Between real technological revolution and systemic financial euphoria
The history of financial markets shows that the major technological revolutions almost always produce two simultaneous phenomena: a real transformation of the economic world and a speculative phase in which investors extrapolate this transformation far beyond what valuations can reasonably support.
Artificial intelligence now seems to be entering this critical area. Markets no longer discuss only the quality of the technology or its potential. They are beginning to integrate the idea of almost unlimited economic domination of the main players in the sector.
The BRJ Global Cycle Index
The BRJ Global Cycle Index is based on a probabilistic reading of financial cycles. Markets evolve according to successive psychological phases: accumulation, expansion, euphoria and then top systemic.
| Zone BRJ | Phase | Description |
| 0-20 | Accumulation | Under-evaluation and pessimism |
| 20-50 | Expansion | Progressive growth |
| 50-75 | Advanced expansion | Growing euphoria |
| 75-90 | Euphoria | Multiple extremes |
| 90-100 | System top | Decoupling of fundamentals |
The IA sector now seems to evolve in an area between 78 and 88 on the BRJ Index, which historically corresponds to an advanced institutional euphoria phase.
Comparison with the 1999-2000 Internet bubble
In 1999-2000, investors paid extremely high multiples for sometimes unprofitable Internet companies. Today, AI leaders have huge real profits and cash flows, but valuations are also beginning to incorporate almost perfect growth assumptions.
| Criteria | 1999-2000 | Current IA | Observation |
| Narrative | Internet will change the world | IA will transform the whole economy | Revolutionary narrative |
| Multiple CAs | Very high | Historically high | Risk of compression |
| Concentration | Cisco, Oracle, Intel | NVIDIA, Microsoft, Alphabet | Focused leadership |
| Profitability | Low | Very high | Great difference |
Conclusion
Artificial intelligence could transform the world as deeply as the Internet or electricity. But financial markets have a recurring tendency: first they underestimate technological revolutions, then they overestimate them brutally.
The BRJ Global Cycle Index today suggests that the IA sector is in an advanced phase of institutional euphoria. Profits are real, but valuations already reflect rarely sustainable economic perfection scenarios in market history.
Big bubbles are not born around absurd technologies. They are born around extraordinary truths… paid far too much.
Bernard Raymond Jabre — BRJ Global Cycle Framework
