As the AI Bubble Continues, Regional Banks Roll Over

More decoupling between AI and the rest of the economy, with Regional Bank stocks off their peak.

Key Takeaways

• Regional Banks Show Signs of Distress: As per Jamie Dimon, with reference to the collapse of First Brands Group: “When you see one cockroach, there’s probably more. Everyone should be forewarned.” Shades of New Century Financial, the canary in the coal mine, in early 2007. With that in mind, the big news yesterday, on an otherwise positive day in the markets, was the -1.2% decline in the S&P 500 Regional Bank index (now down more than -8.0% from its nearby peak in early September).