Record-breaking performance cannot hide concerns! Wall Street executives unanimously warn of AI bubble risk.

Several large banks in the United States have reported record quarterly performance, with trading activity and receivables both hitting new highs, partly driven by the AI frenzy. However, several Wall Street executives have warned that the AI industry may be entering a period of excessive enthusiasm. As the earnings season kicks off this week, many bank executives have emphasized how they are utilizing AI technology in their internal operations. From Bank of America Corp(BAC.US)'s virtual financial assistant "Erica" to JPMorgan Chase & Co.'s cost-saving efforts using AI. However, despite their optimism about the potential of AI, many have also expressed caution, including Citigroup Inc.(C.US) Chief Financial Officer Mark Mason. Mason stated during a conference call on Tuesday, "Looking at current stock valuations and P/E ratios, it must be admitted that some sectors clearly have bubbles and overvaluation." Goldman Sachs Group, Inc.(GS.US) CEO David Solomon mentioned the situation during the internet bubble era during the earnings conference call on Tuesday, stating that the bank is aware of the risks associated with a significant investment in AI infrastructure - "There is a possibility: some projects will flourish, while others will struggle." Investor concerns about whether the AI sector has entered a bubble phase are growing, as AI stocks have experienced significant increases this year. Some critics believe that the recent collaboration between OpenAI and NVIDIA Corporation(NVDA.US) has a "cyclical" nature, with huge investments flowing into a technology that has not been fully validated. At a forum in Washington on Wednesday, Goldman Sachs Group, Inc. COO John Waldron stated that the U.S. economy is making "a fairly large bet" on AI driving growth, but also warned that it is still "too early" to judge whether AI has formed a bubble. He added, "The results may be very promising." Despite differing opinions, top bank executives have detailed their specific deployment of AI. Morgan Stanley(MS.US) CFO Sharon Yeshaya stated during the earnings conference call on Wednesday, "This technology has many applications. We are currently only scratching the surface of what it can achieve." Co-Head of Corporate and Investment Banking at JPMorgan Chase, Troy Rohrbaugh, stated that the bank has begun using AI in some businesses, but also cautioned that the returns from AI are "not always quick or easy." He said, "We are investing and benefiting at the same time, but I believe the real significant returns will emerge in the future." Earlier this week, Evercore founder Roger Altman pointed out that current AI investments are not comparable to the internet bubble of the previous century. Unlike then, the main investors in the AI field today are large, strong, and highly profitable companies such as Meta Platforms(META.US) and Amazon.com, Inc.(AMZN.US). He stated, "That's the biggest difference. The internet bubble involved countless unsustainable businesses." However, he also warned that the market cannot "continue to rise indefinitely."