17 June 2026
The One Stock Reshaping Emerging Markets
Has AI changed EM investing?
Watch Josh Snyder, CFA, Global Investment Strategist, as he unpacks the rise of Taiwan Semiconductor Manufacturing Company (TSMC) in the MSCI Emerging Markets Index and why its weight now nearly matches that of China’s exposure.
He explains why TSMC dominates the benchmark, what this means for emerging markets investing, and why concentration risk may matter more than many investors realize.
Subscribe for Fresh Weekly Takes
- Weekly market insights
- Perspectives shaped by 30 years of investing
- Unique institutional-quality insights, now available to individuals
10 June 2026
No Country for Old Buffets
What happens when AI charges by the bite?
Go to any local buffet and you’re almost certain to find at least one guy who is trying to get his entire quota in during that one meal.
-Google Search
If you lived in the US during the 1980s and 1990s, it’s highly likely you or someone you knew was familiar with a buffet. No, I don’t mean a misspelling of the Oracle of Omaha’s name. I mean the all-you-can-eat type, where every food under the sun, from pizza to pasta to ham and what looked like steak, sat under a heating lamp or on a carving station, and you’d fill your singular plate with 18 different items.
Even though you could make as many trips as you wanted, most people still felt compelled to pile that one plate as high as possible. That was the psychology of the buffet: maximize quantity while the deal lasts.
From an economics perspective, a buffet made little sense. All this food. All this overhead. All the waste. No way to really measure the ROI of 18 items on a plate. A very low-margin business. Even in the good times, many of these companies were teetering on the brink.
Yet, from a customer’s perspective, the appeal was obvious: lots of food at a low price, especially for families. Demand stayed strong, even as the economics remained shaky. But as a business model, the whole thing made little sense. Over time, changing tastes, heavy competition, and razor-thin margins took their toll. Roughly 25% of all US buffets had closed by 1998, and according to various sources, they are down over 90% from the peak all-you-can-eat days.
For the better part of this cycle, AI has been marketed like an all-you-can-eat buffet: cheap, abundant, and seemingly unlimited thanks to flat subscriptions, bundled enterprise deals, and heavy subsidies. But now that the industry is moving from subsidized abundance to tokenized pricing, companies may be starting to realize this one doesn’t serve cheap steak. It sells digits. It turns out that when you remove the subsidy, things get very expensive very quickly.
GitHub, the world’s leading cloud-based platform for software development, recently moved Copilot from flat-rate pricing to usage-based billing through “AI Credits,” with costs rising based on the model used and the number of tokens consumed. For casual users, the change may be negligible. But for power users running multi-step agentic tasks, reported bills jumped 10x to 100x, the kind of sticker shock you get when an all-you-can-eat product suddenly starts charging by the bite. Needless to say, when you meaningfully ratchet up the cost for your customer base, they tend not to be very happy about it.
The era of unquestioned AI spend may be ending, and we think a lot of companies are about to find out that usage and value were never the same thing. We’ve gone from plate stacking to token-maxxing. But at least at the buffet line, you got something useful in return for your money. More companies are finding that AI spend can scale much faster than AI outcomes. For all of Starbucks’ AI spend, they gave up on an AI inventory system just nine months after launch—despite being a supposedly ideal use case—because, well, it ended up creating more work than having humans do it.1
Of course, this isn’t unique to Starbucks. More and more firms are questioning all of this spend because they’re getting very little in return. Uber just announced a spending cap.2 Amazon removed its “churn and burn” leaderboard because it turns out that spending and productivity aren’t synonyms. And lastly, everyone’s favorite online complaint department, Reddit, is rapidly filling up.
All good things generally come to an end. Buffets work until someone starts charging separately for the carving station, dessert tray, and second trip through the line. Maybe we’re starting to see that in AI spend.
Until next time.
What We’re Listening To
Dear reader, if you have made it to the end, thank you. We encourage you not only to read our Insights, but plenty of others as well. This week we are highlighting a podcast that’s currently top of mind, and while it ties into this week’s subject matter, this need not always be the case (how boring would that be?).
This week, check out the Better Offline Podcast: “Why AI Has No ROI”, where host Ed Zitron and economist Paul Kedrosky discuss “why nobody can find the ROI of AI, and why there won’t be a dotcom bubble-style recovery for AI data centers.”
END NOTES
1Cunningham, Waylon. “Exclusive: Starbucks Scraps AI Inventory Tool Across North America.” Reuters. 21 May 2026.
2Ropek, Lucas. “Uber Caps Employee AI Spending After Blowing Through Budget in 4 Months.” TechCrunch. 2 June 2026.
DEFINITIONS
Return On Investment (ROI) is a measure of how much profit or loss an investment generates relative to its original cost, expressed as net gain divided by the amount invested. A higher ROI generally indicates a more successful investment. For example, an ROI of 20% means the investment earned $0.20 for every $1.00 invested.
03 June 2026
Short Memories
When does hype become a warning sign?
