Nick Martell

They explain two key things happening in the stock market right now.

The two huge things happening in the market right now.

First, why software stocks are down.

They're down because people could use AI instead of use their software.

And why chip stocks are up.

Claude needs huge compute to do that software work, like to analyze your financial statements for potential tax breaks.

And we brought the receipts yetis because the iShares chip ETF, which is a fund of a bunch of chip companies, it's up 47% so far this year.

Like we said.

Meanwhile, the iShares SaaS ETF, tracking software stocks, it's down 21%.

So Jack and I call this phenomenon the Great Silicon Inversion.

When chips rip.

It's because software slips.

So Jack, what's the takeaway for our buddies over in the investing game?

There's a secret SOS signal from the stock market.

And when you see it, you should be worried.

Yeti's interesting thing about the software stocks plummeting, their sales are still rising.

Look at ServiceNow, a software company that said on Wednesday, revenues rose 22% last quarter, their best quarter in three quarters.

But then Jack, why did their stock shockingly plummet?

Because their margin shrank.

the profit they made for each buck of software sales fell from 81% to 77%.