Senior financial journalist: The artificial intelligence boom may be a sign of a bubble, and a market crash will eventually come

Renowned financial journalist and author Andrew Ross Sorkin has issued a stern warning about the current AI-driven market, stating that it bears similarities to historical bubbles and that a market crash will eventually occur, although the specific timing and depth cannot be predicted.

In a podcast interview on Sunday, Sorkin expressed his concern that current market prices "may not be sustainable." In his view, the market is caught between two possibilities: either an "extraordinary boom" driven by AI stocks or "everything is overvalued." This statement stems from his research for his new book "1929," which explores the great crash nearly a century ago.

He believes that the AI craze is "almost artificially" supporting the economy and raised a key question: "This is either a gold rush or a sugar rush, and we may not know which one it is for a few years." Sorkin candidly stated that it is currently difficult to deny that the market is in a situation similar to the 2000 internet bubble and the 2008 real estate bubble, with the critical question being "when will the bubble burst?" Additionally, regulatory easing and increasing debt have exacerbated market vulnerabilities.

This concern is not isolated on Wall Street. JPMorgan Chase CEO Jamie Dimon recently stated that he is "much more worried than others" about an impending correction in the U.S. stock market. Meanwhile, analysis from independent research firm MacroStrategy Partnership indicates that the current AI bubble has reached 17 times the size of the internet bubble and is four times that of the 2008 real estate bubble.

Artificial Intelligence: Gold Rush or Sugar Rush?

Sorkin's core argument is that the current economy and market largely depend on the massive investment wave in the field of artificial intelligence. He told the media, "Currently, hundreds of billions of dollars are being invested in AI," and this concentrated influx of capital is supporting overall economic performance.

However, this prosperity driven by a single theme also brings enormous uncertainty. Sorkin summarized the core dilemma facing investors: whether the current optimism driven by AI is due to a technological revolution that can bring long-term productivity leaps and sustained returns (gold rush) or merely a fleeting, unsustainable speculative frenzy (sugar rush). He admitted that the answer to this question may take years to reveal, and until then, the market remains exposed to risks.

Sorkin compared the current market environment to the internet bubble of 2000 and the real estate bubble of 2008. In both instances, new technologies or financial instruments triggered irrational booms, ultimately culminating in severe market crashes.

Regulatory Easing and Increasing Debt Intensify Speculation

In addition to the AI craze itself, Sorkin pointed out several key factors that exacerbate market vulnerabilities. He believes that **the regulatory safeguards relaxed during the Trump administration, the market's increasing reliance on debt, and recent policy changes allowing private equity investments into 401(k) retirement accounts are all laying the groundwork for a potential crisis **

Sorkin emphasized that the danger does not lie in the market "plummeting off a cliff tomorrow," but in the cumulative effect of multiple risk factors:

"There is speculation in today's market, debt is continuously increasing, and all of this is happening against the backdrop of regulatory guardrails being dismantled."

Although Sorkin repeatedly stressed that he cannot predict the exact timing of a crash, he is firmly convinced of its inevitability. He believes that the essence of financial markets is confidence, and the collapse of confidence is often sudden and rapid:

"The answer is that we will experience a crash; I just can't tell you when, nor can I tell you how deep it will be. But I can assure you, unfortunately—I wish I weren't saying this—we will experience a crash."

Risk Warning and Disclaimer

The market has risks, and investment should be cautious. This article does not constitute personal investment advice and does not take into account the specific investment objectives, financial situation, or needs of individual users. Users should consider whether any opinions, views, or conclusions in this article are suitable for their specific circumstances. Investment based on this is at one's own risk