Artificial intelligence (AI) valuations are soaring, driven by industry hype and investor optimism, despite many companies still struggling with profitability. This trend has triggered concerns of a potential bubble, reminiscent of the tech boom of the late 1990s. The S&P 500 now sees a disproportionate weight from giants like Apple, Microsoft, Amazon, Nvidia, and Alphabet, representing nearly 30% of total capitalization. This concentration raises alarm bells among experts like the IMF and Bank of England, who warn of a repeat of the 2000 Internet bubble. Data analysis reveals a disconnect between inflated valuations and real profitability in the AI sector. The S&P 500 price-to-earnings ratio has reached levels similar to the peak of the dotcom bubble. Furthermore, high equity values, relative to nominal GDP, have never been higher than they are now. Experts fear that the disappointment generated by unrealized economic benefits could trigger a sharp market correction in tech stocks. This is compounded by surging investments in AI infrastructure, reaching $1.5 trillion globally. The Gartner firm’s projections for data center and hardware spending echo the trends of the 2000s in telecom. However, these investments haven’t translated into concrete profitability for most companies in the field. A new phenomenon has emerged – a growing network of partnerships between tech giants themselves, raising concerns about speculative market manipulation, reminiscent of the Dotcom bubble era. Individual investors now hold over 35% of American shares, exceeding levels from the late 1990s. This surge in individual involvement creates expectations that are not necessarily grounded in realistic growth potential. The IMF estimates US GDP growth at just 2%, underscoring a disconnect between market projections and economic reality. While it’s too early to say definitively if the current AI boom will lead to another financial crash, experts are cautiously watching for signs of an impending bubble burst.