The most dangerous words in investing might be 'this time is different,' but the second most dangerous might be 'this time is the same.' Almost every major technology transition has seen people underestimate the ultimate scale of the winning technology while simultaneously overestimating the near-term pace of adoption and monetization.
But the problem with that is they always say that this time it's different is never different. And they've said it in each of those bubbles that I mentioned.
The failure mode that I've seen in technology investing over my career is people who are trained on a particular way that technology markets work, and they can't break free of it. They have a very successful decade, typically, where they nail one cycle, and then the next cycle they try to map the old framework onto the new one, and that's where the mistakes get made.
The mistake most investors make is they think about technology investing as stock picking, when really it's about cycle recognition. If you can identify where you are on the S-curve of a technology's adoption, the individual stock selection becomes almost secondary to being in the right part of the cycle at the right time.
I think the biggest lesson I've learned is that the market is a discounting mechanism for the future, not the present. And what that means is that when things look the darkest, that's often when the best opportunities exist, and when things look the brightest, that's often when the risk is highest.
If you were to bet exclusively on the US over the next 20 years, you're effectively betting on that the longest cycle in history just keeps going. There's been a recent reversal. In 2025, international equities gained 31% in dollar terms, outperforming US stocks by about um 15 percentage points, the biggest margin since 1993.
Earnings are holding up, but multiples were not. And to me that's really the story because you know if anything estimates have gone higher and you were getting you know the tech sector at the lowest multiple going back to 2022.
5mo ago
Underscored — save the words that stop you in your tracks.
