Nasdaq down 5.5%: the AI bubble cannot abide the idea of a brake

According to Mediapart, the Democratic victory in the US midterm elections initially seemed to delight Wall Street. Then, on Thursday, the prospect of regulating artificial intelligence sent the Nasdaq down 5.5%, dragging Asian and European markets in its wake. For Mediapart, this is the sign of a bubble "built on headlong flight forward" that can no longer tolerate the slightest brake. The rest is our reading, and it goes a little further than the observation.

What the wire report does not say: which regulation is meant, who is pushing it, and on what timetable. These details are missing at this stage, and they matter. But the raw fact is already instructive: a promise of rules, not a rule, was enough to shave several index points off in a single session.

This is where the notion of fictitious capital becomes useful, and not merely as a term of abuse. A technology share is not a factory: it is a claim on future, anticipated profits. When its value climbs well beyond what the company actually produces, the difference rests on a collective conviction: tomorrow, the value will be there. Yet new value, in this tradition, is born of living labour, and the unpaid portion of that labour, the surplus value, is the source of profit. AI valuations therefore bet on massive future exploitation: automated tasks, compressed labour, wages held down. Even a timid regulation threatens to clip that expected return. This is why a sentence of public policy weighs more heavily than a quarter's results.

It is worth noting in passing the usual inversion of financial commentary. When we write that "markets are walking a tightrope", or that they "rejoice" and then "worry", we attribute moods to an abstraction. Behind it stand fund managers, asset managers, major platforms and states making calculated choices. The market does not panic: people sell, with specific aims and interests.

Which brings us to the question posed by our angle: is the state beginning to discipline fictitious capital? Caution is advised. A 5.5% fall is not discipline; it is a warning that holders of securities address to legislators. The blackmail is classic: "touch our returns and we withdraw our confidence". Here, markets play the role of a lobby without an office in Washington.

If the bubble bursts, the bill will not fall first on the best-placed shareholders. In crashes, layoffs and austerity plans land on those who never received a dividend, while rising unemployment swells the reserve army of labour and weighs on wages. That is the real test of any regulation: whether it protects society from the bubble, or the bubble from society. The answer, for now, is nowhere to be found in the wire report.