Yardeni Sees FEMO Fueling Market Rally Over FOMO

Ed Yardeni, President of Yardeni Research, is downplaying concerns about an AI bubble. He attributes the current market rally to a strong economy and robust earnings.

In an interview with CNBC, Yardeni said he remains optimistic about equity markets despite concerns over oil prices and rising debt.

He points out that the U.S. economy has been 'extremely strong' and is benefiting from stimulus created by hyperscalers' capital expenditures.

'The economy has been extremely strong, and that has translated into what I call FEMO (Fabulous Earnings Momentum), to distinguish it from FOMO (Fear Of Missing Out),' Yardeni said.

He believes the 1999 equity rally was driven by FOMO, whereas the current rally is driven by 'FEMO'.