AI bubble hits reality as US markets tumble

The Nasdaq fell 5.5% on Thursday, November 5, its worst session since April 2025, erasing over $2.5 trillion in market value after the Democratic Party's victory in the US midterm elections. The sharp decline, following October's record highs, has revived fears of a speculative bubble bursting around artificial intelligence. The election results made stricter AI regulation more tangible, with local initiatives limiting data center construction gaining voter support. AI has become a major driver of US economic growth, but mounting infrastructure obstacles and profitability questions threaten a vicious cycle of reduced funding and slowed activity. The correction serves as a reminder that AI's development depends on public acceptance, not just investor capital.