CLMB - I've loved the stock in the past, but are you not concerned that a middleman who connects generally smaller software companies to IT resellers (e.g. consultants, etc.) is ground zero for what AI can really hit hard?

For example, from what I can tell, some of their software/products they are the middleman for are data analysis/management tools and is an area where AI really excels.

Implies a lot of products/jobs are cooked...

Not dissimilar from my experience lately at work and doing tasks outside of work. It's not like much has changed or is changing fast at work, at least in my field, but you can feel that we are venturing into the unknown. I'm left with deep uncertainty and confusion about what comes next.

BX/KKR/APO, etc. - private credit risk hitting these ones pretty hard now.

An interesting thing I read up on last night is how these types of companies are involved in "insurance-like" protection to via collateralized loan obligations (CLOs)...

This Bloomberg article is the far end of this thought:
https://www.bloomberg.com/news/articles/2026-02-16/fund-beating-99-of-peers-sees-few-software-firms-surviving-ai

Here's a couple of AI summaries because the article is behind a paywall:

According to Polar Capital's Nick Evans, competition for established application software firms will come from three primary sources:
-Corporate Clients: The biggest shift is clients using advanced AI coding tools to develop in-house software tailored to their specific needs, allowing them to bypass expensive prepackaged subscriptions.
-AI Startups: A new wave of agile startups is entering the market, leveraging powerful generative AI models to replicate or improve upon the functions of established giants at a lower cost.
-AI Giants & Coding Tools: Sophisticated tools like Anthropic’s Claude Cowork are now capable of replicating and modifying existing software code so efficiently that they threaten the "competitive moats" of traditional firms.
Evans warns that because "software in its simplest form is a way of humans interacting with data," generative AI can now perform these tasks better than many existing software packages.


The piece profiles Nick Evans, a fund manager at Polar Capital, whose $12 billion global technology fund has outperformed 99% of peers over one year and 97% over five years. Evans sold software stocks before the broader market caught on, and his warning to would-be bargain hunters is blunt: most software shares are still toxic and few companies will survive. Yahoo Finance
Application software — the kind that helps users write documents or manage payrolls — looks particularly at risk, in Evans's view. He has sold virtually all of his holdings in the sector, including SAP, ServiceNow, Adobe, and HubSpot, retaining only a small position and some call options in Microsoft. Taipei Times
Evans holds a neutral stance on cybersecurity software, seeing no immediate AI threat there. In total, less than 7% of his fund is invested in infrastructure software and cybersecurity stocks — the two areas he considers relatively safe. Taipei Times
Outside those niches, Evans expects most software firms to go the way of newspapers in the early 2000s, when print media was decimated by the internet. He urges investors to be "significantly underweight application software" and to act quickly, warning that "as the models get better, the disruption is accelerating." Taipei Times
The backdrop: fears that sophisticated AI tools will disrupt software businesses have sent the sector's stocks tumbling — an ETF tracking the US software sector is down 22% — while semiconductor stocks have soared, as AI drives computing demand. Yahoo Finance
In short, Evans's view is that the AI disruption of traditional software isn't a future risk to price in gradually — it's already happening, and most of the industry won't make it through.

SaaS etc. - to what extent do you think companies (banks, manufacturers, etc.) bring software/systems/tools internally again? I mean, we have internal developers and they've made great tools that are way better than sifting through the sea of software options, but they are constantly limited by time/resources. Guess I'm wondering to what extent AI competition in the software space is this possibility vs. cheaper/more numerous external competitors?

There's certainly areas (e.g. security software, etc.) where this doesn't apply right now, but it seems like there are a lot of external software packages that could really just be done better by a small team of skilled software engineers working for the company itself, at least from my experience.

MITQ - didn't like the quarter and sold all at 0.66

looking to buy back in the .40s

FIVN/software - the selloff in software is very broad-based (even cybersecurity names are selling off). You made a great point in a previous post about how really specific apps/software (e.g. plant identification via photos, etc.) are really in danger due to AI.

My question regarding other software companies: is it not about AI replacing that software but rather that the productivity gains in coding could really lower software prices due to competition and/or customer pressure? Like you say, you are potentially doing the work of 20 people.

I've also been trying to think of the other losers and beneficiaries. In my mind, another big loser over the medium term is going to be office-based professionals who are charging using a billable hours model. This is the field I'm in and I think we have to transition to lump sum projects sooner rather than later. Biggest beneficiary might be banks/financial companies that have a huge consulting/software burden.

GPN/ADBE - based on these purchases, you're thinking this is it for the pullback?

FANG stocks look weakest here among the indexes and have been the leading indicator since the bottom of the last market downturn in 2022/2023. Not sure I have much confidence without the mega caps looking better.

RZLV - thanks for sharing; I saw RZLVW and couldn't resist buying a lunch money portion of this degenerate stock.

FINRA Margin relative to GDP might be a better relative measure:

Chart

MITQ - players gonna play

FEIM, etc. - my personal opinion is that this year has been stupid. I've been half cash/SGOV for a good part of the year and am still up a lot by my standards...full disclaimer that I take a more conservative approach than many, so carrying a decent amount of cash (20% or so) is not uncommon for me.

I feel like I'm not even trying and haven't been this unmotivated with respect to the markets in years.

What are you buying/watching?

