lars tvede

IT entrepreneur, investor and author.

[Stocktwits @Stocktwits]

Kevin Warsh: We're raising rates

Trump:

[Kristoffer Lippert @KrisLippert]

Leveraging AI to enhance information digestion is top of mind for many investors today.

@larstvede explains their process: “we use five different LLMs to identify the top 30 venture funds and top 50 liquid asset allocators in the world, […] what would their ideal portfolio look like?”.

Full episode below.

[lars tvede @larstvede]

𝗧𝗵𝗲 𝗥𝗼𝘁𝗮𝘁𝗶𝗻𝗴 𝗪𝗵𝗲𝗲𝗹 𝗼𝗳 𝗗𝗼𝗼𝗺

During my lifetime, humanity has lived through an endless relay race of existential panic such as:

- The Population Bomb
- Mass extinction
- Limits to Growth
- Acid rain
- Nuclear power
- DDT
- Y2K

Consistently, one narrative burns itself out through public fatigue and another steps into the arena.

Now, as the data shows climate panic rapidly fading from the top of public concern, the collective subconscious requires a replacement. That new mantle has landed squarely on Artificial Intelligence.

The threats change; the human appetite for catastrophe remains constant.

[OpenRouter @OpenRouter]

OpenRouter users spent more on OpenAI models than on Anthropic models last week.

This hasn't happened for more than 2.5 years

[lars tvede @larstvede]

𝗪𝗜𝗟𝗟 𝗔𝗜 𝗖𝗥𝗘𝗔𝗧𝗘 𝗣𝗘𝗥𝗠𝗔𝗡𝗘𝗡𝗧 𝗠𝗔𝗦𝗦 𝗨𝗡𝗘𝗠𝗣𝗟𝗢𝗬𝗠𝗘𝗡𝗧?

History and macroeconomics suggest no.

Bank of England data going back to 1700 reveals a striking pattern: through steam, railways, electricity, and the internet, labor’s share of national income has consistently held within a 𝟱𝟰–𝟲𝟴% 𝗯𝗮𝗻𝗱.

What to expect with AI (chart below):

1) AI Transition (Near Term): Extreme chip and power bottlenecks create outsized rents for tech infrastructure, temporarily pulling labor’s share toward ~50%.

2) Abundance Shock: As bottlenecks clear over 10–15 years, marginal production costs collapse. Digital intelligence becomes dirt cheap or free.

3) The Passion Economy: Rutinized work gets automated, driving capital straight into non-replicable human value—culture, art, wellness, and experiences. Labor's share rebounds.

Profound tech waves don’t render humans redundant—they simply redirect where human effort goes.

From my book “2050 – When Machines Do the Work and We Do the Living” (published in China)

[The Economist @TheEconomist]

Our analysis suggests that AI has so far created around 1m new jobs in America. We explain how the technology has created a hiring boom https://t.co/bywoXNJQ7A

[lars tvede @larstvede]

ENJOY YOUR AI AND ALMONDS 🤩

But if you are concerned about water, skip the almonds.

[a16z @a16z]

Humans are the minority user of AI

Agents burn nearly 5x the tokens people do, up 14x since February

Charts of the Week: https://t.co/7YT2BXvuUu

[lars tvede @larstvede]

𝗔𝗜 𝗜𝗦 𝗡𝗢𝗧 𝗔 𝗕𝗨𝗕𝗕𝗟𝗘
I keep hearing claims that an AI crash is inevitable—as if a bubble were already a given. I don’t think it is a bubble. Not an investment bubble, and not an earnings bubble" either. Here are 12 reasons why:

1) 𝗥𝗲𝗮𝗹 𝗗𝗲𝗺𝗮𝗻𝗱, 𝗡𝗼𝘁 𝗦𝗽𝗲𝗰𝘂𝗹𝗮𝘁𝗶𝗼𝗻: Unlike classic bubbles, AI demand vastly outstrips supply. The biggest challenge isn't finding customers; it's securing chips, power, and data centers.

