Market cap MANIA: Breaking down the $5T LOSS in October market cap

TRILLION. THAT'S HOW MUCH MARKET CAP WAS LOST SINCE OCTOBER 6TH. LET'S BRING IN MELVIN MATTHEW MILK ROAD A.I. ANALYST. MELVIN, ARE YOU SENSING THAT THIS IS AN INDICTMENT OVER THIS SUPERINTELLIGENCE REVOLUTION, SO TO SPEAK, OR JUST THEY'VE GOTTEN AHEAD OF THEMSELVES, MOST OF THESE NAMES? >> YEAH. I THINK WE JUST GOT A LITTLE AHEAD. I ACTUALLY, IF YOU LOOK AT THE EARNINGS SEASON, IT HAS BEEN PRETTY STRONG. BUT I THINK THE BIGGEST CONCERN RIGHT NOW IS CAPEX PLUS FREE CASH FLOW GOING NEGATIVE, AS YOU MENTIONED. ASK JUST LOOK HOW MUCH THESE COMPANIES ARE SPENDING TO KEEP UP WITH A.I. DEMAND. A.I. DEMAND IS NOT THE ISSUE. THE ISSUE IS FINANCING, RIGHT? LOOK AT GOOGLE, AMAZON, MICROSOFT. THEIR DEMANDS ARE GOING OFF THE CHART RIGHT NOW, AND THEY'RE GOING TO THE BOND MARKET TO, ESSENTIALLY, RAISE BILLIONS OF MARKETS. METACITIZEN IS -- META IS RAISING $10 10 10 -- 100 BILLION RIGHT NOW. MICROSOFT IS LOOKING TO RAISE $25 BILLION. SO W WE'RE SEEING MASSIVE AMOUNS OF CAPITAL BEING RAISED, AND WE'RE NOW STARTING TO SEE THE REVENUE COME IN JUST YET -- NOT STARTING TO SEE THE REVENUE JUST YET. WE'RE PROBABLY IN THE SECOND OR THIRD INNINGS OF THIS A.I. INFRASTRUCTURE BUILDOUT. THE PROBLEMS MAY NOT COME UNTIL THE SIXTXTHOVER SEVENTH -- SIXTH OR SEVENTH INNINGS, AND IS WE NEED TO STAY PATIENT. CHARLES: THIS CAPEX SPENDING YOU'RE TALKING ABOUT, IT'S JUST GOING TO BE MONSTROUS. IT'S GOING TO GO EVEN TO NEXT YEAR, EVERYONE'S ESTIMATE IS WELL OVER A TRILLION DOLLARS. AND STILL HERE'S WHAT'S CONFUSING, MAYBE FRUSTRATING AS WELL, THERE'S A 20% SELLOFF IN SEMIS. SO THAT MONEY HAS GONE SOMEWHERE AND UP UNTIL A FEW WEEKS AGO, IT WAS FUELING THE SEMICONDUCTOR RALLY THAT WAS AMAZING. IT STALLED IN JULY, AND IT'S NEVER REGAINED THAT CONFIDENCE. WHAT'S GOING ON THERE? >> YEAH. I THINK THERE'S A LOT OF CLARITY WE NEED BEFORE WE CAN GO HIGHER IN THE SEMICONDUCTOR TRADE. I THINK MIDTERMS ARE AROUND THE CORNER. I THINK WE'RE GOING TO GET CLARITY WHEN THAT HAPPENS, AND THEN AB DROPPIC IPO'S COMING UP SOON -- ANTHROPIC. I THINK IF YOU HAVE A SUCCESSFUL IPO, WHICH I THINK THE SEMICONDUCTOR TRADE IS GOING TO BE BACK ON, WE'RE JUST TAKING A BIT OF A BREATHER BEFORE WE GO HIGHER. LOOK AT HOW MANY SELLOFFS WE HAD IN THIS YEAR ALONE. WE HAD THE LIB LIBERATION DAY, JUST TWO OR THREE WEEKS AGO WE HAD ONE. THIS IS JUST AN ONGOING CYCLE, AND WE'RE GOING THROUGH THE GREATEST REVOLUTION OF OUR LIFETIME, YOU KNOW? LIKE, MAKING MONEY IS NOT GOING TO BE EASY. SO I THINK WE ALL JUST