AI market debate: consensus crash expectations could fuel a melt-up instead
abhiadesai · x · 2026-10-17
Steve Hou argues the bond market's and non-AI investors' long-standing disbelief in AI's aggregate productivity impact cuts both ways: accelerating adoption could trigger a right-tail melt-up of the AI trade, while disappointing adoption or frontier-lab economics makes the left tail real; a dot-com-style crash within 18 months is increasingly consensus. Abhi Desai counters that the scarier counterfactual is a world where AI fails to deliver growth—how would all non-AI equities trade? He bets scaling breaks through short-term FUD as it has every wall so far.