2) 𝗨𝗻𝗽𝗿𝗲𝗰𝗲𝗱𝗲𝗻𝘁𝗲𝗱 𝗔𝗱𝗼𝗽𝘁𝗶𝗼𝗻: Over 1.8B people already use Generative AI - after 3.5 years. Its not a fleeting fad.

3) 𝗘𝘅𝗽𝗹𝗼𝘀𝗶𝘃𝗲 𝗥𝗲𝘃𝗲𝗻𝘂𝗲 𝗚𝗿𝗼𝘄𝘁𝗵: In 2023, it took 180 days for the sector to add $1B in cumulative revenue. Today, it takes less than 2 days. OpenAI and Anthropic’s combined ARR run-rate exploded from ~$30B in start January to $95–115B this summer.

4) 𝗔𝗹𝗿𝗲𝗮𝗱𝘆 𝗣𝗿𝗼𝗳𝗶𝘁𝗮𝗯𝗹𝗲 𝗢𝘃𝗲𝗿𝗮𝗹𝗹: While model developers are still focused on scaling, chipmakers and infrastructure providers generate huge profits. The ecosystem as a whole turns an estimated $155–265B in annual operating profit.

5) 𝗖𝗮𝘀𝗵-𝗙𝘂𝗻𝗱𝗲𝗱, 𝗡𝗼𝘁 𝗗𝗲𝗯𝘁-𝗟𝗮𝗱𝗲𝗻: Buildouts are largely financed by hyperscalers' immense free cash flows—not risky debt—minimizing systemic financial risk.

6) 𝗣𝗮𝘁𝗵 𝘁𝗼 𝗣𝗿𝗼𝗳𝗶𝘁𝗮𝗯𝗶𝗹𝗶𝘁𝘆: Modern GPUs generate annual lease revenues of 45–50% of their purchase pricewith up to 90% predicted by Morgan Stanley. Leading players like Anthropic and DeepSeek are already near or past break-even point.

7) 𝗖𝗮𝗽𝗶𝘁𝗮𝗹 𝗧𝗮𝗿𝗴𝗲𝘁 𝗕𝗼𝘁𝘁𝗹𝗲𝗻𝗲𝗰𝗸𝘀: Investments are going directly into scarce, physical assets (power grids, GPUs, transformers) that are actively constraining growth. This is not the "dark fiber" of the 1990s. AI chips are not idle, they are running red-hot.

8) 𝗔 𝗚𝗲𝗻𝗲𝗿𝗮𝗹-𝗣𝘂𝗿𝗽𝗼𝘀𝗲 𝗧𝗲𝗰𝗵𝗻𝗼𝗹𝗼𝗴𝘆: Like electricity and the internet, AI will embed itself into every sector. We are only 3.5 years into a multi-decade shift. Next year, the AI industry will match the global car industry.

9) 𝗦𝗲𝗹𝗳-𝗥𝗲𝗶𝗻𝗳𝗼𝗿𝗰𝗶𝗻𝗴 𝗚𝗿𝗼𝘄𝘁𝗵 𝗘𝗻𝗴𝗶𝗻𝗲𝘀: Competing incentives, first-mover advantages, network effects, and AI-to-AI transactions create diversified, sustained demand.

10) 𝗨𝗻𝗺𝗮𝘁𝗰𝗵𝗲𝗱 𝗣𝗿𝗼𝗱𝘂𝗰𝘁𝗶𝘃𝗶𝘁𝘆 𝗣𝗼𝘁𝗲𝗻𝘁𝗶𝗮𝗹: If AI boosts global productivity growth by just 2 percentage points annually over two decades, global GDP will be nearly 50% higher.

11) 𝗧𝗵𝗲 𝗕𝗶𝗴𝗴𝗲𝘀𝘁 𝗕𝗿𝗲𝗮𝗸𝘁𝗵𝗿𝗼𝘂𝗴𝗵𝘀 𝗟𝗶𝗲 𝗔𝗵𝗲𝗮𝗱: Autonomous vehicles, robotics, and embodied AI will create vast markets that barely exist today. Billions of thinking robots, etc. predicted by 2050.

