The AI Bubble’s Most Terrifying Bull Is Gearing Up

When it comes to AI, it’s a strong echo to the dotcom boom.

Nvidia, the poster child for the necessary hardware behind AI systems, is akin to that of router manufacturer Cisco.

Cisco shares soared thousands of percentage points in the 1990s, only to collapse once everyone had a PC connected to the internet.

Where exactly are we today in terms of a similar move? In a way, 2025 has looked much like 1998 – early into the bubble, but not quite at the blow-off top.

Financial markets, particularly the Nasdaq, are eerily lining up:

Turn Your Images On

The Nasdaq is following the dotcom rally of the 1990s to a T since the launch of ChatGPT (Source: Barchart)

Looking at how the Nasdaq is soaring since the launch of ChatGPT and overlaying it with the performance following the release of Netscape, the first commercial web browser, it’s another sign that AI is just an updated version of the dotcom boom.

Don’t be surprised if this time it ends the same way – a blow-off top ahead, playing into our Most Terrifying Bull Market thesis – before it all comes down.

For now, there’s still some money to be made. By the time everyone’s looking to ignore the fact that it’s a bubble and marginal buyers are all-in, it won’t take much to reverse course.

~ Addison

P.S.: While today’s chart suggests we’re closer to 1997 than 2000, remember, there were some steep pullbacks along the way during the dotcom boom:

The collapse of the “Asian Tiger” economies, the collapse of LTCM, rising concerns over Y2K…

Don’t chase this rally. Use healthy pullbacks to buy strong, industry-leading companies. Keep stacking gold and bitcoin. When worse comes to worst, you’ll come out just fine.

If you have any questions for us about the market, send them our way now to: feedback@greyswanfraternity.com.

When it comes to AI, it’s a strong echo to the dotcom boom.

Nvidia, the poster child for the necessary hardware behind AI systems, is akin to that of router manufacturer Cisco.

Cisco shares soared thousands of percentage points in the 1990s, only to collapse once everyone had a PC connected to the internet.

Where exactly are we today in terms of a similar move? In a way, 2025 has looked much like 1998 – early into the bubble, but not quite at the blow-off top.

Financial markets, particularly the Nasdaq, are eerily lining up:

Turn Your Images On

The Nasdaq is following the dotcom rally of the 1990s to a T since the launch of ChatGPT (Source: Barchart)

Don’t be surprised if this time it ends the same way – a blow-off top ahead, playing into our Most Terrifying Bull Market thesis – before it all comes down.

For now, there’s still some money to be made. By the time everyone’s looking to ignore the fact that it’s a bubble and marginal buyers are all-in, it won’t take much to reverse course.

~ Addison

P.S.: While today’s chart suggests we’re closer to 1997 than 2000, remember, there were some steep pullbacks along the way during the dotcom boom:

The collapse of the “Asian Tiger” economies, the collapse of LTCM, rising concerns over Y2K…

Don’t chase this rally. Use healthy pullbacks to buy strong, industry-leading companies. Keep stacking gold and bitcoin. When worse comes to worst, you’ll come out just fine.

If you have any questions for us about the market, send them our way now to: feedback@greyswanfraternity.com.

Alternative assets like gold and bitcoin are trading off their highs right now, but rising levels of debt and an ongoing political impasse will likely mean much higher price moves for these assets in dollar terms.

U.S. government debt is edging closer to the $38 trillion mark — now well over 120% of GDP. That puts the U.S. in the same league as basket-case economies like Venezuela, Sudan, and Lebanon. Not exactly the kind of company you want to keep.

But it makes sense: history shows that once a country crosses this threshold, things start to break — and it’s rarely just one thing. I’ve talked a lot about that in the past.

An admission: we’re mildly obsessed with the private credit markets.

When there’s a bull market in everything — AI stocks, financials, rare earths, gold and silver — it helps to keep an eye on the plumbing.

One chart tells the tale: since 2015, bank loans to non-depository financial institutions (NDFIs) — think private equity and private-credit funds — have soared nearly 300%.

Consumer loans, residential mortgages, commercial real estate? Flat as Kansas. Post-2008, Basel III and Dodd-Frank made leveraged and middle-market lending so capital-intensive that banks stepped back.

Gold dropped nearly 2% yesterday. But with the massive increase in fiat currencies globally, that’s an opportunity to buy more cheaply.