The Bull, The Bear & The Realist

By Zak Gardezy, CFP®

For weeks now, I’ve been asked the same two questions by clients, friends, family, even neighbors: “Are we in a bubble?” and “Is the market about to crash?”

This may come as a surprise to readers who aren’t Wealthstone clients, but I often think in worst case scenarios. It’s not because I’m a pessimist. I’m actually quite optimistic by nature. But when it comes to financial planning and portfolio management, I always ask myself, “If the market crashes, how does this impact my client?”

Clients today are flooded with negativity because it sells. Fear headlines grab attention. We’re more likely to click on a story titled “Legendary Wall Street Investor Predicts A.I. Market Collapse” than a balanced analysis about earnings and fundamentals. Once you click, algorithms take over and feed you more of the same. Before long, that cycle amplifies emotions. We see greed & FOMO when markets rise, panic when they fall.

Take November 10th. After a tough few weeks for tech stocks, the A.I. sector bounced sharply. The next morning, headlines flipped from doom to euphoria: “A.I. Market Roars Back, Setting Up a Gold Rush for 2026.” Just a day earlier, those same journalists were forecasting collapse. The deeper issue isn’t volatility; it’s sensationalism. Journalism, once grounded in analysis, has been replaced in many corners by click-driven hype.

My advice: be intentional about your information diet. Cross-check your sources and look for bias. If everything you read leans in one direction, it’s time to diversify your inputs, or better yet, go straight to primary data.

What’s Being Debated

This article is titled The Bull, The Bear, and The Realist. So what does that mean? A “bull” believes the market will keep rising and tends to be optimistic. A “bear” believes the market will decline and tends to be pessimistic. A “realist” looks for what’s factual and probable.

The Bull

The bullish case has gained momentum. Several Wall Street firms have raised their S&P 500 targets. UBS recently projected a 2026 target of 7,500, about ten percent above current levels as of November 11, 2025. Their case rests on continued A.I. expansion.

According to this camp, A.I. isn’t in a bubble, rather, it’s undervalued. Record revenue and profit growth from Nvidia, AMD, Microsoft, and others supports that view. Demand across the supply chain, from chip makers to data centers and energy providers, remains intense. The bullish view is simple: A.I. adoption is accelerating, technological progress is compounding, and the ecosystem is expanding faster than expected. UBS may see 7,500, but the more aggressive bulls are looking at 8,000 or higher by the end of 2026.

The Bear

The bears focus on fundamentals. They point to historical valuation metrics and sector concentration. Technology now makes up roughly 40 percent of the S&P 500. The index trades at a price-to-earnings ratio near 31, about double its long-term average of 16. To them, that’s a clear signal of overvaluation.

They argue this setup resembles classic pre-correction behavior: concentrated leadership, stretched multiples, and widespread investor confidence that growth will never slow down.

The Realist

The realist view (my own) leans more bullish than bearish. It considers the broader economy, innovation trends, and behavioral patterns together.

The bulls are right that technology is now foundational to modern life. It’s no longer a luxury or optional tool; it’s integrated into nearly everything we do. Ten or twenty years ago, self-driving cars, humanoid intelligent robots, smart glasses (and smart homes), computer chips in your brain, real-time translation, useful artificial intelligence, etc., were all science fiction. Today, they exist and some of these technologies are scaling fast.

Elon Musk’s nearly $1 trillion Tesla pay package depends on delivering one million Optimus humanoid robots within a decade. Nvidia’s Jensen Huang has said he expects more robots than humans within ten years. Could that be overly optimistic? Possibly. But these founder-CEOs have most of their wealth tied up in their companies. Their compensation and legacy depend on execution, not talk.

Comparing today’s A.I. expansion to the dot-com bubble is flawed. Many dot-com firms had little revenue, tiny market caps, and no viable products. When the bubble burst, they vanished. Today’s leaders, Nvidia, Microsoft, Amazon, Alphabet, Meta, Broadcom, AMD, are among the strongest businesses in history. Their balance sheets rival those of nations. That doesn’t mean A.I. stocks can’t decline, but the foundation is far stronger than it was in 2000.

We may see moderation, not meltdown. Think of the computer revolution: explosive growth in the early years, followed by normalization once adoption became widespread. A.I. could follow a similar path. Constant hardware and model upgrades will likely keep spending high, even as growth rates settle.

The longer-term story is broader than A.I. It includes quantum computing, robotics, autonomous transportation, and commercial space technology. Humanity’s drive to innovate isn’t slowing down; it’s accelerating.

The Economic Undercurrent

The broader economy remains mixed. Labor data points to cooling, while inflation continues to trend lower. A.I. and robotics will disrupt employment much like mechanization did during the Industrial Revolution, displacing some roles while creating entirely new ones.

GDP forecasts remain positive. The Federal Reserve under Chair Jerome Powell is expected to cut rates at least once more before his term ends in May 2026. The Supreme Court may also weigh in soon on the President’s use of emergency powers for tariffs. If tariffs are reduced or restructured, that could boost confidence and provide a fresh tailwind for the markets.

The Outlook

Filtering out the noise, the evidence points to continued growth. A.I. adoption is expanding rapidly, inflation is easing, and interest rates are likely to fall into 2026.

In my view, the remainder of 2025 should deliver a steady, constructive finish and set the stage for what could be an above-average year in 2026.

Zak Gardezy, CFP

Founder & Private Wealth Advisor

Wealthstone Private Wealth Management

7014 E. Camelback Rd. Suite B100A

Scottsdale, Arizona, 85251

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