12) 𝗚𝗿𝗼𝘂𝗻𝗱𝗲𝗱 𝗩𝗮𝗹𝘂𝗮𝘁𝗶𝗼𝗻𝘀: Despite index gains, the Nasdaq’s P/E has actually fallen over the past 3 years as earnings outpaced stock prices. 2027 forward P/Es are surprisingly moderate:
𝗖𝗵𝗶𝗽𝘀 & 𝗛𝗮𝗿𝗱𝘄𝗮𝗿𝗲: NVIDIA 16x | Broadcom 20x | TSMC 17x | ASML 31x | SK Hynix 4x | Micron 6x | AMD 41x
𝗣𝗹𝗮𝘁𝗳𝗼𝗿𝗺𝘀 & 𝗛𝘆𝗽𝗲𝗿𝘀𝗰𝗮𝗹𝗲𝗿𝘀: Microsoft 20x | Alphabet 23x | Meta 18x
𝗖𝗵𝗶𝗻𝗮 𝗔𝗜: Alibaba 16x | Tencent 18x | Baidu 20x (2027 consensus forward P/E)

[Sasha Yanshin @sashayanshin]

Imagine you build a successful business in the UK.

It makes £10 Million profit.

First you pay 25% Corporation tax = £2.5 Million.

Your net profit after tax is £7.5 Million.

Average UK P/E ratio for public companies is ~15.4. Let’s use that as a proxy.

This business is worth £7.5 Million x 15.4 = £115.5 Million.

UK Government wants to tax you 2% wealth tax on your net worth above £10 Million per year. 2% x (115.5 - 10) Million = £2.11 Million.

So you have to pay yourself a dividend of £3.48 Million which will pay 39.35% dividend tax to pay the wealth tax.

Remaining Company profit = £4.02 Million.

If you want to have that money, you have to pay dividend tax again. After the tax you have £2.44 Million.

So the net effect is that if you make £10 Million, the UK Government will take 75.6% of it as tax.

Almost half of this tax comes from the 2% wealth tax.

It’s an extra 35% tax on profit in this example.

Problem is dimwits who were “good at maths at school” and politicians don’t understand basic maths.

This will mean absolutely nobody will take the risk to invest or start a business in the UK.

What is the point? If you are lucky enough to succeed, you will get punished hard.

Jobs will not be created. Investment will dry up immediately. Anyone starting a business who is young enough will move.

The power of FAFO will lead to a collapse in living standards and a collapse in economic growth.

This will destroy the UK economy and be the biggest own goal in a generation.

Why are we blindly walking into a self-orchestrated financial disaster?

But hey - it sounds good because an idiot YouTuber who has no clue said so.

It has good vibes.

Tax the millionaires! What is so bad about a 75.6% tax exactly?

[Daniel Priestley @DanielPriestley]

Socialists imagine a class struggle. In their made-up fantasy the CEO is in competition with low level workers, the wealthy entrepreneur is stealing from the underpaid nurse.

In reality, workers do not compete vertically they compete horizontally.

Entrepreneurs compete with entrepreneurs. Investors outbid each other. CEOs are benchmarked against other CEOs. Nurses are hired from a pool of nurses. Etc.

The CEOs pay has no correlation to the entry level workers. The Football star on £300K a week isn’t linked to the person selling drinks in the stadium. A biotech entrepreneur raising VC capital isn’t paid relative to a cleaner.

What is linked is the demand and supply dynamic of each role.

If a company places an ad for a qualified truck driver and 150 people apply for the role, then the company knows it does not need to increase wages for that role. If the company has an open role for months, it is forced to look at the compensation package.

