"It's not a bubble when everybody thinks it's a bubble. It's going to be a bubble when we get to the other side of this." — David Craver12:48 (Discussing AI market sentiment)
"I used to be able to read a press release and tell you what the stock was going to do the next day. And that is no longer the case." — David Craver1:28 (On market volatility)
Disclaimer: Orignal content owned by or sourced from third parties. It does not represent the views of 'Nuggets' platform or it's team. AI is used extensively across this platform including for summaries. Accuracy is not guaranteed, there can be mistakes. Any info or content on this platform is not a financial, legal, or investment advice. Do your own research. Refer for complete disclosures:- Terms of Use · Full Disclaimer
"I like to say I have a small group that's focused on big questions." — David Craver4:40 (On Lone Pine's team structure)
"Let's talk about the stock market closing tomorrow... and reopening three years from now. What do you want to own in that scenario?" — David Craver8:44 (On duration-based investing)
"I just took half a billion dollars out of my spending... because we're implementing this new technology." — David Craver14:21 (Predicting future CFO conference calls)
Executive Summary
In this episode of Goldman Sachs Exchanges: Great Investors, David Craver, Co-CIO of Lone Pine Capital, discusses the shifting landscape of global markets, characterized by heightened single-stock volatility and elevated valuations driven by passive flows. He argues that this environment creates a unique advantage for fundamental, long-term investors who can look past short-term "knife fights" to identify multi-year structural winners. Craver remains bullish on the AI "super cycle," predicting a "Revenge of the Dinosaurs" phase where legacy non-tech companies leverage AI to drastically reduce costs and widen their moats.
Key Takeaways
The "Rule of 20" is Dead: Historical valuation ceilings (e.g., avoiding companies >$200 billion market cap trading >20x earnings) no longer apply, with dozens of companies now defying this metric.
Volatility has Decoupled from News: Single-stock volatility is at historic highs and often uncorrelated with actual qualitative news, largely due to passive flows and algorithmic trading.
Duration is the Edge: In a market obsessed with quarterly beats, the true competitive advantage lies in asking where a company will be in 3-5 years.
AI Infrastructure is Early: We are only in the 3rd or 4th inning of the AI infrastructure build-out; supply shortages and model scaling suggest the cycle has room to run.
"Revenge of the Dinosaurs": The next wave of AI winners won't just be tech firms, but large legacy enterprises (logistics, industrials) that use AI to strip out massive costs and improve efficiency.
Private Markets are Essential: Being active in private markets is now an imperative for public market investors to understand disruption trends before they hit the stock exchange.
Counter-Consensus on Bubbles: A true bubble doesn't exist when everyone fears one; the real AI bubble may only form once major players like OpenAI go public and adoption is ubiquitous.
Detailed Summary by Topic
Market Structure & Volatility
0:54
Craver highlights a fundamental shift in market behavior since he joined Lone Pine in 1998. He notes that stock price movements are no longer reliable predictors of news quality, often overreacting to events due to the dominance of passive investing and multi-strategy leverage.
The Disconnect: Passive flows do not take a view on valuation, leading to price distortions.
Opportunity: This creates "white space" for fundamental investors who can act with duration, ignoring short-term noise to focus on 3-5 year outcomes.
Lone Pine’s Investment Philosophy
4:33
The firm differentiates itself by maintaining a small research team focused on "big questions" rather than quarterly earnings.
The "Closed Market" Test: Craver asks his team: "If the market closed tomorrow and reopened in three years, what would you want to own?"
Risk Management: They have moved away from pair trading (long/short in the same sector) because shorts often correlate with longs during factor rotations. Instead, they rely on deep knowledge of their concentrated long positions as the primary risk mitigant.
The AI Super Cycle
9:24
Craver offers a bullish, nuanced view on Artificial Intelligence, rejecting the immediate "bubble" narrative. He identifies three key pillars supporting the continued bull market in AI infrastructure:
Model Scaling: Models are getting demonstrably better with more silicon.
Supply/Demand Imbalance: Hyperscalers are still short on capacity.
