The AI Trade Is Unraveling Your Retirement

I was shook…

That’s what the kids today call it when you’re shocked to your core.

This couldn’t be happening. But I was witnessing it. The wholesale destruction of one of the most impenetrable moats in corporate America.

There are some things in life you never question.

Coca-Cola will always have billions of consumer fans. McDonald’s will always have a massive market hungry for Big Macs. And IBM will always have a roster of old-world legacy tech clients desperate for its mainframe services.

That last one might catch you by surprise. After all, mainframe technology is ancient. Pioneered in the 1950s and commercialized in the 1960s through the 1980s, mainframe computers are the backbone of EVERYTHING that matters.

Every bank transaction, ATM withdrawal, credit card swipe, travel reservation system, even military early defense warning systems… These are all built on mainframes. And those mainframes use an almost lost archaic programming language called COBOL.

No one has learned about COBOL in a classroom since the early 1990s. Those who did have either died, retired, or are near retirement. IBM has a monopoly on the survivors.

Why do clients still use mainframes? They have no choice.

The code these mainframes run on is millions of lines long. You can’t rip out and replace an air traffic control system… bank accounting software… or an international credit card network. And that’s what you need to do if you want to upgrade them.

The clients themselves have no idea how the code works or how to rewrite it, patch it, or replace it. They are truly captured by decisions that were made before they were born.

IBM was often the company that installed those systems 50 years ago.

It has been milking that 50-year moat for tens of billions in profits. This moat is responsible for as much as 42% of revenue… But more importantly, it accounts for as much as 60% of IBM’s profit.

Just as Coke and Big Mac are immovable fixtures of American life… So is mainframe maintenance. That’s why it’s unthinkable that clients would ever stop paying IBM for its services.