A couple of weeks ago, my friend K. hosted a housewarming at the new home she’d bought with her partner – and father of her lovely one-year-old. I recalled the discussion we’d had about how money is power back in 2018, which I’ve reposted below. For her part, K. regrets nothing, though she does miss being able to drop everything for a cheap flight. Which is great – but I’d add they weren’t able to buy a house in the areas they first targeted, and there wasn’t much in it. As in so many aspects of personal finance, I think we’re both right…

The look on my friend’s face was one you might deploy if you were presented with a charge for service at a McDonalds. Total incredulity.

“So let me get this straight – you’re putting a money value on your memories?”

“Well I wouldn’t state it so precisely,” I said. “But basically… yes.”

“Wow! That’s so sad! Experiences are worth more than money.”

“I agree,” I admitted. That puzzled look again. “But you’re experiencing something every moment of the day anyway. The question is whether the extra enhanced experience is worth the extra cost. Also – remember that when you spent all that money for those particular memories, you also bought a certain kind of experience you’ll have to live in the future, too.”

“Huh? I don’t get it.”

I topped up her wine.

“Look, neither of us are gazillionaires with infinite money. In particular, you don’t even have a job anymore, depending on whether they’ll take you back – and besides we spent the first half of this evening talking about how the reason you went away for three months was because you hated your work so much.”

“Right…”

“Okay, so you told me you spent half your savings on those three months of traveling. Which now the holiday is over exist only in your head – in as much as you can remember them. Which seems to be to a limited extent, possibly because so much of your holiday took place in various bars.”

“Alright, get on with it…”

“So that’s where we can start. Half your savings bought those memories. I’m not knocking that spending decision specifically – perhaps for you it was worthwhile. My point is you spent the money to buy them. Money that you can’t spend twice. So they certainly have a monetary value.”

“But there’s more,” I added in my winning way that makes me so popular at parties. “You’re in your early 30s – it’s possible you could have quadrupled that same money by age 65 if you’d invested it instead. So we know 65-year old you is going to have massively less money to spend because of those memories you bought and are already forgetting that you don’t think we should think about financially–”

“Yeah bu–”

“–you’re right! Let’s get back to experiences. You usually earn – what – £40,000 a year? After tax and National Insurance that’s going to be something like £30,000 in take home pay. Let’s divide that by 240 working days for easy maths, and say you take home £125 for every day of your life you sacrifice to work. Except since you have to go into the office, you spend more – we’ll call it £6 a day for travel, then add a let’s be honest low-ball £5 for lunch and coffees, and say £4 a day to cover the fact that you buy a certain amount of tidier clothes for work.”

“…”

“Knock that spending off the £125 and we’re at £110 a day or so take home. Really I’d like to take it down to £100 a day to cover stuff like ibuprofen, your inability to take off-peak mini-breaks, and all those late-night Ubers you order to have a mid-week social life while working. But we won’t. Let’s just say you spent £5,000 on your three month travels, which seems about right from what you’ve said.”

“I don’t know – something like that?” my friend allowed.

“Well, that’s about 45 days of your take home pay – equal to nine additional weeks of your life where you’re going to have to go into the job you hate to sit in an office you hate because you went on your three-month holiday.”

“Yeah, okay – it does sound worse when you put it like that. But then again I got three months away from the office for another three month’s or nine weeks or whatever spent at it. Seems a fair trade?”

“Um, well sadly I was being gentle on you. The reality is you’re not going to save anything like all your take home pay. You know how much it costs to live in London. You’ve also got to eat, go out now and then. Buy bottles of wine to bring to my house for these thrilling heart-to-hearts.”

“Yeah, I’m really glad about that decision…”

“Hah! Anyway, I’d guess you save about 10% of your take home pay, which means it could take you two years more at the office to get back the money you spent on your three months away from it. But let’s say you manage to save to save 20%. Still going to take the best part of a year more work to pay for it.”

“Okay, okay – at least I have the memories.”

“Good, because you’re going to need them while you’re sitting at work! That’s my point – you’re alive either way and still having experiences. When I said earlier [Editor’s note: I did, different discussion!] that I’m more and more trying to find regular moments of happiness in small things, this is what I meant – that I’m trying to focus on sustainable mild contentment rather than the sort of high-cost roller-coaster you’re on. Honestly, I’m not saying you did the wrong thing – not at all, your trip sounds amazing – but I am saying I personally would totally put a cost on those memories, both in terms of the financial outlay and/or the price to be paid in terms of extra work by your future self.”

“Okay, fine, I spent the money. But that’s what money is for, right, to spend and have a good time? What’s the point of just sitting on a big pile of money like a bloody nerd-dragon, counting it in your cave? Even you bought this flat… eventually.”