Nowhere does history indulge in repetitions so often or so uniformly as in Wall Street. When you read contemporary accounts of booms or panics, the one thing that strikes you most forcibly is how little either stock speculation or stock speculators today differ from yesterday.
-Edwin Lefevre, Reminiscences of a Stock Operator (1923)
South Korea is known for a whole host of things, from its bustling capital, Seoul, to its viral music and entertainment industry, as well as its iconic cuisine.
But the hottest thing in Korea right now isn’t K-Pop, nor is it gochujang. Nope, it’s something you may not have heard of until recently: a 43-year-old semiconductor company named SK Hynix.
As one of the global “big three” memory companies, alongside Micron in the US and Samsung also in South Korea, SK Hynix appears to be having its day in the sun. Not that the other two aren’t. All three companies now boast market caps north of $1T as of late May, something that couldn’t be said for any of them back in April. The stock prices of these three companies are benefiting from the global AI craze, specifically from data center buildouts that require more sophisticated, vertically stacked High Bandwidth Memory (HBM), rather than more traditional memory used in phones and PCs. They still make that too, of course, but production has shifted toward the more interesting HBM stuff.
Despite all three of these companies doing very similar things, SK Hynix seems to have caught the attention of both investors and the broader public more than the others. So much so that a popular “flex” in South Korea these days isn’t a “Vuitton bag” but a “Vest,” so long as it sports the SK Hynix print.
As big of a flex as a vest may be, it can only be because it’s easier to show off than owning the stock itself, which has gone completely parabolic. A $100 investment last year would be worth more than $1,100 today.
Because of this crazy rise, maybe it’s not that surprising that many South Koreans are cashing out their life insurance policies1 while also borrowing more on margin than ever before to ride this wave.2
If that wasn’t enough, many investors are apparently so sanguine that SK Hynix has now become the largest leveraged single-stock ETF globally, surpassing the $10B mark and leaving its memory brethren behind.
Such Great Heights
What Goes Up (On Leverage), Must Come Down?
A parting word of caution: Selling your life insurance policy, taking out a loan against your existing investments, and then using that borrowed money to buy a single-stock leveraged ETF that tries to double the stock’s daily gain or has the potential to amplify the stock’s daily loss by two times, is certainly a bold strategy in our view. In fact, bold may not be strong enough a word to describe this investment craze. Our guess is that it’s not recommended very often, if ever. Even if those proceeds were invested in a super steady-eddy business, say a consumer staples company, the strategy would still be unwise.
But to do so in a company whose business is notoriously cyclical, and which, in SK Hynix’s case, posted negative gross profit margins just a couple of years ago, one must indeed have a short memory. Or a gambling addiction.
South Korea has given us plenty of viral entertainment over the years. But while a viral song can get stuck in your head forever, we question the staying power of debt-fueled viral portfolio gains.
Until next time.
What We’re Reading
Dear reader, if you have made it to the end, thank you. We encourage you not only to read our Insights, but plenty of others as well. This week we are highlighting a book that’s currently top of mind, and while it ties into this week’s subject matter, this need not always be the case (how boring would that be?).
This week, we’re reading Edward Chancellor’s great 1999 book Devil Take the Hindmost: A History of Financial Speculation. From the origins of financial speculation to the Roaring Twenties and Japan’s bubble economy in the 1980s, Chancellor does a masterful job not just of laying out the facts but of bringing each episode to life. What really stands out across the 300-plus pages and roughly nine bubble periods, though, is a simple truth: “it’s never different.” Our guess is that this current Korean episode won’t be any different either.
But as always, don’t take our word for it, go to your favorite bookseller and find a copy of your own.
END NOTES
1Choi Ji-won. “Koreans Cash out Insurance, Deposits to Chase Stock Rally – the Korea Herald.” The Korea Herald. 11 May 2026.
2Rimmer, Jules. “Debt-Fueled Bets Are Turbocharging the South Korean Stock Market as Kospi Jumps 8%.” Morningstar, Inc. 21 May 2026.
DEFINITIONS
Market Capitalization (Market Cap) is the total market value of a company’s outstanding shares, calculated by multiplying the share price by the total number of shares. It’s a quick way to gauge a company’s size. Companies are often categorized as large-cap (over $10 billion), mid-cap ($2–$10 billion), or small-cap (under $2 billion).
28 May 2026
The Market’s Turkey Problem
Is this market more fragile than it appears?
A turkey is fed for a thousand days by a butcher; every day confirms to its staff of analysts that butchers love turkeys with increased statistical confidence.