I was thinking of SCKT since all the other low float garbage has been running but their balance sheet is crap. UFI and BOC are mildly intriguing. There's a pile of Canadian tickers I trade regularly, but are low liquidity.

Shiller PE basically at 40 now:
https://www.multpl.com/shiller-pe

MITQ - was able to sell some at 0.99 AH from the ~0.61 buy. TY for not posting that it was "getting pre jiggy" the last few days, but now it will probably rocket to $10 :P

SNYR - any thoughts after the raise? I bought a bit after seeing your post and sold out on the run up in July.

GEOS - yeah I actually just unloaded the position I had rebought at 12.31 two weeks ago. I rode it all the way down to the 10s. I'm thinking the folks in from the 10s will be taking some profits. It's odd we never got a PR about contract value if it truly was a big $$$ contract. Nevertheless, I'm bullish on the stock overall. The moves are just too good not to take advantage of right now.

VAPE (old CEAD) - you still have any by chance? I had a few shares laying around still. Didn't wake up and sell any when it hit $150 premarket, but I gladly took most off the table at $45. People have lost their minds.

FONR - low ballers, pathetic offer but nothing would surprise me with Fonar's management

KEQU - I did sell half around 55. Just felt too easy to make 20% on literally just getting in soon after the news release. More than happy to hold the rest.

KEQU - I did the same about 5 min. after the earnings release. I had some already, but I have too much cash, and this one seems reasonable.

MITQ - fwiw, i started buying back at 0.61s today.

GEOS - I guess someone knows the contract value? I sold half at 11.50 on Friday and another 25% at 14.3 today.

I think it's getting a bit ahead of itself but who knows.

MITQ - still got half but may sell more today. Still thinking about it. Will let a small position ride more than likely (maybe 20% or 25%). If they start posting 0.01 or 0.02 quarters or more it could get interesting down the road

MITQ - Sold half at 0.91 on the news of the 9M dollar order. Could certainly keep going though.
https://finance.yahoo.com/news/moving-image-technologies-secures-9m-115100412.html

GEOS - they haven't had any permanent reservoir monitoring (PRM) sales of OptoSeis (or its predecessor) since 2012, so it could be big. Hard to gauge though, but stock performance in 2012/2013 may be a rough indicator.

I'm long a small position.

From most recent 10Q:
Additionally, we have developed high-definition permanent reservoir monitoring systems ("PRM") for land and ocean-bottom applications in producing oil and gas fields. Our primary offering, OptoSeis® fiber optic sensing technology, provides high-definition seismic data acquisition systems with a flexible architecture allowing them to be configured as a subsurface system for both land and marine reservoir-monitoring projects. We continue to have discussions with potential clients for future PRM systems. We are currently performing engineering services for two Front-End Engineering and Design studies for a major oil and producer. We have not received any orders for a large-scale seabed PRM system since 2012.

HSON/STRR - a real Frankenstein created here:
https://finviz.com/news/63367/star-equity-holdings-and-hudson-global-sign-definitive-merger-agreement

If I had a better understanding, I might say that it shores up the preferred stock (STRRP) based on HSON's cash position (17M or so) but who knows.

jinxed it! love the term pre-jiggy 🤣

SGMA - small position here too. Totally bizarre pre-market trading down to 1.08.

I had a sell order at 1.91 the other day that missed (it hit 1.89), then it promptly tanked back down to the 1.20s, so I just sat on it.

Definitely more lucky than good on this one.

FONR - agree, not complaining. I'll have to read the 10Q later when I have a chance. The price action on this one consistently confuses me.

Polymarket recession odds spiking today:
https://polymarket.com/event/us-recession-in-2025?tid=1745951948101

Any news?

PPIH - thanks for heads up, was able to take advantage of the premarket bid. Still holding some

MITQ - bought a small position after the news just now. I don't think the news is anything special but I just have a feeling about the volume/trading pre-market here.

FONR - any opinions here, or are the healthcare reimbursement changes just going to kill them? I would think that MRI scanners might get more expensive with all the tariffs so their maintenance/operation of existing ones may be more lucrative? It's a WAG though.

ty for this post, I saw the news over the weekend but got caught up in other life stuff. After your post, I grabbed a random assortment of these on the 14th when you posted and even though tiny positions the return was decent. USARW being the best.

MITQ - my bids missed just barely the last several days...I want to own it again

PPIH - i added in low 9s after tariff announcement. It responded really slowly to market rally before the news release

Oh no Wade...you had 3500 SQQQ at 55.60...

Agree. And it's the long dated 30 year taking the brunt of it. I bought a bit of TMV today just on a gut feeling and seeing market action.

As you say, rising 30 year bond yield combined with economic crapfest would be absolute worse case scenario because mortgage rates etc don't come down as one would expect during recession.

I do wonder if this might be purposeful by some market actors (e.g. China) to prevent Trump from benefiting from rates decreasing...feeling like I've got a bit of a tinfoil hat on here in this last paragraph though.

Thoughts on bond market/shorting bonds?

I know it's counterintuitive, but I wonder here about erosion of confidence in US debt. Or if pushback from a country like China is that it slows/stops treasury purchases.

TMV, TTT, etc.

Just confirmed on Bloomberg, based on headline

Polymarket at 93% now, did I miss news?
https://polymarket.com/event/trump-imposes-100-tariff-on-china-before-july?tid=1744129654813

otherwise that seems high?