Tom Lee: AI slowdown could be a boon for states that embrace it or for countries with lower power

0:00 need it anymore and I'm free from uncomfortable long sleeves an >> I WANT TO SHOW YOU WHAT THE MARKETS ARE DOING HERE. WE'LL CALL THIS THE LOWS OF THE DAY OR JUST ABOUT NASDAQ DOWN BY 5.25%. THE DOW JONES INDUSTRIAL AVERAGE IS DOWN BY NEAR 1800 POINTS RIGHT NOW. THAT'S A THREE AND A THIRD PERCENT. YOU GOT TO GO BACK TO APRIL OF 25, THE SO-CALLED LIBERATION DAY, TO FIND ANYTHING IN THE MARKET THAT LOOKS REMOTELY CLOSE TO WHAT WE'RE WITNESSING NOW. WITH LESS THAN 30 MINUTES TO GO, LET'S BRING IN TOM LEE OF FUNDSTRAT, WHO'S JOINING ME HERE AT POST NINE. I DON'T THINK YOU'RE EXPECTING THIS BASED ON WHAT YOU TOLD ME YESTERDAY.

0:43 >> NO. >> NOT EXPECTING IT AT ALL. BUT. >> YOU KNOW, AS YOU'RE POINTING OUT. THIS IS A LOT LIKE TARIFF LIBERATION DAY COUPLED WITH DEEP SEEK AND COUPLED WITH SITUATIONAL AWARENESS. YOU KNOW, WE GOT A POLICY SHOCK BECAUSE THAT BLUE TSUNAMI, SOME RHETORIC THAT SCARED PEOPLE. AND I THINK TODAY'S DROP, ESPECIALLY THE OVERNIGHT SESSION IN KOREA, I THINK HAS CAUSED A LOT OF LIQUIDATION. I THINK THERE ARE STORIES OF SOME LARGE HEDGE FUNDS ACTUALLY BEING LIQUIDATED NOW.

1:13 >> I MEAN, THE DIFFERENCE BETWEEN THIS AND SAY, A LIBERATION DAY IS JUST AS THE PRESIDENT HELD UP THE, YOU KNOW, NOW INFAMOUS BOARD WITH ALL OF THESE LARGE TARIFF NUMBERS, HE COULD JUST AS EASILY TAKE THAT AWAY, WHICH HE ESSENTIALLY DID, WHICH IS WHY THE MARKET RALLIED SO FAR BACK. WHAT'S THE MECHANISM FOR REVERSAL HERE? IT'S NOT AS SIMPLE. >> WELL, YEAH. I MEAN, FOR FOR FOREMOST, YOU KNOW, THERE'S JUST A LOT OF FEARS BUILDING ABOUT WHAT COULD HAPPEN WITH AI PROGRESS. BUT I THINK WE HAVE TO JUST KEEP SOME THINGS IN PERSPECTIVE. ONE IS THAT THE DEMAND SIDE FOR AI ISN'T GOING TO SLOW, BECAUSE THERE'S STILL A LOT OF DISCOVERY AND COMPANIES ARE BENEFITING. AND THE SUPPLY SIDE, THERE'S NOT REALLY NEW AI COMPETITION OR SOMETHING THAT COULD WIPE OUT THE INDUSTRY. WHAT'S REALLY BEING DISCUSSED HERE IS A SLOWDOWN IN THE U.S. BUT THAT MEANS A LOT OF OPPORTUNITIES ARE GOING TO EMERGE FOR EITHER STATES THAT EMBRACE AI OR OTHER NATIONS THAT HAVE LOWER POWER.

