AI Fantasy Fades as Wall Street Reels From Real-World Rate Jump

– The trillion-dollar AI promise has masked the threat of rising borrowing costs for stock investors.

– The Federal Reserve's hawkish stance has led to a rout in Big Tech and other growth stocks.

– Investors are becoming more cautious about companies with high valuations and long-term earnings potential.

– A higher cost of capital is detrimental to stock valuations.

– Powell risks overplaying optimism as real yields rise.

The promise of AI has masked the threat of rising borrowing costs for stock investors.  

The Federal Reserve's hawkish stance has led to a rout in Big Tech and other growth stocks 

as investors become more cautious about companies with high valuations and long-term earnings potential