The AI doomsday selloff due to warnings that AI could kill humans is ridiculous. The order backlogs for the data centers will not stop, since these backlogs now extend well into 2032. President Trump dismissed AI safety concerns as a “hoax” that would give China the upper hand in developing AI technology. Chinese bots have been planting false stories about AI and data centers to slow America’s AI momentum.
These Chinese bots are also designed to interfere with the mid-term elections and might explain why President Trump is so passionate about squelching bogus AI rumors. As investors, we have to decide if we want to be manipulated by false narratives planted by Chinese bots and the fake narratives being spread leading up to the mid-term elections.
The good news is that these fake AI and data center narratives should diminish after the mid-term elections, since they are being used to try to swing key congressional elections. The other good news is there are no analyst or guidance cuts for the AI- and data center-related stocks I recommend. I did note that when some of the AI- and data center-related stocks were briefly hit this week, buying pressure rotated into cybersecurity stocks.
Here is a clear sign that China is losing the AI race with America as it calls for more regulation to try to slow down AI development. Chen Yixin, the head of China’s Ministry of State Security, said in an article that AI poses a direct threat to the Chinese Communist Party’s hold on power. Specifically, in the state-run magazine China Cyberspace, Chen called for more party control over AI and stricter government oversight. Chen said this was (1) necessary to protect political stability at home; (2) to defend against increasingly sophisticated cyberattacks and misinformation campaigns from “hostile forces”; and (3) to compete militarily with countries like the U.S.
Vice President J.D. Vance said that it is very odd for the AI industry to approach the Trump Administration and call for more regulation. Vance said he found the request to require more regulation suspect, so it is clear that the Trump Administration does not want to impede AI development.