Tonight, the US stock market continued the significant decline from yesterday, with the Nasdaq quickly breaking below the 21,000 support level. This rebound, supported by retail investors, which was seen as a 'liberation day,' has been overshadowed by the market's long-standing concern of 'liquidity tightening,' which has finally arrived.

The sharp drop in the Nasdaq tonight is attributed not only to liquidity issues but also to a clear 'valuation correction.' There are two main triggers:

One is a research report released by MIT, stating that '95% of organizations have seen zero returns on investments in generative AI,' and 'only 5% of integrated AI pilot projects have generated millions of dollars in value,' leading to the collapse of the AI narrative.

From yesterday to today, stocks like PLTR, cryptocurrencies, and chip stocks have been heavily impacted, while the Dow Jones has shown a much calmer performance.

Another observation point is US Treasuries and gold. Tonight, US Treasury yields have plummeted, following a 'safe-haven logic' rather than a 'liquidity tightening logic,' indicating that the current market is more focused on the valuation adjustment of risk assets.

The second trigger today is Trump's pressure on Federal Reserve Governor Cook to resign (due to fraudulent behavior in applying for favorable mortgage loans). Cook has always been part of Powell's faction; if she resigns early, it would not only weaken the hawks but also provide Trump with an additional temporary appointment.

This raises further concerns about the independence of the Federal Reserve in the market, which may trigger more institutional selling during this downturn.

The next question is, how long will this round of declines last?

From a liquidity perspective, this round of US Treasury issuance will continue until the end of September, while the Federal Reserve's interest rate cut on September 18 will benefit liquidity, meaning liquidity tightening will likely last at least until mid-September.

From the AI narrative perspective, the next 'big event' is undoubtedly Nvidia's quarterly report on August 27. However, this is a double-edged sword; given investors' increasingly high appetite, Nvidia's performance this time may exacerbate market volatility.

According to the interest rate cut schedule, the next important date is this Friday's Jackson Hole meeting. If Powell gives a 'rate cut softening' signal like last year, the market may ease. If he continues to maintain a strong stance against rate cuts, then the decline will continue.

Of course, there is also the final X factor, or lifeline, which is Trump and Besant. They have the capability and willingness to step in and make statements or provide liquidity to rescue the market; it just depends on the timing. Perhaps Trump himself wants to create a golden opportunity to buy at the bottom, then...