Stock Market Desperation Is Sinking In...

Submitted by QTR's Fringe Finance

Another week, another reminder that markets can ignore reality for a lot longer than reality can ignore markets. Heading into Friday’s cash open, our 26 Stocks to Watch for 2026 were still outperforming the S&P 500, up about 16.4% on an average equal weighted basis.

This week was less about stocks and more about a recurring human condition: the desperate need to believe that this time, somehow, the laws of economics, valuation, supply and demand, and basic arithmetic have all changed.

In SpaceX And The Limits Of Human Belief, I wasn’t questioning the company’s accomplishments. I was questioning the increasingly popular idea that extraordinary companies deserve extraordinary valuations forever. At some point, admiration becomes religion. Markets tend to get into trouble when investors stop asking what something is worth and start treating skepticism as heresy.

SpaceX And The Limits Of Human Belief

That same dynamic showed up in Private Shares, Public Problems. For years, private markets have enjoyed the luxury of marking assets at whatever price sounds good in a pitch deck. Unfortunately, liquidity has a nasty habit of showing up eventually and asking uncomfortable questions.

Private Shares, Public Problems

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Then there was Strategy’s New Math: Dilution Equals Accretion?, where shareholders are being asked to ignore basic math and previous statements Strategy and its execs have made in favor of the narrative they are peddling today.

Strategy's New Math: Dilution Equals Accretion?

Speaking of tops, Harris Kupperman explained why datacenters may be this cycle’s version of shale oil: enormous capital expenditures, endless enthusiasm, and a lingering question about whether anyone will actually earn an acceptable return on all that investment. The market hears “AI” and immediately forgets to ask about profitability.

Datacenters Are the New Shale Oil: Harris Kupperman

Phil Bak discussed S&P’s decision to finally draw a line in the sand regarding index inclusion rules. It was a useful reminder that markets aren’t just driven by fundamentals anymore—they’re increasingly shaped by index mechanics, passive flows, and committees trying desperately to keep up with financial engineering.

S&P Takes A Stand: Phil Bak

Then inflation arrived and ruined everyone’s week. In The Inflation Shit Is Hitting The Fan, I pointed out what should have been obvious: inflation isn’t dead. It may not even be sleeping. And if the recent data are telling us anything, it’s that the market’s confidence in endless rate cuts might be a little premature.

The Inflation Shit Is Hitting The Fan

Here’s what else is new on the blog:

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