Sold the qs which i find interesting. And last week you said that you are longer now than i you can remember so why did you trim alphabet i add significantly to alphabet in the 130s when all the genesis and noise came out and i thought it was a Short Term Impact and there was no there there. So i took the opportunity to really super ssize the position and now cutting it back to normal size. It is still one of high larger positions. But i dont think that it was prudent. So really risk manager and in terms of the qs, im short the qs as a heenlg because i have no idea what the Inflation Numbers will be. So i sold the position i had after eight days of market straight up, i would have sold them anyway. Because they are always a trade. They are just to express a near term view. So my near term view is just risk management. I have so much beta in the portfolio through the big names that i thought it was prudent to put a little hedge on it im thinking like you look at meta month to date, up 8. 5 , amazon weve been talking about hitting new record highs microsoft is up 6. 5 in a month. Alphabet is the worst performer of the mega caps month to date have you given any thought into rim t trimming any of those other positions . Im still i wont say lugging because it has done so well, but too long a position of meta i took it in 430s after what i thought was a pretty good earning report it is up eight days in a row. And i would have done it today, but the stock was down, at one point 2 or so. I actually traded a little bit of it. A little bit went longer that is already gone because i used the stop on trading position so i will lighten up on my meta position but purely as a Portfolio Management position. It is just too long. It is my largest position right now and i want to be pretty safe with michrosoft and the others. How are we viewing these stocks eight days in a row for formetad you are in it but trimming it reasonably consistently for the last eight, ten months maybe a little longer. How do we view these stocks in the here and now in what is a big week for ai which well drill down on in a minute so i think that you have to really look at them each individually at this point they have very, very different growth prospects. Very different multiples so the way were looking at meta for example is to say does meta deserve a hire multiple than google why is that. And were looking at them individually. What is your answer the answer is yes but a hard to come by yes we think there are higher barriers to entry on social media. I know ill granny myself here, but im less likely to stop using facebook and just go to Something Else because ill lose high whole community. But it is just as easy to use bing search as it is Google Search and there is the forward pes by the way 35 for meta, 29. 5 for alphabet that tells the story and you think that is justifiably so i think it is because when you look at metas Earnings Growth, 14 next year, 15 the year after that. And they have proven that they can cut costs. Our office has been doing a fun project and we said lets embrace ai, lets start using chatgpt. In a serious way and when we have questions that we might just ask each other, or go to google, lets actually put it into chatgpt and lets see what it comes up with. That is a real threat to search, a real threat to google. So we think of the barrier to entry there is just lower, it is harder so i think that you sus them out and you say apple, what are you really going to grow at, what about amazon i dont think that you buy them collectively joe, well get to nvidia later, but the own the others. And well have to get to it right now. You bought the qs with a great trade but im trained to always think about where is the risk. Im constantly looking at my strategy and saying where is the risk the risk in selling qs, apple is going higher you are seeing a rebuilding of positions in apple from people who have stepped away from apple so far year to date. I also dont want to get in front of i dont know what will happen with nvidia. May 22 is the report. To me it is apple and nvidia right now. When you look at these Mega Cap Companies you have to focus on them Strong Performance from alphabet and meta and amazon. They are not the near term catalysts for the market right now. So i am concerned about stepping in front of what i think is a rebuilding of positions in apple and nvidias earnings. I agree on apple. What is shocking in some respects, i dont remember a show in as long as i can remember where not a Single Person on the desk actually owned apple. Apple is going up he just rebalanced out of it. Jenny hasnt owned it a long time says it is dead money. And youve been in and out i think it is a trade here because of the ai announcement with open penai. That is what is building that was the report that they are nearing a deal with openai so that is what is driving it now. But then you come back to maybe they will sell a few more phones in this fresh cycle. I think that they think they will sell a lot more than a few. But to me youre still left back to where it is. I thought about buying it this morning as a trade, but i didnt want to take a lot of guff from you. Im glad i have that influence on you its only taken like 15 years. Would you rather buy a company that for 2025 and 2026 has 10 earnings gs growth expes or 27 and 28 presuming that they are trading at a similar multiple. What is going up right now near term, apple without a question but you know what, apple is trading at 23 times of only 10 growth so im saying wouldnt you rather own 27 and 28 Earnings Growth what im speaking towards is what i see currently in the marketplace right now. Apple reports its earnings you had so many people that stepped to the sidelines with apple. They lcame in with an historic buyback that taught everyone that bet against them a very punishing lesson what has happened subsequent to that what should have happened if apple was going to resume the down trend is apple, days that followed the earnings report, it should have been the high. I dont feel punished at all about not owning apple im talking about funds assuming they didnt own the others that have been so much better you have to get rid of the narrative keep the conversation apple centric. Because that is what im trying to focus on. If you are going to bet against the qs and s p, just know what you see in front of you the evidence suggests that apple is not going down im hedging, not betting. And number two, i think that the dialogue is getting dont take this the wrong way. Getting old that you have to own apple. Sure, it is 7. 