HAVE TO STAY PATIENT AND BELIEVE -- I STILL BELIEVE IN THE A.I. TRADE. CHARLES: RIGHT. BUT YOU DID LOSE YOUR PATIENCE LAST NIGHT, LEAST TO YOU WENT ON X WHEN IT CAME TO INTEL -- [LAUGHTER] YOU SAID, I'M SELLING ALL THIS CRAP. A COUPLE HOURS AGO, YOU DID SAY YOU SOLD A MAJORITY OF IT. WHAT HAPPENED THERE? OBVIOUSLY; THEY ALL CONDITION WITH WINNERS OR, BUT YOU CHANGED YOUR MIND SIGNIFICANTLY. >> I DID. I WAS ONE OF THE STRONGEST SUPPORTERS OF INTEL THIS YEAR. I TOLD OUR CLIENTS TO SELL INTEL LAST NIGHT BECAUSE THE PROBLEM IS THEIR REVENUE, RIGHT? JUST LOOK AT THEIR REVENUE. FOR CONTEXT, INTEL GENERATED $78 BILLION OF REVENUE IN 2021. FAST FORWARD TO 2026, THEY'RE ONLY MAKING PROJECTED $63 BILLION. LIKE, HOHOW DOES THAT EVEN HAPP? I THINK THIS IS A MISMANAGEMENT FROM THEIR TEAM. AND THE BIGGEST THING IS, LIKE, DEMAND ISN'T EVEN THEIR ISSUE. THEY'RE, AS WE KNOW, DEMAND FOR SERVERS, CPUs ARE EXPLODING, A.I. AGENTS ARE CONTINUING TO EC R EXPAND THAT, BUT THEY DON'T HAVE ENONOUGH MANUFACTURING CAPACITY TO MEET GRAND. AND BECAUSE OF THE RISING MEMORY PRICES, THEIR FOUND IFLY BUSINESS, THEIR PC BUSINESS IS STARTING TO LOSE AS WELL, AND THEIR FOUNDRY BUSINESS HAS CONTINUED TO LOSE BILLIONS OF DOLLARS. AND THEY'RE NOT EVEN GOING TO BE PROFITABLE OR FREE CASH FLOW UNTIL NEXT YEAR. SO THERE'S A LOT OF TROUBLE AHEAD AT INTEL. AND THIS IS, HONESTLY, THIS IS STILL A GREAT COMPANY. I STILL HOLD SOME POSITION BECAUSE, AS WE KNOW, I GENUINELY WANT INTEL TO SUCCEED BECAUSE AMERICA NEEDS INTEL TO SUCCEED. CHARLES: YEAH, NO DOUBT. >> IT'S THE ONLY AMERICAN COMPANY OPERATING AT THE LEADING EDGE OF SEMICONDUCTOR MANUFACTURING AT THIS SCALE S AND WE CAN'T DEPEND ON TAIWAN FOREVER, SO WE NEED THIS COMPANY TO SUCCEED. CHARLES: NO, I SEE THE SAME THING. IT BROKE MY HEART TO SEE THIS LAST NIGHT. LESS THAN A MINUTE TO GO, I KNOW YOU ARE BUYING SOME THINGS NOW, NEBIUS, MICRON, SPACEX AND SAMSUNG. NEBIUS, I'VE ALWAYS CONSIDERED IT THE BEST OF THE NEOCLOUD, BUT HOW WILL THEY CONVINCE THE REST OF WALL STREET, HEY, THE COAST IS CLEAR? >> YEAH. I MEAN, JUST LOOK AT WHAT THEY DID LAST WEEK, THEY RAISED $3.5 BILLION FROM CITIBANK. SO IS THEY'RE NOT -- MONEY'S NOT AN ISSUE FOR NEBIUS RIGHT NOW. THEY HAVE A STRONG BALANCE SHEET. THEY'RE NOT AS AT RISK AS COREWEAVE, AND THEY HAVE AN INCREDIBLE TEAM. I THINK YOU HAVE TO UNDERSTAND NEOCLOUD SECTOR AS A WHOLE IS DOWN RIGHT NOW, BUT AS THEHESE START TO -- THEY'RE REPORTING EARNINGS SOON, AS THEY START TO REPORT EARNINGS, I THINK THEY'RE GOING TO DO INCREDIBLY WELL. IN FACT, ALL THE MILK ROAD