Is the air coming out of the AI bubble? On Wednesday, we streamed the final episode of Let’s Talk Markets Live for 2025. We’ll try not to get emotional. Who better to help us wrap up the year than our good friend Erik Smolinski from Outlier Trading? After all, Erik was our first guest this year too. Way back on January 8th, we were discussing Nvidia’s massive growth and whether AI is a bubble destined to burst. On Wednesday, Nvidia was down 3.5% and Palantir was down almost 5%, so this week’s show began on the same topic, but by week’s end both ended flat to positive. So, is the AI-glass half-full, or half-empty? Fortunately we’ve got both perspectives to share. “I'm a pretty big believer in the tech,” Dave said, “but not so much the valuations. We're so far ahead of our skis. I think it's got a ways to go to come back to Earth.”“It depends what Earth is defined as,” Erik noted. Hmmm.‘We're hovering near highs. Last earnings season was good. We're in the middle of a big technological change, one way or the other,” Erik pointed out. “AI is going to continue being a massively disruptive accelerator.” “But,” Erik conceded, “as all of that is happening, we still have a series of wild cards that I think keep the market on edge. “ Perhaps the biggest wild card of them all is human behavior. As Dave noted, “The market is made up of animal forces. There is irrational exuberance in the market. There are manias.” These manias give way to sustained spikes in pricing that fly in the face of rational valuation. We call them bubbles. Dave pulled out a pretty handy chart to illustrate the point. The chart suggests parallels between the AI bubble and previous market meltdowns. Of course, we all remember how Railway Mania came crashing down in 1848. “There are bubbles. And this idea that there is a rational valuation in order to appropriately allocate capital – that idea is foundational to capitalism,” Dave explained.As Dave’s chart shows, bubbles tend to burst when the markets disobey this foundational idea. So is Erik convinced that we’re in the middle of an AI bubble? Erik agreed that the actual valuations for AI stocks like Palantir probably are “wildly overvalued.”“But,” he said, “somebody wants it here, and somebody keeps buying it here. So I guess this is the big difference between a value investor lens and a trader lens.” Through a value lens, Palantir is too expensive. Through a trader lens, Palantir is up 134% over the last 12 months. “Regardless of how good the dollar is compared to the forward expectations, there are a lot of people trading it who don't give a flying crap about that,” Erik points out. “They're just saying, ‘I think other people are going to buy this thing and it's going to go up.’” Erik also thinks that we haven’t yet seen how high this thing can go. “In a very short-term – using the time frame of a month – we’re in a downtrend,” says Erik. “But I still view us as being in a long-term uptrend.Ultimately, Erik did not think much of Dave’s chart. “This is absolutely a sampling error,” he said. “This is absolutely picking random-ass time frames and saying, ‘This one fits my thesis.’”From there, things got pretty heated. Just kidding. But Dave and Erik do express some fundamentally different views about where the AI market is headed. And that really underscores just how much uncertainty lay ahead as we venture into the new year. We can’t tell you what comes next, but we did invent something that can tell you exactly what’s happening in real time – the brand new, AI-powered Ask Urvin chatbot. How smart is Ask Urvin? Observe… Wanna see what else Ask Urvin can do? Download the Urvin mobile app and start chatting!

