"As 2023 draws to a close, a report from Albert Edwards, a global strategist at Societe Generale known as the "Forex Bank Bear," is sounding the alarm on potential upheavals that could shock the global financial markets in 2024. In his final "Global Strategy Weekly" of the year, Edwards focuses on the instability of the US tech industry and its potential impact on the broader market, as well as analyzing the likelihood of a US economic recession.
Edwards warns that the bursting of the bubble in the US IT sector could be the biggest market "black swan" event of 2024, potentially dragging the entire US market into recession. He notes that the widely anticipated US economic downturn did not materialize this year, which was one of the macroeconomic "surprises." Another surprise was the surge in the US IT tech industry driven by the explosion of AI, with the advent of ChatGPT sparking a FOMO (Fear of Missing Out) frenzy among investors, even as bond yields soared above 5%.
Edwards acknowledges that the remarkable performance of the US "tech" sector this year was largely driven by the "Big Seven" tech giants - Apple, Microsoft, Google, Amazon, Meta, and the newly joined Nvidia and Tesla. He remarks that this has resulted in US tech stocks now comprising nearly a third of the US market value, double what it was five years ago."
https://www.btimesonline.com/articles/162831/20231223/forex-bank-strategist-warns-of-potential-2024-black-swan-in-us-tech-bubble-burst.htm