FrameworkCapital allocationLetter located
Earnings growth is return on capital times reinvestment, which is the AI spending question
Spending is only growth if the return on it exceeds the cost; estimate the return under several assumptions before admiring the spend.
Any capital-intensive growth story, the AI capital expenditure debate, and valuation of a company reinvesting most of its cash flow.
From Hayden Capital's Q2 2026 letter, on the "SaaS-pocalypse" and returns on reinvestment · Fred Liu