Welcome to the HBR Executive Agenda for Nov. 6, 2025. In this issue: Is the Stock Market Doing Too Well? This Monday: HBR Executive Live with Michael Fiddelke New Playbook: How to Know When to Stop a Strategic Project Is the Stock Market Doing Too Well? The U.S. stock market has been on a tear. And despite concerns about overvaluations and excessive AI investment, analysts generally seem bullish on its prospects for the rest of this year and even next. Should we be worried about excessive exuberance? Markets are tough to call. While history is no predictor, it can sometimes be a guide. I reached out to Andrew Ross Sorkin, the financial journalist, who just published the book 1929 about the greatest crash in Wall Street history. He also is the author of Too Big to Fail, an inside account of the economic crisis of 2008, so he knows a lot about financial corrections and their causes. First the good, if unsurprising, news. A 1929-style crash seems unthinkable. The U.S. has put in place many safeguards to help head off the panicky bank runs that tipped us into disaster a century ago, such as creating the consumer-protecting Securities and Exchange Commission and raising bank liquidity requirements. “Could we have another crash? Sure,” says Sorkin. “Could we prevent another Great Depression? I’d like to think so.” But there are some echoes of that earlier period that warrant attention. The 1920s were a euphoric time of technological innovation that parallels the AI-driven promise of today. Investors were betting heavily on promising new industries like automobiles, radio, and appliances. And that bull market was fueled by an unprecedented explosion in credit. Many investors were buying stocks on margin, putting down just a fraction of the share price themselves and borrowing the rest from their brokers. The real economy didn’t keep up with the market’s inflated expectations, and when professional investors began to sell their shares, panic ensued. The deep level of debt throughout the financial system wiped out individuals and companies. The Roaring ’20s gave way to a decade-long Great Depression. “Debt leverage in the system is the match that lights the fire of every single financial crisis,” says Sorkin. In other words, there will always be corrections. But those can trigger deeper, longer-lasting problems if too many people are overextended and are called on to pay back money they simply don’t have. The question is whether there’s too much debt in the system today. That’s hard to answer, in part because a lot more borrowing these days is happening through less regulated private lending funds, a trend that expanded in response to the liquidity requirements on banks put in place after the 2008 financial crisis. Private lending in theory should be as safe as conventional bank loans. But the private lending market is a lot less transparent than its conventional counterpart. Much of the lending is being plowed into AI, both directly and for the industries that support the technology, like data centers, power grids, and real estate. It’s difficult to get a clear picture into the full amount of money that’s tied up in these optimistic bets about AI’s future. But if there is indeed an AI bubble, there will be a shakeout at some point. What’s a skittish investor to do? For starters, one should be cautious, as ever, of hubris. The world has witnessed successive generations of experts who have downplayed the risk of a financial wipeout, arguing that “this time it’s different” because (pick one) new safeguards are in place, technology has made information flows more efficient, or we’re smarter about all of this now. The fact is the financial system is always a delicate balance between innovation and regulation. Looser regulation can help encourage healthy speculation and drive growth, but you never know if regulation is inadequate until it’s too late. Sorkin figures that at some point, possibly soon, we’ll face a “black swan” event that will jolt financial markets. He has no idea what might trigger it, but the debt sloshing through the system is certain to make it worse. The total national debt of the U.S. government, for example, is about $38 trillion. In 1929, the government had a budget surplus. There also is far more debt in the system than in 2008. If the market does turn, what can executives do to mitigate big losses? Sorkin offers a few suggestions. First, while AI will produce its share of winners, it will generate plenty of losers as well. Companies should diversify their investments beyond AI, no matter how promising the technology may seem. That’s true as well for investments in the sectors that support AI. And companies and individuals should do whatever due diligence they can about the source of their funds. If you’re borrowing from a private credit fund, do you have a window into its financial health? Do you know who else it’s lending to? It’s probably also worth putting some money aside for that unknown black swan event, just in case it’s a big one. If you’re not hugely leveraged or overexposed to riskier bets, you presumably should be fine—even if the markets experience some dramatic swings. “Over time,” says Sorkin, “it’s clear that it has been much more profitable to be a professional optimist than a professional Cassandra.” Monday Nov. 11: HBR Executive Live with Incoming Target CEO Michael Fiddelke Whenever a new leader assumes the top role at a storied brand, they have to balance honoring the tradition and history that made the company iconic in the first place, while also embracing the change required to stay relevant. Michael Fiddelke, who joined Target as an intern in 2003 and who will become CEO next February, will join me this Monday, Nov. 10 at 11 am ET to discuss how he’s approaching this challenge. His vantage point at the intersection of finance, strategy, and operations gives him a rare perspective on how large organizations can evolve without losing their soul. You can sign up here now. If you have a question for Fiddelke but won’t be able to attend the event, you can leave it in the registration form. As always, we’ll post a replay of the full event, which is exclusively for HBR Executive subscribers. Register now How to Know When to Stop a Strategic Project Deciding whether to halt a strategic initiative is one of the toughest calls a leader has to make. As much as you might want to make a straightforward analytical decision, the data is often murky or inconclusive. Plus, there’s the politics—these projects are often deeply tied to people’s professional identities and reputations. And ultimately you have to make a difficult decision between discipline and patience: Too much discipline and you risk cutting innovation prematurely; too much patience and you risk prolonging sunk costs and inertia. Our newest HBR Executive Playbook offers a series of questions to ask yourself when you’re weighing whether it’s time to pull the plug. Read more
