This week’s tech rout did more than momentarily puncture confidence in artificial intelligence-related stocks, it also pulled back the curtain on the machinery of modern speculation by showing how quickly it can work in reverse.
A retail-fueled unwind in AI chip stocks reverberated through semiconductor shares across Asia and the US, hammering leveraged exchange-traded funds and denting newly launched SpaceX funds. Elsewhere, the unraveling of Michael Saylor’s Strategy rattled crypto markets as one of the industry’s biggest financial-engineering machines for Bitcoin exposure came under pressure.
On the surface, the week’s casualties appeared unrelated. In reality, they belonged to the same corner of modern markets: products built to let investors express the hottest trade with more leverage, less friction and greater frequency.
