Commentary: How the coming AI-related IPOs could puncture the AI bubble

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There’s an old gambler’s aphorism beloved by wise souls from Amarillo Slim to Warren Buffett that warns: “If you look around the poker table and can’t identify the mark, it’s you.”Investors might be well advised to keep this thought in mind over the coming months.That’s because mega-initial public offerings from the widely followed artificial intelligence firms OpenAI and Anthropic are lined up for takeoff.

Public enthusiasm for these IPOs has been stoked by relentless PR about how AI is certain to change our lives, as well as by a gain in the first couple of trading days after last week’s SpaceX IPO, which was goosed by the Elon Musk company’s claim that it would ride the AI wave into the limitless future.New issues have special salesmanship behind them, which calls therefore for a special degree of sales resistance.— Value investing guru Benjamin Graham on IPOs (in 1949)(Never mind that the gain largely evaporated Monday, when SpaceX shares fell to $154.60 — well below their closing price of $160.95 on their first day of trading on June 12.) There are many reasons for the average investor to look askance at initial public offerings generically; more on those in a moment.

But some are specific to the AI field, especially just now.The rush to public stock listings suggests that AI insiders sense that we are approaching peak AI — more specifically, that the AI bubble is about to burst.Commentary on economics and more from a Pulitzer Prize winner.

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To be fair, concerns about whether AI even has been a bubble have percolat...