{"id":230399,"date":"2025-10-21T22:38:10","date_gmt":"2025-10-21T22:38:10","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/230399\/"},"modified":"2025-10-21T22:38:10","modified_gmt":"2025-10-21T22:38:10","slug":"we-are-absolutely-in-an-ai-bubble-now-it-is-going-to-burst-says-investor","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/230399\/","title":{"rendered":"\u2018We Are Absolutely in an AI Bubble Now. It Is Going to Burst,\u2019 Says Investor"},"content":{"rendered":"

Lauren Taylor Wolfe, the managing partner at Impactive Capital, says that the current wave of excitement around AI<\/a> is a bubble that will eventually burst. In an interview with CNBC, she compared today\u2019s AI craze to the dot-com boom of the late 1990s. \u201cWe are absolutely in an AI bubble now. It is going to burst. I don\u2019t know when. I don\u2019t know the order of magnitude. A lot of people are going to lose money,\u201d she said. Wolfe believes that many investors are getting swept up in the hype and may end up with losses when the market corrects.<\/p>\n

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As an example of current market excess, she pointed to Oklo (OKLO)<\/a>, which is a nuclear energy company backed by Sam Altman. \u201cIt is the largest weight in the Russell 2000 Value index (IWN)<\/a>. It has no revenues for three years\u2026 Today, it\u2019s $25B of market cap with no revenues,\u201d she said, describing the situation as \u201cinsane.\u201d Instead of chasing trends, Wolfe takes a long-term investment approach. She looks for strong companies that are misunderstood or undervalued and works with them to help close the gap between their current market value and their true worth. <\/p>\n

Wolfe recommends looking at sectors that others are ignoring, just like during the dot-com bubble. \u201cYou\u2019d be better off owning a railroad in 2000 than buying Cisco (CSCO)<\/a> at 35x earnings,\u201d she explained. Although she agrees AI will have a major impact on the economy and that companies like Google (GOOGL)<\/a> could benefit, she questions whether the current level of investment makes financial sense. Wolfe argued that the trillions being invested in AI far outweigh the hundreds of billions in free cash flow produced by the Mag 7, making it unrealistic to expect matching profits in the next five years.<\/p>\n

Is QQQ Stock a Good Buy?<\/p>\n

Turning to Wall Street, analysts have a Moderate Buy consensus rating on the Nasdaq-tracking\u00a0Invesco QQQ Trust\u00a0(QQQ)<\/a>\u00a0ETF based on 91 Buys, 11 Holds, and zero Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the\u00a0average QQQ price target<\/a>\u00a0of $673.59 per share implies 10.1% upside potential.<\/p>\n

\"\"<\/a><\/p>\n

See QQQ\u2019s holdings<\/a><\/p>\n

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