Excess Returns – Episode Summary

Episode: When the Data Stops Working | Cameron Dawson and Dave Nadig on What Aggregate Economic Numbers Hide

Date: February 17, 2026
Hosts: Matt Ziegler
Guests: Cameron Dawson (NewEdge Wealth), Dave Nadig (ETF.com)

Episode Overview

This lively episode explores how aggregate economic data and consensus forecasts often obscure crucial underlying dynamics, especially in a market defined by divergence, narrative-driven positioning, and rapid technological transformation. Hosts Matt, with guests Cameron Dawson and Dave Nadig, dig into why market professionals can’t always trust headline numbers, what’s really happening beneath the surface of employment and economic indicators, how narrative and positioning interact in markets, and why innovations like tokenization and AI are reshaping finance but not always as billed. The conversation blends rigorous analysis, skepticism about conventional wisdom, explorations of recent macro themes, and irreverent pop culture asides.

Key Discussion Points & Insights

1. The Problem with Averages and Consensus Forecasts

• Consensus ‘averages’ hide volatility and extremes

  • Cameron’s piece, Raise the Top: Consensus Forecasts Are Average. And That’s a Problem, is discussed. She points out that market forecasts cluster around the mean, rarely anticipating outliers or regime shifts.
  • Quote:

    “It's almost as if nobody's really willing to stick their neck out in their forecast... It's always a good practice whenever trying to make your own forecast to know what everybody else's forecasts are.” – Cameron Dawson [03:59]

• Flat positioning reflects lack of conviction

  • Institutions are neither bullish nor bearish; there’s a prevailing sense of “wait and see” in both equities and bonds, with yields and positions tightly clustered.

Timestamp: [03:40–05:50]

2. What Headline Data Hides: K-Shaped Economy and Employment Distortion

• Dispersion in economic strength

  • Matt and Dave highlight that robust aggregate jobs numbers belie deep differences beneath: Healthcare added 758,000 jobs, while other private sectors would have shown a loss without it.
  • “If it weren’t for healthcare taking care of the elderly in the US we would have lost 143,000 private jobs over the past year.” – Matt Ziegler [01:00]

• Data 'died'—old relationships broken

  • Dave notes how old macro correlations (e.g., durable goods and freight) no longer reliably predict outcomes post-pandemic.
  • Quote:

    "The aggregate data very much belies what's going on under the surface. So K shaped economy, K shaped markets." – Dave Nadig [06:48]

• Consumption remains strong despite weak jobs data

  • Retail sales and consumption keep hitting highs, suggesting the wealth effect and asset-rich households are masking stress at the bottom.

    “The market hasn’t cared, because we have all the AI spending... but... you have to have a reliable consumer under the surface.” – Dave Nadig [09:15]

Timestamp: [05:50–10:38]

3. Market Positioning and Narrative vs. Reality

• Rotation away from Big Tech (‘Anything but market cap’)

  • A modest decrease in mega-cap exposure (like Nvidia) creates big ripple effects due to index weighting mechanics.

    “There is this sort of weird dynamic... RSP has had the best year it's had versus SPY in God knows how long. We're in a bit of an anything but market cap weighting environment.” – Cameron Dawson [12:53]

• Chasing narratives to justify price action

  • Dave cautions against reverse-engineering economic stories to explain inflows into sectors; sometimes moves are just about flows and crowding, not fundamentals.

    “The most dangerous thing is to ascribe narrative to price action.” – Dave Nadig [11:38]

• International valuations and the strong dollar

  • Non-US markets have re-rated but are still cheap vs. the US; currency positioning has driven major FX swings, and consensus keeps getting the dollar wrong.

    “When you get positioning to extremes, you should expect a reverse in direction... That’s exactly what happened last year.” – Dave Nadig [17:10]

• Positioning vs. Narrative

  • The greatest market surprises occur when narratives and actual positions diverge. Be wary when everyone agrees on a story—crowding signals vulnerability.

    “Whenever we all agree on something... that's where real surprises hide.” – Dave Nadig [18:43]

Timestamp: [10:38–20:00]

4. Financial Market Plumbing: Tokenization Realities

• Narrative vs. institutional adoption

  • Dave’s ETF.com piece: Institution-led tokenization is real, but atomic (instant) settlement creates balance sheet and liquidity challenges for big players.

    “This is actually a problem for most players in the market... we’re building this sort of atomic settlement system that the major institutions... don’t really want.” – Dave Nadig [22:23]

• Tokenization’s limited disruption

  • Institutional plumbing (collateral tokens, atomic settlements) is evolving, but true transformation is limited by industry reliance on netting and capital efficiency.

