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birb_cromble  29d ago (text post)   698 thread views

Weekly Finance Thread - 2026-07-18

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Netflix’s stock is something I’m looking at, purely as a contrarian play. It’s at its 2021 highs.

Do you know what's driving it up? Last I looked at it, there was some concern about market saturation.

Look at the chart, man. It's down almost 30% YTD. OP wants to go for a bottom fishing attempt, hoping it'll turn back up soon.

@birb_cromble Disappointing earnings, investors think Netflix management is getting desperate to do something big after losing its bidding war against Paramount, just generally bad vibes.

P/E was down around 21 when I looked yesterday. Netflix is profitable (I think other streamers generally are not), and I'm willing to bet against bad vibes.

Oh I should clarify it's fallen down to its 2021 highs, wiping out 5 years of stock price appreciation.

Thank you for actually taking time to elaborate on the ambiguity there. I thought I was nuts the first time I read it.

So I made a successful tech play and I am trying to decide whether to (1) cash in; (2) re-balance; or (3) let it ride.

The background: I normally invest in boring Vanguard style mutual funds, but a year or two ago a buddy convinced me to take a modest chunk of my overall investments and basically make an AI play. The thinking was that this is analogous to the dot com bubble and people who got in early on "infrastructure" type investments as well as the leading companies ended up doing very well. Some of the investments fizzled, some did rather well, and some did extraordinarily well. Probably the best example is Sandisk which went up more than 50-fold. The upshot of this is that my tech portfolio is now worth a little less than $4 million. It's no longer a small chunk of my overall portfolio but instead is a slight majority of the total value.

At this point, the obvious thing to do is to take some chips off the table, but the tricky part is that part of me thinks that AI is more than just a bubble, that it will have economic impacts which make the Internet seem like pet rocks, hula hoops, and Dutch tulip bulbs. So basically I am left with a question that has been kicking around here for a while: investing in a situation where there is a huge range of possible outcomes, up to and including the possibility of a full on technological singularity. Thoughts?

Even if you believe this is all going to work out and semiconductor, memory etc demand is going to continue to skyrocket, eventually the Chinese are going to get good at making SSDs and RAM (if not the most advanced GPUs, although I suspect they’ll get there too) and margins will fall through the floor. Involution is the way they do business. They’re selling cars and solar panels at -20% margins to compete with each other for market share.

When Apple and Dell and Microsoft and all the data center and hardware companies are lobbying the US to let them buy cheap Chinese parts that are getting better by the month, the US isn’t going to restrict them so that Korean billionaires get richer. What do you think will happen?

At this point, the obvious thing to do is to take some chips off the table, but the tricky part is that part of me thinks that AI is more than just a bubble, that it will have economic impacts which make the Internet seem like pet rocks, hula hoops, and Dutch tulip bulbs.

This can be true at the same time as your investment declining/underperforming. You're not betting purely on AI being more than just a bubble, you're betting on this specific list of companies continuing to benefit off this narrative. Realistically, you caught a huge chunk of the move already, missing another 2x from here may sting but if you exit now you're booking solid profits and the money you take off (minus taxes) can be distributed into other assets that will still continue appreciating.

In general, I think it's a good time to start taking some chips off the table when you start having urges to post something like this. $4m being slight majority of your portfolio, you must be worth around $7m? The volatility of AI stocks is insane, will you able to stomach 30-60% drawdowns? Has the idea of having this net worth set in as new baseline in your mind? Only you can answer these questions. If I was in this situation, I'd take off 50-60% here, put it in the bank for a month or two, get used to seeing this number. And only then start thinking what to do with it.

The volatility of AI stocks is insane, will you able to stomach 30-60% drawdowns?

His SNDK shares are already down around 40% from peak, so the answer to that question seems to be yes. ;)

Or perhaps he's making that post because every night his mind is racing and stomach's turning because SNDK is down 40% and he's wondering if he should hop off the train now ha

Congrats. Even with the additional context you've provided, as long as you're soliciting opinions, I do think there's some value in a partial exit, assuming you're optimizing for taxes etc.

