America: Brace Yourself for an AI-Related Stock Market Crash in 2026
- Donald V. Watkins
- Jun 28
- 3 min read
By: Donald V. Watkins
Copyrighted on June 28, 2026
An Editorial Opinion
All of the signs are in plain view. America’s national debt is $39 trillion and surging. The nation is insolvent, as reported by the U.S. Department of Treasury.
In 2024, American voters gave a shady New York businessman with a record of 6 corporate bankruptcies and 21 other failed businesses a government-issued credit card with unlimited spending privileges. This man went on an unprecedented spending spree after the U.S. Supreme Court created presidential immunity out of thin air and conferred it upon him.
Since Donald Trump assumed office in January 2025, 80% of all market gains in the U.S. has come from AI-related stocks. AI expenditures accounts for 92% of America's GDP growth.
NVIDIA, the designer of the advanced computer chip at the heart of the AI boom, recently became the first company in history to be worth an estimated $5 trillion. For perspective, $5 trillion represents almost 20% of all U.S. GDP – in just a single stock! NVIDIA is the company that doesn’t own and operate a single factory or plant. Taiwan Semiconductor and other chip manufacturers build all of NVIDIA chips. NVIDIA just draws up the designs!
So, the stock of one company that doesn’t make anything is worth a 20% of America’s GDP. Furthermore, one industry (AI) makes up 92% of the America’s GDP growth. That's not good.
Many of today’s big AI companies are burning through cash at an alarming rate. For example, Open AI will need to accumulate $143 billion in negative cash flow before the company makes a single dollar in profit! That’s more money than the market cap of the "Big Three" U.S. automakers combined! Yet, Open AI plans to IPO the company for nearly a trillion dollars this year.
Palantir has a P/E ratio of 222. Which means that if you bought this stock today it would take 222 years at its current earnings to make your money back!
Elon Musk’s xAI has was burning through cash so fast it had to be merged with SpaceX just to keep the entire thing from going under.
What is more, Anthropic is warning that its business could go bankrupt if AI growth forecasts are off by a year.
We also have AI startups with no products and no revenue that are supposedly “worth” billions of dollars. Yet, according to MIT, 95% of corporate AI initiatives fail to produce any return on investment!
Most of our nation’s wealth sits in just ten stocks and the first 8 of them are soaring, based almost solely on the hype surrounding AI.
NVIDIA Corp (NVDA)
Apple Inc. (AAPL)
Microsoft Corp (MSFT)
Amazon.com Inc. (AMZN)
Alphabet Inc. Class A (GOOGL)
Broadcom Inc. (AVGO)
Meta Platforms Inc. (META)
Tesla Inc. (TSLA)
Berkshire Hathaway Inc. Class B (BRK.B)
Eli Lilly and Co (LLY)
If America’s bet on the big AI doesn’t pay off soon, the whole financial system crashes.
To make AI work, companies must spend trillions of dollars on data centers. They must borrow this money. For all practical purposes, this debt is AI-related subprime “junk debt” that is collateralized with special purpose real estate called data centers. This debt will be sold as Collateral Debt Obligations (CDO) and spread throughout the global financial system like subprime mortgages for houses were packaged as CDOs and sold in 2008. Once the loan defaults start occurring, as is likely, the whole financial system crashes, globally.
The AI "house of cards" is NOT sustainable. Investors, banks and sovereign wealth funds already know there are serious financial problems with AI companies. As such, they are trimming their positions and betting against it.
What is Washington doing about the growing AI-related financial mess? Absolutely nothing.
How much American wealth will be wiped out on Wall Street during the predicted AI-related stock market crash? An estimated $30 trillion.
You raises a valid point regarding AI. I was under the impression that with its multiple capabilities, AI would be a win win tool toward preparing strategic financial portfolios for businesses, and preparation of effective business plans for capital acquisition.
While I'm sure that AI creation is not without flaws, I'm sure with careful use, the results you seek is nothing short of inevitable.
I always enjoy how you condense fairly complicated subjects into understandable "everyday" language. I've been following this fiasco for about a year and as best as I can tell. It's a Reset, like when they went off the Gold Standard and somehow this time they want to go to a Crypto Standard. Whatever that means. After that it gets like 3 or 4 levels of convoluted. Safe to say "They Win, We Lose. SAVE YOUR MONEY, REMAIN VIGILANT.