Why Carson Block Says AI and Passive Investing Could Break the Stock Market
4/12/202629 min
In this week's episode of WSJ’s Take On the Week, host Miriam Gottfried and guest host Peter Rudegeair are joined by prominent short seller Carson Block, CEO of Muddy Waters Capital, who explains how AI is poised to fundamentally reshape society, the economy and global markets. With hyperscalers like Google, Microsoft and Meta Platforms continuing to dominate major indices and the Federal Reserve maintaining a wait-and-see position, are we finally entering a short sellers’ market? Block breaks down what he sees as the inherent fragility of a market dominated by passive investing and argues that AI-driven job displacement coul...
Clips
Showing 10 of 12Transcript preview
First 90 secondsReba McEntire0:00
Nearly home. Isn't home where we all wanna be? Reba here for realtor.com, the pros number one most trusted app. A dream home isn't a dream home if it comes with a nightmare commute. That's why realtor.com has Real Commute, so you can search by drive time. Download the realtor.com app today, 'cause you're nearly home. Make it real with realtor.com.
Speaker 20:25
Pros number one most trusted app, based on August 2025 proprietary survey.
Miriam Gottfried· Host0:29
[upbeat music] Hi, everyone. This is Miriam, and I'm joined today by my colleague, Peter Rudiger- Hello ... who is our hedge fund reporter here at the Wall Street Journal. And we have a special guest today. I'm very excited for this conversation. We are gonna have a conversation with Carson Block. He is the founder of hedge fund Muddy Waters Capital, and research outfit Muddy Waters Research. Uh, he is a short seller, and short sellers, of course, are investors who bet against a company's stock, and they look for companies that are overvalued, facing disruption, or involved in a potential fraud. Um, welcome, Carson.
Carson Block· Guest1:06
Thank you. Like, good to be here.
Miriam Gottfried· Host1:08
So the big question that I have, uh, for you today is, you know, it seems like the past few years have been a tough market for short sellers. The market's been up and to the right, interest rates have been low, and it's been very hard, you know, to kind of maintain probably a negative view on anything because the market just keeps going up and up. Some prominent short sellers