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So, the great Howard Marks has descended from the mountain to deliver his wisdom. The bill... So, the great Howard Marks has descended from the mountain to deliver his wisdom. The billionaire co-founder of Oaktree Capital, the guy whose memos Warren Buffett supposedly reads with bated breath, has declared that the AI frenzy isn't a bubble.
Well, "not yet," anyway.
He also says the valuations of our Big Tech overlords are high, but "not crazy." I can almost hear the collective sigh of relief from every hedge fund manager in Greenwich and every tech bro in Palo Alto. See? Dad said it’s okay! We can keep jamming our clients' money into NVIDIA until it achieves sentience and takes over the world. The numbers are big, sure, but they’re not crazy.
Give me a break. This is the financial equivalent of a doctor telling a chain-smoking, whiskey-guzzling patient, "Well, your liver hasn't exploded... yet." It’s a statement so carefully constructed to be meaningless that it’s actually brilliant. It provides cover for the bulls, a warning for the bears, and a fat paycheck for the man who says it. It’s the sound of someone trying to keep the music playing while inching toward the exit.
Not a Bubble, Just... Frothy?
Let’s just sit with that phrase for a second: "not a bubble — at least not yet." This is the kind of linguistic gymnastics that Wall Street masters. It's a get-out-of-jail-free card printed on thousand-dollar stationery. If the market rips another 50% higher, Marks is a genius who saw the continued strength. If it all comes crashing down next Tuesday, he’s a prophet who warned us with that crucial little word: "yet."
It’s like a weatherman standing in 80 mph winds, saying, "We’re not officially calling this a hurricane, but we are seeing some behavior consistent with a very, very enthusiastic tropical storm." Thanks for the clarification. The roof just blew off my house, but I feel so much better knowing it wasn't technically a hurricane that did it.
What does "yet" even mean in this context? Is it a timeline? A set of conditions? Are we waiting for a specific level of insanity before we can use the B-word? Is the trigger when my Uber driver starts giving me AI-chip stock tips, because that happened six months ago. Or is it when startups with no product, no revenue, and just a ".ai" domain name are getting billion-dollar valuations? Oh, wait...
The silence from these gurus on what the actual tripwire is, is deafening. They paint these vague pictures of caution while simultaneously giving everyone the green light to keep speeding. These guys get paid millions to essentially say "maybe," and the entire financial media complex treats it like a stone tablet from God. And we're all supposed to...
The 'Not Crazy' Valuation Game
Then we get to the second part of the sermon: Big Tech valuations are high, "but not crazy." This idea, summed up in headlines like Oaktree Capital’s Howard Marks: Big tech valuations are high, ‘but not crazy’, is just lazy analysis. No, 'lazy' isn't the right word—it's a calculated sedative. It’s designed to soothe the nerves of investors who look at a company trading at 100 times earnings and feel a little flicker of primal fear. Don't worry, Howard Marks says it's not crazy. Go back to sleep.
Let's be real. A handful of companies, maybe seven of them, are now holding up the entire global market. Their valuations are predicated on a future where AI solves not just complex problems, but all problems, and they’re the only ones selling the shovels in this digital gold rush. Is that future possible? Maybe. Is it guaranteed? Absolutely not. To call these valuations "not crazy" is to accept the rosiest possible scenario as a baseline. That, my friends, is the literal definition of speculative mania.
What is the metric for "crazy," anyway? A price-to-earnings ratio that looks more like a zip code? A market cap bigger than the GDP of a G7 nation? We've normalized numbers that would have gotten you laughed out of a finance class ten years ago. Offcourse, a guy whose entire career is built on the existing financial architecture has to say it's not crazy. Admitting it's crazy is admitting the whole game is rigged, and the casino doesn't like to advertise that.
It reminds me of this whole "AI-powered" everything trend. My toaster doesn't need AI. My damn toothbrush company is sending me emails about their AI-driven bristle technology. It's just a meaningless marketing term slapped on everything to justify a price hike, and "not crazy" feels like the same thing for stocks. It's a premium sticker that doesn't actually mean anything.
The Oracle of Oaktree and His Memos
I get it. Howard Marks is a legend. He's not some crypto-pumping charlatan on TikTok. He’s earned his reputation over decades of smart, sober analysis, and his memos are genuinely insightful. I can picture him now, sitting in some impossibly quiet, wood-paneled office, calmly dispensing his thoughts while the world outside is a screaming chaos of algorithm-driven trades and meme-stock hysteria. He provides a sense of stability.
But that’s exactly what makes this kind of commentary so dangerous. When a respected elder statesman of finance tells you the party isn't out of control yet, you’re more likely to believe him and order another round. People forget that these oracles have been wrong before. Very few of them saw the 2008 collapse coming in its full, terrifying scale. Almost no one predicted the dot-com bust would be as brutal as it was. They’re masters of the current system, but that makes them blind to moments when the system itself is about to break.
Am I just being a doomer here? Maybe I'm the crazy one. Maybe this time is different, and we're on the cusp of a productivity boom that will make all these valuations look cheap in hindsight. Then again, "this time is different" are famously the four most expensive words in the English language.
Believing that a handful of tech giants have a permanent, unassailable monopoly on the future of human innovation feels… naive. It feels like the opposite of the forward-thinking, second-level analysis Marks himself champions. It feels like complacency. It feels like an argument for the status quo from a man who has benefited immensely from it. This ain't his first rodeo, and it won't be his last time calming the herd. The question is whether he's calming them before a stampede or during one.
So We're Just Supposed to Smile and Hold On?
Look, this "it's not a bubble yet" talk is the most insidious narrative on Wall Street. It's not a warning; it’s permission. It’s the institutional nod to keep gambling, to keep chasing momentum, to ignore that pit in your stomach that says this doesn't feel right. It's the sound of an inflating bubble, not the pinprick of caution. We’re being told to admire the emperor’s new, algorithmically-generated clothes, and anyone who points out he’s naked is just a hater who doesn’t understand the paradigm shift. Fine. But don't be surprised when winter comes.