Posted by saigrandhi 12/10/2025
But this is only if the trend-line keeps going, which is a likely possibility given the last couple of years.
I think people are making the mistake that AI is a bubble and therefore AI is completely bullshit. Remember: The internet was a bubble. It ended up changing world.
Or, you skip all that and just put it all in an S&P 500 fund.
Because of the way the AMT (Alternative Minimum Tax) worked at the time they bought the stock, did not sell, but owed taxes on the gain on the day of purchase. They had tax bills of over $1 million but even if they sold it all they couldn't pay the bill. This dragged on for years.
https://www.latimes.com/archives/la-xpm-2001-apr-13-mn-50476...
That lesson is part of why I dump my company's shares the first chance I get.
The bubble burst in 2000-2001, Google IPO was in 2004.
The S&P500 also did not do very well at the time.
That is the problem with bubbles.
Let's just say the AI bubble started in 2023. We still have about 3 years, more or less, until the AI bubble pops.
I do believe we are in the build out phase of the AI bubble, much like the dotcom bubble, where Cisco routers, Sun Microsystems servers... etc. sold like hotcakes to build up the foundation of the dotcom bubble
Minimum 3 years and at a hard maximum of 6 years from now.
We'll see lots of so called AI companies fold and there will be a select few winners that stay on.
So I'd give my crash timelines at around 2029 to 2031 for a significant correction turned crash.
AI looks a lot more like the former. Some companies will fail, valuations will swing, but the underlying technology isn't going anywhere. In fact, many of the AI firms that will end up mattering are probably still undervalued because we're early in what will likely be another decade long technology expansion.
If you're managing a portfolio that needs quick returns and can't tolerate a correction, then sure, it probably feels like a bubble, because at some point people will take profits and the market will reset.
But if you're an entrepreneur or a long-term builder, that framing is almost irrelevant. This is where the next wave of value gets created. It's never smooth and it's never easy, but the long-term opportunity is enormous.
The debate is more on what happens from here and how does that bubble deflate. Gradually and controlled where weaker companies shut down and the strong thrive, or a massive implosion that wipes most everyone in the sector out in a hard reset.
I do think there’s something quite ironic that one of the frequent criticisms of LLMs are that they can’t really say “I don’t know”. Yet if someone says that they get criticised. No surprises that our tools are the same.