This Is A GENERATIONAL BULL MARKET! Stocks Are NOT Topping Soon

0:00Stocks are flying higher and everyone wants to know, are stocks overvalued? Now momentum begets momentum. Returns attract capital. New all-time high prices, those bring even higher prices. And nowhere in finance is there more momentum right now and returns than in technology stocks. Blue Kirk Market Insights writes, For the first time in 17 years, the NASDAQ 100 is up four consecutive weeks. The gains exceed 18%. That kind of momentum is usually bullish for the NASDAQ. One month later, the index is higher six of the last seven times, and the median gain is eight and a half percent. Now, a big reason why the Nasdaq is doing so well is because of semiconductor stocks.

0:40Depending on how you count, there are 15 to 18 semiconductor stocks in the Nasdaq index. Opening Bell's Phil Rosen points out how well those companies have done, and he's stayed is just crazy. Semiconductors are destroying software stocks this year, he writes. The semiconductor ETF is up 53%. the software ETF is down 19%. It's a 72 % spread between the two sides of the AI trade. Now, anytime investors, me, you, or anybody else, see a sector explode in popularity like these semiconductor stocks, then it begs the question, have all the returns already been captured by the market or is there still upside for me?

1:19David Marlin writes that 77 % of the semiconductor index constituents are actually overbought right now. It's the second highest reading in the last 20 years. After similar readings, the short-term returns were generally muted. The two-week average was negative. The one-month average was flat. But returns five months out or more, they have been extremely positive. Take the average return six months out. That's been about 19%. So if history repeats itself, that would suggest that semiconductor stocks have a lot more room to run. Now, these semiconductor stocks are a big reason the S &P has made a miraculous recovery from its dismal start to the year.

1:56Creative Planning's Charlie Blello writes that on March 30th of 2026, the S &P was down 7 % to start the year. That was the 12th worst start to a year in history. But after one of the biggest four-week rallies ever, it is now up 5 % year to date. That is above the average year at this point in time right now. He says that there's no impossible in markets, and I agree. Now, this is noteworthy because many investors are worried that the market is overvalued right now. Take Global Markets Investor as one example. They write that the U.S. stock market is extremely expensive. The number of large stocks with a price-to-sales ratio above 10 and year-over-year price gains above 100%, that is now 175 companies.

2:38That's the highest level since the 2021 meme stock frenzy. But if you take out 2021, it's the highest level since the 2000 dot-com bubble burst. And any time anyone references 2000 in the dot-com bubble, everyone freaks out. But if you just look at historical valuations, you know, when men were riding horses to work and stuff, you missed the bigger picture. Daily Chartbook highlights that with 28 % of the index reported, 84 % of companies have delivered higher than expected earnings per share. That's above the five and 10-year averages. In aggregate, those companies are reporting EPS that are 12 % above estimates.

3:12And that's also higher than the five and 10-year averages. Then Mike Zaccardi, he points out that tech is at an all-time high, but its PE is still eight figures lower than just back in October of last year when we had an all-time high. So here's the question, are stocks actually overvalued? Well, to me, it isn't clear that people should be worried at all. In fact, there are numerous areas in financial markets that are not performing well, but semiconductors in tech more broadly, those are doing well. Charlie Blolo highlights that with the exception of Bitcoin, every major asset class is now positive territory on the year.

3:46and Jim Bianco shows that defense stocks are getting crushed during the Iran war, narrative violation. Both Bitcoin and defense stocks were supposed to be going up, but neither one of them have done super hot in this year. But just because these assets have not done incredibly well, doesn't mean that they can't turn it around in the coming days. Take Bitcoin as an example. One, it's done incredibly well since the Iran war started and Bitcoin's been a big winner there. But Frank Fetter also shows that the long-term holder supply is going absolutely vertical. There's not a lot of sellers. There's a lot of people accumulating Bitcoin right now.

4:21And then Frank explains that historical premiums are being paid to short Bitcoin here at$78 ,000. Three standard deviations away from the mean. He says that the shorts are playing with fire right now. So remember, you've got significant accumulation underway of Bitcoin. You've got short sellers piling into an overextended trade. And if you put that all together, it's the perfect ingredients for an asset like Bitcoin to surge higher. Then add in the backdrop of stocks going higher already, along with Kevin Walsh potentially becoming the next Fed chairman. And you have more components to a story where all asset prices are going to appreciate rapidly.

