The AI bubble is leaking air, some economists say. Should investors worry?

TL;DR

Several Wall Street analysts believe the AI boom driving U.S. stocks to record highs may be a bubble.
Capital Economics forecasts the AI bubble could burst in 2027 and predicts an S&P 500 correction next year.
Concerns are raised that AI firms' expected earnings growth outpaces U.S. economic growth, resembling the dot-com bubble.
Goldman Sachs projects global AI capital expenditures to reach $1 trillion in 2026, with $581 billion in the U.S.
Some experts caution against using "bubble" terminology, noting that technological revolutions often see initial investment excesses.
Other strategists are less convinced a bubble is imminent, suggesting AI's full impact might be underestimated and it's already significantly impacting earnings.
Public perception is shifting due to warnings about AI threats, which could negatively impact tech stocks.
Concerns about AI guardrails are distinct from investment bubble fears.

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