The AI Stock Rally Is Lying to You. The CDS Market Is Telling the Truth.
Beneath the AI stock rally’s euphoria, a quiet alarm is sounding. Credit default swaps on AI-linked debt are surging, signaling that the smart money is hedging against a crash. The derivatives market is pricing in risk that the equity market refuses to see. This article explains why the CDS market may be telling the truth about AI’s fragility — and why you should pay attention before the music stops.