Warning: Sometimes the most profitable investment ideas are completely backwards.

Take coal for example.

During the Industrial Revolution, engineers developed steam engines that required far less coal to produce the same amount of work.

Everyone expected coal consumption to fall.

Instead, it exploded.

The cheaper operating costs made steam power economical in more situations.

Factories expanded. Railroads grew. Entire industries became viable that previously weren't.

Before long, Britain was consuming more coal than ever before.

An economist named William Stanley Jevons became fascinated by this phenomenon.

In 1865, he published a book arguing that improvements in efficiency often increase demand rather than reduce it.

Today, economists call this idea Jevons Paradox.

Simply put, when something becomes dramatically cheaper, people often don't use less of it.

They use more.

And while this idea was discovered during the age of steam engines, I believe it helps explain two of the biggest investment opportunities in the world today:

Artificial intelligence and space.

AI: Here’s Why Cheaper Compute Is Good For AI

You've probably noticed that AI tools seem to get better every month.

But they're also getting cheaper.

Tasks that required expensive software or specialized expertise a few years ago can now be done in seconds for a few dollars – or even for free.

Many people assume that as AI becomes cheaper, the companies behind it will make less money.

Jevons Paradox suggests the opposite.

When the cost of intelligence falls, businesses won't use less intelligence.

They’ll use more.

If AI becomes 10x cheaper, companies won't suddenly stop spending on AI.

Instead, they'll deploy it into products, workflows, and business functions that previously weren't economical.

The result is a larger market.

• More users.

• More applications.

• More demand.

That's exactly what happened with computing, electricity, the internet, and, of course, coal.

And it's one reason I remain bullish on the broader AI ecosystem, including companies like Nvidia that provide the infrastructure powering it all.

Space: Here’s Why I'm Bullish On Space Stocks

Now let's talk about space.

Over the last few days, space stocks have sold off following the SpaceX IPO.

• Rocket Lab (RKLB): $125 → $106

• AST SpaceMobile (ASTS): $104 → $83

• Redwire (RDW): $19 → $13

The market seems to be treating SpaceX's success as bad news for the rest of the industry.

I think this is backwards.

Jevons Paradox backs me up on this.

Before SpaceX, getting something into orbit was incredibly expensive.

Launching satellites was largely limited to governments and a handful of well-funded corporations.

SpaceX changed the economics.

Reusable rockets dramatically lowered launch costs.

And if Starship works as intended, those costs could fall even further.

Many investors look at this and conclude SpaceX will simply take market share from everyone else.

Instead, what I see is a dramatically larger market.

Because when access to space becomes cheaper:

• More satellites get launched.

• More companies build businesses in orbit.

• More governments create space programs.

• More communications infrastructure gets deployed.

• More scientific research becomes economical.

• More manufacturing projects become viable.

In other words, lower costs don't reduce demand for space.

They increase it.

That's why I believe the recent weakness in space stocks has more to do with market mechanics than deteriorating fundamentals.

SpaceX just became publicly tradable.

Naturally, investors are selling other space positions to buy the industry's biggest name.

That's understandable.

But what most investors are missing is the fact that SpaceX’s success is also good for companies like Rocket Lab, AST SpaceMobile, Redwire, and more.

If SpaceX succeeds in making access to space dramatically cheaper, the total addressable market for the entire industry becomes much larger.

That's the lesson William Stanley Jevons discovered 160 years ago.

And that's why I see the recent weakness in space stocks as a buying opportunity rather than a reason to panic.