Jeremy Grantham, co‑founder of GMO, has long warned of bubbles. In his new memoir, *The Making of a Permabear*, he recounts spotting the early‑2000s dot‑com surge, a pattern some now compare to the buzz around AI.

Grantham signals that today's market shows frothiness in several arenas. He points to inflated valuations in tech, the rapid deployment of AI tools, and the surge in venture capital funding as red flags. These elements mirror those he flagged during the dot‑com era, suggesting a similar buildup that could precede a sharp correction.

He also highlights a watershed change for Big Tech stocks, noting that regulatory pressure and margin squeezes could erode their recent gains. Grantham watches earnings reports, debt levels, and user growth curves as early warning signs. His analysis suggests that if these metrics deteriorate, the bubble may burst sooner than market consensus predicts.

Grantham admits that uncertainty keeps him awake at night, especially as AI adoption accelerates. He warns investors to stay vigilant and avoid overreaching on speculative tech bets. The takeaway: if valuation spikes outpace fundamentals, the market is primed for a pullback that could shake tech valuations across the board.