Real-World Value: Digital-first companies in their private portfolio are already seeing "mind-blowing" efficiency gains.
Private vs. Public Markets
17:59
Lone Pine views private market investing not just as a return generator, but as a critical research tool.
Symbiosis: Insights from late-stage private companies inform their public market positioning.
Growth: The private market will remain robust as entrepreneurs increasingly prefer to stay private to avoid the scrutiny and volatility of public reporting.
Data & Figures
Data Point
Value
Context
Lone Pine AUM
$19 Billion+
Assets Under Management focused on long-term fundamental investing.
Old Valuation Rule
>$200B Cap / >20x P/E
Craver's old rule for identifying overvalued stocks; now "dozens" exceed this.
AI Build-Out Phase
3rd or 4th Inning
Craver's estimate of where we are in the AI infrastructure cycle.
Potential Cost Savings
~$500 Million/yr
Hypothetical savings a CFO might announce in 2027 due to AI.
Career Duration
33 Years
Time Craver has worked with partner Steve Mandel.
Recording Date
January 27, 2026
Date the interview was recorded.
Stories & Anecdotes
The "Press Release" Nostalgia:1:28 Craver recalls a time when he could read a press release and accurately predict how a stock would trade the next day. He uses this contrast to illustrate how modern market structure (passive flows, algos) has broken the link between fundamental news and short-term price action.
"Revenge of the Dinosaurs":14:04 He uses this colorful phrase to describe the next phase of AI. He paints a scenario of a logistics company or large traditional enterprise that uses AI to do things they "heretofore could not do," effectively allowing old-economy companies to bite back by radically improving their unit economics.
The Founder's Triple:11:55 Craver shares anecdotes from private portfolio CEOs who believe they can triple revenues without ever hiring another human being, underscoring the productivity shock currently underway.
References & Recommendations
People Referenced:
Steve Mandel - Founder of Lone Pine Capital. Context: Craver's mentor and partner for 33 years; advised Craver to always "trust his instincts."
Julian Robertson - Founder of Tiger Management. Context: Craver’s first boss; taught him the value of being willing to change your mind and not looking in the rearview mirror.
Companies/Assets Mentioned:
NVIDIA & Avago (Broadcom): Context: The initial winners of the AI infrastructure build-out.
OpenAI & Anthropic: Context: Future IPO candidates; Craver suggests the "real bubble" might only arrive when these companies go public.
Mag 7 (Magnificent Seven): Context: A mixed bag where some are "fundamentally undervalued" while others are "absurdly overvalued."
Speakers & Credentials
Host: Tony Pasquariello: Global Head of Hedge Fund Coverage at Goldman Sachs. He provides the institutional banking perspective and guides the macro discussion.
Guest: David Craver: Co-Chief Investment Officer at Lone Pine Capital ($19B AUM). A veteran of the "Tiger Cub" lineage, he has over three decades of experience in fundamental equity investing.
Actionable Next Steps
Audit Your Portfolio for "Duration": Review your holdings with the "3-year market close" test. If you wouldn't be comfortable owning a stock if the market closed for 3 years, reconsider its position.
Look Beyond Tech for AI Winners: Start researching large, non-tech "dinosaur" companies (logistics, industrials) that are aggressively implementing AI agents to cut costs and improve efficiency.
Ignore the "Knife Fight": Stop trying to trade around quarterly earnings beats/misses. The volatility there is often uncorrelated with fundamental news; focus on the multi-year secular tailwind.
Monitor Private Markets: Even if you cannot invest directly, follow late-stage private companies like OpenAI as leading indicators for public market disruption.
Jul 16, 2026
Secrets of building The Whole Truth | Shashank Mehta, Founder and CEO | Unstarted | 16 Jul 2026 | Z47 Moments
"I fundamentally cannot live with the gap between my do and my say i find hypocrisy very very putting off" Shashank Mehta 07:04 https://youtu.be/HA7kNZgkcT8?si=CyHcafj8CzT5cQBu&t=7m4s "if you craft your life around your weaknesses you will…