AI Infrastructure Spending Surges as CEO Confidence Hits Lowest Since 2Q25

Key Takeaways

1. CEO confidence fell 6 points to 46 in 4Q26, the lowest since 2Q25, with cybersecurity, AI, and geopolitics as top risks — all rising quarter-over-quarter.
2. Nearly half of CEOs expect AI to boost productivity and cut operating costs within three years, even as AI infrastructure and data center spending hits unprecedented levels.
3. Miami is the strongest buyer's market in the US, with 159% more home sellers than buyers.
4. Social Security beneficiaries will receive a 3.6% COLA starting January 2027, the largest 5-year cumulative increase since 1982–1986.
5. US equity factor performance is narrow: only high beta, pure growth, and momentum are negative month-to-date, while low volatility leads at +4.0% versus the S&P 500's +0.9%.
6. Ollama reports 8.9 million monthly developers, with Fortune 500 companies quietly shifting to open-source models.
7. XBOW founder warns no infrastructure is safe against attackers armed with open-weight models.

1. AI Infrastructure and Enterprise Adoption

1. Nearly half of CEOs expect AI to boost productivity and reduce operating costs within three years, according to The Conference Board survey. The same survey shows CEO confidence fell 6 points to 46 in 4Q26, the lowest since 2Q25, with cybersecurity, AI, and geopolitics as the top three risks — each drawing more concern than the prior quarter. A separate Schwab podcast discussed the unprecedented wave of AI infrastructure and data center spending, alongside higher-than-expected inflation and a continued focus on quality. — via 1 2 3 4
2. Ollama co-founder and CEO Jeff Morgan said the platform has 8.9 million monthly developers, and Fortune 500 companies are quietly shifting to open-source models. Separately, XBOW founder and former Oxford professor Oege de Moor warned that no infrastructure is safe against attackers armed with open-weight models, with discussions also covering open models approaching the frontier and how enterprises should prepare for "Mythos-level models available to everyone." — via 1 2

2. Market and Economic Signals

1. US equity factor indexes show only high beta, pure growth, and momentum in negative territory month-to-date, while low volatility leads with a 4.0% gain versus the S&P 500's 0.9%. Information technology is the only S&P 500 sector down for the month, and its weakness is dragging on those three factor strategies. Breadth has improved significantly for the S&P 500 but only modestly for the Nasdaq and Russell 2000, and the rolling 1-month outperformance ratio rose to 36% from just 17% the prior Wednesday. — via 1 2 3
2. The 10-year Treasury yield's rolling correlation with the S&P 500 remains negative despite one positive reading yesterday. Historical data since 1928 shows the S&P 500 averaged 11.9% annual returns when 10-year yields rose and 11.8% when they fell. — via 1 2
3. October manufacturing surveys diverged after ISM methodology adjustments: the Empire index strengthened while Philly weakened, both in expansion territory. The New York Fed services PMI fell to -20.7 from -8.7, with business climate at -35.0, employment at 0.0, wages at 28.2, and prices paid at 70.0. September import prices rose 1.1% month-over-month, export prices rose 2.2%, and industrial production rose 0.7% versus expectations of 0.4%. — via 1 2 3 4
4. Restaurant and bar retail sales grew 1.0% on a three-month moving average in October, the strongest pace in over a year. — via 1

3. Housing, Social Security, and Inflation

1. Miami is the strongest buyer's market in the US, with 159% more home sellers than buyers. — via 1 2
2. 72 million Social Security beneficiaries will receive a 3.6% cost-of-living adjustment starting January 2027; over the past five years, benefits have grown 26% cumulatively, the largest five-year increase since 1982–1986. — via 1 2
3. A market commentator criticized the Federal Reserve for failing to fulfill its most important duty — price stability — noting that since January 2020, US consumer prices have risen at a 4% annualized rate, double the Fed's 2% target. Had the Fed met its mandate, CPI would be 14% lower than current levels. — via 1

4. Investment Strategy and Notable Views

1. Ben Carlson argued that the most "boring" investment advice right now may be to rebalance portfolios, noting that sometimes boring is beautiful. Shared content pointed out that decent returns are now possible in balanced portfolios without relying on a stock market surge, because bonds are finally earning their keep. — via 1 2
2. Meb Faber shared a Jean-Marie Eveillard investment maxim: "I would rather lose half of my shareholders than lose half of my shareholders' money." — via 1
3. Mohnish Pabrai built his investment business by cloning Warren Buffett's partnership model: when his fund launched in 1999, it charged no annual management fee, a 6% hurdle rate, and 25% of profits above the hurdle — a structure borrowed roughly 30 years after Buffett's partnership ended. Pabrai encouraged investors to find other managers who also charge no annual management fee and tell friends, who eventually became clients, turning a borrowed business model into a referral source. He defined "cloning" as studying what has worked, understanding why, and applying it yourself, and said nearly everything that has worked in his life came from borrowing others' best ideas. — via 1
4. Pabrai acknowledged that most of his attempts failed, explaining that as long as the cost of failure is low enough, one successful idea can cover dozens of failed attempts, and the size of the eventual winner matters more than a perfect record. He also cited his own mistake of selling excellent businesses already in the portfolio, only recognizing years later how much long-term holding of exceptional companies could matter when management and performance remain strong. — via 1
5. Elad Gil spoke with OpenAI co-founder and President Greg Brockman on the No Priors podcast, covering AI and mathematics, AI regulation, breaking through biology data bottlenecks, revolutionizing drug discovery, proactive agent Dots, consumer agents, UI evolution, cybersecurity in the AI era, and OpenAI's human-centered philosophy. — via 1
6. A16z founder funded a $25 million nonprofit, the Securing America's Infrastructure Foundation (SAIF), aiming to provide AI-driven cyber defense at zero cost to small cities, rural school districts, and rural hospitals. The founding board includes Brian Barrios, GoldsmithOnGov, Bob Lord, vishalmisra, and philvenables. — via 1
7. A WebGPU Gaussian splatting rendering project featured 800,000 splats forming an environmental world, with the author arguing this density has a real chance at near-infinite scaling for building vast, relaxing environments. — via 1
8. A robot completed a 100-meter run in 8.6 seconds but still cannot fold a towel, according to a Sloptoberfest entry by javif4_ using SlopCannon. — via 1
9. A shared post argued Europe should not cede frontier AI to the US and China, claiming this idea is gaining traction in Europe but is fundamentally wrong, stating "build or surrender, the choice is still ours." — via 1