Stock Market Collapse: There is currently a lot of chaos in America, the world’s largest economy and stock market. The crisis in people’s jobs is constantly coming to the fore, which is increasing the difficulties of the Trump administration.
Not only this, the impact of the economic crisis in America is also being seen on other countries.
The first sign of a future crisis comes from the stock market. It can be seen from history and this is what is currently happening in the American stock market. The American stock market has been on a continuous selling spree for the past few days, and this week, on Thursday, November 6, there was an earthquake in the American stock market.
The previous day, Friday or the last trading day of the week, the fall in the American market did not stop. The Dow Jones Industrial Average rose 66.26 points to settle at 46,978.56, while the IT index Nasdaq Composite fell 48.77 points to close at 23,005.22. At the same time, the S&P 500 index remained flat at 6,728.80. If we look at the reasons for this decline, three main reasons emerge.
AI stocks in trouble
The bubble around artificial intelligence, or AI, is said to be starting to burst. As investors are increasingly concerned about AI companies, the question arises as to why the word ‘bubble’ has suddenly been used in relation to AI.
Large technology companies, especially AI-themed stocks, are enjoying high valuations and investors are wary of their ability to deliver future returns. Although AI-based stocks have seen a strong rally in the past two years, the growth has not been consistent. At the same time, investors are worried that the growth shown by some big tech companies is not matching the growth, meaning that the valuation is too high. Therefore, despite some AI-related companies reporting good results, shares have seen a sharp decline.
Massive job cuts
The US economic slowdown is deepening the employment crisis, with about 1.53 lakh people in the US staying at home in October 2025 alone. This is the highest number of job cuts in the month of October in the last 20 years and so far in 2025, about 1.1 million jobs have been cut, which is about 65% more than a year ago.
These layoffs are not limited to just one or two sectors, but are affecting many industries including technology, retail sales, the service sector, warehousing and logistics. Investors’ confidence in AI is now faltering, which is why this sector is being significantly affected, and rising costs and growing economic uncertainty are forcing companies to increasingly implement cost-cutting measures. With the entry of AI, many jobs have now been replaced by automation/AI.
Pressure on the economy
While the pressure on the US economy has increased due to the possibility of a Fed rate hike, the US debt has increased to more than $38 trillion and has reached an estimated 324% of GDP. In such a situation, if the US does not find a timely solution to this challenge, not only economic but also political and social challenges may arise rapidly. Also, the fear of rising inflation is also growing.
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