Comment Re:Let's keep some perspective (Score 1) 68
Yes bubbles happen in US stock markets. The MBS situation in the 2007-2008, the Enron and Lucent situation in the late 90's, the SPAC system of the last several years, and now AI.
But you're seeing the trees and missing the forest. In the US, stocks are required to report their financials according to specific rules and are audited, all of which is regulated by the SEC, have many large institutional investors who are more analytical and less prone to emotional buying, and most importantly unlike a single-party (and now nearly single-member) system like China has, we have a bureaucracy with a transparent form of the rule of law. While the process for making laws in the US can be messy, the open debates about those laws and regulation changes means the market is informed of when the rules are going to change and has time to adapt. Transparently, consistency, and trust are key to predictability, which allows investments to be made.
China has none of that. The bureaucracy can change on a whim. if a company is too successful, they can "disappear" the CEO for months until he returns and swears fealty to the party. Taxes can change in a moment without any warning. Most of the investors are retail or individual investors, prone to panic and flights, which is why institutional investors are far more rare in China; it's too unpredictable and risky.
Even now, when the SEC is gutted by the Trump administration and the AI hype is in full swing, the markets are reacting rationally. Most of the public companies today in AI besides NVIDA are these neo-clouds, and they're getting hammered by the markets. Anthropic just filed their S1, and while some are buying the hype others are pointing to the fact that the company per it's own disclosures is in deep financial trouble and is majorly risky. It'll go public, but not for $2T like they want, and there will likely be major caveats on them. Even when the regulators are asleep at the wheel as they are now, there are too many players who have a stake in the game to keep it consistent. ANd yes we're in an AI bubble, but the bubble appears to be in the private markets mostly, not the public markets. And when it crashes, yes the US markets will come down, possibly as bad as 2008. But again, there are too many players in the game in the US; after 2008 the market bounced back as people focused on companies with good fundamentals. There are plenty of companies on the US stock markets that are doing very well; Berkshire Hathaway, Waste Management, Costco, Coca-Cola; they're doing quite well and even in a crash will continue to do quite well. Energy is going well, FInancial Services is booming, and Industrial stocks are all doing great, primarily with the Defense subsector as the military goes to retool.
All of those companies are doing quite well, following the rules, are predictable investments and good growth prospects. When teh AI bubble bursts, there are still great sectors who follow the rules and will cushion the market, and capital will flood back in, rebound the market as it wipes out the AI nonsense, adn things go on.
You just can't say that about Chinese markets, because there is no trust and they're highly unpredictable; the US markets are vastly different.