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To Investors,

The American economy is booming. At least that is what the GDP numbers are telling us. US GDP grew 3.8% year-over-year in Q2 and the Atlanta Fed is estimating Q3 growth to be between 3.5% - 3.8%.

Historical context is important to understand the magnitude of these numbers. The average GDP growth for countries around the world is approximately 2.9% and the United States has outperformed for the last 80 years by growing GDP on average 3.2% annually from 1947 to 2025.

So what is driving the good times right now?

The answer is very simple: artificial intelligence. Adam Kobeissi shows that approximately 63% of all GDP growth is coming from AI-related spending. This means that without the AI CAPEX boom, the US economy would be in a significantly worse position.

This AI-related spending can be best visualized by looking at data center spending since 2020. Kobeissi writes “spending on data centers in the US has tripled since the release of ChatGPT in November 2022. Spending on structures excluding data centers is down ~20% since the 2023 high. The strength of technology companies has created two “economies” in the US.”

Speaking of two economies, compare the explosion in AI-related spending with the fact that US small business bankruptcies reached a record 2,221 year-to-date. This is up 83% over the last five years. These bankruptcies reflect high borrowing costs, cautious consumer spending, and economic pressures disproportionately affecting smaller businesses.

This second economy also saw US employers announce 1.2 million job cuts in 2025, which is the second-highest in 16 years. These job cuts create a paradox where labor market deterioration coincides with the S&P 500 adding $17 trillion since April.

Think of how crazy that is.

Small businesses are going bankrupt and more than a million people lost their job, but US corporate profits hit record highs in Q4 amid strong demand and pricing power.

If you looked up the definition of opposing outcomes, you would find these data points front and center as they expose inequality between corporate performance and worker outcomes. Plenty of people will use this information to rail against the system. They will stoke populism and claim that the only path forward is socialism.

But we know that is not true. In fact, history shows us over and over again that economic incentives drive outcomes. Programs like Invest America will give people a stake in the capitalist system, while providing a financial head start for millions of young people.

And the data shows that young people, particularly Gen Z, may be more enthusiastic about financial markets than you would think.

Gen Z is starting to invest earlier than previous generations. About 54% of this cohort are beginning by age 21 compared to 31% of millennials and 27% of Gen X.

Additionally, 63% of young adults view the stock market as an excellent wealth-builder. Gen Z favors stocks and millennials lean more into crypto as their primary investment. What is maybe most interesting, younger generations are nearly 3x more likely to hold speculative assets, including crypto-related stocks and day trading.

So what is my big takeaway from all of this?

There are pockets of great data in the economy and financial markets, but those big trends like AI are covering for areas of weakness. That is normal. There are people claiming everything is great or everything is horrible…both of the groups are right.

But maybe the real lesson here is that we should trust the kids. They are enthusiastic. They are pouring capital into financial markets. They see value in AI, bitcoin, crypto, and robotics. These young people are predicting the future. We all should just make sure we are listening.

Hope you all have a great day. I’ll talk to everyone tomorrow.

- Anthony Pompliano

Founder & CEO, Professional Capital Management

Is the Fed About to Trigger the Next Bitcoin Boom?

I recently sat down with John Pompliano to dig into what’s really at stake at the upcoming Federal Reserve meeting - whether the move should be 25 bps, 50 bps, or nothing at all.

We breakdown how those decisions ripple through markets and why bitcoin’s unique monetary policy is becoming impossible for the world to ignore. Plus, discuss the shift as bitcoin miners move into AI infrastructure - why it’s happening, how they’re doing it, and what it means for investors.

Enjoy!

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Two Economies, One America: How AI Is Driving Growth While Small Businesses Collapse