AI Power Demand, Crypto's Agent-Driven Cycle, and a Historic Bond Drawdown

Key Takeaways

1. Raoul Pal argues AI power demand is underestimated and that the next crypto cycle will be driven by AI agents trading around the clock.
2. Charlie Bilello's data show long-term compounding is lumpy, the U.S. bond market is in its longest drawdown on record, and mortgage rates sit at 7.28%.
3. Lyn Alden says the yield curve is flat rather than steepening, and that fiscal dominance changes the shape of a recession rather than preventing one.
4. Liz Ann Sonders' feed highlights a 20-year-high nominal GDP growth rate, record capital goods imports, and a top-heavy S&P 500.
5. Marc Andreessen's timeline is dominated by AI-generated music and video experiments with named toolchains.
6. Meb Faber flags a rules-based fixed income strategy signaling 100% T-bills and raises the scale of a potential SpaceX IPO.

1. AI, Energy, and Crypto

1. Raoul Pal argues that concern over AI power consumption is aimed in the wrong direction: the strongest companies on Earth need more electricity than current supply provides, and they have only one path to build it fast enough. He also judges that the next crypto cycle will not be human-driven but powered by billions of AI agents trading around the clock, describing it in a conversation with @cryptomanran as the first real bull market and calling the AI-blockchain convergence the larger opportunity. — via 1 2
2. Lyn Alden reports that U.S. electricity prices are rising at their fastest pace in decades, a data point that sits alongside Pal's supply-side argument without resolving it. — via 1

2. Markets, Rates, and Compounding

1. Charlie Bilello's data show that U.S. equities have averaged roughly 10% annual total return, yet in 98 years only 4 years landed within ±2 percentage points of that figure, with average up years at +21.0% and average down years at -13.5%. Over the past five years returns diverged sharply: SPY +85% versus NKE -75%. — via 1 2 3 4 5
2. The U.S. bond market (Bloomberg Agg) fell 2.6% in September, with only five worse months in 30 years, and has now been in drawdown for more than six years (74 months), the longest on record. The 30-year Treasury yield closed at 5.64%, which Bilello notes was exceeded every day in the 1980s and on 92% of trading days in the 1990s, attributing the sense of alarm to recency bias. — via 1 2 3 4 5
3. Core PCE, the Fed's preferred inflation gauge, was 3.0% in August and has run above the 2% target for 66 consecutive months; Kevin Warsh said at the September FOMC press conference that inflation is too high and has persisted too long, and the material expects at least one more rate hike before year-end. The 30-year average mortgage rate is 7.28%, the highest since November 2023, against a 2021 low of 2.65% and a 2023 peak of 7.79%; Trump campaigned in September 2024 on bringing mortgage rates back to 2%. — via 1 2 3
4. Bilello's framing is that bull markets last about five times as long as bear markets (bulls 5 years, +254%; bears 1 year, -31%), so markets create wealth far more often than they destroy it and interrupting compounding is the biggest risk. He also warns that he never asks for money by email or message and that such accounts are impersonators, with AI accelerating these scams. — via 1 2
5. Lyn Alden disputes the claim that the end of the bond curve is breaking, saying the yield curve is flat rather than steep, and that what is really happening is a market correction of where rates should sit in the current environment. She also clarifies that fiscal dominance does not mean a recession is disallowed: the U.S. is pre-emptively offsetting a potential recession with 7% stimulative deficits, which changes the recession's shape but does not make it impossible. — via 1 2
6. Liz Ann Sonders' feed notes nominal GDP growth of 8.5%, the strongest in 20 years excluding the pandemic period, which the forwarded content argues may make a 5.25% 10-year Treasury yield still too low. The same feed reports semiconductor free cash flow surging past $400 billion while hyperscaler cash flow has turned negative. — via 1 2

