Get Ready For A.I.-Mageddon | Fred Hickey

The current stock market represents the greatest bubble in U.S. history, driven by an unsustainable earnings bubble fueled by massive, speculative data center spending. AI-linked stocks, which account for a record percentage of the S&P 500 and Nasdaq, face severe vulnerability as economic models disintegrate and returns on investment remain elusive. Corporations are increasingly pivoting toward lower-cost, open-source models—including Chinese alternatives—to mitigate rising token costs, threatening the revenue projections of major hyperscalers. With margin debt at record levels and physical constraints limiting infrastructure growth, the market is primed for a significant correction. Investors should prioritize capital preservation, maintaining high cash positions while awaiting a "fat pitch" opportunity to deploy capital into undervalued sectors like commodities and gold, which remain structurally attractive as central banks continue to diversify away from U.S. Treasuries.