Lance Glinn:

Welcome in to another episode of the Inside The ICE House podcast, our markets in focus series and joining us as he always does talk market movement and market trends is Phil Rosen. Phil, thanks so much for joining us Inside The ICE House. Happy to have you here.

Phil Rosen:

Thank you for having me.

Lance Glinn:

We have to start with what has been the biggest headline over the last bunch of weeks and months. And obviously that is the conflict in the Middle East. Tensions involving Iran have a way I think of quickly obviously grabbing market attention. This geopolitical uncertainty I think has tended to really change on an almost day-to-day basis. We see through various social media posts, we see through various TV headlines. Things are constantly moving, evolving and changing. When you see this happen, this constant movement where it's really hard to just keep pace with everything that's going on, how do you frame what truly matters for markets versus what's more just noise in the headlines?

Phil Rosen:

It's a great question. And the way I look at markets when there's a geopolitical shock, I look back at history. I say, "Okay. What did previous geopolitical shocks bring to the table and how did stocks perform on a maybe six or 12 month basis after the fact?" And we know that typically after an oil shock of a swing of more than 20%, stocks 12 months later are up I think 24% on average dating back several decades. So to me, this is a reminder that this is indeed a short term catalyst. And I think there's a lot of fear and uncertainty in markets and there's also a lot of very human and social fabric costs of the conflict in Iran.

But we've seen a few, I would say, positive steps as far as the market angle for this. The VIX closed the other day below 20, and that was the first time since the conflict started that that's happened. So usually when the VIX spikes above 30 and then comes below 20, that marks a turning point for stocks. And we've also seen oil come down with the ceasefire talks. And of course, by the time this publishes, we may have some changes as far as how far along the ceasefire talks actually are, whether they stick, how fragile it is. But in this moment, stocks are pretty much looking for any type of positive catalyst to grab onto and rally. So we've seen a really strong reversal and momentum coming into the weekend talks essentially. So I think between those two things and you stack that on top of how oil shocks typically go as far as the market reaction, hopefully things are looking up for the near term.

Lance Glinn:

And of course, we're recording this on Friday, April 10th. This is going to come out on Tuesday, April 14th. So like you said, things that are happening today might be a little bit different than when it comes out on Tuesday, but we have seen markets react sharply at times in the short term. And you talked about when things happen in the short term, we really have to look back at history to see what that means for the long term, how it'll stabilize in the months and year plus ahead. But when it comes to managing risk, both in the short and long term, how should investors think about it when uncertainty is often this headline driven thing?

Phil Rosen:

So I think if we look back to Liberation Day a year ago, almost exactly a year ago, it's a pretty good analog for what we're seeing now because the reasons to sell and the reasons to buy are almost solely emanating from the White House. And that's a very unusual market catalyst, but we have a very near term memory of when this was the case. So a year ago, if you held through Liberation Day and Trump's announcement of tariffs, you are up double digits compared to those who sold the S&P 500 about. That's an approximation.

Lance Glinn:

Sure.

Phil Rosen:

So if you ... My guess, and maybe history backs this up, if you didn't do anything, made zero adjustments through the Iran conflict, and then in a year compared to the people that did sell on all the uncertainty, all the bearish headlines, my guess is that holding will perform better than selling in this instance. And I don't know if there's ... Sure, there's a lot of fear and you're seeing a ongoing rotation in markets with energy outperforming, tech underperforming, those things were already happening coming into the year. So I don't know if you can exactly point to them and say, "Hey, here's what the Middle East uncertainty is causing in markets." So I don't know if that's a fair analysis, but I do think generally when you have such a strong catalyst hinging on pretty much what the president is saying or what he plans to do next, You can almost be sure that holding through all the noise is probably the best long-term solution.

Lance Glinn:

So away from everything going on in the Middle East, Phil, I want to spend a couple questions or a question or two talking about you because you've had to change recently in your own life. Obviously still with and still running and founding Opening Bell Daily, but you've recently taken on this role as chief market strategist for ProCap Financial. So first and foremost, congratulations on the new role.

Phil Rosen:

Thank you.

Lance Glinn:

But for a minute, just take us through what the role entails, how it helps really shape the way that you interpret markets for clients and for audiences as we sit here.

Phil Rosen:

Yeah. Thanks, Lance. So we are building ProCap Insights, which is Wall Street's first Agentic AI research shop. And what that means ... It sounds like a lot of buzzwords but really we can produce extremely high quality research with our army of AI agents, and we can do it with very little human intervention and no employees. So I'm essentially orchestrating this army of agents to produce actionable insights, trade ideas, deep dive research reports for the independent investor. And typically when you think about Wall Street research or institutional grade research, that can run 10s to hundreds of thousands of dollars just to access those reports. And right now what we're doing, we're doing it for like 1% the cost and we're giving it to our readers for about 1% the cost. So that's an unbelievable change as far as the economics of how we're doing this.

