Slate Money Schrödinger’s Equities
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Jan 3, 2026 In 2025, the US stock market gained but left investors feeling underwhelmed compared to international performance. The role of AI in these gains sparked an engaging debate. Surprisingly, Mexico emerged as a winner during the Trump trade war, capturing supply chains. M&A activity skyrocketed to $2.4 trillion, while Warren Buffett's impending retirement raised questions about Berkshire Hathaway's future direction. The hosts also pondered Tesla's valuation despite declining deliveries, showcasing the unpredictable nature of the market.
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Dollar Drop Boosted U.S. Multinationals
- The S&P includes many global companies, so a weaker dollar actually raised the value of foreign revenues for U.S. firms.
- This offset some domestic concerns and helped the index despite domestic sector weakness.
Mexico Gained From Tariff Uncertainty
- Mexico benefited from U.S. tariff tensions because most North American trade remains USMCA-exempt.
- Lower effective tariffs made Mexico an attractive manufacturing destination for U.S. companies.
Hyperscalers Are The AI Pick-And-Shovels
- Hyperscalers and data-center builders act like 'pick-and-shovel' plays for AI compute demand.
- These firms benefit structurally because only they can scale the massive compute AI requires.