A new AI model is crashing the market.

Monly Fool Hidden Gems Investing starts now.

Welcome to Motley Fool Hidden Gems Investing.

I'm Travis Hoyim, joined today by Lou Whiteman and Emily Flippin.

And guys, we got to talk about the topic of the market, at least over the past 48 hours or so.

That is tech stocks dropping like a rock.

This is everything that was on fire, Emily, over the past six months, over the past, you know, maybe 18 months.

And now they've suddenly fallen back to Earth.

We're talking about memory.

We're talking about equipment makers.

There's a number of different catalysts here. This could talking about memory. We're talking about equipment makers. There's a number of

different catalysts here. This could be the AI model Kimi that has come out of China. It could also

be earnings season. So when you're seeing these stocks fall, what is in your mind as an investor?

Well, the first thing that comes to mind is trying to understand what is the core driving

principles that's resulting in a sell-off that we're seeing across the board. And trying to

reconcile Netflix and Micron, you're probably scratching your head thinking to yourself,

what do these companies have in common? And the short answer is, they're very popular with

retail investors. In fact, if you look across the board, a lot of the stocks that are down massively are very popular with retail investors. In fact, if you look across the board, a lot of the stocks that are

down massively are very popular with retail investors. And we've seen a lot of people kind of flood

into companies, whether that be for fear of missing out, whether that be just part of the hype cycle.

And as we start to get earnings from these businesses, as people's fear starts to grow,

then you have people who never really had a thesis in the first place for buying in, start to panic. And when you buy into a company without a real thesis for why you're holding that business, hopefully for the long term, then it's really easy to panic whenever the market starts to sell off. So I think the cross the board selling off that we're seeing, it can be a result for Micron, a memory shortages, for Netflix, as a result of earnings, for IBM. Good Lord, who knows as a result of IBM, whether it be internal struggles or a sell-off in the software industry in general. But all of these things are different dynamics, all being driven by the same core principles, which is, I'm an investor, and I'm afraid. And I'll tell you what, the market is made up of humans. It's made of people who make emotional decision. And I think I see personally a lot of emotional decision making happening this week. Yeah. And it's funny. We never notice it on the way up, right? I mean, Micron is down what, how much percent, but they're also training where they did in early June. IBM is back at its worst day in history,

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