Weekend Reading #383

This is the three-hundredth-and-eighty-third weekly edition of our newsletter, Weekend Reading, sent out on Saturday 26th September 2026.

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What we're thinking.

Markets seem to have settled into a rhythm this week. Despite higher bond yields stocks rallied especially the Nasdaq which pushed to new highs. We wrote about this possibility last week and our base case is higher! The AI trade has evolved once again. First, we had GPUs and Nvidia, then we had the bottleneck trade led by memory and now it appears to us we have entered a new leg led by the first real consumer application of AI in the form of agents. This has been catalysed this week by Meta's Muse agent, which we touched on last week. Meta has rocketed in the past week as the world realised what is unfolding. It is still not even back at its previous all time high yet. The agents trade has also got the CPU names going again as AMD went to new highs rapidly and ARM and Intel also surged.

Elsewhere, crypto and blockchain names have also continued to move higher as it becomes increasingly clear that these are very important to the US regime moving forward with or without the Clarity Act.

Going back to yields, we watched a very good interview with Scott Bessent this week (below), where he clearly stated his belief is that yields are tied to refining bottlenecks as result of the war and that once the war is over, yields will rapidly fall. We think this is probably true however there is a game of chicken being played at present with the market in the meantime. And if the war isn't over one way or the other soon, the market will keep pushing yields higher, forcing Bessent et al to act. It is a fine line. And as we have learned in markets over many years, it really isn't smart to dismiss short term fluctuations when one is "sure" of a longer-term outcome. So, we advise everyone to remain on their toes as the range of outcomes is rather wide. One of our favourite quotes (mentioned before) is that it will all be ok in the end and if it's not ok it's not the end. In this case for bond yields it's not ok so it's not the end.

What we're reading.

Grok recommended a new spy book thriller called Red sparrow by a guy named Jason Matthews. It's the first in a trilogy and was really good. A US agent and a Russian agent are both trying to recruit each other and it makes for riveting reading. It is quite intricately written which usually is a problem for me as too much detail I get bored, but in this case it was just so well put together that I've now got the next book in hand. DC

A couple of weeks ago we saw a whole chorus of AI fearmongering show up on social media of all sorts, starting with an individual called Jacob Coxon who claimed to be a former employee of Anthropic and OpenAI, and who resigned because of concerns that AI could kill us all. Then we saw BOTH OpenAI and Anthropic agreeing in their calls for more regulation, which ultimately got shot down by the likes of Jensen Huang, Scott Bessent and Trump – rightly because to blame criminal action on “agents” rather than the people who started it all is like blaming arson on “fire” even though the arsonist only lit a small match or spark. But Twitter being Twitter does what it does and goes digging – and ends up pulling links between the Amodeis of House Anthropic with a much more sinister blast from the past: Sam Bankman-Fried and the cult of Effective Altruism. And the “whistleblower” Jacob Coxon that started it all? Turns out he’s an EA plant too. Just another friendly reminder to always maintain a healthy amount of skepticism!
 
In crypto/prediction markets land, what started out as a twitter spat between @icobeast, part of the influencer/marketing crew at US-based prediction markets operator Kalshi, and swiss quant @beniduboss, turned into a full-blown catastrophe for Kalshi. Short story, because @icobeast was less than polite to beni, beni went on full-on investigative beast mode and produced a full-blown expose of what looks like Kalshi market makers wash trading to push trading volumes up. And now we’re at the finale. As it stands, the WSJ has published a full feature on it, and obviously the CFTC now on the case since Kalshi is CFTC regulated. Moral of the story: don’t mess with twitter anons. But the bigger question is – were these markets really as liquid as they were made out to be after all? EL

What we're watching.

This coverage of the Trump/Xi speeches at the White House dinner is very interesting. I would call it a lovefest. It is clearer than ever to me that both leaders wish for a detente between the two nations and are attempting to impose this. It doesn't mean there isn't intense and hard competition behind the scenes in many areas especially in AI. But it means that on the surface the two countries work together as they say, "for the benefit of humanity". Whether it ends up working out who knows. But they are going to try.
 
And here is the interview mentioned above with Scott Bessent. Many years ago, I had a motto when it came to Chinese investing. Just listen to what the govt says and follow. Since Trump's 2nd regime kicked off, I have had the same motto. And Bessent spells it out regularly. DC

What we're listening to.

Eric and Andy (crypto bros no surnames) appeared on the Bankless pod this week to talk about Robinhood Chain and memecoins and tokenised stocks. This is incredibly educational for non-crypto people and in my view discusses what could be the beginning of an unimaginably large movement to bridge crypto and stocks. Robinhood is the responsible play, but as you can hear from this one, there is a plethora of memecoins which can go up a lot or just as easily go to zero. Personal favourite (sorry again) is BONER, which is also Eric's one. It's well worth the time to listen.
 
I really enjoyed this listen featuring Alix Pasquet III, a hedge fund manager of some acclaim. In it he discusses pretty much everything relevant to a hedge fund manager today. But my favourite part was right at the beginning where he basically echoed my core belief that any investor needs to manage money according to their own personality. You can't cheat yourself. Some people can endure huge volatility, and some can't stomach losing a penny. Everyone is different but must be true to oneself. The way he put it was that you have a competitive advantage in being yourself. And that I loved. Very high-quality conversation filled with gold. DC