Identifies the 'three D's': dispersion in returns due to disruption, leading to derating. The market is no longer giving mega-caps a 'free pass' on CapEx; wants to see actual numbers. Concerns are increased CapEx spending, dwindling free cash flow, shareholder returns, and squeezed margins.

Points to massive dispersion in S&P 500: 43% up >10%, 18% up >20%, but 17% down double digits and 7% down >20%. Says there are bull markets underneath but you need to pick specific stocks.

Suggests it could be seen as late-cycle but might also be a defensive 'step back' from AI trade uncertainty into old economy sectors.

Describes a 'sell first, ask questions later' environment. Growth rates still moving up despite corrections. Forward issue is whether analysts catch down to price reaction. Expects 'range bound choppy market' until greater clarity on top-line revenues.

Calls it the key debate. AI CapEx has driven US growth. A meaningful pullback in CapEx (as investors demand) could slow the US economy. It's a fine balancing act; the tug-of-war will persist.

Describes how money piled into momentum trades, leveraged players suppressed volatility, vol control funds increased positions, retail used levered ETFs. A vol spike triggers unwind and outsized moves. Says this is partly what we've seen recently - unwinding of momentum trades carried too far.

Says they've had a large overweight to EM, favoring Latin America for exposure to raw materials, AI trade, falling rates (inflation down), and improving geopolitical risks. Took some profits after aggressive run but would look to re-enter on a pullback.