Earnings season in the US is going well. Maybe you noticed.

Specifically, 82% of companies who’ve reported so far beat on the bottom-line and nearly that many on the top-line. When almost eight-in-10 large-cap US corporates manage to top sales estimates, the read-across for the nominal growth impulse is auspicious.

This is why you own stocks, folks. As Nomura’s Charlie McElligott’s always keen to remind clients, corporates live in the nominal world, and although we can’t say for sure what’s going on currently given the government data blackout, nominal growth in America was still strong last quarter thanks to the implacable US consumer and a still-low unemployment rate.

Every day, there’s another warning about credit cracks — Jamie Dimon’s “roaches.” A quick web search turns up a new Bloomberg story called “Cracks In The Credit Market Could Be A Warning For Wall Street” and a Barron’s article (Barron’s still exists, as it turns out) called “How Bad Could The Private Credit Crisis Get? Just Look At 1929.” Let me translate those two headlines for you: “Click me please.” (Never forget: Those publications and all publications like them don’t give a single damn about your financial well-being, nor about your mental stability. Their mission isn’t to inform, it’s to monetize your attention.)

That’s not to say there won’t be another credit cycle (they are cycles, after all) nor is it to downplay private credit risks specifically. But as SocGen’s Manish Kabra put it Monday, thanks to strong nominal growth, credit conditions are healthy. “Private sector leverage — both household and corporate — relative to GDP is declining overall,” he wrote, adding that for blue-chip corporate America, net debt to EBITDA is the lowest in a decade.

The figure on the left, above, shows you the net debt to EBITDA history. The figure on the right shows you revenue per employee. You might suspect there’s upside there considering the opportunity for corporates to replace humans with AI. Ask Amazon about that or, more to the point, ask someone recently laid off by Amazon.

Speaking of AI, the Nasdaq 100’s responsible for 82% of the S&P 500’s 12% earnings growth this year, Kabra went on. SocGen has a basket of what they call “AI Boom” stocks. There are 63 of them. The list is included below this article.

Those stocks are half of S&P 500 market cap, and are responsible for more than two thirds of the index’s return since ChatGPT launched three years ago, SocGen noted.

The figures above give you some context. Excluding those 63 names, the S&P’s not doing as well, to put it mildly.

If you’re curious, the S&P would trade near 8,000 today if “non-AI boom stocks” had matched the performance of AI-driven stocks, according to SocGen’s calculations.

The bottom line, from the bank’s Monday update: Ongoing revenue beats are indicative of “a solid US nominal growth trend.” “Our word for this season? ‘Strong,'” Kabra said. “Just like the last two seasons.”

SocGen’s ‘AI Boom’ Stocks