I don't know how often you've failed to sell at a peak and lost, but it doesn't feel great. Cashing enough to cover that right now and then rebalancing might be good. If it's memory now, what's next? The PMCs mowing down NIMBYs blocking data center builds?

From a psychological perspective I'd say pull half your winnings out and distribute it hedging against some scenarios you can think of. If AI goes off and the tech stocks don't reap the outside gains what might? A broad index of companies like the S&P500 might get commodity priced intelligence for very cheap and become much more valuable because their size and market position give them the best chance to leverage the boons. Other inherently scarce commodities like minerals and land will likely preform well in any scenario where labor, both physical and intellectual, falls to marginal. So mining companies with mineral rights and REITs might pay off. I'm sure you can think of some other scenarios. In most worlds these investments aren't big winners, but in the worlds where they are you'll be very happy you halved your direct AI exposure, which will be plenty anyways if it pays off, to hedge in them.

Congrats on the success.

I suppose my 2c is that continuing to invest in tech stocks in expectation of AI being a crazy world shaking event seems a bit counter-productive; at the level of disruption that'd need to happen, it seems much more likely to me that value ends up accruing in completely unexpected places, that property rights themselves stop making much sense or even just straightforward doom as you say, rather than straightforward "AI investors rule, everyone else drools".

If there truly is going to be an aristocracy, it seems extraordinarily unlikely to me that it's going to be made up of random people who had a few mil in tech stocks pre-singularity, when society is already made up of interests much more powerful than "upper % retail investors".

YMMV, just a random largely risk-averse guy online.

Honest question - what's your number to retire today? Because for me a least, $4 million is fuck you money. Do you really need more?

Honest question - what's your number to retire today? Because for me a least, $4 million is fuck you money. Do you really need more?

I'm already semi-retired in the sense that the business I run has stopped accepting new projects, at least temporarily and possibly permanently. The other wrinkle is that I am engaged and my fiancee is from a wealthy family so she may end up being on the high-maintenance side of things. But anyway, my question is more about making the most of the big changes which seem to be on the horizon as opposed to budgeting for retirement.

I'm pretty confident that absent some doom type scenario, we'll all end up collecting UBI. My concern is that there is going to end up being some kind of permanent or semi-permanent aristocracy. Which would kind of suck, but if there's going to be an aristocracy, I think I'd rather be one of the aristocrats.

Do any of you have any side jobs or gigs that you do? Do they earn any positive income?

I play in a band, and just for giggles I did the math on today's take. I think that after travel costs, I probably made about $3 an hour. It's still a fun hobby that basically funds itself, but I won't be quitting my day job anytime soon.

A few close friends that live near major US cities do photography/videography as a side gig and seem to make decent money. As you'd expect, the pay range is fairly wide:

  • one friend who lives near NYC has approx. 5 years of semi-professional experience, and does shoots for established small businesses (real estate developers, restaurants, etc.) I think he charges several thousand dollars (no more than $10k) for a day of shooting + the editing afterwards. He seems to enjoy it.

  • another friend, near LA, with approx. 1.5 years of semi-pro experience, does smaller shoots - parties, graduations, maternity shoots - and I'd estimate that she charges around 500 bucks for an afternoon (usually something like 4 hours) + editing. For her, it's an enjoyable hobby that happens to make money. No plans to go full-time, as far as I know.

There's an up-front gear investment, and cameras can get expensive, but I'm sure there are entry-level options for less than $500.

I used to resell things on ebay. Product acquisition was mostly automated through bots, so packing and shipping out orders was the most time consuming thing, perhaps ~8 hours/week. Profits would vary a lot, but average would be around $2.5k per month. Pretty easy and brainless stuff, but often times inventory would sit for a few weeks/months taking up a lot of space, so it got annoying.

My Substack buys me a few cups of coffee every month.

I sold a few digital and vinyl copies of my last album (not enough to break even on the recording costs, although fortunately the label paid for the vinyl pressing).

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