Hi Dotikers!

The AI bubble question just got a very official stamp. Emmanuel Moulin, governor of the Banque de France, is now openly warning that the sky-high valuations of American AI companies could face a brutal correction, and that Europe would not be watching from a safe distance. European investors hold between 15 and 20 percent of US equities, so if Wall Street sneezes on AI, Paris and Frankfurt catch the cold.

What makes this warning worth your attention is not the bubble talk itself, we have heard that tune for two years now. It is the shift in how the party is being financed. Until recently, the massive AI buildout was mostly paid for with equity, meaning investors risking their own money. Today, debt is taking over, with hyperscalers and AI labs borrowing billions against profits that exist mostly in pitch decks. Add rising interest rates to that cocktail and the math gets ugly fast: expected returns shrink, refinancing gets harder, valuations wobble. We have seen this movie before, and the sequel rarely wins awards.

Moulin also raised a point that deserves more airtime than it gets: the companies most integrated with AI are already hiring fewer people, especially young graduates. The bubble debate is not just about stock prices, it is about an entire generation entering a job market that is quietly closing doors.

Honestly, when a central banker starts sounding more cautious than the tech press, it is probably time to listen. That does not mean AI is overhyped as a technology, the productivity gains are real. But there is a growing gap between what AI can do and what the market has already priced in. Betting on the former is smart. Betting on the latter, leveraged with debt, is how corrections are born.

Let's dig in.

G.

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