Markets reacted mildly to AI extinction fears, viewing potential safety pauses as beneficial for hyperscaler cash flow. SoftBank saw a notable wobble, but US 10-year yields still hit 5%, showing Treasuries gained no safe-haven bid. A new NBER working paper by Michael Callen, Saipremnath Muthukumaran, Noam Yuchtman, Gregory Levy, and Jonathan Weigel finds US and UK institutional uncertainty now matches early 1940s levels.

Analyzing 12mn Times of London articles (1800-2019), their "critical juncture" index spikes around the 2014 Scottish referendum and 2016 Brexit vote. The dataset ends in 2019, missing COVID-19, Trump 2.0, and recent AI alarms. HSBC's multi-asset team notes markets have shrugged off major shocks, but the paper warns we may already be in the subsequent turmoil.

Investors should take these predictive signals seriously as the rules of the road are questioned.