4:55And we're seeing some of this already happen in the commodity sector. Remember, those prices have been going up very aggressively. Jordy Visser, my friend and someone I talk to every Saturday, he explained to me what's happening this weekend. Take a listen to how Jordy explains the commodity bull market. This is a very unique economy. If I wanted to figure out where inflation was over the last 17 years, we were in a bear market in commodities for 17 years, except for COVID. So the reason I kind of took a shot at people fitting things to historical data is today's world is not the same as it was from 2010 to 2015.

5:32We are in a commodity bull market. We have shortages across the globe. And what Craig Fuller talked about was freight is out of control, all because of AI, all because of the one big beautiful bill, all because of lower energy costs here and higher energy costs around the globe. So natural gas is low. That'll keep help inflation a little bit down. Oil's higher, gas is higher, diesel's higher. That'll push it up. But the reality is memory prices, CPU, semiconductors, that stuff, there's no end in sight. And the reason I bring this up for Bitcoin for people, at some point, Bitcoin is either in the abundant bucket or it's in the PMI sensitive bucket.

6:10It's a PMI sensitive. Its returns are there. The only thing missing, which I still think will happen, is year over year, CPI will get above 4%. Three-month bills will stay below 4%, and we'll have negative real yields. And I think that's what's happening is software is in a deflationary problem. So your world, Bitcoin's now moving into the inflationary world, my world, which is more related to commodities and scarcity. Now, if you take what Jordy's saying here and you extrapolate it, I believe that we are in a generational bull market. We've been locked in this environment since we came out of the 2008 global financial crisis.

6:43There's been a couple of dips here and there, but for the most part, we're in a generational bull market. The central bank is supporting the market in a way that was previously deemed off limits. So whenever you have a pessimist promise you how bad the future is gonna be, how much destruction you're gonna see in your portfolio, just remember to never buy into the nonsense. The modern industrial revolution is underway. We are rebuilding the infrastructure that is necessary for America to prosper for the next hundred years. Owning a piece of that trend is likely to pay off handsomely for those who are willing to do the work and understand what's happening right now.

7:14Whether it's AI companies, whether it's data center, power generation, drones, space, or many other technologies that are all coming to market. We have some of the world's best entrepreneurs who are very well capitalized and they are very ambitious. And whenever you put capital into entrepreneurs' hands and they go and they create things from scratch, there will be economic returns attached to that. Just look at some of the biggest companies in the world right now. Many of them weren't around 50 years ago. That's what innovation does, is it brings new people to the market with new solutions to big problems.

7:50And those who solve those problems drive returns. And so every time I hear somebody talk about, is the stock market overvalued? I always get a good laugh because usually they'll pull out some graph that goes all the way back to the 1800s where people were literally writing with feathers. They were doing it under candlelight and they're riding horses to work. It's just absurd. We've connected devices now. I literally have a phone, an iPad, a computer. I get on the internet and I have every single piece of information at my fingertips. I can communicate with anyone in the world in seconds. This is not your grandfather's market because technology has accelerated.

8:28And then add in the fact that the central bank, they have a monetary bazooka. They can cut interest rates and they can print money. And that is what they are doing. QE is alive and well. They've cut numerous times going into the end of 2025. Kevin Warsh is going to ride into the central bank and he's going to save the day, supposedly. He's going to start slashing interest rates. He's going to make sure that deflation doesn't hurt the U.S. economy. And he is going to make sure that asset prices continue to go up. Whether you like it or not, whether you agree with it or not, Lower interest rates are going to happen.

9:04And when lower interest rates come to the market, that means that asset prices will go up. I'm not saying that we should cut interest rates just to make asset prices go up. I'm saying that they're going to cut interest rates, which are going to drive asset prices up. And so you can sit on the sidelines with all the crybabies and they'll tell you, oh, everything's overvalued. Oh, the U.S. economy, the tariffs, inflation, Iran, and a whole litany of other nonsense. or you can simply understand one important thing. The show goes on. If you buy assets in the United States of America and you hold them for long periods of time, almost always they'll go up.

9:43And if we're talking stocks, they definitely go up because the central bank has engineered an environment where the dollar has no bottom. And so stocks, Bitcoin, and many other assets, they have no top. That's it for today's show. Thank you guys so much for watching. Please remember to subscribe on YouTube and I'll talk to all of you live from the desk of Anthony Pompliano tomorrow.