The K-Shaped Economy Comes for Software

Markets are starting to downplay the on-again/off-again Iran headlines. Instead, they’re getting back to their core business of the past three years: cheerleading the AI boom.

However, 2026 has a new twist. Investors are now fearful about how AI programs could rapidly change the dynamic in the software space. Hardware stocks have caught a bid over the past two weeks, but software stocks continue to lag:

While tech hardware stocks have rebounded sharply in the past few weeks, software stocks remain out of favor with investors, fearful of rapid, AI-driven change. (Source: @ekwufinance via X)

The market is willing to give AI infrastructure plays the benefit of the doubt. But as earnings season kicks off, AI spending and progress could lead to rapid changes for both hardware and software plays.

~ Addison

P.S. Last week’s Grey Swan Live! with Dr. Mark Skousen yielded a romp through political and economic “liberty” from the signing of the Declaration of Independence and the 25o-year anniversary of Adam’s Smith’s Wealth of Nations – with a strong detour through the renaissance accomplishments of Benjamin Franklin – all the way to Elon Musk and the entrepreneurs leading the U.S. economy into the AI and space age.

As America celebrates its 250th anniversary this year, Mark is gathering renowned guests for The World’s Fair of Liberty – this year’s theme for FreedomFest – in Las Vegas, July 8-11, 2026.

FreedomFest is easily the most unique gathering of economists, historians, money managers, policymakers and iconoclasts held each year. The Anthem film festival, held in tandem, brings together filmmakers and creative types from all over the world.

If you haven’t been, or want to return this year, the event promises to be a fantastic gathering in honor of America’s 250th anniversary. Check out the details here. (***During our conversation, Mark went into some detail on the discounts he was able to secure at Las Vegas hotels exclusively for attendees to this year’s event.)

In the meantime, you can watch the replay of Grey Swan Live! Mark Skousen in the members section of the Grey Swan website. If you’re not already a member, click here to join our latest livestream.

Markets are starting to downplay the on-again/off-again Iran headlines. Instead, they’re getting back to their core business of the past three years: cheerleading the AI boom.

While tech hardware stocks have rebounded sharply in the past few weeks, software stocks remain out of favor with investors, fearful of rapid, AI-driven change. (Source: @ekwufinance via X)

~ Addison

Debts and deficits will eventually cause a crisis. Treasury Secretary Scott Bessent’s effort to help bail out the Japanese Yen this week is entirely motivated by self-preservation. The contagion signal flashing in Japanese bonds since late ‘25 is infecting the BOJ, which may be forced to sell U.S. Treasurys to stabilize its own currency.

The copper price is no doubt benefiting from inflation driven by money printing. But the doc don’t lie. Copper’s new all-time highs, while gold and silver still languish, are a sign the AI growth story is also that of the global economy itself.

Many miners were profitable with gold around $2,000 and silver near $50. At sustained prices closer to $4,000 gold and $60 silver, the arithmetic changes dramatically.

The stock market is getting an unexpected boost to kick off August, bucking the historically weak summer session for the U.S. stock market.

What’s happening? The Bank of Japan and the U.S. Treasury are making a coordinated effort to support Japanese yen; a move last attempted nearly 30 years in the height of the Asian Financial contagion (1998).

Many miners were profitable with gold around $2,000 and silver near $50. At sustained prices closer to $4,000 gold and $60 silver, the arithmetic changes dramatically.

The stock market is getting an unexpected boost to kick off August, bucking the historically weak summer session for the U.S. stock market.