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Albert EdwardsGlobal Strategist Société GénéraleIt raised a red flag about the current state of the US stock market. He believes the market, driven largely by technology and artificial intelligence, is in trouble. dangerous bubble This could have dire consequences.
Known for his bearish sentiment, Edwards drew parallels between the current market situation and the dot-com bubble of the late 1990s. In an interview with Luckpointed out rising valuations The fact that some of the tech companies are trading at more than 30 times forward earnings is seen as a clear sign of a bubble.
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The analyst also highlighted a key difference in the current scenario: the economy’s heavy reliance on AI not only for business investment but also for consumer spending, which is driven more than usual by the top quintile of wealthy Americans. He warned that this would make the economy more fragile than in previous bubbles.
Despite his track record of correctly predicting the dot-com bubble and also issuing warnings that did not materialize, Edwards remains steadfast in his belief that the current situation is alarming. He stated that the USA has not experienced a recession since 2008, and that this long growth period further increases his concerns.
“Usually, when you’re in the grip of a bubble, people don’t want to listen because they’re making too much money.” said Edwards.
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Edwards’ warning adds to growing concerns about the state of the US economy, particularly its dependence on artificial intelligence and technology. Ruchir SharmaThe investor and author recently suggested that the US economy’s heavy reliance on AI could lead to the bursting of the AI bubble.
While the S&P 500 fell 1.65% in the last 5 trading days, the NASDAQ fell 2.26%, led by technology sales. blockbuster result from Nvidia Corp. (NASDAQ:NVDA) reflects investors’ concerns about the AI bubble. In the same period, Nvidia shares fell 3.90% due to the CEO’s influence. Jensen Huang He reportedly criticized the market’s lackluster response and expressed his dissatisfaction.
Meanwhile, Bill Gates He acknowledged the existence of an AI bubble but warned that it was not comparable to historical bubbles. Also a Wedbush analyst Dan Ives he reiterated, “This is an AI Bubble and not Nvidia’s boom quarter and the bullish demand comments around it Blackwell/Rubin That’s what we’re focused on despite this sale.”
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This article Stock Market Bubble Is Developing Worse Than the 2008 Financial Crisis, Analyst Warns: ‘People Don’t Want to Listen Because…’ originally appeared Benzinga.com
