Uh oh...

Check out the latest cover of The Economist.

“The Sorcerer of Silicon”... Jensen Huang, the CEO of Nvidia (NVDA)... wielding a crystal ball, with Nvidia chips and dollar bills swirling around him.

Talk about an obvious warning shot.

• When a financial magazine puts a hot investment trend on the cover, your red flag should go up.

Journalists are almost always late to the party. You’re usually better off doing the opposite of what a cover implies. The Economist has been a particularly good contrarian indicator.

Back in 2003, it ran a famous cover declaring “The end of the Oil Age” when oil was around $25 a barrel. Oil went on to hit $145 over the next five years. But that’s just one example.

Two Citibank analysts later studied Economist covers. They found 68% were wrong one year later. Shorting the assets featured on bullish covers returned an average of 8%. Buying assets featured on bearish covers returned an average of 18%.

I’ve written about this magazine cover curse many times. This Nvidia cover is on-the-nose bullish. Normally, I’d bet against it.

• I’m breaking my rule this time.

I think Nvidia will be higher one year from now. 

We’re only at about halftime in this artificial intelligence (AI) boom. I haven’t seen a single data point suggesting that it’s slowing down.

Amazon (AMZN), Microsoft (MSFT), Meta Platforms (META), and Google (GOOGL) are expected to spend more than $700 billion this year. Most of that money is going toward AI infrastructure.

And the demand behind that spending is still growing rapidly. Google is now processing more than 22 billion AI tokens every minute, up from 16 billion just one quarter earlier.

But here’s what really stands out. One estimate suggests fewer than 500,000 people worldwide are currently serious users of AI agents.

What happens when that number becomes 500 million?

You know I’m an AI maniac. I have Claude open all the time. I pay $200 a month for the max plan and would happily pay 10X more.

I’m still using AI in ways that seemed remarkable just a few years ago. And we’re nowhere close to knowing all the ways people and businesses will eventually use it.

We’ve gone from generative AI to reasoning AI. Now we’re moving toward AI agents that can actually perform tasks for us. Next comes physical AI: autonomous vehicles, robots, and other intelligent machines.

Each new stage creates more demand for computing power.

Which brings me back to Nvidia.

• Tomorrow marks exactly eight years since I first recommended Nvidia in public.

Back then, most investors still thought of Nvidia primarily as a gaming-chip company.

I saw something different. Its GPUs were becoming the computing engine behind artificial intelligence, self-driving cars, and other disruptive technologies.

I wrote that I could see Nvidia doubling over the next two years.

Talk about an understatement. I didn’t know ChatGPT was coming or that Nvidia would become both the world’s most important company and one of the greatest stocks of all time.

But the underlying idea was right. When a great technology creates a new market, the companies supplying it can grow for much longer than investors expect. That’s probably the #1 lesson I’ve learned from investing in disruptive technology stocks.

For the past three years, investors made a fortune figuring out what was scarce in AI. First it was chips. Then power, memory, chipmaking equipment, and photonics.

Those were great trades. There will be more like them. Bottlenecks will continue to move around and present opportunity.

Some of today’s hot stocks will lose their edge.

But as AI keeps growing, the industry will most definitely need enormous amounts of computing power.

Our latest research has only made me more convinced that the AI boom is far from over.

• So, I’m ignoring The Economist “sell signal.”

It’s funny… I originally predicted Nvidia would double within two years in 2018.

Now here we are in 2026… and I think it could double again within two more years.

It’s not going to gain 3,193% like the last time I wrote that. But doubling your money in two years isn’t bad.

What do you think?

Do you agree with me, or am I a fool for breaking my rule?

Stephen McBride

Chief Analyst, RiskHedge

PS: If you want to follow where I think the AI boom goes next, sign up for The Jolt. It’s my free letter where I share the trends, stocks, and ideas I’m watching each week. Here's how to sign up.