In five weeks, the stocks behind the AI boom have shed trillions. Underneath is a web of deals where suppliers fund their own customers, and an economy leaning on that spending to grow.
By Joseph Jackson | TAMPA (Nov. 8, 2026)
The short version
Nvidia has lost about $1.4 trillion in value since its October record. Thursday, Nov. 5, was the worst day for U.S. stocks since April 2025.
A credit fund mapped $3.6 trillion in AI financing and called about 120 deals "highly circular": the same companies show up as investors, customers and suppliers.
AI investment accounts for roughly a quarter to a third of U.S. economic growth this year, while job growth stays weak.
The losses have been building for weeks. On Thursday, they broke open.
The day after Democrats swept the midterms, the S&P 500 fell 4.4% and the Nasdaq 5.5%, the worst day for both since April 2025, MLQ reported in its weekly wrap. The chip index dropped about 12%, its second-largest one-day fall on record. Investors feared the new Congress will make data centers harder to build, according to CNBC as summarized by Stock Titan.
Estimates of what was erased that day run from $3.2 trillion (FactSet, via the Financial Times) to $3.7 trillion (Bloomberg).
The scoreboard
Nvidia: fell 9.26% Thursday, erasing about $448 billion. Down about $1.4 trillion and 24% since its October record (IBTimes). Six straight losing weeks (GuruFocus).
Micron, AMD, Marvell, Sandisk: each lost about 17% Thursday (MLQ).
The "Magnificent Seven": lost more than $1 trillion combined in one session.
CoreWeave: fell 15.5% on Oct. 14 as its bonds neared 15% yields (Admiral Markets).
Oracle: fell nearly 9% as the CoreWeave debt scare spread (24/7 Wall St.).
Memory and AI power stocks: down an average of 60% and 53% from their 2026 highs (Crypto Briefing).
Chip stocks bounced Friday. The indexes still finished the week lower.
Follow the money around the circle
Here is how the loop works, in plain terms.
Nvidia makes the chips. It invests in AI companies. Those companies use the money, and contracts tied to it, to rent computing power from cloud providers like Oracle and CoreWeave. The cloud providers then buy Nvidia chips. The money ends up back where it started, booked as sales.
Some of the biggest pieces:
Nvidia → OpenAI: a letter of intent for up to $100 billion. Nvidia's own filing said there is "no assurance" of a final deal, Global Finance reported.
OpenAI → Oracle: a roughly $300 billion cloud deal. Oracle, in turn, spends billions on Nvidia chips, Bloomberg reported, via Noah Smith.
Nvidia ↔ CoreWeave: Nvidia owns about 7% of CoreWeave and agreed to buy $6.3 billion of its cloud services. OpenAI also took a $350 million stake in CoreWeave.
AMD → OpenAI: AMD gave OpenAI warrants for up to about 10% of AMD, tied to chip purchases.
London credit fund Sona Asset Management mapped $3.6 trillion of AI financing across 176 deals and flagged about 120 as highly circular, Benzinga reported. Both the International Monetary Fund and the Bank for International Settlements have named circular AI financing as a risk to the wider financial system.
The debt underneath
Much of the buildout runs on borrowed money.
Alphabet, Amazon, Meta and Oracle had issued more than $228 billion in bonds this year as of Oct. 13, according to LSEG data cited by investingLive. Oracle had $125.3 billion in borrowings as of August.
CoreWeave carries about $50 billion in debt and is still losing money, Reuters reported. Over four quarters it paid about $1.87 billion in interest while posting operating losses, according to TIKR's analysis of its filings. When a company's bonds yield 15%, lenders are pricing it like a risky bet.
And the biggest customer in the loop isn't profitable either. OpenAI is reportedly on track to lose around $14 billion this year.
Growth, but whose?
This is where the stock market meets everyone else.
AI investment accounts for roughly a third of U.S. economic growth this year, ING economist James Knightley estimated, according to the Wall Street Journal. Wells Fargo puts it closer to a quarter over the past year, Marketplace reported.
That spending goes into chips, servers and buildings. It does not show up as many new jobs. Goldman Sachs has called this a period of "jobless growth." Fed Chair Jerome Powell has called "growth without jobs" a real problem for policymakers.
Put simply: a big share of the growth on paper depends on a few companies keeping up record spending, much of it with each other, much of it borrowed. If they slow down, there isn't much else carrying the load.
The other side
Not everyone sees a collapse coming.
Some analysts say the term "circular" gets used too loosely. Suppliers investing in customers is common, and it can spread Nvidia's sales beyond a few giant buyers, economist Noah Smith argued.
J.P. Morgan Asset Management said the selloff looks driven partly by hedge funds cashing in gains, not by a collapse in demand.
After the drop, Nvidia trades at about 24 times earnings, far below its five-year median of about 55.
CoreWeave's CEO says its $104 billion order backlog more than covers its debt.
What to watch
Nvidia reports earnings on Nov. 17. That will show whether customers are still ordering at the same pace. The next day, Nov. 18, CEO Jensen Huang faces a closed-door House briefing.
The question for the AI boom is the same one any business faces: are there enough paying customers at the end of the line? This month, the market started asking.
Sources
MLQ, The week in AI, Nov. 2–8 — https://mlq.ai/news/the-week-in-ai-nov-2-8-voters-turn-on-data-centers-ai-stocks-slide-and-the-buildouts-financing-gets-more-expensive/
Benzinga (Financial Times/FactSet figures) — https://www.benzinga.com/markets/tech/26/11/62969899/nvidia-claws-back-losses-after-400-billion-bloodbath-but-the-ai-scare-isnt-over
IBTimes, Nvidia losses — https://www.ibtimes.co.uk/nvidia-loses-market-value-ai-stock-selloff-1830575
Stock Titan, why AI stocks are down — https://www.stocktitan.net/articles/why-ai-stocks-are-down-today-nvidia-back-to-start-of-2026
GuruFocus, Nvidia weekly declines — https://www.gurufocus.com/news/9184071/nvidia-nvda-shares-fall-amid-sixth-weekly-decline-presenting-deep-value-opportunity
Crypto Briefing, AI stock losses — https://cryptobriefing.com/ai-stocks-erase-13-trillion-selloff/
Admiral Markets, CoreWeave — https://admiralmarkets.com/education/articles/shares/coreweave-stock-drop-ai-debt
24/7 Wall St., Oracle — https://247wallst.com/investing/2026/10/15/oracle-fell-nearly-9-as-coreweaves-bond-scare-spread/
Reuters via LetsDataScience, CoreWeave debt — https://letsdatascience.com/news/coreweave-shares-and-bonds-slide-as-debt-fears-grip-ai-build-b082a38e
investingLive, Big Tech bonds (LSEG) — https://investinglive.com/stocks/coreweave-bonds-trade-like-distressed-debt-as-ai-spending-outpaces-balance-sheets/
Benzinga, Sona Asset Management map — https://www.benzinga.com/markets/prediction-markets/26/09/61868516/oracle-coreweave-ai-financing-3-6-trillion
Noah Smith, Should we worry about AI's circular deals? — https://www.noahpinion.blog/p/should-we-worry-about-ais-circular
Global Finance, The Circle Game — https://gfmag.com/technology/the-circle-game/
Wikipedia, AI build-out financing — https://en.wikipedia.org/wiki/AI_build-out_financing
Wall Street Journal/ING via AI Weekly — https://aiweekly.co/node/11173
Marketplace, Wells Fargo estimate — https://www.marketplace.org/story/2026/09/30/ai-spending-boosts-q2-gdp-growth-revision