The AI Scarcity Myth Is Breaking

**Guy Adami** (0:00)
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**Dan Nathan** (1:04)
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All right, welcome to the Risk Reversal Podcast. I am Dan Nathan. That is Guy Adami. Hi, Guy.

**Guy Adami** (1:33)
Hello.

**Dan Nathan** (1:34)
Big week coming up, man. We just actually got done with a big week of earnings. Bank stocks got it kicked off. A lot of stuff going on in the memory and the semi-space. We have some model wars, not just here, but also abroad, some good stuff coming on from China. We got to talk about Apple in China. That's one, it was not on my bingo card for this week. Oil guy, oil up 22% since hitting a low. It was like a multi-month low, right? Since the war started and some of those stocks are still trading pretty well.
Netflix, this is Friday. We are talking about 11 o'clock a.m. Stocks down 9% followed its earnings. And then we'll just do a little earnings preview, that sort of thing. How's all that sound?

**Guy Adami** (2:16)
Sounds good. And we might as well start with memory because those are the ones that have moved in an amazing fashion. And this is something we've been addressing now, I think for the better part of the last three or four weeks, where not every day, but I'd say three times a week, we're seeing 8% moves to the upside and to the downside. And obviously everybody's love child over the last six months, maybe longer, it's been Micron. And there was stock that recently made an all time high of $1,255. And I think it did it June 25th or something like that. Whereas we're sitting here the third week of July or what have you, a stock that today and again today is Friday, traded down to $800.
So think about that move for a second. It's a pretty significant move in a very short period of time. Now we have been saying that if you're looking for support, it probably comes in the form of the former all time high, believe it or not, that we saw back in May, which lo and behold, Dan, was $800. So today's low mirrors the all time, the prior all time high that we saw in May. So that sort of makes sense. But the bigger picture here is, is this just to sell off like we've seen before over the last, you know, six to nine months, or is this something more? And I think that's what the market's going to struggle with.

**Dan Nathan** (3:33)
Yeah, so today's a really interesting day. Obviously, we have no idea how it closes. By the time you're listening to this, you will have a sense. I mean, it was kind of ugly on the opening. We looked at this DRAM ETF, which I absolutely love. We've been talking about it a lot recently. This was listed, I think you and I talked about a few weeks ago in April. It was very near the all-time highs in many of these stocks, or at least how the sentiment was turning a little bit. This ETF guy has $22 billion under management. That is highs, I think it was over 25 I can't remember the last time I have seen a sector ETF grow like this. But when I'm looking at the price action and a bunch of these names, and this SK Hynix is going to be really confusing, by the way, just the way it trades in Korea and then how it trades here. Obviously, the ADR, there's a lot of disc locations here, but all those names we just talked about, Samsung, Micron, SK, they're all in this DRAM ETF. This thing today traded as low as 48.65, is trading at 53 right now.