Hysteria + widespread financially illiteracy means there are lots of people prepared to buy AI stocks at any price. They're adamant to get in (FOMO).
Suppose OpenAI will be a successful company into the long term, and you bought its stock at a $5T valuation. After several reporting seasons and subsiding hype, its true worth turns out to be closer $1T. OpenAI could still be enormously successful, but anyone you bought at much over $1T valuation is going to get hurt.
Every single railroad company failed. That repeated several times.
The ones that existed on the end were created by assembling the capital brought on the bankruptcy of the original ones. Most of those failed too.
That's how a bubble is. No original investor got out ahead.
Financiers and Entrepreneurs are playing the game better then they used to, they should both survive at higher rates.
That means that in reality we didn't get any single actual bubble pop since the end of WWII. That may happen again this time, or maybe it won't. The amount of money running around is looking like something the governments can't save, but I did think the same in 2007.
Anyway, no financiers and entrepreneurs never know what to do with a black swan.
That's a bubble. It happens every time because it has to happen every time. If you stay out of the game, the people who stay in the game win and your holdings in redundant technology are worthless.