Sacks states AI represents 40% of US GDP growth and 80% of stock gains this year.
“40% of US GDP growth this year is AI and AI companies have accounted for 80% of the gain in US stocks this year.”
Sacks argues the chip stock correction is momentum-driven, noting a 10x run-up in memory chips over the past year.
“Meaning that over the past year, you've had this roughly 10 x run up in memory chip stocks, and you've seen this overall huge rise in any stock that's related to the AI boom.”
Sacks notes Nasdaq fell 10% from peak while momentum trades dropped 30-40%, showing amplified correction.
“I think there was something like a 10% pullback in the Nasdaq from the peak. But when you look at this momentum trade, was down like 30% or 40%.”