Bubble 2.0 or a new paradigm? At least this time, the giants are really making money, not just promising.

Data from May 23 shows that the U.S. stock market CAPE in 2026 is approximately 39.5–41.7, reaching a 25-year high, second only to the 1999 bubble. Analysis suggests that the main driver of the rise is the AI concept, with a few tech giants dominating the S&P 500; however, unlike the many unprofitable companies at that time, AI leaders have cash flow, mature business models, and high profit margins. Investment has expanded into data centers, energy, and enterprise applications. Warning that the market is highly concentrated among a few AI giants, if interest rates rise, AI commercialization underperforms expectations, or growth slows, valuations will be pressured and volatile. History shows that after high CAPE levels, returns over the next decade are mostly in the low single digits.