Analyst Weekly, June 2, 2025
From Web to Intelligence: Mary Meeker’s AI Playbook for the Subsequent Decade
Mary Meeker, lengthy dubbed the “Queen of the Web,” has returned to long-form with the AI Tendencies Report 2025, her first main deep-dive since pausing the Web Tendencies Report in 2019.
Over 20 years, she constantly recognized key inflections: the explosion of web customers (1996), on-line adverts overtaking print (2000), and cellular’s eventual dominance (2008). At Kleiner Perkins and later BOND Capital, she backed lots of tech’s iconic names- Fb, Spotify, Twitter, Sq., Snap.
AI is shaping as much as be probably the most capital-intensive and transformational tech shifts for the reason that web. The report highlights that Huge Tech has already spent over $200B on AI infrastructure in 2024 alone, with NVIDIA rising because the standout winner, now accounting for 25% of worldwide information heart CapEx.
Crucially, whereas coaching AI fashions stays pricey (usually $100M+), the price to make use of them (known as inference) has dropped ~99.7% in two years. That’s fueling a surge in developer and enterprise adoption. Microsoft’s AI income hit $13B; OpenAI crossed $3.7B; Anthropic and others are seeing comparable development.
Funding Takeaway:
This setup has opened up funding alternatives throughout three fronts: (1) infrastructure suppliers (NVIDIA, Oracle, CoreWeave), (2) enterprise software program embedding AI into workflows (Microsoft, Salesforce, Adobe), and (3) specialised AI-first verticals in healthcare, regulation, and industrials (e.g., Abridge, Harvey, Anduril). In the meantime, China’s open-source LLMs are quickly narrowing the efficiency hole, elevating geopolitical and aggressive concerns.
The report underscores a historic platform shift, likened to cellular or cloud, with the “interface layer” transferring from apps to brokers. The following decade of productiveness (and returns) might come from whoever owns that layer. Traders ought to place throughout each enablers (infrastructure, chips, fashions) and integrators (software program, automation).
Earnings Watch: Decrease Bar, Greater Shock Potential
Wall Road is dialing again full-year S&P 500 revenue forecasts- now anticipating 7% EPS development in 2025. That’s down barely, however nonetheless robust vs. the two.3% common earlier than previous recessions. Q1 earnings already confirmed resilience: earnings jumped 13%, with gross sales up 5%. A lot of the cuts are centered on Q2, the place tariff-driven price will increase and demand headwinds are anticipated to hit hardest.
However right here’s the twist: decrease expectations may set the stage for upside surprises. If corporations handle provide chain shifts, or maintain pricing energy, Q2 may beat the (now-lowered) bar- particularly for industrials and shopper discretionary.
Volatility Watch: Fragile Calm
Proper now, markets appear to be on stable footing. Inner momentum seems wholesome, with greater than half of S&P 500 shares simply hit new 20-day highs, a sign that has traditionally pointed to robust 6-month returns. Industrials are main the best way, and even the important thing Discretionary vs. Staples ratio, a gauge of threat urge for food, has turned increased after a short dip.
That mentioned, there are a number of developments on the radar that would stir volatility within the coming weeks:
Liquidity squeeze: Treasury money balances (TGA) start draining on June 15.
Fiscal stress: Web curiosity prices now make up 18% of US tax income.
Tariff cliff: The present pause on reciprocal tariffs expires July 9 and we might not have courtroom readability by then (see under). The authorized appeals course of is transferring slowly, making it more durable for the US to finalize new commerce offers in time.
Tariff Drama: Court docket Says No, Appeals Say Maintain Up
A US courtroom dominated US tariffs are unlawful and gave a 10-day rollback deadline – however plot twist: an appeals courtroom hit pause. So for now, tariffs keep. The authorized combat may stretch into summer time, perhaps even to the Supreme Court docket.
Why it issues: The present truce on reciprocal tariffs ends July 9, and we would not have authorized readability by then. That’s making it more durable for the US to ink new commerce offers, giving different nations a purpose to play hardball.
Huge image: Authorized uncertainty = market volatility. If world companions suppose the US is dropping grip on enforcement, they might retaliate and markets don’t love uncertainty. Keep watch over volatility as this unfolds.
Now Everybody’s Enjoying Hardball: The EU’s stalling on concessions, presumably utilizing US authorized uncertainty as leverage. Trump tossed out a 50% tariff menace final week, however Brussels didn’t flinch. Subsequent transfer? The G7 Summit (mid-June) might be key to look at for progress, particularly with Japan.
In the meantime, China’s dragging its toes on a Might 12 tariff deal to restart rare-earth exports (yep, we had flagged it). The US hit again with tighter export controls.
The vibe: If the US seems unsure, others will take benefit. It’s shaping as much as be a tense summer time for commerce.
Gold’s Rise Displays Structural Shifts in Reserve Administration
The yellow steel stays elevated close to document highs. Gold is hovering round $3,300/oz after a 26% surge this yr, underpinned by its safe-haven attraction. We expect that gold’s ascent previous $3,300 shouldn’t be the product of speculative extra however the results of a sustained shift in how world establishments handle reserve belongings. Central banks have been the dominant patrons over the previous two years, signaling a structural relatively than cyclical revaluation.
This development accelerated after 2022, when geopolitical occasions highlighted the dangers of overconcentration in a single reserve asset class. In response, a rising variety of nations, notably in Asia and the Center East, started diversifying away from sovereign debt holdings, notably US Treasuries. With no credible different reserve forex, many have elevated allocations to gold- a impartial, liquid, and traditionally acknowledged retailer of worth.
Investor positioning, in contrast, has remained conservative. Gold presently accounts for roughly 1% of worldwide funding portfolios. That determine is much under historic ranges: through the Bretton Woods period, gold and associated belongings made up 50–60% of institutional holdings. Whereas a return to these ranges is neither possible nor fascinating in a contemporary monetary system, even a modest reallocation to three–5% would indicate important incremental demand.
The latest uptick in ETF inflows and fund publicity suggests that personal traders are starting to comply with central banks into the commerce.
Silver, in the meantime, has lagged gold however might current uneven upside. Whereas central banks don’t maintain silver, its twin function as a financial steel and a essential industrial enter, notably in photo voltaic, batteries, and semiconductors, makes it more and more related in a world economic system transitioning towards electrification.
For traders, a balanced method stays prudent: 75–80% publicity to bodily gold or gold ETFs for stability, and 20–25% to high-quality miners for upside potential. The latter stay deeply discounted relative to bullion however carry materially increased volatility.
Investor Takeaway: We see a compelling case for growing long-term publicity to gold. Current worth motion has created a extra enticing entry level and additional alternatives might emerge. Over the long-term, we consider gold stays a strategic asset: a core holding amid accelerating de-globalization, and a transition asset throughout a interval marked by coverage uncertainty and central financial institution steadiness sheet shifts.
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