Credit investors have reportedly become increasingly concerned about the potential impact of an AI bubble on credit markets.
Bank of America (BAC) said Monday its January client survey showed that 23% viewed the emergence of an AI bubble as their No. 1 concern, up from 9% in its December survey, according to Bloomberg.
Here’s what other bankers and analysts have been saying about the AI bubble threat.
Jamie Dimon, CEO, JPMorgan Chase (JPM):
“There’s always a surprise in a credit cycle,” Dimon said Monday, according to CNBC. “The surprise has often been which industry [is impacted]…you didn’t expect utilities and phone companies in ’08, ’09, and this time around, it might be software, because of AI.”
Dimon added he was concerned about a cycle at some point, which could result in a wave of borrower defaults.
“There will be a cycle one day … I don’t know what confluence of events will cause that cycle. My anxiety is high over it,” Dimon said. “I’m not assuaged by the fact that asset prices are high. In fact, I think that adds to the risk.”
Damir Tokic, Seeking Alpha analyst:
“In my opinion, the AI bubble burst with the Oracle (ORCL) earnings report on September 10th, 2025—that’s when ORCL stock price spiked, reversed, and crashed,” wrote Tokic earlier this month. “The first phase of the AI bubble burst was essentially a burst of the credit-driven infrastructure bubble—with Oracle as the poster child.”
Tokic goes on to argue that the second phase of the AI bubble burst was the selloff in software stocks, which he expects to be followed by a broader decline.
“It’s Phase Three that will cause a recession with the bubble burst—that’s when the stock market will likely ‘crash’ like in 2000 and 2008. Phase Three will likely start when the unemployment rate starts rising, specifically due to AI-related job losses—and this will start happening over the next 6 months. In the meantime, markets will likely be volatile,” Tokic added.
High Yield Investor, Seeking Alpha analyst:
“While mega-cap tech and software have been phenomenal investments in recent years, the market appears to be growing nervous about AI exposing and bursting bubbles in both, as software stands to be disrupted by AI, and mega-cap tech is sinking hundreds of billions of dollars into AI CapEx that may not deliver significant enough returns to justify the spending, thereby destroying shareholder capital,” High Yield Investor wrote on Feb. 19.
“Instead, we think that conservatively positioned and heavily discounted software lenders, as well as dividend-paying AI infrastructure companies, are the best risk-adjusted ways to play this dual bubble-bursting threat,” they added.