I doubt, or at least hope, that no sort of managed fund for retirement (read: low risk) is going 15% on AI stuff. Regardless of what one thinks might happen, it has to be accepted at this is an obviously very high risk bet, because this all is screaming bubble even more than the era of 'zomg i flipped this house i financed on an insta-approved loan, installed granite counter tops, and walked away with $20k profit in 4 days.'

But probably they will invest in the sp500, and tech companies make a big portion of the sp 500 and these tech companies also happen to be big in AI

Failing to diversify is the fund managers' problem. Pension funds shouldn't have all their investment in a single countries' stock market (doesn't matter that most, if not all, of those companies operate worldwide, they are still from the US), not even in equity markets. A wiser investment manager (or individual investor) would put a chunk in different kind of equities, and diversify into fixed rate, precious metals, perhaps real estate... Not bet it all to the volatile S&P 500. "Past performance does not guarantee future results.".

Who's "we"? Most of us have zero say when the backroom circular deals are made.

If it’s a bubble, then the long term value people are now counting on to retire with in the future is not actually real though, right? Like a bubble popping doesn’t destroy real value that used to exist, it exposes fictional value that never really existed.

It reallocates real value to the capitalist class. Most of us don't babysit stocks 8h a day and will be holding the bag.

What’s the mechanism you have in mind for that happening via bubble? They sell early before the crash? I’m curious if that actually happens, since the mass psychological nature of market crashes seems to make them difficult to predict reliably, even for people with a lot of resources.

Inflation on the other hand definitely does reallocate real value to whoever already owns a lot of assets, and I believe inflation often goes along with bubbles, since credit expansion is what usually kicks off the bubble in the first place.