Excess Returns

Jim Paulsen sees a risk of a stock market correction as financial conditions tighten and investors grow comfortable with tech's long run of leadership. But his warning does not require a recession or the end of the bull market.
In this month's Jim Paulsen Show, Jim joins Justin Carbonneau and Jack Forehand to walk through the charts behind his cautious outlook. He explains how rising yields, oil prices, and a firmer dollar can affect the economy with a lag, why favorable seasonality may offer less support than investors expect, and how a slowdown in technology spending could challenge market leadership.
We also explore the signals Jim sees in retail, housing, employment, and Walmart's relative performance. He closes with a possible path through a correction: slowing growth, lower inflation and yields, and a recovery that could give the bull market another run. His seven lagging sectors, the "Modest Seven," are central to that case.
Topics covered:
Why Jim Paulsen is cautious without making a recession or full bear-market call
His financial-conditions gauge and the risks of tightening into an already pressured economy
How restrictive conditions can weaken the November-to-April seasonal advantage
The delayed effects of bond yields, oil prices, and the dollar on economic surprises
Technology spending relative to GDP and why slower growth could matter for tech stocks
AI adoption, pricing, and the challenge of turning investment into profits
How two decades of tech leadership may encourage complacency and crowded positioning
The divide between AI, inflation-assisted sectors, and the "Modest Seven"
What sector performance, bond yields, and the Walmart Recession Signal suggest about growth
Why rate cuts may initially accompany falling stocks, and how a correction could set up another advance
Follow Jim Paulsen:
Paulsen Perspectives
Jim Paulsen on X
Timestamps:
00:00 Jim Paulsen's outlook: correction risk without a bear-market call
07:41 Restrictive conditions and the seasonal buying period
14:12 Why the Fed and investors interpret conditions differently
20:28 Oil, yields, the dollar, and their lagged effects
26:00 Technology spending relative to the economy
30:18 Can AI break the historical pattern?
35:00 Tech's long leadership cycle and investor complacency
42:00 AI, inflation-assisted sectors, and the Modest Seven
47:06 Market signals ahead of economic reports and bond pressure
53:00 Bond competition and the Walmart Recession Signal
58:11 How a correction could lead to another bull-market run
Learn more about the Excess Returns podcast network:
https://excessreturns.co
No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

Barry Ritholtz, Dave Nadig and Matt Zeigler explore why AI's real productivity gains don't automatically translate into an investing edge. From stock picking and market concentration to the financing behind the AI buildout, they separate enthusiasm for the technology from the economics of owning it.
Subscribe to Click Beta on Spotify⁠⁠⁠
⁠⁠⁠Subscribe to Click Beta on Apple Podcasts
In this episode of Click Beta, Barry Ritholtz and Dave Nadig join Matt Zeigler for a conversation about where AI is already changing their work and where investors should ask harder questions. Barry shares how his team uses AI to analyze portfolio drift and identify clients who may need a rebalance. The discussion also covers client relationships, consumer pricing, creative side projects, and why Barry is increasingly enthusiastic about bonds without calling an end to the equity bull market.
Topics covered:
Why widely available AI tools may improve research without creating a lasting stock-picking advantage
Market breadth, mega-cap concentration, and the potential impact of large tech IPOs
Data center financing, credit quality, and the risk of rapid technological change
Barry Ritholtz's use of AI to analyze allocation drift, taxes, and household circumstances
How better meeting records can strengthen the human side of financial advice
Learning to collaborate with AI and asking better questions
The debate over dynamic pricing, consumer data, and whose interests AI agents serve
Baseball tools, astronomy dashboards, music discovery, and the joy of experimenting
Deciding which tasks to automate and which activities are worth doing yourself
Barry Ritholtz's case for bonds, municipal income, and avoiding the reach for yield
Find our guests:
Barry Ritholtz — The Big Picture - https://ritholtz.com
Ritholtz Wealth Management - https://www.ritholtzwealth.com
Barry Ritholtz on X - https://x.com/Ritholtz
Dave Nadig's work at etf.com - https://www.etf.com
Dave Nadig on X - https://x.com/DaveNadig
Timestamps:
00:00 Meet Click Beta: AI and the stock-picking question
05:14 AI concentration and market breadth
10:08 Tech IPO valuations and data center financing
15:22 Barry Ritholtz: AI and portfolio rebalancing analysis
20:58 Can AI improve the human side of financial advice?
25:49 Better client questions and better prompts
30:13 The AI imagination gap: collaboration versus search
36:48 Dynamic pricing and the consumer-retailer arms race
41:26 Consumer data and the incentives behind AI agents
45:54 Astronomy, music, and testing your assumptions
51:18 Automating busywork to make room for curiosity
55:39 Creative experiments and choosing what to automate
01:00:11 Why Barry Ritholtz is excited about bonds
01:04:37 Bonds versus equity income and closing thoughts
Learn more about the Excess Returns podcast network:
https://excessreturns.co
No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

Chris Davis and Robert Hagstrom explore the tension between holding great businesses and keeping a winning stock from becoming too much portfolio risk. Why do two investors who believe in letting winners compound also use 10% position limits?
On this episode of 100 Year Thinkers, Chris Davis of Davis Funds and Robert Hagstrom of EquityCompass join Matt Zeigler and Bogumil Baranowski to discuss position sizing, selling mistakes, index concentration and the cost of growth. From Chris Davis’s experience selling Costco to the debate over who will capture AI’s economic benefits, they examine what it takes to hold a business through uncertainty without ignoring risk. Stay for Matt and Bogumil’s closing discussion of the lessons for investors.
Subscribe to the 100 Year Thinkers of Spotify⁠⁠
⁠⁠Subscribe to the 100 Year Thinkers of Apple

