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'Exactly how the dot-com bubble burst': A market research firm says keep an eye on this AI warning sign
(www.businessinsider.com)
this post was submitted on 20 Jun 2026
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Dot-com bubble took about 5 years before it burst, and that was crazier. Why would you think this one would pop quicker?
The problem is, we kinda just fell into the dotcom bust. The internet hit, most loved the internet, It made a lot of money and didn't put people out of work directly. It burst when the investors decided they wanted to cash out and everyone jumped out at the same time.
The AI bubble is being tended to. They know how it works, infusing money here and there, they can keep it going for a long time. AS the mega rich are invested in it and they're siphoning all the cash out of the middle and upper middle class, all they have to do it keep the engine running and suck it all dry.
You see them right now carefully stepping into IPO. Courting the right billionaires and trillionaire. There's already clear indicators that these big entities need to be 10x larger to actually earn their valuations, nobody cares. Corrupt bottom to the top.
This one may not actually pop in decades if they can manage it
AI is bigger than dot com and debt derivatives combined.
Nah, like a 5th of the market was tied up in dot com. Hundreds of start-ups that were all supposed to take over their sector. AI is not sustainable, but it's nothing like that.
You're talking about from buildup to crash, though. As if everyone just looking at literally any large investment and saying "it's a bubble!" is dong anything other than being a broken clock right twice a day.
I follow conspiracy theories extensively, and people have always predicted a huge, massive economic collapse next year - every year. On Art Bell, it was a constant, reiterated prediction every year from 1994 until 2013. It's only the ones that happened to say it in 2006 or 2007 that rode the credit of "actually predicting the 2008 crisis!" Even the ones saying it before the Dot Com bubble didn't get it right because their doomerism made all predictions "end of the world" level.
I wonder if there's a name for this fallacy...
Suggesting that something isn't true simply because a lot of people are saying it's true (with or without evidence, doesn't really matter). "I keep reading about this being a bubble, so that means it can't be true"
It's like the inverse (converse? I forget. It's been years since I took a logic course) of an appeal to the masses.
Regardless, it's fallacious reasoning.
You're not getting the full picture of the reasoning, or intentionally ignoring parts, I dunno.
Large groups of people are historically bad at predicting financial markets. Very few people ever correctly predict a bubble ending, and considering that a large group of people are traumatized by 2008 and can read Wikipedia well enough to see the Dot Com bubble, they've erroneously put 2 and 2 together and think all large investments in tech will equate to a bubble. Regardless of the structure underlying it.
Structural differences between Dot Com bubble and AI investments are numerous and extensive. Structurally, they're similar anecdotally at best. Yes, there are problematic parts. Data center demand will never be met by anything other than a few janky fly-by-night centers and ramshackle kludge-hosts in Serbia or Brazil where they're not regulated like the US or EU.
The circular investment issue isn't just actual cash trading hands, it's assets and stock as well. In previous bubbles the majority of the bad investments were over-leveraged financing. Loans. There's actually very little in terms of loans going into these companies, which is a notable difference between this and literally every other bubble in history.
I think the bubble will be 2 or 3 smaller bubbles that falter, but the mass of the overall industry will fail to full tip over because there's enough parts that can be scrapped and reapplied to other issues anyway, that demand won't ever evaporate as it did for $2 million URLs in the Dot Com bubble, or railway lines to nowhere in the 1840's.
This does not ignore or assume no problems from layoffs and job displacement. That's a very real and huge threat, and AI will only enhance this problem by trying to claim it can manipulate and bilk poor people better than Google can.
I haven't heard this much bubble talk ever. It's not the same prediction made by the same people again this time. I don't even know anybody irl who likes vibecoding (myself included) who thinks this is sustainable.
I don't know what you're trying to say. People had bad takes about that bubble so all bubble scepticism is discredited? But it popped, which means all these investors had bad takes as well. So...
Nobody worth listening to thinks this bubble is going to be worse than the dotcom bubble. It's simply not that big to begin with. I guess there's some wishful thinking too, but what's the alternative to this investors-expected AI growth? Everything except the AI market crashes?
Exactly. And you know who's bad at predicting things? Large groups of people.
It's a fractional bubble at best. Unlike the Dot Com bubble, which invested in things like URLs that no one wanted and WorldCom's fiber layout, the buildouts and investments being done on spec aren't of the kind that are single-use. Data centers are always in demand, anyway. Storage and cloud compute are always in demand. Electricity is in demand. If AI flops tomorrow, other than 3 over-valued companies employing....a few hundred people, and idiot investors in those companies, the entire economy isn't yet entirely dependent on LLMs exactly because they suck at most of what they do anyway. Government contracts are stabilizing the whole industry anyway, something absent from the Dot Com era.
Edit: You know who IS a risk? All the dipshit startups that think putting a wrapper on a CustomGPT was a good business model, and took out loans for that rather than split equity. That's going to be your first indicator to look for, and it's wavering because, as it turns out, 99.999999% of those ideas are stupid.
History is the best teacher, and a detailed look shows these are only alike in that they are tech-related.
Except people did predict the crash, they could see it coming and they made bank out of it. They made a movie about it.
That movie was about 20 people copying one guy