DID THE NEXT BIG CRASH JUST START?? (NO ONE Is Prepared For THIS!) | EP 1532

**Optimist Fields** (0:02)
$3 trillion, or close to $3 trillion was wiped off the global markets this morning. And the markets are in a bit of a panic right now. But this is begging the bigger question, is the AI bubble finally bursting? You guys know my view on it. I don't know if it's a confirmed fact that that's where we are.
But there is some concerns happening. And the real question, I think, is, where is that trillions of capital going to go when it finally, when the investors finally realize that, hey, maybe it's not safe where it is? So to get to the bottom of this, I do have to start in South Korea. So I know, I know you're like, why are we even talking about South Korea? Well, this is where the global market meltdown started. And I do have a, I do have my boy, Chris. Well, Chris back in the building.

**Chris** (0:59)
What's up, everyone?

**Optimist Fields** (1:00)
Going to be a good show. All right, guys, so let's start here.
Shots at the Bull Theory IO on Twitter, and blood bath in Asian markets. So over 800 billion wiped out from the Asian stock markets in just a few hours amid a massive tech stock sell off. South Korea's Cosby is down 8.2%. Actually, I think it went down about 12%. They literally had to do the circuit breakers and stop trading. Japan's Nikea is also down. Taiwan's stock market is also down and going further. We saw this morning that at the market opened. Wait, where to go? Where to go? S&P 500 itself wiped off 1.4 trillion. It's a blood bath out there for stocks. But Dow Jones actually up a little bit. So that's kind of interesting. But again, you see the markets to really explain what is going on right now in South Korea. A little bit of a breakdown of what is happening.
We're seeing golds down, silver's down, tech stocks are down, equities are down. And they're all going down at the same time, like a force selling across all the markets. And again, to explain this, it is starting with an AI semiconductor deleveraging. So this is what happened. South Korea leverage ETF crisis. Here's on Yahoo Finance, Sparks global chip sell off. So South Korea's top financial regulator expressed regret Monday over approving a batch of high leverage single stock ETFs last month, setting off a violent sell off in memory chip shares that spread from Seoul and Hong Kong into US pre-market trading. It actually spilled into the actual market open. So Samsung Electrics fell 12.31.
SK Hynex dropped 12.47% with both stocks opening sharply higher before collapsing through the session. The magnitudes of the move helped push the Cosby down roughly 10% from its recent record high, triggering a market wide circuit breaker trading halt. And then of course, Nasdaq's down 2%. I think S&P 500 was down around 3%, putting the index on pace to shed more than $1 trillion. It's in fact now as of market opening, 2, 3 hours since the market opened, it's past $1 trillion. Again, the catalyst was a Monday briefing from the financial supervisory service governor, Li Chen Jin, who said he wishes he had done more to block the late May launch of 16 single stock leverage ETFs tracking Samsung and SK Hynix. Those funds held combined assets of $3 billion at launch, but have since swelled to roughly $14 trillion won or $9.1 billion, with approximately 92% of holders being retail investors. These are high-risk products, despite consumer warning, trading hasn't cooled. All right, so break down a little bit, kind of breaking this down a little bit.
We're seeing that a lot of Korean investors are buying into the AI hype right now. And obviously, there has been, it's been a very hot market. As we know in the US, AI stocks, the, you know, the SpaceX IPO, and I do have a bit of a little update on the SpaceX IPO, which does kind of come together with this whole story, is that's the shiny trade right now. Everyone is chasing the AI hype bubble. And it looks as if, again, big if, what we're seeing, the deleveraging that we're watching right now in South Korea is spreading to everyone else. So the South Korean investors, they are known for being extreme gamblers. I actually have a good zero-hedge tweet here. And it goes, as a reminder, Korean gamblers have never been more levered, more levered, and more levered than they are right now. Record leverage ETFs. Everyone is chasing the AI hype bubble. Now, we've been covering this for a couple of weeks, that all the capital that's been leaving Bitcoin has been chasing the AI bubble. And now, what we're seeing, at least starting again, this could not necessarily spill over into US AI stocks, but we're seeing what potentially could be the start of this capital rotation out of AI deleveraging out of AI, because everyone's kind of maybe waking up to the fact that everything's running a little too hot, that maybe this AI bubble is in fact a bubble. And now, we're seeing our markets are starting to feel some pain from this. So, it isn't just a single thing happening, an isolated event in South Korea, because everyone was chasing the AI chip stocks, this AI memory boom, and now it's being walked back. And again, at the same time, as I was telling you, we are seeing that SpaceX is also having a little bit of trouble. So, the SpaceX IPO, which, in fact, I told you was probably going to happen, I think, what was it, maybe Friday or Monday, I was getting a little doubtful on my conviction that the SpaceX IPO would, in fact, go down. It ripped up, well, as of this morning, actually, before this morning, it did rebound a little bit, but SpaceX did a complete round trip to its opening IPO price. And again, the reason this is all connected is because we don't know how many retail investors in Korea also bought into the SpaceX IPO. SpaceX and Tesla are extremely popular in Korean markets.