2:10 SO I THINK IN SOME WAYS, THIS IS SORT OF A A SPEED BUMP QUESTION, BUT DOES THAT WARRANT THE MASSIVE, MASSIVE REPRICING OF THESE STOCKS? I THINK THAT'S OVERLY DONE. >> WELL, I MEAN, UNLESS THE SPEED BUMP BECOMES A POTHOLE AND YOU HAVE MORE SIZABLE SORT OF CLAMMING UP OF THE, THE THE MONEY. YEAH. AND THAT PEOPLE JUST ARE FORCED BY MARKET FORCES, MARKET TURMOIL, OTHER THINGS IN THE ENVIRONMENT THAT JUST CAUSE A, EITHER A DELAY OR AN ABSOLUTE, YOU KNOW, RETHINKING OF SOME OF THE SPENDING. ARE YOU CONSIDERING ANY OF THOSE?

2:46 >> I AM, BUT I THINK WE SHOULD JUST HAVE SOME PERSPECTIVE ON THE CONSEQUENCES. YOU KNOW, TEN GIGAWATTS OF AI CONSTRUCTION IS EQUAL TO ALMOST 350,000 HOMES OR LIKE 5000 HOTELS. SO A STATE THAT WANTS TO PREVENT THIS CONSTRUCTION IS GOING TO HAVE A GIGANTIC HOLE IN THEIR BUDGET, NUMBER ONE. BUT NUMBER TWO, I THINK WE HAVE TO REMEMBER THAT THIS THIS IS REALLY COMPLETELY CHANGING THE NARRATIVE AROUND INFLATION RISK AND EVEN THE FED HIKES. TODAY'S PRODUCTIVITY NUMBER MEANS I THINK THE SEPTEMBER HIKE LOOKS LIKE A MISTAKE. THE DECEMBER PROBABLY DOESN'T HAPPEN. BUT THEN I THINK THE FED PUT COMES INTO PLAY. IF IT BECOMES A EMPLOYMENT RISK STORY. SO I THINK THAT THERE'S INHERENT STABILIZERS. AND AGAIN I THINK IT'S JUST TOO EARLY FOR PEOPLE TO SAY AI CONSTRUCTION WON'T HAPPEN. IF YOU SAW THE THE TEXAS GOVERNOR ELECT SAYS THEY'RE GOING TO ACTUALLY ALLOW THE EXISTING PROJECTS TO, TO BE COMPLETED. SO I THINK THERE'S A LOT OF DOOMSAYING THAT'S MAYBE OVERSHOT.

3:42 >> WHAT IF GROWTH, YOU KNOW, TOTAL GDP SLOWS IF, LET'S SAY 75% OF IT WAS DIRECTLY TIED TO THE AI INFRASTRUCTURE BUILD OUT FOR 2026, WHAT HAPPENS IF THAT SLOWS? ISN'T THERE A RIPPLE EFFECT THROUGH FINANCIAL MARKETS? >> YEAH, I THINK WE HAVE TO BE GIVE COMPANIES SOME CREDIT. THEY WERE VERY INGENIOUS ABOUT DEALING WITH THE TARIFF SHOCK, THE TARIFF LIBERATION DAY BECAUSE EARNINGS HELD UP. I THINK COMPANIES ARE GOING TO FIND WAYS TO DEAL WITH THIS POLICY SHOCK OF THE BLUE WAVE.

4:14 AND I THINK WE'VE EVEN HEARD STORIES THAT, FOR INSTANCE, YOU MAY BE RETROFITTING EMPTY INDUSTRIAL PLANTS AND OFFICE SPACE TO PUT IN DATA CENTERS. SO I THINK THERE'S GOING TO BE WAYS FOR POWER AND GIGAWATTS TO BE CONSTRUCTED. SO I LOOK AT THIS AS AN OPPORTUNITY FOR AMERICAN BUSINESSES TO BE USE SOME INGENUITY. >> WOULD YOU BE A BUYER OF MANY OF THESE NAMES TODAY? >> JUST WANT TO POINT OUT TARIFF LIBERATION DAY, DEEP SEA LIBERATION, DEEP SEA DAY, SITUATIONAL AWARENESS DAY