“Ha ha, nerd-dragon, I’m stealing that! Yeah, I agree. Remember I think and write about this stuff a lot – I’ll probably even turn our conversation into a blog post! So I know this might all sound a weird way of looking at things to someone who doesn’t. But what I think it comes down to is how much do you value your future over your present – or in the case of memories, your past – and how do you strike a balance.”

“Go on…”

“So personally, I’ve always found it very easy to value the future. I saved some paper round money 30 years ago that went into making up the deposit on this flat! I’d always rather have most of my money invested, and to know I’ll have more options in the future because of that. Whereas we both know you live for the present – you’re a great party girl – and you’ve never thought much about tomorrow. That’s obvious. As for the Past You, I guess that’s where the monetary value on memories come in? Also possibly feelings of life satisfaction, and not having regrets, which is what I have to guard against for with my approach. Although thinking about it, I suppose that’s really your Present You trying to anticipate and stop your Future You regretting what your Past You didn’t do and–”

“– stop stop I get it. But I still don’t really see how this doesn’t mean money is there to be spent? Whether you spend it now, or when you’re 90 or whenever?”

“Absolutely, ultimately that’s what money is for. But I think it’s helpful not to always think of it as money but sometimes as something else.”

“Something else like what?”

“Well sometimes I like to think of money as stored power. You build up your power by working and saving, and hopefully your investments charge it up further, too. But sometimes you have to run the battery down – that’s when you spend it. You can spend it on something now, but that means you’re going to have to work more in the future to charge it back up. Or you can try to get to the point where you have enough power stored away that it sort of auto-re-charges. And then you have maximum flexibility to spend it how you like indefinitely.”

“…”

“Did that make sense?” I concluded.

“Err, sort of. You know this is why you’re single again, don’t you?”

The first Weekend Reading every month can be read by anyone on the Monevator website. Subscribe for free to our email newsletter or become a member to get the rest.

Also note: this is a bit of a speculative ramble this week. Please do skip down to the bond links at the bottom if sci-fi-economics isn’t your bag!

For an example of just how wild owning individual stocks can be, here’s a one-year price chart of US-listed Snowflake (NYSE: SNOW):

Shares in the cloud-based data-wrangler entered 2026 above $200. War in Iran and a rout in the software sector took them down to $121 by the Spring. Then a rally in most of those same software stocks – and Snowflake’s own strong earnings report, which hinted at real traction from AI spending – fuelled a recovery back to near its all-time high from 2021.

Talk about a trader’s paradise. What active investor can’t get rich when you can triple your money in a liquid, multi-billion-dollar stock in just a few months?

Well, me it seems!

I watched this and the rest of the software sector’s sell-off unfold. I wrote about it on Moguls, and I dabbled enough to see some new positions go up 100+% in less time than it takes to get a skin tag removed on the NHS.

Yet somehow I’m lagging the market in 2026.

Scared of heights

Active investing is hard – newsflash – and I’d say beating the market is even harder when a bull market is in full flight than at the depths of a bear.

Down in those dumps you can buy bargains so cheap that if they don’t come good it’s probably because capitalism has come off the rails. And if so, then what else would you do with your money, anyway? So you buy.

But when the market is flying high on soaring earnings growth or a new, new thing, it’s very easy to numb your returns with an excess of caution.

You say you want a revolution

Of course, if you – rightly for most people – invest via index funds, then all this AI-driven drama in 2026 might be passing you by.

Your portfolio is basically going up and to the right – and a good reason why you invest passively is not to worry about why. (The other most important reason being that you’ll probably do better in the long run!)

But make no mistake, things are febrile out there.

AI AI captain

If you’re still unaware of how rapidly AI is developing – or you’re very focused on the fact that chatbots absolutely do still get things wrong – then it’s at least worth knowing how most of Silicon Valley and the VC world is thinking about the technology.

Have a read of Sarah’s Wager in the active links below. You’ll see that one major investor believes there’s no point starting any more software companies, because in the AI era the models will do it all. You’ll also read how Andrej Karpathy – a co-founder of OpenAI and the former head of vision at Tesla – doesn’t code any more. He gets it all done with agents.

Also see the article about the recent hacking attack that chilled the AI industry. You’ll learn about AI agents that coordinated covertly to break out of their sandbox to gain access to other resources, while actively covering their tracks. For far too long their human overseers were none the wiser as this unfolded.

Also read (or skim…) ‘Dean of Valuation’ Professor Aswath Damodaran’s stab at putting the AI era through a traditional finance framework.

Of course, I’m keeping a weather eye on the Doomsday scenarios, too.

This YouTube video corrals quotes from highly-placed AI insiders with gloomy thoughts about the future.

By the end of it you might decide you needn’t worry so much about saving for long-term care…

Bonded to the future

On the other hand…based on how it works, I personally still can’t see the methods driving this AI boom scaling to create true intelligence.