    “We are giving up a lot of sort of reuse and hypothecation of capital that the system relies on... once you go with this atomic tokenized settlement, you destroy that.” – Cameron Dawson [26:04]

• Why only narrow cases matter

  • Echoed through banking metaphors and escrow examples: sometimes, friction and intermediaries are a feature, not a bug.

Timestamp: [20:00–29:41]

5. Recessions, Market Rotations, and Real-World Impact

• Recession rhetoric: Disliked and dangerous

  • All hosts reject the romanticizing of recessions as “healthy resets”—real people suffer, especially the poor.

    “Recessions really suck for the poor.” – Cameron Dawson [30:26]

• Rotation ≠ recession

  • Value-oriented sector rotations can happen without true economic downturns. Not all corrections involve broad pain.

• Concentration risk and portfolio correlation

  • Dave warns that when assets go parabolic, the risk isn’t just pullback but also rising correlation, undermining diversification.

Timestamp: [29:41–32:07]

6. Surprise and Personal Topics (Pop Culture, Workflow, Social Media)

• Yoga shushing and space reverence (Dave)—[32:22]
• Meatloaf anecdotes and karaoke dreams (Matt/Dave)—[32:38]
• Cameron’s exit from Twitter/X, move to LinkedIn’s surprisingly good discourse—[34:50]
• Super Bowl halftime breakdown (Bad Bunny, nostalgia, and distribution)—[36:44–46:37]
  • “There’s still this idea that somehow there’s going to be an American monoculture... The reality is... things that used to be niche now have hundreds of thousands of people who are into them.” – Cameron Dawson [44:58]

Timestamp: [32:07–47:33]

7. AI’s Real Impact: Workflows and K-Shaped Solutions?

• AI’s invisible productivity dividend

  • AI effects are diffuse: not a step change for every business, but small businesses gain huge productivity, and specific sectors see real step changes (storage, legal research).

    “I still think that small and medium businesses are going to be the biggest percentage beneficiaries of AI.” – Dave Nadig [48:06]

• New tools, harder-to-measure impact

  • AI-accelerated workflows in education (study guides, lecture transcription), writing (dictation to LLMs), customer service, etc.—massive hidden productivity gains, but hard to see in GDP.

    “The AI thing... is going to be extremely difficult to quantify in any meaningful way... just think about how it's impacting people's day-to-day lives.” – Dave Nadig [50:17]

• Potential to address inequality—But only for the equipped

  • People with capital and skills can leverage AI for new opportunities; those without may face greater risk of being left behind.

    “For those people in the economy who have both the capital and the intellect and the animus to actually build a business, to go do their own thing... that's net positive for people who might otherwise be left behind.” – Cameron Dawson [50:59]

• Anecdotes: seniors using generative AI, speech becoming a new interface (ChatGPT)

Timestamp: [47:33–56:21]

Notable Quotes & Memorable Moments

• “All we know is that we don’t know.” – Dave Nadig quoting Oasis [03:59]

• On the K-shaped recovery:

  “If it weren't for healthcare, taking care of the elderly in the US, we would have lost 143,000 private jobs over the past year...” – Matt Ziegler [01:00], repeated for emphasis

• “Data died and what to do about it.” – Dave Nadig on how macro relationships have broken [06:48]

• On tokenization:

  “Narrative is not reality... we've had so much attention in the last 18 months on crypto... meanwhile the actual sort of decentralized finance ecosystem... that's actually moved on apace pretty well.” – Cameron Dawson [20:35]

• On positioning vs. narrative:

  “The greatest market surprises occur when narratives and actual positions diverge.” – Dave Nadig [18:43]

• “Recessions really suck for the poor.” – Cameron Dawson [30:26]

Timestamps for Important Segments

• Consensus Forecasts & Master Plan Analogy: 03:40–05:50
• Aggregate Data Hiding Realities/K-shaped Market: 05:50–10:38
• Flows, Positioning & Narrative in Markets: 10:38–20:00
• Tokenization: Reality vs. Hype: 20:00–29:41
• Recession Rhetoric, Rotations & Risk: 29:41–32:07
• Surprise Questions, Pop Culture, Halftime Show: 32:07–47:33
• AI’s Impact on Productivity and Inequality: 47:33–56:21

Conclusion

This episode pulls back the curtain on how market participants struggle to interpret headline numbers, how narratives drive positioning, the limits and promise of fintech innovation, and why the real impact—both in markets and society—is shaped as much by what is unseen (or unmeasured) as by what makes the news. Packed with both sharp macroeconomic critique and light-hearted banter, this conversation’s core message is to beware easy stories, dig beneath the data, and recognize that the future isn’t distributed evenly—whether in markets, technology, or culture.

Find the guests:

• Cameron Dawson: [NewEdge Wealth], LinkedIn, Bluesky
• Dave Nadig: ETF.com, LinkedIn
• For more, visit [Excess Returns podcast feed]