Another surge market is coming... And 6 months later, the AI bubble collapse begins / Why the US small and medium-sized bank bankruptcy march is erupting

Summary

Dr. Yoo Shin-ik argues that the current market surge is fueled by unsustainable liquidity, and that within six months the AI bubble will deflate and small/medium US banks may face renewed stress. He recommends shifting from growth stocks to defensive Korean sectors and short-term bonds, and warns that the Fed has limited room to cut rates.

• Yoo predicts the AI bubble will burst when liquidity growth fails to keep pace with capex needs.
• He expects the economy to peak out around year-end, leading to higher volatility.
• He advises reducing AI exposure and moving into K-pop, K-beauty, and Korean food stocks as defensive plays.
• He recommends buying short-term US Treasuries to capture high yields while hedging downside risk.
• He warns that small/medium US banks are vulnerable to recurring failures due to bond losses and stablecoin competition.
• He highlights that stablecoin and DeFi leverage could trigger a liquidity crisis similar to SVB.
• He notes that the Fed cannot cut rates easily because service inflation and fiscal deficits remain elevated.