Talk of an AI bubble has been circulating for months. Even OpenAI CEO Sam Altman, one of the industry’s most influential figures, has hinted that valuations and expectations may be running ahead of reality. On paper, the signs are there: soaring stock prices, lavish spending, and bold promises about AI’s transformative power. But unlike past bubbles, this one doesn’t feel the same in everyday life.
How Past Bubbles Felt Different
The dot-com bubble of the late 1990s was impossible to miss. Startups with little more than a website were throwing parties, buying Super Bowl ads, and drawing in retail investors who thought internet stocks were a ticket to easy money. By 2001, more than half of U.S. households owned stocks, many through online brokers like E-Trade and Ameritrade.
The housing bubble of the mid-2000s was just as visible. Adjustable-rate mortgages and house-flipping stories dominated casual conversations. By 2004, nearly 70% of American households owned homes, and subprime lending was rampant.
More recently, the crypto boom during the pandemic brought another wave of hype. Coins like Dogecoin and Solana were touted as the "next Bitcoin," and crypto ads filled the Super Bowl. By 2021, one in six American adults had bought cryptocurrency, with participation even higher among younger men.
These bubbles weren’t just financial—they were cultural. You didn't need to be an investor to feel their presence.
Why AI Feels Different
Artificial intelligence is certainly a hot topic, but its reach is narrower. Unless you work in tech or follow the industry closely, you’re unlikely to see AI speculation dominating dinner-table conversations. The companies driving the AI boom—Nvidia (NVDA), Microsoft (MSFT), and a handful of other mega-cap tech firms—are already massive. Their dominance means that most of the money flowing into AI is concentrated in corporate earnings reports and institutional portfolios, not in the hands of everyday investors.
Yes, ordinary Americans do have exposure to AI through index funds and retirement accounts, since just seven tech stocks have driven most of the S&P 500’s gains this year. But that’s a far cry from the speculative frenzy of buying dot-com penny stocks or flipping houses.
A Boardroom Bubble, Not a Backyard One
The hallmarks of a bubble are there: lavish spending, aggressive mergers and acquisitions, and lofty narratives about AI reshaping trillion-dollar industries. But so far, the phenomenon seems confined to boardrooms and balance sheets, not households.
That distinction matters. If the AI bubble bursts, the fallout may be felt more through corporate earnings, stock indexes, and institutional portfolios than through the kind of personal financial pain seen in past bubbles.
The Bottom Line
AI may well be in bubble territory, but it doesn't feel like the dot-com, housing, or crypto manias because it hasn’t yet seeped into everyday financial behavior. For now, the AI boom is a story of mega-cap tech dominance and corporate investment cycles. The real question is whether, if the bubble pops, ordinary people will feel it—or whether it will remain a correction largely contained to Wall Street and Silicon Valley.