Category: LiberalLeft

Open AI does produce valuable Generative AI tools that we all find valuable. But is it irreplaceable? and is it really as valuable as all the money being poured into it? Why can’t over companies like Anthropic or the many AI companies created now replace the Gen AI features outputted from the Chat GPT engine?

The real question is: Does Open AI currently turn a profit?

The San Francisco-based company has not yet turned a profit. With all the money poured into Open AI, it could also amplify concerns about an AI bubble if the generative AI products made by OpenAI and its competitors don’t meet the expectations of investors pouring billions of dollars into research and development.

There is no major life function: eating, sleeping, drinking, mating that Open AI remotely solves. It’s a nice to have that makes automated processes more efficient.

The near future over the next 2 to 3 years will answer the question regarding whether these investments into Open AI will payoff, or generate massive write-offs on the balance sheets of the companies investing.

Both Andrew Ross Sorkin and Jamie Dimon, Chase CEO have both predicted a stock market crash and “major correction” coming shortly.

Sorkin compares the situation in 1929 to the current market:

https://www.msnbc.com/morning-joe/watch/andrew-ross-sorkin-so-many-parallels-between-1929-and-now-that-i-worry-about-249857093819

As of mid-October 2025, Jamie Dimon, the CEO of JPMorgan Chase, believes the US market is at a higher risk of a significant correction than others perceive. He cites multiple factors, including high valuations, geopolitical tensions, and an uncertain economic outlook, as reasons for his concern. 

https://www.foxbusiness.com/markets/jamie-dimon-warns-major-market-risk-next-few-years

If you are in long positions, GET OUT before the tidal wave hits shores!

China retaliated with the threat of “countermeasures” in response to the future trade wars. Revisit China’s long history regarding how committed they are to not feeling like they are bullied by anyone to get a glimpse of how long this will last in the years ahead. To truly understand China’s importance on the US and global economy, one needs to fully understand the magnitude of China’s impact to the national debt and the production of consumer goods made in China.

With the recent news that China is clamping down on exporting Raw materials that serve as the underpinning of AI Chips, the AI stock surge is OVER! Se Acabo! The Nasdaq, S&P and Dow that have been banking so hard on “AI darling” stocks are about to tumble real fast.

The rare earth materials that China is placing restrictions on are essential for the production of many computer chips, which are used in everything from smartphones to artificial intelligence systems.

The Rare Earth material restrictions placed by China are the most targeted action to limit supplies of rare-earth materials. This move is a follow-up from the April tariffs with China that were never rectified, and will result in China exercising long-arm jurisdiction over foreign companies to target the semiconductor industry.

The Export Controls China recently placed on Rare Earth materials may lead to week-long delays in shipments to companies like NVDA. The clearest risk all these “AI darling” companies face is an increase in the prices of rare earth-dependent magnets that are critical to the chip supply chain, 

Ask yourself, why do you think NVDA was so concerned a month ago with gaining access to the China markets? It’s not solely focused on the revenue generated from sales in China, but rather creating a stronger relationship in the government where the nucleus of their product is created.

This move will have a direct impact on the AI Darlings of late: NVDA, AMD, Apple, Oracle, etc….the prettiest girls in the Ballroom this past summer.

This is the thesis behind this post: The AI Boom is about to become the AI Burst!

The recent enforcements on China to levy “massive tariffs” was the triggering event for repercussions we are about to see in the stock market for the next 2 years. The stock market has been on a historic tear for the past 5 months, dating back to April 4th when the market tanked as a result of the tariff introduction. The real question we have to ask ourselves is: Did we really resolve the fear of the tariffs dating back to early April or did we just “kick the can” for 5 months and let AI enthusiasm dictate the market surge? No more room to kick the can when you’ve kicked it as far as it can go on a dead end ally. As Jamie Dimon correctly predicted, a major correction is in store for the stock markets. Time to face the music!

Stock and Bond Market crash coming Halloween 2025. Spreading Into 2026 and beyond

Government Shutdown occurring in hours.

Stock Market crashes in Q4.

The imminent federal government shutdown is less than 24 hours away and it will have a catastrophic impact on the stock market in the last quarter of this year.

Government shutdowns do not normally have a direct impact on the stock market as the eventual re-opening of the government is always factored in.

Why would this government shutdown be different? and why would this have an impact on the Stock Market? 1 Answer:

Labor Market and Increasing Unemployment

Unemployment is already growing. Federal employees have already been laid off in droves earlier in the year. This government shutdown will have further impact to Federal employees, many of whom reside in the Washington, DC and the larger Virginia area.

Combine the Government shutdown with the growing consumer pricing as a result of the tariffs, the recipe produces a very grim 4th quarter.

The lack of spending and increasing unemployment is occuring at the worst time of the year: Holiday season when the global retail market is expecting spending to increase.

The trends in the recent unemployment statistics have a direct correlation to the trends we experienced in 2008.

Last week, Tony Pasquarello, Hedge fund leader of Goldman Sachs informed us to be “Responsibly Bullish” on the stock market. This is the equivalent of saying: “You can buy this car with over 100,000 miles and it PROBABLY won’t break down on you.” This remark is a hedge in and of itself, its essentially saying: I think the stock market will go up, but I’m not guaranteeing it, so be “responsible”.

This is everything that is wrong with corporate finance: You hear one thing, but don’t really understand the fine print hidden in the message.

This author understands that this comment is a sham and proper representation of how to……

BULLSHIT responsibly

If you want a more prudent perspective on what will occur with the stock market listen to Tom Stevenson of Fidelity International:

“A stock market crash is right around the corner.”