The Tom Woods Show Ep. 2736 The GDP Racket & the AI Profitability Problem
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Feb 19, 2026 Kevin Duffy, Principal at Bearing Asset Management and author of the Coffee Can Portfolio newsletter, shares sharp takes on the true state of the economy. He explains how GDP can hide quality issues. He questions AI firms' profitability despite massive spending. He spotlights China’s rising productivity and why thematic, contrarian investing matters.
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Missed Bitcoin, Bets On Gold
- Kevin Duffy admits Bitcoin lies outside his circle of competence and that he 'missed the boat' on it.
- He favors gold personally but welcomes monetary competition and allows small Bitcoin allocations for others.
Vet Advisors With Future Scenarios
- Ask advisors scenario questions like the odds of hyperinflation over the next decade to test preparedness.
- Duffy says prefer advisors who plan for changing regimes instead of extrapolating recent zero-rate performance.
China As An Innovation Competitor
- China now competes on innovation and talent, not just low cost; competitive pressures will reshape tech leadership.
- Duffy argues China's entrepreneurial talent pool and necessity-driven efficiency make it a long-term investment theme.