Same for a CEO. A board representing shareholders would like to hire a CEO for a lot less if they could. Their dream scenario would be to hire a CEO who brings in institutional investors, attracts top executives, drives innovation and growth, keeps margins steady and is a good public face for the business even under pressure. It turns out there aren’t a lot of these people looking for work and if you want one you have to pay more than other companies are offering.

The class struggle isn’t vertical it’s horizontal. CEOs are in competition with CEOs. Retail workers are in competition with retail workers. Demand and supply dynamics set the price.

Sure you can say that a CEO want’s profitability and would like wages to be lower BUT it’s not up to the CEO - demand and supply tension sets the price of workers. An Airline like RyanAir would like free pilots if they could get them but they can’t… so they pay the market rate.

The reason incomes are rising at the top and falling at the bottom is not class warfare. It’s technology and globalisation.

Technology makes basic jobs simple, remote or fully automated. At the same time tech makes executive roles more leveraged, more important and more valuable.

A CEO used to run a smaller organisation. Today a CEO who’s 2% better on a $5B company is generating $100M more. Seems sensible to try and pay a few million to get $100M.

Globalisation has put workers from all over the world in completion with each other - downward pressure on wages. Globalisation has given CEOs more market opportunities to explore - upside opportunity to unlock.

The rich are not very interested in buying houses that poor people own. The poor are not buying up the homes the rich want. They are separate groups living separate lives. Try finding the genuinely rich people whose strategy is to hoard normal residential homes - it barely exists as a thing. About 85% of landlords are people who own 1-4 properties. Super-landlords (100+ properties) are 0.2% of landlords and own a tiny fraction of the 30M homes in the UK… and they’re heavily taxed.

Class warfare isn’t real. It’s an imagined war in the minds of socialists.

Demand and supply dynamics are real. To the degree it is measured in class, it’s a horizontal competition not a vertical one.

[Mikhail Khodorkovsky @khodorkovsky_en]

A fuel crisis keeps spreading across Russia.

I ran the country's largest oil company. Let me explain what is actually happening — and why the Kremlin cannot stop it. 🧵[1/12]

[lars tvede @larstvede]

The Ferrari Luce looks to me like the official vehicle of a luxury oat-milk startup 😵‍💫

They should have learned from Jaguar what not do do.

[lars tvede @larstvede]

Around 2.5% of global ETF volume is currently commodity funds. May rise to above 10 % over the next decade.

[Mario Nawfal @MarioNawfal]

🇩🇰 Copenhagen's Green-led council is limiting elderly care residents to 80 grams of beef per week for climate reasons.

That works out to 11.4 grams a day, which is less meat than most people put in a single taco.

A Green party rep explained the logic: the elderly "have been the biggest climate sinners throughout their lives."

So the plan is apparently to make them atone for it in their final years, one thimble of mince at a time.

Critics, including opposition parties and elderly advocates, say the policy risks undernutrition in a population already vulnerable to it.

The council says it's flexible, but the elderly eating climate penance for dinner might disagree.

Source: BT, Ekstra Bladet

[lars tvede @larstvede]

@MadsStrange_ I Schweiz er det 0%.

[Daniel @danielisdizzy]

Kevin Warsh, the new Fed Chair, just made it clear why rates are going lower:

“AI is going to make almost everything cost less.
We’re at the front end of a productivity boom.
Economic growth won’t be inflationary—we’re in the early innings of a structural decline in prices.”

Elon Musk, Sam Altman, even Stanley Druckenmiller all expect AI to be strongly deflationary.

The next few years are going to be insane.

[lars tvede @larstvede]

Iran has lost the war, and they seem to know it now. After bombing Saudi, they now ask Saudi for help.

[lars tvede @larstvede]

Not the same, but a bit similar: in 52 BC, Julius Caesar built two concentric defensive walls during the Battle of Alesia—an inner line to trap Vercingetorix and an outer line to hold off a massive relief army.
This allowed him to besiege and defend simultaneously, avoiding encirclement and ultimately forcing the Gallic surrender.

[U.S. Central Command @CENTCOM]

https://t.co/v7ABGhPKr3