New York Post columnist Charles Gasparino argues the AI bubble is about to burst like the dot com crash
The AI bubble is about to burst - and a big market correction is coming
Context
A mainstream columnist calling the top adds to a week of AI selloff worries, though his case rests on historical comparison rather than new data.
This is an opinion column by Charles Gasparino, published by the New York Post on the evening of October 17. It argues from the history of the 2000 dot com crash and does not present new figures or reporting.
Deep dive
On October 17, the New York Post posted a column by Charles Gasparino headlined: The AI bubble is about to burst, and a big market correction is coming.
Gasparino compares today's AI boom to the dot com mania that ended in March 2000, when, he writes, a historic run up in stocks was exposed as one of history's great investment bubbles and the tech market took years to recover. He argues that history repeats itself with market manias and that the current AI mania will almost certainly follow the same path, with losses for investors.
He writes that the most likely trigger is the instinct of hedge funds and institutions that do their own research, and that these investors now sense something is not quite right with AI. He says he cannot tell whether the prior week's market moves, which he describes as rising rates after a bad inflation report followed by a selloff in AI stocks, are the herd's final statement on AI.
Gasparino says there may be more froth to come, pointing to possible IPOs by Anthropic and possibly OpenAI. He argues interest rates will rise because AI competes with the federal government's borrowing needs, and that much of the AI spending uses debt, which he calls the main ingredient of any crash. He advises readers to take profits.
The column gives no valuation figures, and its claims about coming IPOs are not sourced.
What to expect next
Watch whether the AI selloff deepens or reverses in the coming weeks, which will test calls like Gasparino's against views such as Goldman's that hedge funds have cut AI exposure too far.
Also watch the debt markets that fund data centers, which Goldman's notes flagged as a weak point, and whether Anthropic or OpenAI file for public offerings. Nvidia's November earnings could be a key moment for AI valuations.