Hahaha, damn, the stock market is going to fall apart. Why is it dropping? The answer is here.
Let’s start with the broader market. The Nasdaq got absolutely hammered, flash-crashing by more than 4%. The main culprits were semiconductor stocks like SNDK and MU, which plunged as much as 15%!
So why did they fall so hard?
I actually explained the reason in my U.S. market analysis this afternoon: something’s gone wrong with data centers!
Here’s the market’s logic: Texas turned blue, and the new governor, Inohosayan, vowed to suspend and ban approvals for all data centers and cancel tax breaks unless they get approval.
Other blue states are doing much the same. That makes it harder to build new data centers, so forecasts for semiconductor shipments are starting to come down sharply.
That’s why semiconductor stocks like MU and SNDK plunged, dragging down the broader U.S. market. And the U.S. market dragged down assets around the world—Bitcoin got caught in the crossfire, too.
Ah, when the giants clash, it’s ordinary investors like us who suffer. Even hiding out in crypto didn’t spare us from the midterms.
But if history is any guide, markets tend to drop sharply around the midterms. So this was more or less expected. The difference this time is that the winning side is directly attacking the market’s foundations, while semiconductor stocks are especially sensitive and highly leveraged.
But did you know? Historical data also shows that after a big midterm-related selloff, it’s often the best time to position yourself in U.S. stocks! So you could consider buying some index funds or Bitcoin on the dip. They should recover eventually—it may just take more time. Be friends with time!
Let’s start with the broader market. The Nasdaq got absolutely hammered, flash-crashing by more than 4%. The main culprits were semiconductor stocks like SNDK and MU, which plunged as much as 15%!
So why did they fall so hard?
I actually explained the reason in my U.S. market analysis this afternoon: something’s gone wrong with data centers!
Here’s the market’s logic: Texas turned blue, and the new governor, Inohosayan, vowed to suspend and ban approvals for all data centers and cancel tax breaks unless they get approval.
Other blue states are doing much the same. That makes it harder to build new data centers, so forecasts for semiconductor shipments are starting to come down sharply.
That’s why semiconductor stocks like MU and SNDK plunged, dragging down the broader U.S. market. And the U.S. market dragged down assets around the world—Bitcoin got caught in the crossfire, too.
Ah, when the giants clash, it’s ordinary investors like us who suffer. Even hiding out in crypto didn’t spare us from the midterms.
But if history is any guide, markets tend to drop sharply around the midterms. So this was more or less expected. The difference this time is that the winning side is directly attacking the market’s foundations, while semiconductor stocks are especially sensitive and highly leveraged.
But did you know? Historical data also shows that after a big midterm-related selloff, it’s often the best time to position yourself in U.S. stocks! So you could consider buying some index funds or Bitcoin on the dip. They should recover eventually—it may just take more time. Be friends with time!
