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Bob Elliott, Bob Elliott, co-founder and CIO at Unlimited, stated that many investors focused on the AI trade may not realize the significant role played by monetary and fiscal policy in supporting it.
Elliott added that the next phase of policy-driven support for the AI trade is likely to be much more challenging.
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Earlier, Elliott warned that market enthusiasm for AI was based on expectations of exponential growth while actual spending was showing signs of leveling off, according to a previous note. He also described the recent increase in U.S. bond yields as normal within the context of market data and anticipated policy tightening in comments reported last week. These observations come as investors weigh the impact of fiscal and monetary policy on technology-related trades.