We are in a high-risk bull market driven by AI earnings. The consumer is supported by tax refunds until August, after which they will be more stretched. The economy is an AI economy, with 95% of Q1 GDP growth driven by tech. It's too early to be bearish on AI stocks; sell calls for income instead.

Consumers are feeling inflation strain but food is resilient, especially protein. Hormel posted 6th consecutive quarter of net sales growth and profit growth across all segments. They are shaping the portfolio away from volatile commodity businesses like whole bird turkey toward consumer-focused brands.

Enterprise IT systems are becoming decision systems with natural language interfaces. Startups are building layers that take data from historical systems and bring intelligence to enterprises. Great AI businesses are worth paying up for; valuations are high but justified for rare, fast-moving companies.

Even within luxury, there is a K-shaped performance. Brands with strong equity, geographic balance, and disciplined pricing are doing well. Those reliant on aspirational consumers or aggressive price increases are struggling. Gucci's turnaround is particularly hard in this environment.

Market has priced in fantastic earnings but may be extrapolating Q1 strength. Consumer is weakening with savings deteriorating. Risk of rate hikes is material; Fed may not cut. AI breadth is narrow; market is vulnerable to any drawback in AI.