I sold all my SP500 yesterday morning

Dan Loewenherz reports that he sold all his Vanguard S&P 500 ETF (VOO) and SPY holdings after holding some SPY shares since 2005. He says he rarely trades but viewed recent rises in interest rates as new, underappreciated information that increases second-order risks to the market. The immediate mechanism he describes is higher inflation and interest rates pushing data-center bond prices down, forcing bondholders to sell equity to meet coupon obligations and triggering a rapid unwinding of AI-related stocks that currently dominate market gains.

He lays out five failure modes that guided his exit: sustained higher inflation and rates, earlier-than-expected saturation of AI spending with unclear ROI, the risk that lab IPOs flop or are canceled causing confidence to collapse, the emergence of recursive superintelligence that could upend hardware winners, and an oncoming recession amplified by corporate and consumer leverage. Because the S&P is highly concentrated (he cites ~40% weight in ten companies), he views broad index exposure as irresponsible today. He says he still holds selected defensive positions such as Berkshire Hathaway shares and long-term zero-coupon U.S. Treasuries.