And also our view is that the report quality is actually even better. Because think about this, we are using literal super intelligence. We're not using the same sole human brains that we've had to rely on for decades. Now we are suddenly using the newest technology, the newest AI models, and we're seeing how quickly they can find data, how they can debate one another to pressure test ideas and to make sure that all the conclusions we arrive at are backed by 10 different data sources that you wouldn't ordinarily be able to draw conclusions from as just a human alone.

So all these things are very unique in the sense that a couple of years ago, this probably wasn't possible. And now we at Procap Financial and with Procap Insights, we really are pushing the edge on what we can do with these AI agents and they can research, they can publish, they can find patterns that, for example, me or even a veteran analyst, I don't think would be able to point out ourselves.

Lance Glinn:

Let's take that a little bit of a step further. So there's data ingestion, there's obviously decision making. They're sorting through unnecessary data too and finding what really matters. What advantage though ... Because you talked about the uniqueness of it. What advantages ... And maybe it's some of the stuff that you just answered. But what advantages and what separates this AI powered research compared to obviously the traditional models that have worked for a long time. But like you said, we're in a new age that if we're sitting here five, 10 years ago, Procap might not have been able to do what it's doing right now.

Phil Rosen:

So yeah. It's a great question. We are using the most smart machines we've ever come up with as a society. And I don't think that the traditional Wall Street firms or research shops, they are not on the bleeding edge of it as much as we are. It would be my guess. And what we want to do, we essentially want to give the independent investor the same level and quality and access that Wall Street has had traditionally. And I think that edge is something that is novel and new. And also the nuance and the insights that we can bring using AI to go through millions of data points, that is also novel and new and something that we can do. We're not doing this, but we could publish hundreds of reports per day if we really wanted to. And something at that scale and speed just cannot be replicated unless you're using the latest technology.

So I think that's a big differentiator. I've been reading and helping produce these reports myself. They are very, very smart, I must say. And I've been enlightened to just how good these agents are in maybe the last month or so. And they are so good, they are so smart. And what we do, we can essentially set a team of a dozen agents out on a specific task and we can have them all look for a different angle of the same thesis and we can have them debate one another to see who is really on the firmest ground and then they can all come back with a cohesive conclusion based on all these different viewpoints that generate trade ideas for the independent investor.

Lance Glinn:

So I want to just speak more to AI broadly. And we've talked a little bit about this in our previous conversations, but the role that AI is obviously having on the job market. And more companies obviously are using it to potentially automate or make more efficient these roles that are traditionally handled by people. What are you just seeing first and foremost through potentially the reports that you guys have created at Procap? What are you seeing in stock performance and how have investors reacted to this AI and job market convergence?

Phil Rosen:

Yeah. It's probably the biggest question in the market narrative right now. What the AI displacing jobs really means as far as how many people are really getting displaced? Are people not being able to find jobs? Are jobs not being created because of AI? But one of the, I think, narrative violations that we've found with Procap Insights ... And we found this going through millions of data points using AI agents. The typical narrative that Wall Street believes where layoffs lead to higher stock prices, that's a very flimsy belief actually. And in the last few years, there's actually been almost zero correlation between companies that announced job cuts and how high their stock goes in the coming two, three years after that. So if you look at some of the best performing stocks in the last three years, the top 12 have a mix of headcount reductions, headcount growth, and then static growth. So that alone should say, okay, if we just look at that pattern, there's actually no ties to shrinking or growing headcount and share price returns because it looks so random and the data actually show there is very little correlation there.

Lance Glinn:

So Phil, as we wrap up this month's conversation, I want to stay on the topic of AI's impact on the jobs markets. Now, obviously we see headlines, we see numbers, but do the numbers that you see with Procap Insights, do those match the headlines that we see on almost in every week and every month basis?

Phil Rosen:

So far in 2026, we've seen about 27,000 jobs taken out explicitly because of AI, but the uncovered number through ProCap Insights has been approximately a million jobs were not even created because of AI. So to me, that's the bigger story. If you look at the 27,000 number, that's like 0.01% of the entire employment force. But then if you look at the million number that's not coming online or not being opened up to new hires, that's a much more jarring of a statistic. And the story to me really, if you have a job market that no longer has a pipeline for young people to join, then it's a terrifying outlook for new college grads. And what we're seeing, one data point we found with Procap Insights, younger engineers that are 22 to 25, their employment prospects have actually dropped 20% since their peak in 2022, but engineers over 30 have actually seen a 12% increase in job opportunities since 2022. So it's not so much that AI is destroying the labor market, it's bifurcating the labor market between young and experienced essentially. And if you look at engineers as, let's call it the most exposed to AI displacement, it really is a story of who got in before AI arrived and who is just coming in now. Totally different outlook.

Lance Glinn:

Well, Phil, congratulations on the new role. Thank you so much for joining us Inside The ICE House.

Phil Rosen:

Thank you for having me.