliable fundamental alpha pools. But as the players at the poker table have shifted, the constraints of those new players have created new alpha pools. Long duration fundamental investing has been gutted, and definitionally competing against a group of non-fundamental (quants, factor/thematic investors, indexers) and duration-constrained (multi's) investors should be a huge competitive advantage, long term (however frustrating in the near term). To wit, a 9-month thesis where I "look through" the next two prints is now considered a long-term thesis. Rigorous investment process serves investment judgment, but the real alpha generation fits a power-law distribution and there is some ineffable "nose for money" that the great investors have, that cannot be trained necessarily. Investing is a very hard game, that cannot be distilled to a reinforcement learning sandbox (by the time it is, the regime will have shifted and new drivers move stocks). AI has no sense of materiality, no true discernment, and the lack of context of N of 1 situations (if you haven't noticed, we are living in an N of 1 world!). There is a irreducible element of humanness that is critical to success in fundamental investing, and that won't change. What does this all mean? In my opinion, there is no better time to be starting a careers as an investor. My first year on the desk, I spent a lot of time doing grunt work: updating Nielsen files, updating models for my PM, creating same store sales master files, building question lists for CEO meetings, etc. This is grunt work. I can automate this all now, and get more quickly to the deep, value added parts of learning the investment process. Will AI drive alpha? This is a debate people are having, which I find sort of silly. When used correctly, by the right investor, of course it will. Ask any great investor if they had another 4 hours of research time per day whether the quality of their research would improve? That's kind of a dumb question...of course it will. Compressing the mechanical part of your job to focus more on the artisanal part of the job is Step 1, and with agentic systems accelerating fast is now in the strike zone of possibility. This is before we start to layer in a broader monitoring net and use cases to go deeper and build more rigor, finding signals in unstructured data that were missed before, as well as turning your investment genius into a co-pilot pattern recognition system. The future is very bright for fundamental investing, in my opinion.

@HannahDCox I am old enough to remember, airport security was once private and worked.

If TSA were privatized it would operate like CLEAR. I really don't get the Democrat hand-wringing over this.

@mcuban Its worse than that! They send weekly bills that no one can review because of HIPA. Invoices with zero accountability.

I don’t think people realize how much healthcare costs are driving big companies to fire and not hire. It costs them $30k per family, per year for premiums and care. Most of that goes to the massive, vertically integrated insurance companies that send weekly bills that no one reviews in details. And it doesn’t include the company overhead to deal with it all. It’s usually the 2nd largest expense after payroll. Which is insane It’s far easier to blame AI than it is to blame Healthcare costs. Want to increase jobs, wages and improve affordability for every American ? Break up the biggest insurance companies. Make divest non insurance companies. They don’t need thousands of subsidiaries. That’s how they game and abuse the system and increase costs for all of us. Call your senator and tell them to support the BreakUp Big Medicine Bill by @HawleyMO and @SenWarren.

@Rukwengye One of the reasons we started @mimeo is physical paper improves learning and retention. It's also why my new book is paper: globalipobook.com

Denmark is investing $83,754,486 in textbooks and turning away from its digital-first approach to education. This follows research showing that screens reduce concentration, impact mental health, and hurt student performance. Yet another dynamic to the EdTech debate.

Great article from @McLainSean in the @WSJ on Amazon Bringing Fast Delivery to Rural America. Can't wait for #eVTOLs @LandingsNetwork and rural @zipline

@naval Android too. Which dominates Outside the US

AI coding agents can now deliver one-shot custom apps straight to your phone. It’s the beginning of the end for the iPhone’s dominance.

We're expanding across rural America. 🌾 Need: Strategic vertiport locations Offer: Zero CapEx, revenue share, full turnkey solution Got 1.5+ acres? Join the movement. landings.co #Landings #RuralAirMobility #eVTOL

@reidhoffman Here is a crazy discovery: Claw bots have personality types. You can use the OCEAN behavioral framework to make AI-Human teams better align.

Not enough companies are using AI to dissolve the coordination tax. As you add people and increase scope, the tax on aligning them grows superlinearly. AI can increase throughput without adding layers of humans whose core job is alignment work.

More #GlobalIPO coverage pulse2.com/jeffrey-stewar…

Turns out IPO are back! This time they are Global. Book is out next week. citybiz.co/article/819206…

Amazing stuff. Learning by doing. Q: "Why not build a LNG ship here?" A: "The cost of building an LNG ship in Asia is ~$260M. It costs about $1B here." Q: "So why can't shipbuilders just use American steel?" A: "When we put tariffs on imported steel, it drives the prices of steel up. What we know today is that American steel is about twice as much as steel in China." Q: "So what you are saying is when the price of steel goes up because of tariffs, then the American steel manufacturers hike the price of steel? 🤯"

