Everyone's watching to see if software stocks have finally hit bottom and whether the Nasdaq can get its mojo back. But what if the AI boom everyone's betting on doesn't play out like Wall Street hopes? According to one market watcher, the real story is much bigger—and potentially much more disruptive.

For Jordi Visser, head of AI Macro Nexus Research at 22V Research, this isn't about a simple rebound in the iShares Tech-Expanded Software Sector ETF (IGV) or the broader Nasdaq. "This is not a cycle. This is a regime shift. This is going at light speed," he said in a recent video. In his view, AI isn't just another growth driver to juice earnings. It's a deflationary force with the power to reshape corporate economics, labor markets, and, quite possibly, credit markets.

"We are entering a phase of multiple compression across anything related to software," Visser warned on his weekly podcast. So, the question for investors isn't really when growth stocks recover. It's whether the entire economic playbook that supported them for the last decade—asset-light models, recurring revenue, long-duration growth—still works in a world where intelligence can be replicated almost instantly.

A Structural Shift, Not A Cycle

Here's the core of the argument: AI is accelerating competition so fast that the old valuation math is breaking down. For over ten years, software companies enjoyed a sweet spot. They had low capital costs, predictable subscription income, and investors were willing to pay up for growth projected far into the future. Visser argues that era is ending. Why? Because AI collapses barriers to entry.

Think about it: when code can be generated in seconds, customized on demand, and improved autonomously, scarcity disappears. And without scarcity, those long-duration valuation premiums—the high price-to-sales multiples everyone got used to—can't hold. Visser calls trying to bottom-fish beaten-down SaaS stocks now "playing the game of the prior decade." In this new framework, the widening gap between winning and losing stocks isn't just market noise. It's the market trying to price in a radical amount of uncertainty about future cash flows. "In a world where software can be created in seconds, the old model breaks," he said.

Dispersion Signals Stress Beneath The Surface

One of the key charts Visser is watching is the surge in equity dispersion. It's a fancy term for a simple idea: while the overall market might look calm, underneath, individual stocks are swinging wildly. "The S&P is flat year-to-date, yet 185 stocks have posted greater than 15% absolute moves in both directions, double the 81 names we saw on this same day last year," he noted.

That level of internal market chaos has only been matched twice in the last 30 years: during the dot-com bust and the Global Financial Crisis. According to Visser, those historical episodes of extreme dispersion were precursors to wider credit spreads. "Credit is the key signal to watch — that's where the next fear could emerge," he said. In other words, the tremors in the stock market could be a warning for the bond market.

Not A Bubble — But Potentially Deflationary

Perhaps Visser's most controversial take is this: AI is inherently deflationary. As AI models get better and cheaper—especially with the rise of lower-cost open-source alternatives—pricing power across huge swaths of the software ecosystem could come under sustained pressure. "This is incredibly deflationary once you reach intelligence-scale competition," he argued.

The problem isn't a lack of innovation; it's monetization. If companies can't charge as much for software that's easier than ever to replicate, revenue expectations will fall. And if revenue misses while capital expenditure (like all those expensive AI chips and data centers) remains high, credit markets will eventually take notice. The ripple effects could touch private markets, software company debt, and even the massive spending plans of the big cloud "hyperscalers."

Volatility Likely To Persist

For now, Visser isn't predicting a full-blown systemic crisis. Corporate earnings and broader economic growth are still holding up. But he does expect the transition to this new AI-driven world to be, in a word, messy. "Expect persistent volatility — not systemic risk, but structural messiness," he said, adding that multiple sharp corrections remain possible even if the overall market goes sideways.

The bigger takeaway for investors is that the AI era may crown a completely different set of winners than the last tech boom did. "AI is a supersonic tsunami disrupting anything not based on scarcity," Visser said. If he's right, the next chapter won't be defined by whether the S&P 500 goes up or down a few percent. It will be defined by who adapts fastest to a world where software isn't scarce, but physical things might be.

"Physical infrastructure, commodities, industrials, and hardware are poised to become the structural winners of this new era," he concluded. It's a stark reminder that sometimes the biggest technological revolution doesn't make the old kings richer; it changes the entire kingdom.