Scott Shuey · · 4 min readWhy SEA won’t shake in an AI bubble pop
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In focus
- Signs of AI bubble are here – how will it affect SEA
- Revisit our survey on which AI tools are most favored by founders in the region
- Grab deepens its venture into autonomous vehicles with new investment
Hello reader,
One of my favorite scenes in the 2015 film The Big Short is when hedge fund manager Mark Baum (a character based on investor Steve Eisman and played by Steve Carell) takes his crew to Florida to look for evidence of a real estate bubble.
After speaking to bankers who bragged about handing out bad mortgages to anyone with a pulse and then to a stripper who admitted to taking these loans to buy five houses, Baum declares that “there’s a bubble.”
In the real world – and without the benefit of hindsight or strippers – bubbles are not that easy to spot. Even in the case of AI, which most industry insiders seem to agree exists, it’s hard to gauge what will happen when that bubble bursts.
Will it explode as it did in 2007 and threaten to destroy the economy? Or will it be like the dot-com bust, which triggered a recession but from which the industry managed to recover?
And since the AI bubble seems so heavily focused on US companies, what does a bubble mean for Southeast Asia?
This all leads into today’s top story, where I speak to founders and investors about the possibility of an AI bubble popping in 2026. There is concern, but it’s not all doom and gloom.
Across the board, there are expectations of a dot-com area correction – at least here in Southeast Asia, where the focus on AI has been more practical and less focused on hype.
Scott Shuey, senior editor
Top Story
Who’s afraid of a big, bad AI bubble in 2026?
Image credit: Arsal Ysfin
Some industry players couldn’t agree on when the AI bubble is going to burst, but most of them think that if it happens, any correction that follows would go quietly rather than with an epic collapse. Expectations will reset and projects will scale back, but AI adoption will continue anywhere it can be useful.
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