5 of the s p, but as i said, so what it has been 7. 5 of the s p. Earnings growth right now is driven by their buybacks, not the fundamentals so it could be a trade in front of the announcement, but i dont think anybody in it world thinks that they have to own apple anymore. They have seen it as a lag and as an outperformer why do Companies Buy back stocks and issue difference de dividends . Because any dont have other places to use the cash they are sitting on a mountain of cash and they wont use that to do deals they could, but they dont need to they dont want to they cant. What do you mean they cant im glad you asked. They can do whatever they want youre right. But just because you can doesnt mean you should. And in their case sure they could, but i dont think that they have access to buy anything into is meaningful enough to move the needle in terms of future growth. Otherwise they would they are too big, they have their products like they are better off trying to drive growth by reducing their share count. It is a sign of maturity who are they going to buy . Who could they possibly buy to really drive earnings nvidia no is that has never ever been the Growth Strategy for that company. They didnt need it to be what they need to have happen is finally ignite a strong refresh cycle on the iphone, which they think that their foray into ai will be the catalyst do just that. Whether in part because of reports of openai incorporation and chatgpt into the iphone, it is whatever will take place out of wwdc less than a month from today. They have insent advised buying interest into the stock im not arguing the long term fundamental merits, Growth Opportunities of this company. Im saying what i see in front of me right now, risk to my is it that by the way, i dont own apple. So ive got the risk the risk to me is that the single largest weighting in the s p looks like you are seeing significant rebuilding of positions and to me it will move higher until its 200 we mentioned the arms race for ai is heating up and a really in, i dont know, 45 minutes or so it becomes red hot yet again because that is when openai holds its big event. Googles Developers Conference is tomorrow. And there is a lot to look at in this what todays announce the means not only for openais aspirations, but certainly what the reverberations are going to be for alphabet. How they are trying to compete with, fend off, be as relevant as, all the above. And really interesting that openai is holding this event and also one day before googles ultra important Io Developers event. Remember last year when google held this event, stocks shot up because it really proved its ai proposition what it could be so well get the two things back to back. Openai one will be streamed. And we know that we wont get gpt5, we wont get some kind of search engine, but sam altman said that he will produce something that users will really like and he thinks is magic. And that is what openai has been good at. Whether it was the original chatgpt, whether the image or video generator, there is some speculation over what we could be hearing today one possibility is an ai agent and it feels like the whole field is going toward an ai agent. You talk about wwdc, a key question there, how can siri be better, how can it turn into this ai agent. Sam altman talked about an extension of the user that can like automatically write emails and respond and the other almost like an can executive assistant that can reason, that can push back almost like a Senior Executive with a ceo he said he liked the latter better so that is a possibility well be listening for that. And another possibility or upgrade being speculated is builtin phone call capability so well see features not some massive product and probably steps on the way to an ai agent in terms of google tomorrow, the stakes could not be higher it feels like it has been playing catchup over the last 18 months so google has to come out and wow users and developers and remember its search generative experience has only been limited beta instance this is one of the narratives i love the deco as we call it that says openai event frontruns google io because in some respects they have been frontrunning google from the outside of this whole ai arms race process to the degree now that alphabet has come across as reactive rather than proactive because they have had no choice. If you are a developer looking at that, youd say no way. Google has had the technology, they have had the engineer, they have had deep mind way before openai could even exist or chatgpt could exist. It was a technology that google and deep mind put out there that allowed the chatgpt moment so it is so ironic that it does feel like they are playing catchup at least from a user point of view. People have to opt into use gemini where chatgpt is just out there. And you have others springing up open source from meta, clog from anthropic. It is the rise of the chat box when google was supposed to be here first all right, thanks for that. So mooibicrosoft Developers Conference kicks off in a week or so. Do you feel like i feel like that is the stock of this group that needs some sizzle back somehow. Not that it has been terrible obviously, but one month kind of meh. Were just getting going here obviously so well see how it reacts to some of the new, but if you look over the last year, alphabet, microsoft, not even a competition in the returns that those shares have delivered for their investors. And it is not microsoft that is the better one you are right look, microsoft is they are all fully