As billions continue to flow into artificial intelligence, experts and investors are sharply divided over whether the sector is entering bubble territory. A Bank of America survey found that 54% of fund managers believe AI valuations have inflated beyond fundamentals, echoing concerns reminiscent of the dot-com era.
The Bank of England has warned of a potential “sharp market correction” tied to excessive optimism, while figures like investor Michael Burry have bet against AI leaders such as Nvidia and Palantir. OpenAI CEO Sam Altman also acknowledged “overexcitement” in the market, predicting both huge gains and heavy losses.
Others remain optimistic. Goldman Sachs economist Joseph Briggs and ABB CEO Morten Wierod argue the investment wave is sustainable, though constrained by limited infrastructure and labor capacity. IMF economist Pierre-Olivier Gourinchas said any downturn would likely remain contained because AI spending isn’t heavily debt-financed.
Amazon founder Jeff Bezos described the frenzy as a “productive” kind of bubble that could still yield major technological benefits in the long run. Meanwhile, UBS strategists note that even investors who believe in a bubble remain largely invested, signaling faith in AI’s transformative power despite mounting warnings.
