The market has been on quite a run, so I’d describe my outlook as cautiously optimistic. It reminds me of the last major tech cycle I experienced firsthand—the 1990s, which was also based in the Bay Area. Back then, stocks were driven higher based on future demand. I remember asking my father why the market was down in 2001, and he matter-of-factly said, “Reality didn’t meet expectations.” That’s often how tech cycles play out.

Today, AI has the potential to fundamentally change the way business is done. The demand is very high for data centers, computing power, advanced chips, software and new use cases. At the same time, tech companies are taking on debt, financing their customers, and investors are trying to put as much capital as possible into AI-related businesses.

So unlike the 1990s, the demand appears to be exceeding the supply. But like the 1990s, the money is flowing.

As a broad investment manager, our responsibility is to evaluate opportunities within the context of each client’s goals. While the stock market may continue to move higher, we also want to make sure we’re making smart decisions based on each client’s unique situation.

Tech cycles tend to follow a pattern of early adopters, mainstream adopters, and eventually the FOMO adopters. I don’t think we’re at the FOMO stage yet, but I do think it’s coming. It’s worth remembering that the NASDAQ went up about 80% during the final year of the dot-com bubble.

For now, the market is probably in a good place. We just need to stay focused on the point when expectations no longer meet reality.

Thank you for your continued partnership.