Episode summary
Tech Bloodbath Now: Is Bubble Finally Popping? | Chris Vermeulen
The David Lin Report
· · 30 min · Hosts: David Lin · Guests: Chris Vermeulen
Summary
The discussion centered on a sharp tech selloff that hit Google, Intel, semiconductors, and the Nasdaq, with the host framing it as a possible bubble break in the AI trade. Chris Vermeulen argued the move is largely a rotation out of high-beta tech and into defensives, dividend stocks, utilities, healthcare, and bonds, rather than a full exit from equities. He said institutional distribution had already been visible in semiconductor charts and that hedge funds were dumping tech throughout October.
Vermeulen said the selloff reflects rising investor concern that AI spending is hurting earnings and free cash flow before it produces enough profit. He compared the AI surge to the internet bubble, saying the theme is still in a euphoric, momentum-driven phase but is now being scrutinized more harshly by the market. In his view, Google’s earnings disappointment and Intel’s collapse showed how quickly sentiment can reverse when expectations are too high.
He did not endorse buying the dip. Vermeulen said he is staying on the sidelines until price action firms up, though he expects the market may be oversold enough for a bounce early next week. He also argued gold’s drop below $4,000 and falling bond yields point to margin calls and a broad safety rotation, while warning that gold and silver may have further downside if the breakdown continues.
Key takeaways
- Chris Vermeulen said the tech decline looks like institutional distribution, not just a one-day earnings reaction, especially in semiconductors.
- Vermeulen said investors are punishing companies that spend heavily on AI without delivering enough profit growth.
- He expects the market could bounce early next week, but he is not buying the dip until a new uptrend is confirmed.
- Vermeulen said money is rotating into dividend stocks, utilities, healthcare, and bonds because large investors still need to stay invested somewhere.
- He warned gold’s break below $4,000 and the broader unwind in risk assets could signal margin calls and more downside in precious metals.
Notable quotes
“there's a lot of blood on the streets when it comes to the tech space”
“I think I think AI is kind of in the similar space as we saw back in the internet bubble”
“No, we don't we don't catch falling knives. We just let them fall”
“there's a lot of selling. There's some unwinding in the AI space”
How the episode opens
It's Friday, October 30th. There's a bloodbath in the tech sector today. So, Google's down about 12% yesterday on Thursday after a disappointing earnings release, which we'll get into.
Intel's down 30% just today on Friday, following a 20% drop yesterday. So, it's been down about 50% since just a couple of weeks ago. And like what what's going on in the tech sector?
That's what we're here to find out today. There's actually a rotation out of tech into defensives. Bonds are taking a bid, utilities are up, healthcare is up, and um and it looks like people are rotating into safety right now.
Gold's actually down. We're going to find out why. But broadly speaking, is the AI trade over?
Is this the beginning of the bubble pop? Comment down below. We're going to get your uh we're going to get our next guest take, but also let me know what you think of the comments down below.
Christopher Mulan joins us right now. He's the chief market strategist at the technical traders.com. Right now on Koshi, the largest prediction market in the US, traders are predicting that there's an 80% chance that the NASDAQ 100 will finish the year positive this year.
So traders are still expecting a rebound. Is Christopher Mulan expecting a rebound? We're going to find out.
If you agree with traders on Kowi, then a $50 trade could yield $6128. If you're correct, this video is brought to you by Koshi. It's the largest prediction market in the US.
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From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- tech stock selloff
- ai spending concerns
- semiconductor selloff
- investor rotation to defensives
- gold and treasury yields
Watch the episode
Watch “Tech Bloodbath Now: Is Bubble Finally Popping? | Chris Vermeulen” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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The David Lin Report, this episode and its artwork belong to The David Lin Report. Octagon is not affiliated with the show; this page is an independent summary.
