Michael Burry’s credit default swaps, which made him millions during the 2008 financial collapse, are often seen as an example of how such bets act as a premonition of a big crash ahead. However, investors are now worrying if the rising credit default swaps for big tech giants today may be a signal for a big AI-driven market crash in the near future.
New AI innovations and rising spending on the nascent technology led investors to believe that AI would be the next big driver of the market rally earlier this year. The expectations were indeed true, briefly, as tech-faced markets sharply rallied. South Korea’s Kospi, the face of this rally, skyrocketed more than 120%, before things began to go haywire.
