I sat down this morning and was touring the carnage that a Chinese firm had wrought upon the mighty US/Silicon Valley AI industry and it dawned on me that perhaps the baton of ingenuity had been passed from West to East.
At a minimum, it is now shared. So I penned this Tweet:
I’m exceedingly concerned that all this leads to a vast bursting of the US-centric Nvidia-led stock bubble. Bubbles are really fun on the way up and even more painful on the way down.
But the Federal Reserve really only knows how to blow bubble serially, and that’s what they’ve done again and will, no doubt, attempt to do again. So we’ll see more bubbles in the future, you can bank on that.
They never ring a bell at the top, and very few people realize in the moment that a top has been struck. Which is why I am taking some time here to review the prior two stock peaks we experienced in 2000 and in 2007 (not a typo).
The lesson is that these things take time to play out, but quite often, if you are paying close attention, you can see them well before most other people, giving you an edge.
The US system requires huge amounts of capital flow just to maintain itself. To pay for those flows, the US has layered all manner of grifts and rackets upon its people.