AI boom meets backlash as markets wobble—and Gary Marcus’s warnings finally resonate

A shaky week for tech has given fresh currency to AI skeptic Gary Marcus, who says the latest models aren’t living up to the hype. After an MIT survey found 95% of corporate gen-AI pilots are failing and OpenAI’s GPT-5 underwhelmed, investors knocked roughly $1 trillion off the S&P 500’s value before a partial rebound tied to rate-cut hopes. Strategists warn that colossal data-center spending and lofty valuations—particularly around Nvidia and Big Tech—may outpace near-term revenue, even as Wall Street stops short of calling a bubble. Former Google CEO Eric Schmidt has also softened expectations for near-term AGI, signaling a mood shift in Washington and Silicon Valley. Banks see productivity gains ahead but caution that “capex indigestion” could weigh on margins and multiples. Marcus argues the market misread AI’s capabilities and economics; history suggests froth, retrenchment, and eventually durable value.

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