Norway’s $2.2T Sovereign Fund Models ‘AI Correction’ Crashing Nvidia, Broadcom—And The Results Are Brutal – Broadcom (NASDAQ:AVGO), NVIDIA (NASDAQ:NVDA)

Norges Bank Investment Management (NBIM), which runs Norway’s $2.2 trillion sovereign wealth fund, has modeled a brutal “AI correction” —and the stress test shows equities down 53%.

What NBIM Modeled

In the fund’s “AI correction” scenario, where the capex boom fails to produce real productivity gains, the model shows equities plummeting by 53% and the fund’s total value dipping by 35%, while fixed income increases by 10%.

NBIM assumes central banks respond, pushing yields down.

NBIM says market concentration makes this year’s AI scenario more punishing—a bigger equity hit, only partly offset by bonds.

The stakes are high because NBIM is the world’s largest single stock owner, holding roughly 1.5% of all listed equities globally.

Prediction Markets Price The “Bust” Risk

On Polymarket, the contract for “AI bubble burst by…?” prices the risk of a major sector crash at roughly 18% by December 31, 2026.

Unlike vague sentiment surveys, the Polymarket contract has…