Warnings about an artificial intelligence market bubble are surfacing from an unusual mix of sources — including inside the US government.
According to Eric Katz of NOTUS, a draft report from the US Treasury Department is set to warn about the risks of the AI market, likening some of its key aspects to the dotcom crash of the early 2000s. The detail is notable because, publicly, the Trump administration has been bullish on AI. Privately, NOTUS reports, some of its own analysts are weighing today's AI boom against that earlier bust.
The caution is echoed on Wall Street. As reported via Bing News and MSN, Bank of America has warned of a "painful" stock market snapback as AI speculation reaches what it describes as extreme levels. The context: the S&P 500 just posted its strongest quarter since 2020, and the report notes an impressive year-to-date rally of about 9 percent. The concern from major financial institutions is that this run-up is about to "crash into a wall."
Together, the two items point in the same direction — that enthusiasm for AI may be inflating stock prices faster than the underlying business can justify, the same pattern that preceded the dotcom collapse.
Neither source predicts a specific date or scale for any downturn, and a draft Treasury report is not final policy. But the signals are worth watching.
Why it matters: when both a government agency's internal analysts and a major bank independently invoke the dotcom crash, it suggests the risk of an AI-driven market correction is being taken seriously by people whose job is to see it coming.