It’s Going to Be Really Bad’: Fears of AI Bubble Burst Surge in Silicon Valley”

In recent days, tech insiders and analysts are sounding alarms over what many now call a looming AI bubble in Silicon Valley. With sky-high valuations, aggressive funding rounds, and a glut of AI startups, the signs of overextension are spurring intense scrutiny and pessimism among investors.

Warnings come from voices across the spectrum. Regulatory and economic bodies—like the Bank of England and International Monetary Fund—have flagged that AI valuations may not be backed by sustainable fundamentals. Some predict that if the bubble bursts, its fallout could ripple across tech, finance, and global markets.

Behind the hype are issues like inflated expectations, weak profit models, and overreliance on speculative capital. Many startups focus on pushing the frontier of generative AI or data infrastructure without clear monetization paths. Some analysts say the current model resembles a feedback loop: valuations fuel more investment, which in turn amplifies valuations further.

Yet others urge caution before declaring a crash. They argue that while some AI players may falter, the underlying technology still holds transformative promise. The debate now centers on which segments will survive and how deep a correction might become.