I just noticed something that reminded me of the old story again. The Nasdaq dropped over 2% on November 20, 2025, and everywhere in the media, people were talking about a "AI bubble." This isn't the first time we've heard this warning, and honestly, we should take a close look at what happened in the late 1990s—because the parallels are remarkable.

Back then, there was a similar euphoria around the internet. Everyone thought the old rules no longer applied, that valuations didn't matter as long as the technology was revolutionary enough. Companies without profits, without a clear business model, received valuations in the billions just because they had ".com" in their name. Sounds crazy? Yes, but it really happened.

The dotcom bubble wasn't just a correction. It was a collapse. After the peak in March 2000, the Nasdaq lost almost 78% of its value in two years. Companies once considered the future disappeared overnight. Thousands of startups went bankrupt. Silicon Valley literally emptied out.

But here's the interesting part: not everything was wrong with the technology itself. Amazon and eBay survived because they aligned their business models with real profitability, not just growth at any cost. They adapted, became operationally more efficient, and built sustainable companies. The technology was real, but many of the valuations weren't.

That brings me to today. AI is indeed transformative—that's undeniable. But the same narrative is reappearing: "This time, it's different." That was the excuse in the 1990s too. Investors ignored traditional metrics like cash flow and profitability in favor of abstract metrics. They focused on narratives instead of fundamentals.

Take Nvidia as an example. Some compare it to Cisco from the dotcom era—both dominated their infrastructure sectors and experienced explosive growth. The difference? Nvidia actually generates massive cash flows and has real pricing power. Cisco was at its peak similarly overvalued as many others. The stock price fell so drastically that the all-time high of $82 from the bubble has not been reached again more than 25 years later.

The timeless lesson is simple: cash flow, operational efficiency, and practical utility beat stories. Markets may reward companies temporarily for growth and vision, but sustainable value comes from repeatable, profitable results. FOMO and herd behavior repeatedly push asset prices beyond reasonable limits.

So yes, the dotcom bubble is a warning. But it’s also a lesson that transformative technologies endure—if the companies behind them are solid. Discipline and skepticism are more important than ever now to find the balance between groundbreaking opportunities and speculative excesses.