Picture a family dinner in 2021, when someone asks if you have bought any Bitcoin yet. Now picture the same dinner in 2026. The question has changed. Now it is about AI stocks. The words are new, but the feeling is exactly the same.
Why does this keep happening? And why can we never seem to stop it?
The same story, a new name
Bubbles are older than computers. In the 1630s, Dutch buyers paid huge sums for tulip bulbs. In the 1840s, Britain went mad for railway shares. In the late 1990s, almost any company with “.com” in its name could raise money.
The dot-com bubble burst in 2000. The Nasdaq lost close to 80 percent of its value by late 2002. Then came crypto, the next big promise. Bitcoin hit about 69,000 US dollars in late 2021. A year later, it had fallen below 16,000.
Now the talk is about AI. Chip makers and AI companies have seen their share prices climb for years. Big tech firms are spending huge sums on new data centres. In mid-October, a global tech sell-off hit names like Nvidia, AMD and Dell. The reason was worry about how all this AI spending will be paid for. Some experts call it a bubble. Others say the growth is real. Both sides could be partly right.
Why our brains love a new thing
The answer starts inside our heads. Humans are built to copy each other. If everyone around us is buying something, our brain reads that as a safe choice. This is called herd behaviour, and it probably helped our ancestors survive.
Then there is FOMO, the fear of missing out. Watching a friend make money hurts more than we like to admit. We do not want to be the one person who said no. So we buy late, often near the top.
New tech makes this worse because nobody knows its true value. With an old company, you can look at its profits. With a new idea, you can only guess. And when people guess, they usually guess big.
Cheap money adds fuel too. When interest rates are low, savings earn very little, so people look for something more exciting. That is a big part of what happened in 2021. Even very smart people get pulled in. Isaac Newton lost a lot of money in the South Sea Bubble of 1720.
“This time is different”
Every bubble comes with a story. Railways would connect the world. The internet would change everything. Crypto would replace the banks for good. AI will do all of our work.
The funny part is that the story is often true in the long run. Railways did change the world, and the internet did change everything. The mistake is not the idea. The mistake is the timing and the price.
A researcher named Roy Amara put it well. He said we tend to overestimate the effect of a new technology in the short run. We also underestimate it in the long run. That gap between hope and reality is where bubbles grow.
Hype, quick taps and our own limits
Today the pull is stronger than ever. Trading apps let anyone buy shares in seconds, at any hour of the day or night. Social media turns every price jump into a viral post. The faster we can act, the less time we spend thinking. That is great for the apps, and not always great for us.
That habit reaches far beyond the stock market. Anything built on quick taps and a rush of excitement can pull us in. The same rule applies to trading apps and to using betting apps: set your limits first, before the hype starts. A limit you set when you are calm is much better than one you set in the moment.
Can we ever avoid them?
So, back to that dinner table. Should you buy the next big thing? Nobody can tell you for sure, and you should be careful of anyone who says they can.
In my view, bubbles will never fully go away. They come from human nature, and human nature does not change much. But each one also leaves something useful behind. The railway crash left Britain with railways. The dot-com crash left behind the cables that built the modern internet.
The AI boom will probably do the same, whatever happens to share prices. The trick is to enjoy the new tools without risking your savings on perfect timing. Most people who lose big in a bubble did not pick the wrong idea. They put in money they could not afford to lose, at the worst moment. Stay curious, stay calm, and keep a little doubt in your pocket.
