President Donald Trump regards the stock market as a referendum on his performance, and by many accounts the numbers are high. But Bloomberg Opinion analyst Jonathan Levin is urging readers not to be fooled, describing the market as “lousy for most.” In a column published Friday and highlighted by Alternet, Levin argued that the rally is being carried by a single industry, that most Americans are not making money on it, and that they have plenty to lose if it all goes south.

“Although the S&P 500 Index closed at an all-time high this week, it did so on the strength of a handful of companies focused on the booming artificial intelligence sector, papering over signs of growing vulnerabilities in the economy and financial markets,” Levin wrote in Bloomberg Opinion. “With the midterm elections less than a month away, what Trump sees as an asset for Republicans may in fact be a liability.” That dynamic reflects how the S&P 500 is built: because the index weights its members by market value, outsized gains in a few of the largest companies can lift the headline number even while much of the market underneath struggles.

The economy, he warned, is “reeling from inflation that remains stubbornly high and unchecked fiscal budget deficits,” while average hourly earnings adjusted for inflation have been losing ground for five months.

Levin pointed to a Federal Reserve Bank of New York report released this week showing that Americans expect their earnings growth to lag even further behind consumer inflation over the next 12 months, driven in part by the surge in gasoline and diesel prices caused by the US-Israel war with Iran. “That’s in addition to efforts underway by the White House to find workarounds to reinstate the inflationary tariffs deemed illegal by the Supreme Court,” he wrote.

With inflation devouring modest pay raises, Levin said it is no surprise that Americans are spending less — a pullback that is weighing on the stocks of companies in the “consumer, travel, transportation, real estate and financial sectors.”

The purported strength of the AI trade, led by Meta Platforms Inc., Microsoft Corp., and chipmaker Nvidia Corp., is overshadowing the poor performance infecting much of the stock market. Levin acknowledged that these outperformers could sustain their momentum, at least for a while, and that the rest of the slumping market could eventually catch up. But he noted that billionaire Michael Novogratz said on Wednesday that AI is the “biggest bubble of our lifetime.” Whether those gains broaden beyond the AI leaders or stay concentrated in them is the trend to watch heading into the midterms.

Bridgewater hedge fund founder Ray Dalio said this week that AI a “classic bubble” nearing a bursting point, citing rising interest rates and the need to turn wealth into cash.

“It’s impossible to know when exactly a bubble will burst, but what is certain is that the market will crumble, and probably spectacularly, if investor sentiment turns against AI,” Levin wrote. The losers, he added, would not be limited to investors making concentrated bets on AI stocks. The fallout would also hit 401(k) investors and everyday Americans, who suffered a similar fate when the housing crash concluded the Bush years.

“As of 2025, around $23 trillion in assets were indexed or benchmarked to the S&P,” Levin wrote, citing an S&P Dow Jones Indices survey. “Also leveraged to the index’s fragile value is wealth-driven consumption and, ultimately, millions of jobs.” The figure spans funds that track the benchmark outright as well as actively managed money measured against it, extending the index’s reach well beyond direct AI shareholders.