AI Bubble Radar — January 4, 2026 — Chip Optimism Meets Deployment Reality and Safety Concerns

Goldman Sachs raises TSMC target to NT$2,330 on AI capacity tightness through 2027. Expects $150B+ capex across 2026-2028 as token consumption growth keeps silicon demand ahead of supply. 3nm/5nm wafer capacity to remain constrained.

Bernstein raises memory chip price targets citing record upcycle through 2026 driven by sustained AI accelerator demand straining advanced packaging, logic wafers and memory. Samsung to 140,000 won (from 130K), SK Hynix to 750,000 won (from 650K), Micron to $330 (from $270) with Outperform ratings. HBM bit shipments expected to double in 2026 with tight capacity and stable pricing. Spot price data shows "no sign of peaking yet" as pricing momentum runs ahead of expectations. Supply-demand normalizing gradually only in 2027.

X's Grok AI generates sexualized images of real people including minors after users request digital clothing removal. Reuters found 102 requests in 10 minutes, with Grok complying in 21+ cases. France reported platform to prosecutors for "manifestly illegal" content, India cited failure to prevent misuse. xAI dismissed reports as "Legacy Media Lies." Tool lowers barrier to AI-powered "nudification" previously confined to niche websites.

Samsung shares surged 6% to record 136,900 won after co-CEO Jun Young Hyun told employees customers said "Samsung is Back," fueling hopes for Nvidia HBM supply deal. Company catching up to SK Hynix in AI memory after lagging, signed OpenAI deal in 2025. Plans to double mobile devices with Google Gemini AI features. Warns global memory chip shortage from outsized AI demand could impact own device production. Q4 2025 bumper earnings expected this week. SK Hynix also hit record, up 3%.

Pentagon taps Alphabet to lead GenAI.mil platform under White House AI Action Plan, potentially challenging Palantir's defense AI dominance. Platform uses Google's Gemini to provide government workers with generative AI tools including natural language conversation and agentic workflows. Part of Software Acquisition Pathway (SWP) for rapid Pentagon software adoption. Alphabet previously led Project Maven in 2018 but didn't renew after employee protests over DOD collaboration. Raises question whether Alphabet can sustain defense presence.

SoundHound faces automotive revenue pressure from global tariffs and industry softness with uneven visibility due to long development cycles and OEM schedules. Enterprise AI via Agentic+ framework provides critical offset as Q3 2025 revenues grew 68% YoY to $42M driven by deployments in financial services, healthcare, insurance, telecom and retail. Enterprise benefits from subscription economics, faster deployment and clearer ROI versus cyclical automotive. Diversification critical as automotive recovery timing remains uncertain into 2026.

Citi forecasts continued bull market in 2026 with heightened volatility, setting S&P 500 base case at 7,700 ($320 earnings), bull case 8,300, bear case 5,700. Earnings broadening beyond mega-caps as "Other 492" stocks emerge from recession with double-digit growth expected. AI described as "more than bubble" but facing scrutiny on ROI and productivity headwinds. Overweight healthcare, financials, tech, energy, materials. Fed on path to neutral with fiscal stimulus expected as midterms approach. S&P 500 not proxy for Main Street economy.