Topics covered:
Why selling a genuinely great business can be an investor’s most expensive mistake
How client behavior and fund constraints influence 10% position limits
Chris Davis’s concerns about index concentration, momentum and future IPO incentives
Robert Hagstrom on trimming positions as the margin of safety shrinks
The bull-case pre-mortem: asking what could make selling today a mistake
What Chris Davis missed about Costco’s growth and ability to adapt
Why identical earnings growth can produce different shareholder returns
Whether AI spending builds durable pricing power or delivers more value to users
How customer trust and restraint on margins can strengthen competitive advantages
Balance sheets, circular financing and the humility required to size a position
⁠Chris Davis / Davis Funds⁠
⁠Robert Hagstrom / EquityCompass⁠
Chapters:
00:00 Holding great businesses and the case for position limits
06:47 Robert Hagstrom on concentration and client risk
12:40 Index concentration, momentum and IPO incentives
19:03 Trimming winners, margin of safety and the Costco lesson
30:09 Valuation, return on capital and the cost of growth36:01 Is AI’s capital spending cycle temporary?
40:10 AI pricing power: builders versus users
45:35 Competitive advantage, margins and customer trust51:45 Balance sheets and circular AI financing
55:53 Evaluating the AI investment cycle
01:00:23 Matt and Bogumil’s takeaways: position sizing and AI
01:10:25 Being an AI user versus an AI investor
Learn more about the ⁠Excess Returns podcast network⁠.
No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

Katie Stockton of Fairlead Strategies explains why the S&P 500 can reach record highs while many individual stocks struggle. She sees the bull market as intact, but weaker participation raises an important question for diversified investors: is the pullback creating opportunity, or signaling a more lasting change?
In this episode of Excess Returns, Katie Stockton joins Matt Zeigler and Justin Carbonneau to examine market breadth, rising Treasury yields, sector leadership and the signals that would change her outlook. She also explains why the Fairlead Tactical Sector ETF holds roughly half its assets in equities at the time of the conversation, and walks through the charts for gold, oil and Bitcoin.
Topics covered:
Why narrow leadership can sustain the index while diversified portfolios lag
The difference between an overbought market and a downturn in momentum
Why weak breadth alone is not a reliable market-timing signal
Small-cap support levels and the difference between a relief rally and a lasting recovery
The Treasury-yield breakout and credit spreads as a longer-term risk gauge
Sector relative strength, technology leadership and international market concentration
How the TACK ETF's rules-based approach produces more defensive positioning
Gold's role as a potential hedge despite a weakening price trend
Crude oil's support and resistance levels and Katie Stockton's Bitcoin outlook
The BNAV ETF's tactical Bitcoin strategy and the risk signals to watch into year-end
Learn more about Fairlead Strategies.
Follow Katie Stockton on X.
Chapters:
00:00 The bull market and weakening breadth
06:02 Narrow leadership and small-cap weakness
13:43 Treasury yields, breakouts and resistance
18:56 Credit spreads and sector leadership
24:53 TACK positioning, semiconductors and international stocks
30:22 Gold, oil and Bitcoin: reading the trends
35:30 Bitcoin indicators and the BNAV strategy
39:47 Credit, volatility and tech: the year-end risk watch
Learn more about the Excess Returns podcast network.
No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.

Tom Maher of Hilton Capital Management explains what is changing for small-cap stocks as earnings improve and AI spending reaches beyond big tech. After years of justified large-cap leadership, he sees reasons to revisit smaller companies while remaining selective about business quality, financing needs and valuation.
In this episode of Excess Returns, we explore the physical infrastructure behind AI, the case for diversifying beyond the largest stocks, and how Tom Maher finds businesses with improving fundamentals. We also discuss the effects of passive investing, opportunities in reshoring, and why knowing more about a company does not always lead to a better investment decision.
Topics covered:
Why stronger earnings helped justify large-cap leadership and what could change that balance
How AI construction and equipment spending can benefit smaller industrial companies
Why some small companies grow into large caps while others remain small
Self-funding businesses versus companies that depend on outside capital
Unprofitable index constituents, private equity and the changing IPO market
How interest rates affect financing costs, valuations and portfolio decisions
Why ETF flows can move a stock independently of its business fundamentals
Finding improving businesses without mistaking a low valuation for an opportunity
Evaluating management incentives, consistency and acquisition decisions
Tom Maher's lessons on taking partial profits and reading unexpected stock-price reactions
Learn more about Hilton Capital Management.
Chapters:
00:00 Tom Maher's outlook: earnings, valuations and risk
05:26 Small-cap earnings and AI infrastructure spending
11:41 Defining small caps and why some companies stay small
16:45 Active management and business quality
22:03 Small-cap index quality and companies staying private
27:15 Combining stock selection with a macro view
32:58 Higher interest rates and portfolio decisions
37:04 Passive investing and ETF-driven stock moves
41:33 Finding stocks with improving fundamentals
51:13 Valuation, consistency and management quality
56:39 Reshoring and the industrial recovery
01:01:14 Research, profit-taking and investor expectations
Learn more about the Excess Returns podcast network.
No information discussed in this podcast should be construed as investment advice. Securities discussed may be held by the hosts and guests, their firms or their clients.