“Now, all of a sudden, we're getting that same issuance, but in the equity markets, right? SpaceX, OpenAI, Anthropic. Is there going to be a crowding out effect there? Is that going to create a bear market in 27? I'm sure 27, some point, I'll be short the whole year.”
Squawk Pod · October 2026
Jones comparing the coming wave of giant AI-era IPOs to 1998–2002, when unlocks kept adding supply and made those years the easiest to be short. He says insiders with no visibility into their businesses will want to diversify and sell.
Transcript
…out and sovereigns may take us to the tipping point. And then, again, now that we've elevated interest rates by 100 basis points, if you just take the CBO baseline from last year, you've got to add $120 billion to the deficit because of the 100-basis point jumping in. So, you're Kevin Wars, though,
what do you do?
…path. I think he won't do that. And I think that's why I'm saying it's going to be challenging. It's going to be really challenging in the possibility of something breaking down the road. And particularly when I look at how the flow pictures shifted. If you think about it, we've seen what the hyperscaler issuance in the debt markets had done to corporate prices, corporate bond prices, right? Now, all of a sudden, we're getting that same issuance, but in the equity markets, right? SpaceX, OpenAI, Anthropic. Is there going to be a crowding out effect there? Is that going to create a bear market in 27? I'm sure 27, some point, I'll be short the whole year. There's just, there's little data. You're short the whole year? Oh, well, again, if I go back to 2000, you remember it. If I go back to 2000, so you had all this issuance, all these IPOs in 98 and 99, and really 2000, 2001, 2002, those were the easiest years to be short because you kept having these unlocks that just kept adding supply to the market. And I've got to think that on these unlocks…
What have you been doing right now, I ask? Because I think last May you were talking about buying a lot of the hyperscalers and buying a lot of the AI-related tech stocks. Still there?
At this moment, no. Again, for me, the tactical professional question is: are we going to get the fourth quarter run for the roses after these midterms? And maybe after Anthropic comes, are we going to get just the craziness that we typically see in December and January? And I'd say right now…
If you're that worried, what do you think about the tools that Treasury Secretary Besson has or doesn't have? And the reason I ask is he's talked about being the house. He's talked about the buybacks or buying back treasuries. I don't know if you think that that can actually make a difference.…
More from Squawk Pod