I started a Backdoor Roth Strategy last year but did not know about the Mega Roth Strategy.  Am currently working with my planner to implement via a third party.  I decided to prompt ChatGPT to get some background. Turns out this strategy has been in use since 2014.  Has anyone had any experience with it?  Any tips that ChatGPT may have missed (see below).  TIAUrvin - how about a Community on "Investing & Tax Strategies for Nest Eggs"My prompt to ChatGPT: Mega Roth strategy for financial investing and tax managementThe Mega Backdoor Roth (often called the “Mega Roth strategy”) is a high-income tax-management and investing strategy that allows you to move tens of thousands of dollars per year into Roth tax-free space, well beyond the normal Roth IRA limits. Below is a clear, practical breakdown, including who it’s for, how it works, limits, risks, and planning considerations. 1. What the Mega Backdoor Roth Is (in plain English) It’s a strategy that uses after-tax contributions to an employer 401(k) and then converts those contributions to Roth—either: • Inside the plan (Roth 401(k) conversion), or • By rolling them out to a Roth IRA Once converted, future growth and withdrawals are tax-free. 2. Why People Use It Major advantages: ✔ Bypass Roth IRA income limits ✔ Create very large tax-free retirement balances ✔ Reduce future Required Minimum Distributions (RMDs) ✔ Powerful estate-planning tool ✔ Hedge against future tax rate increases This is most valuable for: • High earners • Business owners • Professionals late in career • Those already maxing all other tax-advantaged accounts 3. 2025 Contribution Limits (Key Numbers) Total 401(k) limit (employee + employer + after-tax): $69,000 ($76,500 if age 50+ with catch-up) Employee elective deferral: • $23,000 (pre-tax or Roth) • $30,500 if age 50+ Employer match/profit sharing: • Varies by plan After-tax space available for Mega Roth:$69,000– employee deferral– employer contributions= maximum after-tax contributionExample: • Employee deferral: $23,000 • Employer match: $10,000 • After-tax allowed: $36,000 → convertible to Roth 4. Step-by-Step: How the Strategy Works Step 1 — Confirm your 401(k) allows: ✔ After-tax (non-Roth) contributions ✔ In-service Roth conversions OR in-service rollovers (This is the biggest gating factor) Step 2 — Max standard contributions • Max pre-tax or Roth 401(k) • Capture full employer match Step 3 — Contribute after-tax dollars • These are not deductible • They grow tax-deferred briefly Step 4 — Convert ASAP • Convert to Roth 401(k) or Roth IRA • Minimize taxable earnings 5. Tax Treatment (Critical) After-tax contributions: ✔ Already taxed ✔ Convert tax-free Earnings before conversion: ✖ Taxable as ordinary income ✔ Minimal if converted frequently Best practice: 👉 Convert each pay period or monthly 6. Roth 401(k) vs Roth IRA Conversion FeatureRoth 401(k)Roth IRARMDsYes (can roll later)NoInvestment flexibilityLimitedUnlimitedCreditor protectionStrongState-dependentEarly accessMore restrictedMore flexible Common strategy: Convert to Roth 401(k) → Roll to Roth IRA at retirement 7. Common Pitfalls (Very Important) 🚫 Plan doesn’t allow after-tax contributions 🚫 No in-service conversions 🚫 Waiting too long to convert (tax drag) 🚫 Mixing after-tax with pre-tax in rollover 🚫 Employer limits after-tax to small % 8. Mega Roth vs Backdoor Roth IRA StrategyAnnual Roth CapacityBackdoor Roth IRA$7,000Mega Backdoor Roth$30k–$50k+ If eligible, Mega Backdoor Roth dwarfs all other Roth strategies. 9. Who Should Use It (Ideal Profile) ✔ Income above Roth IRA limits ✔ Maxing 401(k), HSA, and IRAs ✔ Stable high cash flow ✔ Long investment horizon ✔ Expects higher future tax rates 10. Advanced Planning Considerations Combine with: • HSA maxing (triple tax advantage) • Defined Benefit or Cash Balance plans • Tax-loss harvesting in taxable accounts • Roth conversions in low-income years Estate planning: • Roth IRAs pass tax-free • No lifetime RMDs • Powerful multi-generation asset 11. When NOT to Use It ✖ You need near-term liquidity ✖ High-interest debt remains ✖ Expect dramatically lower tax bracket in retirement ✖ Employer plan fees are excessive 12. Quick Eligibility Checklist ☐ Employer plan allows after-tax contributions ☐ In-service Roth conversions or rollovers allowed ☐ Cash flow supports large contributions ☐ Long-term horizon If all are “yes” → this is one of the strongest tax strategies available

The Big 3A quick look at the top stories we’re following this week.AI stocks stumble into Monday. Oracle, Broadcom and Microsoft extend on last week’s losses as investors back away from big tech in the last trading week of the year. Tesla surges on Musk’s Monday announcement. News that the EV maker is currently testing driverless robotaxis pushed Tesla’s stock to its highest price in nearly a year.Delayed data points set to post this week. November job numbers come out on Tuesday; an inflation reading on Thursday; and an update on October’s retail sales figures TBS.This week’s Company Earnings Announcements at a glanceLennar Corporation (LEN)--Tuesday, 12/16Micron Technology, Inc. (MU)--Wednesday, 12/17General Mills, Inc. (GIS)--Wednesday, 12/17Accenture plc (ACN)--Thursday, 12/18NIKE, Inc. (NKE)--Thursday, 12/18FedEx Corporation (FDX)--Thursday, 12/18Paychex, Inc. (PAYX)--Friday, 12/19