To put it bluntly, there’s a lot of dumb money floating around in big funds and family offices trying to meet their mandate to “get me some of that AI in our portfolio.” With public equities limited and many funds not allowed to invest in private equities placements they moved into bonds.

Those folks initially viewed bonds as a safe bet just like folks thought mortgages were a safe bet. However if it turns out they just bought into a mess of “sub-prime” AI bro fantasies and these bonds go bad they’re in for a world of hurt just like 2008 when folks stopped paying their mortgages.

As this all starts to unwind it’s going to be fun watching these same folks run for the exits.