Investors Get a Dose of Reality

Humbling times for markets
https://www.ft.com/content/e41dadef-c473-48ff-9fa5-30b56d40af34
Investors finally show signs of growing weary of the painfully obvious nonsense.
 
Inside the Meltdown of a Wunderkind’s A.I. Hedge Fund
https://www.nytimes.com/2026/07/31/business/situational-awareness-leopold-aschenbrenner.html
Situational Awareness, led by a 24-year-old, exploded onto the artificial intelligence scene — and then nose-dived.
 
How A.I. Mania Turned This Stock Market Into a ‘Version of Squid Game’
https://www.nytimes.com/2026/07/31/business/korea-stocks-chips-kospi.html
South Korea’s KOSPI index has swung wildly because of both the enthusiasm and anxiety related to investing in the global artificial intelligence boom.  

EM Growth Models Debate

The Limits of Asia’s Two Major Growth Models
https://www.project-syndicate.org/commentary/china-india-development-models-limitations-and-lessons-for-others-by-hinh-t-dinh-and-karim-el-aynaoui-2026-07
Data from a period in which both China and India pursued deliberate industrial policies show that neither country's development route is accessible to other countries. At best, their experience can alert policymakers to structural limitations and coordination problems that will require their own homegrown solutions. 
 
Explaining China’s Industrial Competitiveness
https://www.project-syndicate.org/commentary/china-industrial-competitiveness-root-causes-by-miao-yanliang-2026-07
External headwinds have not weakened China’s manufacturing competitiveness. That is because the Chinese economy combines an unusually large manufacturing base, deep supply chains, fast engineering feedback loops, and cutthroat domestic competition to create global powerhouses. 

China is smarter about subsidies than everybody else
https://www.ft.com/content/871976c7-8c4f-405e-803e-d86cf22bcf0f
Beijing is stealing a march on its competitors by targeting strategic sectors.

AI Capex Spending and Bubble Fears

In Silicon Valley, Some Say an A.I. Bubble Would Be Just Fine
https://www.nytimes.com/2026/07/30/technology/ai-bubble-venture-capital.html
As fears spread over a possible artificial intelligence bubble, some tech investors say: Bring it on.
 
Big Tech’s A.I. Spending Keeps Rising. So Do the Jitters.
https://www.nytimes.com/2026/07/30/technology/amazon-google-ai-data-center-spending.html
Amazon joined a procession of tech giants that ramped up their spending on artificial intelligence, as its capital expenditures soared 69 percent. Concerns over the industry’s spending are mounting.
 
Big Tech AI spending spree tops $1tn
https://www.ft.com/content/dcf3873e-7b32-4a24-a90d-3bccf1d2c996

AI revenues are growing fast, but not fast enough
https://www.economist.com/finance-and-economics/2026/07/28/ai-revenues-are-growing-fast-but-not-fast-enough
The returns on trillions of dollars of spending are deeply uncertain.

International Mystery

The Great Chinese Oil Mystery
https://www.theatlantic.com/economy/2026/07/china-iran-usa-oil-prices/688086/
America’s greatest rival is single-handedly averting a global energy crisis. No one knows how the country is doing it—or why. 

Exchange Rates and Global Imbalances

Don’t blame global imbalances on the undervalued yuan
https://www.economist.com/by-invitation/2026/07/28/dont-blame-global-imbalances-on-the-undervalued-yuan
Demanding that China revalue the yuan gets both the diagnosis and the cure wrong, write Gita Gopinath, Pierre-Olivier Gourinchas and Hélène Rey.
 
What the Big Mac index reveals about a global currency beef
https://www.economist.com/interactive/leaders/2026/07/30/what-the-big-mac-index-reveals-about-a-global-currency-beef
It highlights economic problems—and helps explain how to solve them.
 
Related:
https://www.economist.com/interactive/briefing/2026/07/30/the-big-mac-index-at-40

Asset Market Concentration

AI investment concentration risk is not just in equities
https://www.ft.com/content/5ac77b70-d057-44d4-b2b3-5eccb0e73484
Bond markets are increasingly dominated by a bet on the same thesis as other asset classes.

 
Related:
https://www.fa-mag.com/news/cds-market-surges-as-wall-street-picks-ai-s-winners-and-losers-87920.html
https://www.reuters.com/commentary/reuters-open-interest/worlds-18-quadrillion-balance-sheet-has-simmering-problem-2026-07-30/ 

Mag 7 Era Nears its End

The Magnificent Seven Are Riding into the Sunset by John Authers
https://www.bloomberg.com/opinion/newsletters/2026-07-29/the-magnificent-seven-are-riding-into-the-sunset 

Everyday Investors Are Over the Mag Seven and Into New AI Darlings
https://www.wsj.com/finance/stocks/everyday-investors-are-over-the-mag-seven-and-into-new-ai-darlings-a112ea2b
Once the Magnificent Seven’s most enthusiastic fans, they are looking elsewhere for the next superstar tech stocks. 

Related:

Dividends are the best way to protect yourself from the AI bubble
https://www.telegraph.co.uk/business/2026/07/17/dividends-best-way-to-protect-yourself-from-ai-bubble/
Equity income-focused strategies offer a steady alternative to the US and its surging economy.