The US stock markets are booming. But why? | Kenneth Rogoff

Buoyed by the AI boom the rally shows no sign of stopping - that's bizarre, given there is little reason to believe it can last

• US markets close at record highs as enthusiasm for AI drives gains

There seems to be a bizarre disconnect between the surging US stock market and the sad state of American politics. Winston Churchill supposedly quipped, Americans always do the right thing, after they have tried everything else." But in light of the impending rematch between Joe Biden and Donald Trump in this year's US presidential election, Churchill's observation needs adjusting: Americans, apparently, do the right thing only after they have tried everything else twice.

What explains this disconnect between the stock market's buoyancy and the crisis facing American democracy? The market may simply believe that the US president has limited influence over the domestic economy, at least in the short term. Or perhaps investors believe that artificial intelligence conquers all.