Episode 147
The AI Bubble: Why 2026 Feels Like 2008 Again
Summary:
I break down why 2026 is giving “housing crash déjà vu,” what credit default swaps have to do with AI, and why the signs of an AI correction are getting louder. I connect the dots between the mid-2000s housing bubble and today’s AI mania. From distorted balance sheets to credit default swaps reappearing as investor “shelters,” I unpack how debt, equity, and narrative are inflating valuations — and why a correction could hit harder than expected.
Chapters:
00:00:00 — Why 2026 Feels Like the Matrix: Housing Crash → AI Bubble
00:01:00 — The Return of Credit Default Swaps (and Why That Matters)
00:02:00 — Debt, Equity, and the Illusion of Growth in AI
00:03:00 — Narrative vs. Fundamentals: What Breaks First?
Subscribe to the Show: https://youtube.com/@cascadingleadership?si=Bvj34b6Tg7-u3Qew
Music Credit: Good_B_Music
Mentioned in this episode:
Left in Exile Outro
Left in Exile Intro
Transcript
Welcome to 2026. Happy New Year. So the article points out that investors are seeking massive amounts of security to shield themselves from the potential of an AI bust, and that. AI bust is a result of massive debt that's been incurred by all of these AI companies as they push more and more resources into trying to reach the mythical end goal of a GI.
the reason why I said that it feels like I'm stuck in the matrix, and many of you might be feeling the same way, is because of the specific vehicle that's being used by a lot of these investors to shield themselves from the risk, and that's the credit default swap, if that sounds familiar.
t and the crash happened was [:That particular investment vehicle, the, the one that caused the housing crash and completely cratered the economy, it's coming back with a vengeance. Looks like that particular investment vehicle plays a big role in how investors are seeking shelter
as they try to hedge against an AI bubble bursting,
at Wall Street investors and [:you've seen reporting come out over and over again about how all of these investments and all of the growth in GDP has been driven by a handful of companies using circular financial transactions to make it look like they're actually growing, when in fact they're just shifting money from one pocket to another.
Over the last 12 months, you've seen these credit default swaps go through the roof in this space, and that indicates that a large number of investors are growing more and more concerned about the impending collapse of the AI bubble. And some analysts have predicted that this bubble is going to be much worse than anything that we saw in the housing crash.
hicles because they thought. [:That same language was now applied to the tech sector and tech sector companies investing in ai, and now investors are seeing that the balance sheets don't make sense, so they're seeking shelter.
This is yet another example of how big business capitalizes on the profits, but socializes all the risks to the rest of us. Keep an eye on all of this because the rumblings about an AI collapse is getting louder and louder.
