Markets Defy Geopolitical Shocks Amidst AI Boom, Echoing 'Black Swan' Warnings

The article from Delo uses the analogy of a well-maintained but aging car, driven aggressively by a new owner, to illustrate how global financial markets seem to be enduring significant geopolitical stress without apparent breakdown. The recent events, including the attack on Iran and the subsequent blockade of the Strait of Hormuz, which historically would have sent oil prices soaring and stock markets plummeting, have instead seen only moderate price increases and swift market recoveries. This resilience is puzzling, especially as stock prices have climbed even higher than before the conflict.

Analysts point to the booming artificial intelligence industry as a potential explanation. The immense capital flowing into AI – funding data centers, infrastructure, and manufacturing – creates a powerful economic momentum. This sector's growth, fueled by high expectations and the inertia of investment, appears to be overshadowing traditional risk assessments related to energy security and geopolitical instability. The market, it seems, is prioritizing the potential for short-term gains in AI over the risks of energy shocks.

However, the article cautions against complacency, invoking Nassim Taleb's 'black swan' theory. History is replete with examples of speculative bubbles preceding dramatic crashes, events that are easily explained in hindsight but impossible to predict. The author contrasts the current situation with the 'end of history' era following the Cold War, a period characterized by global economic integration, flourishing trade, and declining military spending, which facilitated rapid technological advancement. In that era, excess capital could be channeled into productive growth. Today, while markets react almost instantaneously to presidential tweets, the real economy faces physical limitations, and the long-term consequences of prioritizing speculative growth over fundamental stability remain uncertain, a stark warning for investors and policymakers alike.