Overview
- Tech led a broad sell-off, with the Dow down nearly 800 points, the S&P 500 off 1.66%, and the Nasdaq lower by 2.29%, and AI and data-center stocks fell the most.
- Cramer warned that secondary offerings and executive share sales in AI-linked names, including some crypto-related plays, echo late-1990s patterns.
- He questioned the sustainability of heavy compute spending and lofty valuations, citing OpenAI’s rapid rise to roughly a $300 billion valuation on about $13 billion in annualized sales and large infrastructure commitments.
- He said investors should favor profitable AI leaders, noting that cash-rich hyperscalers provide a cushion that makes a 2000-style collapse less likely.
- Recent analyses from Goldman Sachs and Morgan Stanley likened aspects of the AI boom to a late-stage bubble, reinforcing calls for greater selectivity.