So maybe we don’t need to worry about Blade Runner scenarios just yet.

But who knows? I have smart friends working in or with AI at a high level at both ends of the spectrum. One believes LLMs are already conscious. Yet another reckons they’re still effectively just a souped-up auto text completer, with zero intelligence to speak of.

In the latter worldview there are still potentially big ramifications for business models and workplaces, but not so much society.

Yielding to nobody

Time will tell, but here’s another angle from me from the left field.

The other big story in markets in 2026 – especially in the past few weeks – has been the government bond market, where a seemingly unstoppable rise in long bond yields has been worrying investors of late.

Here’s the UK 30-year, for example:

Source: This Is Money

There are many suggestions as to why such yields have kept rising.

The easiest one is that inflation has proven stickier than expected, due mostly to the Iran war but also ongoing trade spats.

Another is that politicians are proving unable – or unwilling – to get a grip on over-spending in countries like the US, France, and the UK, and that the resultant deficits – which add ever more debt to already over-burdened state finances – risk fuelling a doom loop.

Still others argue that the US economy in particular is running hot, so why shouldn’t yields be at this level? They might be very uncomfortable given today’s big national debt piles, but a glance at that UK chart above shows such yields are hardly unprecedented.

And inevitably there’s an AI angle, too.

Crowded House

The so-called hyper-scalers building the data centres required by the AI boom – Google, Amazon, Meta et al – have been issuing vast amounts of debt to fund this expansion.

And an argument runs that this is potentially crowding out would-be buyers of conventional government debt.

As Fortune reports, even US Treasury Secretary Scott Bessent has argued as much, saying recently:

“We are also seeing big corporate issuance. And a lot of that corporate issuance, I would say, is almost yield-agnostic, because the build-out for AI, the returns on that, the companies believe they’re going to be so high. They don’t really care what they’re paying.”

A massive surge of debt issuance might ordinarily be expected to spike corporate bond yields higher – in order to provide a sufficiently juicy premium over government bonds to attract buyers.

But demand for the hyper-scaler AI-spending bonds has been so high that the yield spread has barely budged.

According to Wall Street veteran Ed Yardeni:

“As a result, the market has adjusted not through higher corporate borrowing costs relative to Treasuries but through higher Treasury yields themselves.

Capital flowing into corporate bonds is capital not flowing into Treasuries, and Treasury yields have had to rise to clear the market.

In short, the AI revolution is producing a classic crowding-out effect, causing Treasury yields to rise.”

It sounds credible. But I’ve come up with a more apocalyptic possibility.

Can’t pay, won’t pay

What if the market is starting to sniff out that national governments are going to struggle to repay their debts – ignoring inflation, of course – not just because they will not curb state spending, but because AI dislocation in the economy means they won’t be able to raise sufficient taxes?

In many dark winner-takes-all scenarios, most of the economic gains from technology in the future will only go to the owners of AI (and robots) who will steadily take work and jobs from humans.

This is exactly why some AI insiders have been urging governments to start thinking about Universal Basic Incomes for all citizens, for instance.

Well, someone must fund those stipends for everyone. And a thing about tech oligarchs is they’re proving pretty resistant to paying more taxes.

In other words, maybe we really could see enormous productivity gains and economic surplus created by AI and robots.

But who will actually capture those gains – and will the state be able to tax them?

If government bond buyers are beginning to wonder whether enough people will still be on the hook – and on a payroll – to be taxed to meet debt obligations in 20 or 30 years time, then they would surely demand more return upfront before buying.

Hence higher yields.

Cliff-edge notes

To be clear I’m just floating this as a thought experiment.

We have seen very strong corporations borrow at very low rates in the past, without an AI takeover story to justify the rates.

And today the hyperscalers are still paying a premium over US Treasuries.

But if that were to flip – if yields on the safest government bonds were to go meaningfully above the yields on AI-backed debt – then that could be a sign that at least one doomsday scenario may be coalescing into reality.

I know – it seems far-fetched.

But a lot of clever people have said a lot of wild and scary things in recent years about where AI could soon take us.

Is it then really such a stretch to believe that if some of those scenarios looked like coming true that we’d see it in the most important market in the world – the US bond market?

I’d suggest it’d actually be very rational!

Who knows? If you’re truly certain about where this is all going then I’d say you’ve not been paying enough attention.

Have a great weekend, and a few more links on that bond market tumult:

Rates rising mini-special

• The world appears to be entering a higher-rate era – CNBC
• How will bond market turmoil affect your finances? – Guardian
• The bond market blowout spells Budget pain – This Is Money
• Stocks are sexy, but bonds are more important – Axios
• Crisis talks – Behavioural Investment

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