---
title: "🛑 WAKE UP CALL: Could the AI Trade trigger a 15-20% S&P 500 correction? (Goldman Sachs Analysis)"
description: "It's not about the current earnings—it's about the Capex future. \n\nAnd if that future changes, the market is in for a shock.\n\nGoldman Sachs just dropped a massive warning. \n\nThe Core Risk: AI Spending Reversal\n\nThey say that our current S&P 500 valuation is priced for an incredible, long-term AI Capex boom (spending on AI infrastructure). \n\nWhat if that boom stalls? If AI capex growth expectations revert to early 2023 levels, GS estimates the S&P 500 valuation multiple could see a 15-20% DOWNSIDE. \n\nThat's a huge potential correction driven only by multiple compression.\n\nThe Extreme Scenario (The Nightmare Fuel) -> Imagine the Hyperscalers slamming the brakes on spending.\n🔴 The expected Capex for 2026 is approximately $433 billion. A reversion to the 2022 Capex level of $158 billion would result in a massive reduction of $275 billion—the \"Lost Capex.\"\n🔴This $275 billion shortfall represents a 30% reduction to the consensus estimate of $1 trillion in S&P 500 sales growth. Consequently, the expected S&P 500 revenue growth rate would drop sharply from the consensus of 6% to approximately 4%.\n➡️ Ultimately, this decrease in spending would pose a substantial downside risk to both the AI investment trade and the broader S&P 500 market.\n\nThe Takeaway for investors: This isn't about today's P&L. It's about the market's perception of tomorrow's AI-driven growth. \n\nA dramatic cut in capex would signal the long-term AI earnings thesis is broken, leading to a much steeper decline in stock valuations than a simple revenue reduction would suggest.\n\n🔑 Don't miss this point: Near-term revenues might only drop modestly, but the hit to long-term earnings growth expectations will crush valuations.\n\nSource: Goldman Sachs, Neil Sethi\n@neilksethi"
---

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# [🛑 WAKE UP CALL: Could the AI Trade trigger a 15-20% S&P 500 correction? (Goldman Sachs Analysis)](https://blog.syzgroup.com/syz-the-moment/wake-up-call-could-the-ai-trade-trigger-a-15-20-sp-500-correction-goldman-sachs-analysis)

 Written by [Charles-Henry Monchau, CFA, CMT, CAIA](https://blog.syzgroup.com/syz-the-moment/author/charles-henry-monchau) | Dec 5, 2025, 2:41:31 PM

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