Episode Details

AI stocks just had their longest losing streak since 2008. In this solo episode, Joe Withrow uses the selloff in artificial intelligence (AI) stocks to ask a better question than "what will the market do next?" The better question is why you should care at all.

The selloff comes down to debt and interest rates. Big tech is on pace to spend roughly $700 billion this year building AI data centers, much of it borrowed. CoreWeave, which rents out computing power to AI firms, sits at the center of it, and one of its bonds hit a yield of about 16% while the U.S. government borrows for ten years at around 5%. Joe puts the move in proportion: this is worry, not panic, and the broader credit markets barely moved.

Whether it's the AI bubble popping or a healthy shakeout, nobody knows, and Joe explains why the Phoenician League's strategy doesn't depend on the answer. Then he makes the case for real diversification. Owning many stocks across many industries isn't diversification, because they fall together in a real drawdown. He walks through a $100,000 portfolio in a 30% market drop, with 80% in stocks versus 10%, and explains why the old 60/40 and 80/20 portfolios were a lucky passenger on four decades of falling interest rates.

Joe lays out his layered model, with gold, Bitcoin, and max-funded life insurance as the foundation and stocks, cash-flowing assets, and private investments on top. He shares how he tracks his own allocation, why he doesn't rebalance, and how the model tells him where to focus next. The episode closes with a 10-to-20-minute homework exercise to map where your money sits.

In this episode:

- Why AI stocks fell for days in a row, and what the selloff says about debt and interest rates
- Why CoreWeave's bonds sold off, and what a 16% yield signals about the market's fear of non-payment
- AI bubble or healthy shakeout? Why Joe's strategy doesn't depend on the answer
- Why diversifying across stocks and sectors isn't real diversification
- A $100,000 example comparing an 80% stock allocation with a 10% allocation in a 30% drop
- How asset allocation protects you from the market and from your own decisions under stress
- Why 60/40 and 80/20 portfolios were a lucky passenger on four decades of falling interest rates
- The layered model: gold, Bitcoin, and max-funded life insurance as the foundation, with stocks, cash-flowing assets, and private investments on top
- How Joe tracks his allocation, why he doesn't rebalance, and how the model sets his priorities
- Homework: a 10-to-20-minute exercise to map where your money sits

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