The Midterms Just Destroyed the AI Trade?

Jordi Visser argued that the midterm blue wave and the week’s market sell-off did not change the long-run AI investment case, but they did intensify the pressure on public equities, especially large tech and infrastructure-heavy names. He said the market has already absorbed a lot of the election impact, yet the next two years could bring more regulation, more government scrutiny, and slower data-center buildouts in key states like Texas. In his view, that makes the current AI trade more fragile and more dependent on leverage and liquidity than many investors realize.

Visser framed the S&P 500 as increasingly split between “492 bonds” and a small group of call-option-like winners, with the Mag 7 forced to spend heavily for uncertain upside. He argued that AI progress will continue, but public companies face cyber risk, political intervention, and margin pressure, so their growth profiles will deteriorate. He also said hedge fund deleveraging is already underway and that the peak of leverage has passed.

Against that backdrop, he remained constructive on Bitcoin. He said falling oil, easing inflation expectations, and lower real yields should improve liquidity conditions, while Elliott Wave analysis suggests Bitcoin has corrected in a textbook pattern and may be near its 200-day moving average around 73,74. He also said Bitcoin still offers a cleaner way to participate in growth than public stocks because it faces fewer government hurdles.