The AI Bubble Is Real And It’s Going To Pop. Even Though AI Is Teal And Not Going Away

Two things can be true at the same time, even if markets hate admitting it. AI is real. AI is powerful. AI is going to change how work gets done, how businesses operate, and how productivity looks over the next decade. And at the same time, the AI bubble is absolutely real and has gone completely out of hand.

We have seen this movie before. The late 1990s dot com era was full of real innovation. The internet was not fake. E commerce was not fake. Digital advertising was not fake. What was fake were the valuations, the timelines, and the belief that profits did not matter. Sound familiar. That bubble popped hard, even though the technology itself went on to reshape the world.

That is exactly where AI sits today. Companies with thin products, unclear revenue models, or straight up marketing decks are being valued in the trillions collectively. Five trillion dollar narratives are being floated as if this is some kind of inevitability rather than a wild assumption. That is not confidence. That is mania.

AI will absolutely improve efficiency, replace certain jobs, and create new ones. It will reshape software, healthcare, logistics, and defense. None of that requires every AI related company to trade at insane multiples right now. Progress does not move in straight lines and markets always front run reality far too early.

The market is pricing in perfection. Perfect adoption. Perfect regulation outcomes. Perfect monetization. Perfect margins. History says that never happens. What happens instead is disappointment, capital destruction, consolidation, and then the real winners quietly emerge after the wreckage.

The biggest tell of a bubble is how people react to criticism. Any skepticism about AI valuations is treated like heresy. Questioning timelines or profitability gets you labeled as anti technology or clueless. That emotional response is never present in healthy markets. It shows up when people are overexposed and terrified of being wrong.

None of this means AI is going to disappear. Just like the internet did not disappear after 2000. It means prices need to reconnect with reality. It means many companies will fail. It means some stocks will drop 60 to 80 percent and never recover. That is how bubbles end.

The real long term winners in AI probably are not even obvious yet. They will be boring. They will make money quietly. They will survive a downturn because they have real customers and real margins. Those companies usually emerge after the crash, not before it.

So yes, the AI bubble is real. And yes, AI itself is real too. Pretending only one of those statements can be true is how people get wrecked. Innovation changes the world. Markets still overshoot, always have, and always will. The hard part is surviving the hype phase long enough to benefit from the real revolution that comes after.