Will Stocks Crash in 2026? Here Is What History Suggests.

Group 1 - The S&P 500 has increased by 79% over the past five years, raising concerns about its valuation metrics and potential overpricing [1] - The launch of OpenAI's ChatGPT has triggered a significant technology boom, reminiscent of the internet boom in the late '90s and early 2000s, leading to substantial investments in AI chips and hardware [2] - Analysts at Goldman Sachs project that cloud computing companies may spend $500 billion on AI hardware by 2026, contributing significantly to GDP growth [3] Group 2 - Companies are investing heavily in depreciating hardware like GPUs, which may negatively impact long-term corporate earnings if AI investments do not yield expected results [4] - The generative AI boom resembles the California gold rush, with AI chipmaker Nvidia being a major beneficiary, reporting a 62% year-over-year increase in third-quarter earnings to $57 billion and a 65% rise in profit to $31.9 billion [5] - OpenAI is projected to potentially burn through $17 billion in cash by 2026, raising concerns about the financial viability of its upcoming IPO [6] Group 3 - While generative AI is a remarkable technology, it is not a guaranteed solution, and investor patience is waning regarding AI spending that lacks tangible results [7]