valued meta, fully valued but in terms of microsoft, i think that is what everybody went to initially. I say everybody, obviously that is a broad generalization. But that was the obvious play. People could see how the openai relationship will drive new subscriptions, whether it is 360 or whatever or upgrades. And how they are putting it into the cloud. So it was the most obvious play and was everybodys favorite ai play including mine. And remains. Because i think that will be the one with the gift that keeps on giving i also dont believe you are paying much of a premium because of the recurring Revenue Growth. So i think that got a lotof early adopters and now it is just quarterly news. So that is the issue ive thought about the same thing multiple times joe, youre still on microsoft. That is a great point steve is making. If you think about the evolution of the ai technology, where was it that investors paid the premium initially. They did that with microsoft, with meta. And as the journey has taken hold now to where we are looking into 2025, i feel as though, okay, it is amazon and apple where investors are now expecting that you are going to see the appreciation, the revenue contribution it has been consistent with nvidia and alphabet has had some friction back and forth. Alphabet definitely got some recognition in the last six months but i think the market focus right now on ai as it relates to the mega caps, it is amazon, apple and Nvidia Arm Holdings wants a bit of say in that conversation too there are. Reporter s now that they have plans of their own to develop their own ai chips christina, all eyes are on nvidia and they report on the 22nd of this month, but what about this arm report . Ill get to nvidia in a second the nikkei is reporting that arm is setting up an ai division and plans to launch an ai chip prototype by 2025. The company has supposedly already begun talks with foundries to support the new part which could, according to the report, lead to a eventual spinoff of their ai chip business i reached out, arm wouldnt comment. But the chip would be a major pivot for arms Business Model and secondly it would put arm in competition with its Current Customer base like nvidia, apple, et cetera so you have some analysts that are a little skeptical of this report thus far. And since you guys have brought up nvidia so much, lets talk about what is happening on may 22 share price went up, hovering 5 hire in higher in the last month but jeffries estimates that ai as a percentage of total chip revenue will go from 5 which was back in 2022 to 25 by 2027. So it will continue to drive growth especially with all these deep budgets and pockets from the hyper scalers that have promised to spend. And nvidia remains the favorite given its control over the entire ecosystem as well as launch of its new blackwell chip for the second half of the year early whisper numbers, this is according to wells, is that it will be 26 billion for the april quarter, total revenue, versus the street estimates at 25. 5 billion right now. So out of that 26 billion, at least 23 billion has to come specifically from Data Center Revenues and you were talking about valuations analysts keep revising their estimates surprisingly for nvidia just leading up to this report stock trading compared to arm, which is way higher, but what is important for this company is how the stock reacts post earnings last year there was like 24 that will pull more money into semis. Or does it go lower and drive momentum out and maybe into software thank you, appreciate that. Hard to find people getting negative ahead of the print on the 22nd adam parker who i think has gotten more cautious negative on mega cap tech wont go there when it comes to nvidia. Still bullish there. Jeffries says that bullpullbacks the time to reload too early to sift out the winners and losers in the ai basket yet, but nvidia is our favorite some people say maybe it is not too early. The street has placed its bet that it is not too early to say nvidia is one of the winners doesnt have to be undisputed winner, but it is is no doubt thought of as if there is a couple winners, two, three, they are in that mix. No matter what and i agree completely on what adam is saying. It is the anchor of the ai halo. And i doubt very much that even if nvidia was to deliver earnings report, which would be disappointing and wed see the price decline, i dont think very many people would move so quickly away from nvidia so as i said, it seems to be the core anchor ai holding what is interesting to me is what the effect is going to be of nvidias earnings on the rest of the ai halo how about like critical if i take three names, broad demo broadcom, cadence design and amd, each had their peak in march. Those stocks have done nothing the last 60 days they need something to resurrect performance. And they are reliant to getting something positive from nvidia to do that so i really think that the ai halo is where you want to focus on off this upcoming report sflp we have a news alert regarding the Gates Foundation yes, Melinda Gates is resigning. In a statement she said it is time for her to move on to the next chapter of her philanthropy she points to the fight for women and girls in the u. S. And around the world and said under the terms of my agreement with bill in leaving the foundation, i will have an additional 12. 5 billion to commit to my work on behalf of women and families and says she will share more about what that entails in the future of course she had cofounded the Worlds Largest charitable found indication with her then tuhusbn bill gates the couple pledged publicly to give away at least half their wealth they announced their divorce in 2021, but they have continued to Work Together on the foundation. Bill gates today also released a statement thanking melinda for her critical contributions to the foundation and wrote im sorry to see melinda leave, but im sure she will have a huge impact in her future philanthropic work. And he says he is confident in the Current Leadership Team of the foundation and its mis