AI Compute Spend Tops Dot-Com Peak, Igniting Bubble Correction Fears

U.S. compute investment has surpassed the 1990s dot-com era peak as a share of GDP for the first time in 25 years, amplifying risks of a hardware-led market correction similar to the early 2000s amid high S&P 500 concentration in a few AI mega-caps. The trend began March 12 with AI trade bifurcation—Point72's hundreds of millions in hardware gains versus RGM Capital's 23-year closure on software bets—and widest S&P dispersion since 2005. It escalated March 30 via SaaS crashes (Adobe -65%, Salesforce -51%, Atlassian -85%, Meta -33% to 17x P/E), persisting April 30 despite revenue beats as investors prioritize consumer monetization over capex loops amid 50-100% growth hype versus low single-digit GDP.