-Nassim Nicholas Taleb
Risk, schmisk. Who needs to think about risk when there are returns to be had? While risk management should always be top of mind, whether you’re trying to accumulate wealth or grow it, if you’ve only been paying attention since, say April Fool’s Day 2026, the “fool” was the one worried about risks. Maybe it’s because it’s baseball season, or maybe it’s because Allbirds is no longer a failed shoe company but rather a “winning” AI one. Or maybe it’s because, as friend of the firm Paul Kedrosky, Ph.D., recently pointed out, too much ChatGPT is like driving drunk! Regardless of the reason, today’s lesson is about confidence, and even though it’s not November, we’ll be looking at risk through the eyes of a turkey. It tends to be the case that during periods of maximum market confidence this often brings periods of maximum vulnerability. In the current cycle, investors have been rewarded for ignoring just about every piece of negative news, from energy shocks, tariffs, wars, or just about any other disruption you can think of, they’ve all been met with new all-time highs in equity markets.
Because of this, the behavior of “buying the dip” has continually been reinforced. However, in our view, investors may be showing the same false confidence as Nassim Nicholas Taleb’s proverbial turkey before Thanksgiving: each uneventful day reinforces the belief that all is well… until suddenly it isn’t. The longer nothing breaks, the more complacency continues to build. Today’s market strength may therefore be concealing, rather than easing, a growing buildup of risk.
Surprise
To us, one of the clearest examples of that hidden risk is the shift in AI spending from internally funded investment to debt-funded expansion. Even the largest and most profitable technology companies are spending at a scale that free cash flow alone can no longer support, as evidenced by a general decline in free cash flow yields across many tech behemoths.
As these companies increasingly embrace Homer Simpson’s “Hey big spender, buy this blender” mindset, except in tech land it’s GPUs rather than blenders, they’re now becoming more and more of a dominant force in the investment-grade bond market, something we have never really seen before. And maybe one day, given the torrid pace of spending, they may even become a major presence in the high yield bond market too!
This ultimately matters because the more debt one adds into the system, the more one increases the fragility of that system: it raises the system’s dependence on flawless execution, timely commercialization, and stable financing conditions. These are difficult assumptions under any market cycle, because the universe, unlike the metaverse, is unpredictable. With data center delays, energy constraints, and supply chain problems already slowing projects, the gap between expectations and realized returns may widen, leaving markets vulnerable to a sharp repricing when the market’s turkey day finally comes.
Until next time.
What We’re Reading
Dear reader, if you have made it to the end, thank you. We encourage you not only to read our Insights, but plenty of others as well. This week we are highlighting a book that’s currently top of mind, and while it ties into this week’s subject matter, this need not always be the case (how boring would that be?).
The obvious choice here is “The Black Swan” by Nassim Nicholas Taleb. We can squabble over whether this is his best book, but it’s hard to argue that it’s his most familiar book and thus most cited. The funny thing about the book though, is that it’s often completely misunderstood. Black Swans are inherently unpredictable. That’s precisely why we need tools and systems that lessen fragility and attempt to safeguard against them.
But as always, don’t take our word for it, go to your favorite bookseller and find a copy of your own.
DEFINITIONS
Free Cash Flow (FCF) is the cash a company generates from its operations after paying for capital expenditures (maintenance and growth investments). It’s the money left over that could be returned to shareholders, used to pay down debt, or reinvested. Many investors view FCF as a better indicator of financial health than reported earnings.
IMPORTANT INFORMATION
All figures shown in USD unless otherwise specified.
The information provided in this document does not constitute investment advice and no investment decision should be made based on it. Neither the information contained in this document or in any accompanying oral presentation is a recommendation to follow any strategy or allocation. In addition, neither is it a recommendation, offer or solicitation to (i) sell or buy any security, (ii) purchase shares in any investment fund that GQG Partners LLC and its affiliates (collectively “GQG”) may sponsor, offer or manage, (iii) establish any separately managed account, or (iv) implement any investment advice. It should not be assumed that any investments made or recommended by GQG in the future will be profitable or will equal the performance of any securities discussed herein. Before making any investment decision, you should seek expert, professional advice, including tax advice, and obtain information regarding the legal, fiscal, regulatory and foreign currency requirements for any investment according to the law of your home country, place of residence or current abode.
This document reflects the views of GQG as of a particular time. GQG’s views may change without notice. Any forward-looking statements or forecasts are based on assumptions and actual results may vary.
GQG provides this information for informational purposes only. GQG has gathered the information in good faith from sources it believes to be reliable, including its own resources and third parties. However, GQG does not represent or warrant that any information, including, without limitation, any past performance results and any third-party information provided, is accurate, reliable or complete, and it should not be relied upon as such. GQG has not independently verified any information used or presented that is derived from third parties, which is subject to change. Information on holdings, allocations, and other characteristics is for illustrative purposes only and may not be representative of current or future investments or allocations.
GQG Partners LLC is a wholly owned subsidiary of GQG Partners Inc., a Delaware corporation that is listed on the Australian Securities Exchange (ASX: GQG). GQG Partners LLC and its affiliates provide certain services to each other.
GQG Partners LLC is registered as an investment adviser with the US Securities and Exchange Commission. Please see its Form ADV Part 2, which is available upon request, for more information.
© 2026 GQG Partners LLC. All rights reserved. This document reflects the views of GQG as of June 2026.
