The AI Bubble Pops, For Now A recent stock market correction has left investors reeling, but Tom Lee, cofounder of Fundstrat Global Advisors, believes the companies at the center of the AI trade still have years of runway ahead.
He expects the market to rebound later this year. The current market dynamic is a perfect storm of leverage and hype. Margin debt has surged 54% annually, one of the largest increases in the past 60 years.
This has created a situation where investors are forced to sell holdings to cover margin debt, leading to a massive correction.