AI valuation fears grip global investors as tech bubble concerns grow (www.cnbc.com)

U.S. AI-related stocks slid this week, sparking warnings from the IMF and the Bank of England about a possible AI-driven tech bubble and broader contagion risk. Goldman Sachs CEO David Solomon warned of a "likely" 10–20% equity drawdown within two years, while BoE Governor Andrew Bailey flagged that tech’s productivity gains could be offset by uncertainty around future earnings streams. The sell-off hit big names and ecosystems: SoftBank lost almost $50 billion in market value in a week, Scion Asset Management disclosed short positions against Palantir and Nvidia, and yet some investors view the dip as a buying opportunity. UBS and others point out that earnings have so far beaten expectations and overall volatility has been unusually low given the scale of AI investment. For the AI/ML community the episode matters because it highlights stretched valuations, concentration risk in U.S. equities, and the real-world infrastructure tailwinds that persist despite nervousness. European suppliers and builders tied to AI—Legrand (shares up ~37% this year) and data‑center builder Skanska—report strong demand, underscoring continued hardware and facilities investment even if software multiples contract. Asset managers are responding by diversifying: some favor emerging markets (India, Brazil, broader EM) to reduce U.S. concentration. The net implication: expect tighter investor scrutiny on revenue visibility for AI firms, continued capex in chips and data centers, and potential spurts of volatility as markets reprice long-term AI cash‑flow assumptions.