First it was the release of GPT-5 that OpenAI “totally screwed up,” according to Sam Altman. Then Altman followed that up by saying the B-word at a dinner with reporters. “When bubbles happen, smart people get overexcited about a kernel of truth,” The Verge reported on comments by the OpenAI CEO. Then it was the sweeping MIT survey that put a number on what so many people seem to be feeling: A whopping 95% of generative AI pilots at companies are failing.
A tech selloff ensued, as rattled investors sent the value of the S&P 500 down by $1 trillion. Given the increasing dominance of that index by tech stocks that have largely transformed into AI stocks, it was a sign of nerves that the AI boom was turning into dotcom bubble 2.0. To be sure, fears about the AI trade aren’t the only factor moving markets, as evidenced by the S&P 500 snapping a five-day losing streak on Friday after Jerome Powell’s quasi-dovish comments at Jackson Hole, Wyo., as even the hint of openness from the Fed chair toward a September rate cut set markets on a tear.
