After the U.S. stock market crash, has the century-long peak arrived? Is the AI bubble about to burst?

Today, SK Hynix's earnings fell short of expectations, triggering another猛烈 sell-off in Asian tech stocks and sending the market into a bloodbath.

Looking back at this correction:

• The Nasdaq has fallen approximately 8%–10% from its peak;
• The Philadelphia Semiconductor Index has dropped about 25% from its June high;
• South Korea's KOSPI index plunged 10.84% in a single day, now down 35.81% from its all-time high.

But right as chip stocks were hemorrhaging, Apple reclaimed the title of the world's most valuable company, and the Dow Jones Industrial Average bucked the trend to hit a new high. It seems capital hasn't entirely fled the US stock market; rather, it's rotating out of the crowded AI hardware trade and into assets with more stable cash flows and less valuation pressure.

This has split the market into two camps: one side shouting, "The AI bubble has finally burst," while the other insists, "This is just a healthy purge; the AI narrative hasn't changed."

So, the real question is:

Is the US stock market facing a "once-in-a-century top," or is it still climbing the "wall of worry" within a bull market? Is the AI bubble about to completely burst, or is it merely undergoing a temporary valuation repricing?

⬇️ Below, let's witness the debate between the bulls and the bears.

The Bulls: The AI Narrative Remains Intact, This Is Not a Bubble Burst

Argument 1: Cathie Wood @CathieDWood｜ARK Invest Founder｜XHunt Rank: 170

Cathie Wood believes the market is still climbing a classic "wall of worry."

A true market top rarely occurs when everyone is filled with doubt. Instead, it's born from extreme optimism – when investors universally believe "the sky's the limit," that's when risk can truly spiral out of control.

The current market, filled with controversy, fear, and skepticism, doesn't resemble a typical final top.

Core Judgment: This is likely a normal correction within a bull market. The long-term logic of disruptive innovation remains unchanged. A real major top usually appears when consensus is extremely unanimous.

Argument 2: RamenPanda @IamRamenPanda｜XHunt Rank: 3994

RamenPanda shifts the focus from AI hardware to the software and application layers.

The market fears that massive investments in data centers and computing infrastructure will lead to overcapacity. However, these infrastructures ultimately need to generate returns through software, platforms, and commercial applications.

The internet era also experienced a phase of infrastructure overbuilding. Cisco was the early star, but the true long-term winners were Google, Microsoft, and Amazon that emerged later.

The AI era may follow a similar path: hardware investments overheat first, then value gradually shifts toward software and applications.

Core Judgment: Infrastructure oversupply might be an inevitable stage of a technological revolution. The current phase seems more like a transition from hardware buildout to application realization, not the end of the AI era.

Argument 3: Investment Talk Jun @TJ_Research｜XHunt Rank: 9918

After SK Hynix's earnings release, the stock initially opened about 8% lower but quickly rebounded.

Investment Talk Jun believes this is the opposite of the "sell the news" pattern seen after Micron's earnings, potentially signaling a short-term bottom.

If bad news has already been fully priced in by the market, even disappointing earnings might lead to exhausted selling pressure. More importantly, there are no signs yet of a systemic weakening in AI demand guidance.

Core Judgment: Short-term sentiment has been vented intensely, but AI demand hasn't been proven false yet. What the market needs is data confirmation, not continued panic.

Argument 4: Nico's Investment Wisdom @tychozzz｜XHunt Rank: 13869

Nico argues the key lesson from this crash is: no matter how strong the fundamentals or low the P/E ratio, when an asset is at highs, once the market decides to compress valuations, the stock price can still plummet. The memory and storage sector is a prime example.

But "valuation compression" does not equal "the AI industry logic being disproven."

The Nasdaq's forward P/E ratio is now close to levels seen at the end of March this year. Instead of panic selling, the more critical actions are to control leverage, set take-profit levels in advance, and hold indices and quality companies that can truly deliver earnings.

Core Judgment: Sentiment can quickly depress valuations, but ultimately, earnings determine stock prices. The AI narrative hasn't changed; it might just be a matter of time before quality assets return to their previous highs.

Argument 5: US Stock Immortal @hanking66｜XHunt Rank: 44611

The US Stock Immortal's view is more direct: don't sell stocks at the moment of maximum panic.

In his view, this decline has already shown the emotional characteristics of a "final washout" – despair, suffocation, breaking resolve – with investors interpreting every piece of news in the most pessimistic light.

The fact that many stocks were heavily sold off before their earnings reports also suggests that pessimistic expectations may have already been priced in.

Core Judgment: Buy the dip. Endure the most extreme phase of sentiment; opportunities may belong to those still able to step in.

The Bears: Cracks in AI's Creditworthiness Have Appeared; The Bubble Is Purging

Argument 1: ZeroHedge @zerohedge｜Noted Macro Analysis Media｜XHunt Rank: 200

ZeroHedge believes the market is re-entering a phase of pricing in that "circular financing is actually quite problematic."

