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Tuesday, May 12, 2026

Did the AI Bubble Just Pop? Black Swan Spotted Overnight

Semiconductors continued to spur the dead horse $SPX (UNCH) market on Monday — with the $SOX touching 12k pinning the investor stupidity meter in the red (fuckwit levels). Latest pump job: $NVTS +30%.

Then came the Black Swan of the year.  Most investors haven't even grasped the full implications... let alone heard the story reported accurately. 

 A top South Korean policymaker on May 12, 2026, proposed a "citizen dividend" paid to citizens funded by taxes on high AI company profits. This proposal, targeting AI-driven gains. Officials later tried to clarify it would apply to "excess tax revenue" rather than a specific new corporate tax", but judging by U.S. futures, the black swan has already flown the coop.

What's to keep the full socialist Mayor of New York City from doing the same thing at the New York Stock Exchange ... and maybe that's why they just built a second NYSE in Texas - another fact most investors are being kept in the dark about.

Another fact you've been left in the dark on is the fact that the semiconductor trade was propagated in Asia as a classic sequential pump job — exactly like we saw in crypto — with the Asian traders running the table.   

A couple blogs back I laid out the two obvious pins that could pop this AI party: Xi holding one, the Fed holding the other. 

"That puts the pin that may burst the AI bubble directly in Chairman Xi’s hand. And with the Middle East cutting off Chinese oil shipments (a blockade — an act of war), it’s a possible black swan. As of today, investors are none too concerned.

The Fed holds the other pin. Higher rates to fight inflation seem unlikely now that Trump's guy is in — but I guess it'll all come out in the Warsh. 😅" [link]

Now S. Korea just dropped a third. And who's to say the new full Socialist Mayor of NYC, doesn't follow suit? Why else would they be building a duplicate $NYSE in Texas?    

 I correctly identified the semiconductor trade as being propagated in Asia - calling it out as a ". Classic sequential pump job, just like we saw in the crypto space - in fact I think Asian traders are running the table." [link], 2 Days Later A S. Korean Black Swan Sends Market Futures Roiling, and now you see the fallout, and the bull contortionists arguing with the tape 

I actually had bullish trades to get to, before the black swan hit the tape - next time. 

Take Care, 

AA

P.S. Bubbles don’t burst in a single day. Even after the top, we’re going to see explosive bear-market rallies. Semis are still a relatively small sector — we’ve got much bigger fish to fry. 

P.P.S. Alternative title for today's blog: How The Guy Who Was Right One Time Became The Poster Child For Perma-Bearish Failure (19th time wrong in a row edition) ðŸ˜‚  

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