For years they told you stock picking was dead. "Just buy the index. Don't bother with research. The passive bid will carry you." I'm here to tell you that era is OVER. And the people who don't adjust are going to pay for it. The S&P 500 just broke below its 200 day moving average for the first time in 214 sessions. It's on pace for its fourth consecutive losing week. The Mag 7 which carried the entire market for 3 years are getting dismantled. Microsoft down 18% year to date. Amazon down 10%. The Roundhill Magnificent Seven ETF down 6% while the equal-weight S&P is outperforming. The rotation I've been calling for is here. R is for Rotation, not Recession. But here's what most people don't understand about passive investing, and why this unwind could be SAVAGE: The machine that drove prices up without caring about fundamentals is going to drive them down the same way. There's been no real price discovery in large-cap US equities for years. Money flowed in because money was flowing in. That's NOT investing. I saw the exact same dynamic in Japan in the 1980s. I ran the Fidelity Overseas Fund during that bubble. The Japanese market got to two-thirds of the entire non US equity index. Banks traded at 100x earnings, 10x book. The float was so tight you couldn't buy or sell ANYTHING in size without moving the market 20%. Jeremy Grantham, John Templeton - all the greats were screaming about it. They were early. But once the worm turned, it was fast. And the beautiful part was you didn't need to be a genius. You just had to avoid Japan and index everything else. Hit them where they ain't. That's where we are with US mega-cap tech right now. You don't need to make complicated bets. Just stop being concentrated in the same 7 stocks that everyone else owns. Step 1: switch your cap-weighted S&P into the equal-weight RSP. Overnight you cut your Mag 7 exposure from 35% to 0.2% per name. The equal weight has been winning all year. I think that continues. Step 2: look overseas. International markets have been outperforming the US in 2026. European equities, Japanese stocks, emerging markets - all cheaper, all under-owned, all benefiting from the capital rotation out of US tech. Step 3: get into real assets. Gold. Energy. Commodities. These are the sectors that perform when inflation is the dominant risk, which it is. Oil at $96 with a war in the Persian Gulf isn't going back to $50 regardless of what any politician promises. And step 4: if you have the stomach for it, there's a portfolio of overvalued garbage out there that's going to get cut in half. Companies with no earnings, no moat, and no reason to exist at current prices. The short side hasn't been this attractive since 2000. After years of the index crushing active managers, the tables have TURNED. Dispersion is widening. Fundamentals are starting to matter again. Stock picking isn't dead. IT WAS JUST SLEEPING

THE SKY IS BECOMING STRUCTURED Most people see another #eVTOL flight. But in Guangzhou, something quieter happened. The GOVY AirCab didn’t just take off. It operated inside a context that is already being prepared to receive it. Planned vertiports. Defined urban use cases. Institutional presence. A narrative already pointing to real operations. This is no longer about proving flight. It is about positioning within an emerging system. To understand this moment, it’s important to recognize what has already been built. EHang, with the EH216-S, established something foundational: A way to operate eVTOLs in the real world. Not as isolated aircraft, but as part of a controlled, repeatable, and certifiable environment. Short-range missions. Defined routes. Autonomous logic. Integration with local infrastructure. They didn’t just introduce a vehicle. They helped make operations… understandable. What GOVY AirCab reveals is not a replacement of that path. It shows how another industrial player is entering the same emerging layer, bringing its own strengths, constraints, and interpretations. ✔️2 seats ✔️30 km range ✔️~120 km/h cruise ✔️25-minute charging ✔️Target price below ~$230K ✔️Planned production and delivery timeline These are not extreme specifications. They are intentional boundaries. Because this category is not trying to solve everything. It is trying to fit into specific, repeatable scenarios: ✔️Urban crossings ✔️Tourism routes ✔️Short-distance connections ✔️Early-stage commuting corridors And this is where the real shift is happening. Not in performance alone. But in alignment between vehicle, infrastructure, and use case. Multiple companies are now moving within that same direction. Not as copies. Not as direct challengers. But as participants in a space that is still being shaped. The most important signal is not who is ahead. It is that: The conditions for operation are no longer hypothetical. They are being prepared, tested, and gradually normalized. What we are witnessing is subtle, but decisive. The sky is not being “disrupted”. It is being organized. And once that structure stabilizes, everything that follows becomes easier to deploy, easier to replicate, and easier to understand. Cities once grew around rivers. Tomorrow, they will grow around autonomous air corridors. eVTOL is not entering the skyline. It is reorganizing it. #Skylark @eVTOLBrazil Before the world understands it, we are already flying through it. #GAC #GOVY #AirCab #LowAltitudeEconomy #ElectricAviation

@eVTOLBrazil Happening in North America too thanks to @LandingsNetwork 2,000 vertiports planned

@MollySOShea Its impact on the IPO and Global liquidity. Out on the 31st. globalipobook.com

Is anything new actually being said in AI other than growth adoption, lawsuits, fraud, job fear, & incremental “breakthroughs”? Am I missing something? What should I be asking?

New @HorizonAircraft is looking good, can't wait to fly youtube.com/watch?v=AZa0QQ…