Meta trial and AI reality check hit big tech stocks, hedge funds suffered worst underperformance vs S&P 500 in July in more than 20 years of data

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“I don’t even know the f***ing product lines. Where is all the revenue coming from?”

Sam Altman: “Actually… I think we should be more of a platform company than a product company.”

*This 2 minute section is astounding because Sam Altman just admitted:

1) AI (LLMs) are a commodity; meaning they’re easily substitutable, suffering from extreme boom and bust cycles.

2) OpenAI doesn’t have any products, they’re relying on users to build them.

3) They want to be a service provider, putting them in direct competition in a space already dominated by Oracle, Amazon, Microsoft and Google.

The scary part is Sam doesn’t realize he just told the world that the emperor has no clothes.

According to a recent Goldman Sachs prime brokerage report, active hedge fund managers suffered their worst monthly underperformance relative to the S&P 500 in over 20 years. This historic underperformance was primarily driven by extreme crowding in mega-cap technology names and a rapid de-grossing phase as semiconductor valuations cooled off significantly during the month.

While retail investors holding diversified index funds remained relatively insulated, institutional long/short funds took a severe hit as crowded thematic AI bets unwound rapidly. The broader market’s natural diversification allowed the passive S&P 500 index to significantly outpace active manager returns during this volatile period, sparking renewed debate over active management vs. passive indexing in the current macroeconomic climate.

https://www.cnbc.com/2026/08/21/goldman-hedge-funds-historic-underperformance-sp500-degrossing.html

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