The S&p 500 has big tech companies as their top holdings. Companies like Nvidia obviously.
China will be invading Taiwan soon. Companies like Nvidia do not manufacture their chips in North America. If Taiwan is attacked they will lose all production capabilities. They will have no product anymore and Nvidia will outright go to zero. All other big tech is vulnerable. Apple especially is reliant on Taiwanese chips. So most of the big tech companies will go bankrupt or collapse 90 percent. SPY and QQQ will be devastated. Multi trillion dollar companies will be wiped out overnight.
It will be even worse because the western economies are reliant on AI spending. We're heading into a tech dark age and it'll probably be worse than the 1929 depression. In 1929 the market fell 90 percent and took over 25 years to recover.
I'm thinking commodities like oil and also maybe defense stocks are the only things that survive. Maybe a little bit of gold but that's already run up a lot. I'm expecting the indices to drop 90 percent. I'm not sure how bonds would do during this upcoming tech collapse. I know about intel but not sure if that would immediately sell off upon the invasion.