Several danger signals are already visible:

• The Nasdaq 100 is approaching a 10% technical correction;
• Semiconductor and momentum factor trades have been hit hard;
• Cracks in the creditworthiness of AI-related companies are starting to appear;
• Trades involving Nvidia and OpenAI are once again raising concerns about circular financing;
• China's low-cost models and open-source tools continue to drag down profit expectations.
• If AI giants invest in each other, buy from each other, and contribute to each other's revenue, it becomes difficult for the market to discern how much comes from genuine end-user demand versus capital circulating within the industry chain.

Core Judgment: The credit and financing expansion of the AI industry is hitting a wall. The bubble's purge phase may begin sooner than most investors expect.

Argument 2: Phyrex @PhyrexNi｜XHunt Rank: 784

Phyrex focuses more on the leverage risks underlying the US stock market.

Currently, US investors have borrowed about $1.53 trillion to buy stocks, and brokerages' net credit balance has dropped to approximately negative $1.061 trillion. Margin debt increased by about $86 billion in a single month and has been rising for three consecutive months.

This means the US stock market is not only overvalued but also increasingly reliant on borrowed funds. Once incremental funding slows down, the mechanical buying that drove the rally could turn into mechanical selling.

This risk could also spill over into Crypto. During cross-market deleveraging, BTC is more likely to be sold first as a high-beta risk asset, rather than immediately rising independently as "digital gold."

However, short positions in US stocks are also elevated. Short interest in the Russell 3000 is near 6%, and around 3.5% for the S&P 500, so the possibility of a short squeeze rebound exists.

Core Judgment: The real risk may not be the AI technology being disproven, but the simultaneous occurrence of high valuations, high leverage, and slowing capital inflows. Once deleveraging starts, both US stocks and BTC could face mechanical selling.

Argument 3: Peter Schiff @PeterSchiff｜Economist, SchiffGold Founder｜XHunt Rank: 1486

Peter Schiff believes AI itself is a real technology, but AI-related stocks have formed a serious bubble.

China's low-cost models, open-source technology, and increasing industry competition will continue to pressure the profit margins and moats of US AI companies.

If massive capital expenditures cannot translate into matching cash flows, more valuation "air" still needs to be squeezed out.

Core Judgment: The AI technology is real, but the AI stock bubble is equally real. The bubble may have already burst, and what lies ahead is a sustained period of purging.

Argument 4: CryptoPainter @CryptoPainter｜XHunt Rank: 2207

CryptoPainter views the South Korean stock market crash as a stress test for the AI infrastructure narrative.

He doesn't deny the demand for AI computing power and data centers but warns against the circular investment, excessive financing, and high leverage built around this narrative.

Therefore, this correction may not replicate the complete industry collapse of 2000, but could replay the violent deleveraging seen in the Korean market: the technological direction remains valid, yet asset prices suffer significant drawdowns due to fragile valuation and financing structures.

For Crypto, if BTC breaks down again, one of the most likely external triggers is continued declines in the US stock market.

Core Judgment: AI technology being real doesn't mean asset prices are reasonable. Compared to the industry going to zero, the more realistic risk is the purge of financing and leverage, transmitted from US stocks to BTC.

Argument 5: Hellen @peng_hellen｜XHunt Rank: 40426

Hellen compares the current AI frenzy to the British Railway Mania and the Dot-com bubble.

Railways and the internet both genuinely changed the world, but speculative fervor still led to massive infrastructure overbuilding. For some projects, the more they invested and operated, the heavier their losses became.

This mirrors the dilemma faced by some large language model companies: more users mean higher computing and inference costs, but revenue may not be enough to cover the expenses.

The internet didn't disappear after its bubble burst, but the Nasdaq still fell for 31 consecutive months, dropping about 78% from its peak.

Core Judgment: Great technology and huge bubbles can coexist. AI might change the world, but related asset prices can still become severely detached from their true value and demand.

Summary of Arguments

The Bulls Argue

The current crash is primarily due to the unwinding of crowded trades and sentiment-driven valuation compression. There is no data yet proving a systemic collapse in AI demand.

New competitors and low-cost models won't necessarily destroy US tech giants; they might instead lower the barriers to AI adoption and expand the application market.

The AI narrative is not over. The market can still advance along a "wall of worry."

The Bears Argue

The moats of AI companies are not as deep as the market imagines.

High valuations, high capital expenditures, leverage, and circular financing all propped up the past rally. Once revenue and cash flows fail to match the investment, the entire valuation system will be repriced.

Technological revolutions won't disappear, but investment bubbles can definitely burst prematurely.

Final Thoughts

What's happening to US tech stocks is not an outright denial of AI's long-term logic. Instead, the market is starting to recalculate an equation:

If the return on capital expenditure is insufficient, circular financing recedes, and China's low-cost models keep pressuring prices, how much of a moat do US tech leaders truly have left?

The Nasdaq correction, the halving of memory stocks, and the plunge in Korean chip stocks are essentially a concentrated release of this concern.

But to declare that a 'once-in-a-century top has arrived' is probably premature.

The real inflection point lies not in today's sentiment-driven valuation compression, but in the coming quarters and beyond: Can AI revenue and free cash flow match the enormous capital expenditures? Can demand in the industry chain expand from circular procurement among giants to truly paying end-users?