3. Positioning, Data, and Market Structure

1. Sonders' feed reports the S&P 500 fell 0.45% in September, its third monthly decline in four months, while still up 11.8% year to date; Q3 gained 2%, the smallest quarterly gain since Q3 2021, and the Russell 2000 fell 7.5%, its first quarterly decline since Q1 2025. Q3 asset moves included the 10-year yield +0.81 bp, diesel +32%, crude +35%, and the 30-year mortgage rate +0.72 bp. — via 1 2 3
2. Seasonality and breadth data in the same feed: since 1928 the S&P 500 has averaged +0.6% in October with a 58% win rate, a best October of +16.3% and worst of -21.8%; the equal-weight S&P 500 was set for a seventh straight weekly decline, matching the second-longest streak on record, previously seen during the dot-com bust and the 2022 bear market. — via 1 2
3. Concentration and trade data: the top five S&P 500 stocks accounted for 30.4% of index market cap at the end of Q3, and U.S. capital goods imports excluding autos continued to climb vertically, up 57.2% year over year in August to a new record. — via 1 2
4. August activity data: personal spending rose 0.9% month over month, up $190.8 billion, split between $114.1 billion in goods and $76.7 billion in services; wholesale inventories rose 0.7% (prior +1.3%) and retail inventories 0.3% (prior +0.8%); construction spending rose 0.9% versus 0.0% expected, with the prior revised from -0.5% to -0.1%, and private residential +1.1% and private nonresidential +1.0%. — via 1 2 3
5. Labor and survey data: MBA refinance applications fell 8.7% last week to the slowest pace in over a year; September ADP showed private employment improving across all size cohorts, strongest among mid-sized firms (250-499 employees); Chicago PMI rose to 58.8 from 47.1, the fastest four-month gain and a return to expansion; ISM manufacturing fell to 54.5 versus 55.0 expected and 54.6 prior, with new orders at 55.3, prices paid at 77.9, and employment at 52.7. — via 1 2 3 4
6. Layoffs and claims: Challenger layoff announcements fell 19.9% year over year in September, with 573,195 cuts year to date versus 946,426 in the first nine months of 2025, a 39% decline; initial jobless claims fell to 197,000 versus 200,000 expected and 198,000 prior, with continuing claims at 1.701 million versus 1.725 million expected and 1.712 million prior, the largest increases in Michigan, Oregon, and Alaska and the largest declines in Hawaii, Georgia, and Texas. — via 1 2
7. Ben Carlson's forwarded items all circle the same question set: when the next bear market arrives, why rising rates have not crushed stocks, and why higher rates do not always hurt equities. — via 1 2 3
8. Meb Faber cites a bond strategy paper whose rule is to buy riskier bonds only when spreads are wide enough, otherwise hold T-bills; at the time that meant 100% T-bills, and Faber says the system's signal today is also 100% T-bills, describing it as "T-Bills and Chill....Most of the Time" and as a form of tactical time-series carry. He also asks about a SpaceX IPO so large it would immediately rank in the top ten by market cap, noting that since 1950 no company has done so and that going back to 1900 he finds only U.S. Steel. — via 1 2

4. AI Creation and Content

1. Marc Andreessen's timeline in this window consists entirely of reposts showcasing AI-generated music and video experiments, several with named toolchains: one used Midjourney, ChatGPT, Hailuo H3, Claude Opus 5.5, Premiere Pro, and Boris FX Continuum with extensive manual editing, and another generated video with Opus 5.5 and Suno 6. — via 1 2 3 4 5 6 7 8 9 10 11 12 13
2. One repost stresses that the work was not a single generation but a long collaboration with Opus 5.5, calling it only the beginning of that model's capability; some pieces carry split credits for lyrics, music and narrative, original character design, and animation. Another repost uses 1984 as its thread, with the author recounting reading the book in 1982, becoming the voice of the phone in 1999 and the voice of the machine in 2003, and stating that "1984 has already happened, you are living in a simulation," with the method being to hand a folder of prompts, Midjourney images, and a song to Opus 5.5. — via 1 2 3
3. Lyn Alden says she has not reduced her participation in financial Twitter but has become more selective as social media turns to entertainment and AI spreads, prioritizing quality and signal. She argues AI will make informational content increasingly cheap, leaving taste, which in finance means signal, expressed by choosing what to oppose and focusing on exceptions; a repost notes her views have been consistent, that she has fewer followers as a result, and that she would rather post a strong signal occasionally than play the online engagement game. — via 1 2 3
4. Spruce Point Capital flags that NVA issued a going-concern warning and disclosed material weaknesses in financial controls, questioning whether its operating condition is self-evident and asking whether its $9.2 million of 2025 operating income was a profit or a loss. — via 1
5. Jason's posts include a view that venture firms may be better off staying behind the scenes, a repost that All In Summit is returning to Los Angeles with messaging around the main stage, the hallways, and late nights, and a hiring notice for a podcast video editor at LAUNCH and This Week in Startups to produce short-form content for TikTok, X, Instagram, LinkedIn, and YouTube Shorts, requiring strong interest in tech, AI, and venture and attention to the latest AI editing trends. He also reposted that Abliteration joined a16z Speedrun, noting another LAUNCH team accepted into Speedrun and the Andrew Chen connection, with a repost saying Speedrun should not forget its first backers at LAUNCH. — via 1 2 3 4 5 6
6. Jason quoted a post about a Tesla Model S blowing a tire at 175 mph on a German highway with no fatalities, commenting not to drive at 175 mph, emphasizing Tesla safety, saying he bought a Tesla only for his family's safety, and urging people to choose the safest option; he also reposted that Louisiana is proving doubters and pessimists wrong. — via 1 2